Amendment to the Commission proposal COM(2011) 625 final/3 for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy
Date: 2012-09-25
Institutions: European Commission
Subjects: Croatia, accession to the European Union, aid to agriculture, biodiversity, climate change, economic instrument for the environment, redevelopment aid, reform of the CAP, rural development, single payment scheme

EUROPEAN COMMISSION 

Brussels, 25.9.2012  
COM(2012) 552 final 

2011/0280 (COD) 

Amendment to the Commission proposal COM(2011) 625 final/3 for a 
REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

establishing rules for direct payments to farmers under support schemes within the 
framework of the common agricultural policy 

EN 

   EN 

 
 
  
 
EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

The accession of Croatia to the EU is scheduled for 1 July 2013. Although the Act of 
Accession1 has not yet been ratified by all Member States, the Commission has recently 
updated its Multi-Annual Financial Framework proposals2 in view of Croatia's accession. A 
similar adjustment exercise should be prepared for the CAP reform proposals to ensure that 
once they are adopted, Croatia will be fully covered as a new Member State.  

2. 

RESULTS OF CONSULTATIONS WITH THE INTERESTED PARTIES AND 
IMPACT ASSESSMENTS 

In relation to Croatia, there was no need for consultation of interested parties or an impact 
assessment since these adjustments follow from the Act of Accession.  

3. 

LEGAL ELEMENTS OF THE PROPOSAL 

The adjustment will take the form of an amendment to the proposal COM(2011) 625 final/3 
for a Regulation of the European Parliament and of the Council establishing rules for direct 
payments to farmers under support schemes within the framework of the common agricultural 
policy, to include in the proposal those provisions specific to Croatia which are already in the 
Accession Treaty. The main changes relate to the inclusion of provisions on  

- the gradual introduction of direct payments in Croatia (phasing-in), 
- the possibility to grant complementary national direct payments (CNDPs) to complement 
those support schemes listed in Annex I which Croatia will implement following the reform,  
- certain financial aspects (national envelopes in Annex II, net amounts after capping in 
Annex III, maximum amount of CNDPs that may be granted in Annex V), and  
- the implementation of the special national de-mining reserve in Croatia. That de-mining 
reserve relates to de-mined land which has returned to use for agricultural areas. 

4. 

BUDGETARY IMPLICATION 

This amendment has no budgetary implications, apart from those already set out in the 
explanatory memorandum for the updated proposals for the Multi-Annual Financial 
Framework. 

1  
2  

OJ L 112 of 24 April 2012. 
COM(2012)388 of 6 July 2012. 

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2011/0280 (COD) 

Amendment to the Commission proposal COM(2011) 625 final/3 for a 
REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

establishing rules for direct payments to farmers under support schemes within the 
framework of the common agricultural policy 

Commission proposal COM(2011) 625 final/3 is amended as follows: 

(1) 

The first sentence of recital (5) is replaced by the following: 

"In order to ensure uniform conditions for the implementation of this Regulation and 
to avoid unfair competition or discrimination between farmers, implementing powers 
should  be  conferred  on  the  Commission  in  respect  of:  the  authorisation  of 
complementary national direct payments for Croatia; the setting of the amount to be 
included  in  the  special  national  de-mining  reserve  for  Croatia;  the  fixation  of  the 
annual  national  ceiling  for  the  basic  payment  scheme;  the  adoption  of  rules  on 
applications  for  allocation  of  payment  entitlements;  the  adoption  of  measures 
regarding  the  reversion  of  non-activated  payment  entitlements  to  the  national 
reserve;  the  adoption  of  requirements  related  to  the  notification  of  transfer  of 
payment entitlements to the national authorities and the deadlines within which such 
notification are to take place; the setting out of the annual ceiling for the payment for 
agricultural practises beneficial for the climate and the environment; the setting out 
of  the  annual  ceiling  for  the  payment  for  areas  with  natural  constraints;  the  setting 
out  of  the  annual  ceiling  for  the  payment  for  young  farmers;  the  setting  out  of  the 
annual  ceilings  for  the  voluntary  coupled  support;  the  adoption  of  rules  on  the 
procedure  for  the  assessment  and  approval  of  decisions  in  the  framework  of  the 
voluntary  coupled  support;  the  adoption  of  rules  on  the  procedure  of  the 
authorisation  and  the  notifications  to  the  producers  related  to  the  authorisation  of 
land  and  varieties  for  the  purposes  of  the  crop  specific  payment  for  cotton;  the 
provision  for  rules  on  the  calculation  of  the  reduction  of  the  amount  of  the  crop 
specific  payment  for  cotton;  the  adoption  of  rules  concerning  general  notification 
requirements." 

(2) 

Recital (11) is replaced by the following: 

"(11) With a view to ensuring that the amounts for the financing of the CAP comply 
with  the  annual  ceilings  referred  to  in  Article  16(1)  of  Regulation  (EU)  No  […] 
[HZR],  an  adjustment  of  the  level  of  direct  support  in  any  calendar  year  should  be 
maintained.  The  adjustment  of  the  direct  payments  should  only  be  applied  to 
payments  to  be  granted  to  farmers  in  excess  of  EUR  5  000  in  the  corresponding 
calendar  year.  Taking  into  account  the  levels  of  direct  payments  for  farmers  in 
Bulgaria, Croatia and Romania in the framework of the application of the phasing-in 
mechanism to all direct payments granted in those Member States, this instrument of 
financial  discipline  should  only  apply  in  Bulgaria  and  Romania  as  from  1  January 
2016 and in Croatia as from 1 January 2022." 

(3) 

Recital (12) is replaced by the following: 

"(12)  In  order  to  take  account  of  the  developments  relating  to  the  total  maximum 
amounts of direct payments that may be granted, including those resulting from the 

- 3 - 

 
 
decisions to be taken by the Member States regarding transfers between the first and 
second  pillars  and  those  resulting  from  the  notifications  to  be  made  by  Croatia 
regarding  the  de-mined  land  that  has  returned  to  use  for  agricultural  activities,  the 
power to adopt acts in accordance with Article 290 of the Treaty should be delegated 
to the Commission for the purpose of reviewing the national and net ceilings set out 
in this Regulation." 

(4) 

The last sentence of the recital (14) is replaced by the following: 

"To ensure equal treatment of farmers whose direct payments are subject to phasing-
in in Bulgaria, Croatia and Romania, the minimum threshold should be based on the 
final amounts to be granted at the end of the phasing-in process." 

(5) 

The following sentence is added at the end of recital (19): 

"The  same  possibility  should  be  available  also  for  Croatia  for  which  a  phasing-in 
mechanism will apply until 2021 according to the Act of Accession." 

(6) 

A new recital is inserted after the recital (19): 

"(19a)  Regulation  (EC)  No  73/2009  as  amended  by  the  Act  of  Accession  of  2011 
provided for a special national de-mining reserve for Croatia in order to finance for a 
period  of  ten  years  after  the  Accession  to  the  Union  the  allocation  of  payment 
entitlements  to  land  which  will  be  de-mined  and  returned  to  agricultural  use  every 
year.  It  is  appropriate  to  set  the  rules  for  determining  the  amounts  dedicated  to 
funding support for that land under the support schemes foreseen in this Regulation 
and  for  the  management  of  that  reserve.  In  order  to  take  account  of  the  amounts 
resulting  from  the  notifications  to  be  made  by  Croatia  regarding  the  de-mined  land 
that  has  returned  to  use  for  agricultural  activities,  the  power  to  adopt  acts  in 
accordance with Article 290 of the Treaty should be delegated to the Commission for 
the purposes of reviewing certain financial provisions applying to Croatia. 

(7) 

In Article 1(b), point (viii) is replaced by the following: 

"(viii)  a  framework  to  enable  Bulgaria,  Croatia  and  Romania  to  complement  direct 
payments." 

(8) 

In Article 6, paragraph 2 is replaced by the following: 

"2. 

In  order  to  take  account  of  the  developments  relating  to  the  total  maximum 
amounts of direct payments that may be granted, including those resulting from 
the decisions to be taken by the Member States in accordance with Article 14 
and those resulting from the application of the second paragraph of Article 17b, 
the  Commission  shall  be  empowered  to  adopt  delegated  acts  in  accordance 
with  Article  55  for  the  purpose  of  reviewing  the  national  ceilings  set  out  in 
Annex II."  

(9) 

In Article 8, paragraph 2 is replaced by the following: 

"2. 

In the framework of the gradual introduction of direct payments as provided for 
in Article 16, paragraph 1 of this Article shall apply to Bulgaria and Romania 
as from 1 January 2016 and to Croatia as from 1 January 2022." 

(10) 

In Article 10, the following sentence is added at the end of the paragraph 4: 

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"In  Croatia,  for  the  years  2014-2021,  the  amount  claimed  or  due  to  be  granted  as 
referred  to  in  paragraph  1  shall  be  calculated  on  the  basis  of  the  amount  set  out  in 
Annex Va.A."  

(11) 

The title of Chapter 2 of Title II is replaced by the following: 

"Provisions applying to Bulgaria, Croatia and Romania" 

(12) 

The title of Article 16 is replaced by the following: 

"Gradual introduction of direct payments in Bulgaria and Romania" 

(13) 

The following Article is inserted:  

"Article 16a 

Gradual introduction of direct payments in Croatia 

In  Croatia,  direct  payments  shall  be  introduced  in  accordance  with  the  following 
schedule of increments expressed as a percentage of the  corresponding level of the 
direct payments as applied from 2022: 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

25 % in 2013, 

30 % in 2014,  

35 % in 2015,  

40 % in 2016, 

50 % in 2017, 

60 % in 2018, 

70 % in 2019, 

80 % in 2020, 

90 % in 2021, 

100 % as from 2022." 

(14) 

The title of Article 17 is replaced by the following: 

"Complementary  national  direct  payment  and  direct  payments  in  Bulgaria  and 
Romania" 

(15) 

In Chapter 2, the following Articles are added:  

- 5 - 

 
 
" 

"Article 17a 

1. 

2. 

3. 

4. 

5. 

6. 

7. 

Complementary national direct payments for Croatia 

Croatia shall have the possibility, subject to authorisation by the Commission 
by  means  of  an  implementing  act  without  the  assistance  of  the  Committee 
referred  to  in  Article  56,  to  complement  any  of  the  support  schemes  listed  in 
Annex I, where relevant. 

The  complementary  amount  which  may  be  granted  in  a  given  year  and  for  a 
given  support  scheme  shall  be  limited  by  a  specific  financial  envelope.  This 
envelope shall be established as the difference between: 

(a) 

and 

(b) 

the  amount  of  direct  support  available  per  support  scheme  concerned 
after the full introduction of direct payments according to Article 16a for 
the calendar year 2022  

the  amount  of  direct  support  available  per  support  scheme  concerned 
after  the  application  of  the  schedule  of  increments  according  to  Article 
16a in the year concerned. 

The total amount of complementary national direct payments granted shall not 
be higher than the ceiling set out in Annex Va.B. for a corresponding calendar 
year. 

Croatia may decide, on the basis of objective criteria and after authorisation by 
the Commission, on the amounts of complementary national aid to be granted. 

The  authorisation  by  the  Commission  shall  specify  the  relevant  support 
schemes  and  define  the  level  up  to  which  the  complementary  national  direct 
payments may be paid.   

As  regards  complementary  national  direct  payments  intended  to  complement 
the  voluntary  coupled  support  referred  to  in  Chapter  1  of  Title  IV,  the 
authorisation  shall  also  specify  the  specific  types  of  farming  or  the  specific 
agricultural  sectors  referred  to  in  Article  38(2)  to  which  the  complementary 
national direct payments may relate. 

The eligibility conditions for complementary national direct payments shall be 
those  for  support  under  corresponding  support  schemes  as  laid  down  in  this 
Regulation. 

The  complementary  national  direct  payments  shall  be  subject  to  any 
adjustments  which  may  be  rendered  necessary  by  developments  in  the 
Common Agricultural Policy (CAP). They shall be granted in accordance with 
objective  criteria  and  in  such  a  way  as  to  ensure  equal  treatment  between 
farmers and to avoid market and competition distortions. 

- 6 - 

 
 
8. 

Croatia  shall  submit  a  report  providing  information  on  the  measures  for  the 
implementation of the complementary national direct payments before 30 June 
of the year following their implementation. The report shall cover at least the 
following:  

(a) 

(b) 

any changes in the situation affecting the complementary national direct 
payments; 

for  each  complementary  national  direct  payment,  the  numbers  of 
beneficiaries, the total amount of complementary national aid granted, as 
well as, the hectares, the number of animals or other units for which the 
aid has been granted; 

(c) 

a  report  on  control  measures  applied  in  relation  to  the  complementary 
national direct payments granted.  

Article 17b 

Special national de-mining reserve for Croatia  

1. 

From  2014  onwards,  Croatia  shall  notify  the  Commission  no  later  than  31 
January every year of the areas which have been identified in accordance with 
Article 57a(10) of Regulation (EC) No 73/2009 and which have returned to use 
for agricultural activities in the previous calendar year.  

Croatia  shall  also  notify  the  number  of  payment  entitlements  available  to 
farmers on 31 December of the previous calendar year, as well as the amount 
remained unspent in the special national de-mining reserve at the same date. 

If  applicable, the  notifications provided in the first and second subparagraphs 
shall be made per region as defined in accordance with Article 20(1). 

2. 

The Commission shall calculate on a yearly basis the amount to be added to the 
amounts  set  for  Croatia  in  Annex  II,  when  reviewing  that  Annex  pursuant  to 
Article  6(2),  in  order  to  finance  the  support  to  be  granted  under  the  schemes 
listed in Annex I for the areas referred to in the first subparagraph of paragraph 
1  of  this  Article.  This  amount  shall  be  calculated  on  the  basis  of  the  data 
notified by Croatia in accordance with paragraph 1 and the estimated average 
direct payments per hectare in Croatia for the year concerned.  

The  maximum  amount  to  be  added  in  accordance  with  the  first  subparagraph  
on the basis of all the areas notified by Croatia in accordance with paragraph 1 
up  to  2022  shall  be  EUR  9  600  000  and  shall  be  subject  to  the  schedule  of 
introduction  of  direct  payments  in  accordance  with  Article  16a,  as  set  out  in 
Annex Vb. 

3. 

The  Commission  shall,  by  means  of  implementing  acts,  set  the  share  of  the 
amount to be added in accordance with paragraph 2 which Croatia shall include 
in  the  special  national  de-mining  reserve  in  order  to  allocate  payment 
entitlements for the areas referred to in the first subparagraph of paragraph 1. 
This  share  shall  be  calculated  on  the  basis  of  the  ratio  between  the  basic 

- 7 - 

 
 
payment  ceiling  and  the  amount  set  in  Annex  II  before  its  increase  in 
accordance  with  paragraph  2.  Those  implementing  acts  shall  be  adopted  in 
accordance with the examination procedure referred to in Article 56(2). 

4. 

For  the  years  2014  to  2022,  Croatia  shall  use  the  special  national  de-mining 
reserve  to  allocate  payment  entitlements  to  farmers  on  the  basis  of  de-mined 
land  declared  by  the  farmers  in  the  year  in  question  under  the  following 
conditions: 

(a) 

such land is eligible within the meaning of Article 25(2),  

(b) 

(c) 

the land in question was returned to use for agricultural activities during 
the previous calendar year, 

the  land  has  been  notified  to  the  Commission  in  accordance  with 
paragraph 1. 

The  value  of  the  payment  entitlements  established  under  this  Article  shall  be 
the  national  or  regional  average  value  of  payment  entitlements  in  the  year  of 
allocation within the limits of the amount available in the special national de-
mining reserve.  

 The  Commission  shall  be  empowered  to  adopt  delegated  acts  in  accordance 
with Article 55 for the purposes of adapting the amounts set out in Annex Va 
in order to take account of the application of this Article." 

5. 

6. 

(16) 

In Article 18, paragraph 1 is replaced by the following: 

"1.  Support under the basic payment scheme shall be available to farmers if they 
obtain payment entitlements under this Regulation through allocation pursuant 
to  Article  17b(4),  first  allocation  pursuant  to  Article  21,  from  the  national 
reserve pursuant to Article 23, or by transfer pursuant to Article 27." 

(17) 

In Article 19(3), the following subparagraph is added: 

"The  first  subparagraph  shall  not  apply  where  such  a  modification  is  due  to  the 
application of Article 17b(2)"  

(18) 

In Article 21(2), the first subparagraph is replaced by the following: 

"Farmers  who,  in  2011  or  in  the  case  of  Croatia  in  2013,  activated  at  least  one 
payment entitlement under the single payment scheme or claimed support under the 
single area payment scheme, both in accordance with Regulation (EC) No 73/2009, 
shall receive payment entitlements the first year of application of the basic payment 
scheme provided they are entitled to be granted direct payments in accordance with 
Article 9." 

(19) 

In Article 49, paragraph 3 is replaced by the following: 

"3.  By  way  of  derogation  from  paragraph  2,  in  Croatia,  Cyprus  and  Malta  the 
amount referred to in paragraph 1 may be set at a value lower than EUR 500, 
but not less than EUR 200." 

- 8 - 

 
 
(20) 

In Annex II, the following is inserted after the entry for France:  

" 

Croatia 

111 900 

130 550 

149 200 

186 500 

223 800 

261 100* 

For Croatia the national ceiling for calendar year 2020 is 298 400, for 2021 is 335 700 and for 

* 
2022 is 373 000 (in thousands EUR)." 

(21) 

In Annex III, the following is inserted after the entry for France: 

" 

Croatia 

111.9. 

130.6 

149.2 

186.5 

223.8 

261.1* 

For Croatia the estimated net ceiling for  calendar year 2020 is 298.4, for 2021 is 335.7 and for 

* 
2022 is 373 (in million EUR)." 

(22) 

In Annex IV, the following is inserted after the entry for France:  

" 

Croatia 

100 

1 ha 

" 

- 9 - 

 
 
(23) 

A new Annex Va is inserted: 

"ANNEX Va 

Financial provisions applying to Croatia referred to in Articles 10 and 17a 

A.  Amounts for applying Article 10: 

(in thousands EUR) 

Croatia 

373 000 

B.  Total amount of complementary national direct payments referred to in Article 

17a(3): 

(in thousands EUR) 

2014 

2015 

2016 

2017 

2018 

2019 

2020 

2021 

Croatia 

261 100 

242 450 

223 800 

186 500 

149 200 

111 900 

74 600 

37 300 

" 

(24) 

A new Annex Vb is inserted: 

"ANNEX Vb 

Maximum amount to be added to the amounts set out in Annex II in accordance with 
Article 17b(2) 

2014 

2015 

2016 

2017 

2018 

2019 

2020 

2021 

2022 

(in thousands EUR) 

Croatia 

2 880 

3 360 

3 840 

4 800 

5 760 

6 720 

7 680 

8 640 

(25) 

In Annex VI, the following is inserted after the entry for France: 

"  

Croatia 

5.9 

9 600 

" 

" 

- 10 - 

 
 
 
 
 
 
 
 
 
(26) 

Annex VII is amended as follows: 

(a)  The  following  entry  is  inserted  after  the  row  concerning  Article  57  of 

Regulation (EC) No 73/2009: 

" 

57a 

Article 17b 

- 

(b)  The  entry  concerning  Article  121  of  Regulation  (EC)  No  73/2009  is  replaced 

by the following: 

" 

" 

121 

Articles  16  and 
16a 

- 

(c)  The  entry  concerning  Article  132  of  Regulation  (EC)  No  73/2009  is  replaced 

by the following: 

" 

" 

132 

Articles  17  and 
17a 

- 

" 

- 11 - 

 
 
LEGISLATIVE FINANCIAL STATEMENT 

1. 

FRAMEWORK OF THE PROPOSAL/INITIATIVE  

1.1. 

Title of the proposal/initiative  

- 
Amendment  to  the  Commission  proposal  COM(2011)  625  final/3  for  a 
Regulation  of  the  European  Parliament  and  of  the  Council  establishing  rules  for 
direct  payments  to  farmers  under  support  schemes  within  the  framework  of  the 
common agricultural policy; 

Amendment  to  the  Commission  proposal  COM(2011)  626  final/3  for  a 
- 
Regulation  of  the  European  Parliament  and  of  the  Council  establishing  a  common 
organisation of the markets in agricultural products (Single CMO Regulation); 

- 
Amendment  to  the  Commission  proposal  COM(2011)  627  final/3  for  a 
Regulation  of  the  European  Parliament  and  of  the  Council  on  support  for  rural 
development by the European Agricultural Fund for Rural Development (EAFRD); 

- 
Amendment  to  the  Commission  proposal  COM(2011)  628  final/2  for  a 
Regulation  of  the  European  Parliament  and  of  the  Council  on  the  financing, 
management and monitoring of the common agricultural policy. 

1.2. 

Policy area(s) concerned in the ABM/ABB structure3  

Policy Area Title 05 of Heading 2 

1.3. 

Nature of the proposal/initiative (Legislative framework for the CAP post 2013) 

x The proposal/initiative relates to a new action  

(cid:133)  The  proposal/initiative  relates  to  a  new  action  following  a  pilot  project/preparatory 
action4  

x The proposal/initiative relates to the extension of an existing action  

x The proposal/initiative relates to an action redirected towards a new action  

1.4. 

Objectives 

1.4.1.  The  Commission's  multiannual 

strategic  objective(s) 

targeted  by 

the 

proposal/initiative  

In  order  to  promote  resource  efficiency  with  a  view  to  smart,  sustainable  and 
inclusive  growth  for  EU  agriculture  and  rural  development  in  line  with  the  Europe 
2020 Strategy, the objectives of the CAP are: 

- Viable food production; 

3 
4 

ABM: Activity-Based Management – ABB: Activity-Based Budgeting. 
As referred to in Article 49(6)(a) or (b) of the Financial Regulation. 

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- Sustainable management of natural resources and climate action; 

- Balanced territorial development. 

1.4.2. 

Specific objective(s) and ABM/ABB activity(ies) concerned 

Specific objectives for Policy area 05: 

Specific objective No 1:  

To provide environmental public goods 

Specific objective No 2:  

To compensate for production difficulties in areas with specific natural constraints 

Specific objective No 3:  

To pursue climate change mitigation and adaptation actions 

Specific objective No 4:  

To  manage  the  EU  budget  (CAP)  in  accordance  with  high  standards  of  financial 
management 

Specific objective for ABB 05 02 - Interventions in agricultural markets:  

Specific objective No 5:  

To improve the competitiveness of the agricultural sector and enhance its value share 
in the food chain 

Specific objective for ABB 05 03 - Direct aids: 

Specific objective No 6: 

To contribute to farm incomes and limit farm income variability 

Specific objectives for ABB 05 04 – Rural development: 

Specific objective No 7  

To foster green growth through innovation 

Specific objective No 8:  

To support rural employment and maintain the social fabric of rural areas 

- 13 - 

 
 
 
 
 
Specific objective No 9  

To improve the rural economy and promote diversification 

Specific objective No 10  

To allow for structural diversity in farming systems 

1.4.3.  Expected result(s) and impact 

It  is  not  possible  to  set  quantitative  targets  for  impact  indicators  at  this  stage. 
Although  the  policy  can  steer  in  a  certain  direction,  the  broad  economic, 
environmental  and  social  outcomes  measured  by  such  indicators  would  ultimately 
also depend on the impact from a range of external factors, which recent experience 
indicates have become significant and unpredictable. Further analysis is on-going, to 
be ready for the period post-2013. 

As regards the direct payments, Member States will have the possibility to decide, to 
a limited degree, on the implementation of certain components of the direct payment 
schemes. 

For  rural  development,  the  expected  results  and  impact  will  depend  on  the  rural 
development  programmes  that  Member  States  will  submit  to  the  Commission. 
Member States will be asked to set targets in their programmes.  

1.4.4. 

Indicators of results and impact  

The proposals provide for the establishment of a common monitoring and evaluation 
framework  with a  view  to measuring the performance  of the Common Agricultural 
Policy.  That  framework  shall  include  all  instruments  related  to  the  monitoring  and 
evaluation  of  CAP  measures  and  in  particular  of  the  direct  payments,  market 
measures, rural development measures and of the application of cross compliance. 

The  impact  of  these  CAP  measures  shall  be  measured  in  relation  to  the  following 
objectives: 

(a) 

(b) 

(c) 

viable  food  production,  with  a  focus  on  agricultural  income,  agricultural 
productivity and price stability; 

sustainable management of natural resources and climate action, with a focus 
on greenhouse gas emissions, biodiversity, soil and water; 

balanced  territorial  development,  with  a  focus  on  rural  employment,  growth 
and poverty in rural areas. 

By  means  of  implementing  acts,  the  Commission  shall  define  the  set  of  indicators 
specific to these objectives and areas. 

Moreover,  as  regards  rural  development,  a  reinforced  common  monitoring  and 
evaluation system is proposed. That system aims (a) to demonstrate the progress and 
achievements  of  rural  development  policy  and  assess  the  impact,  effectiveness, 
efficiency and relevance of rural development policy interventions, (b) 
contribute  to  better  targeted  support  for  rural  development,  and  (c)  to  support  a 
common learning process related to monitoring and evaluation. The Commission will 
establish,  by  means  of  implementing  act,  a  list  of  common  indicators  linked  to  the 
policy priorities. 

to 

- 14 - 

 
 
1.5. 

Grounds for the proposal/initiative  

1.5.1.  Requirement(s) to be met in the short or long term  

In order to meet the multi-annual strategic objectives of the CAP which are a direct 
translation  of  the  Europe  2020  strategy  for  European  rural  areas  and  to  fulfil  the 
relevant requirements of the Treaty, the proposals, as amended to take account of the 
Accession  of  Croatia,  aim  to  lay  down  the  legislative  framework  for  the  Common 
Agricultural Policy for the period after 2013. 

1.5.2.  Added value of EU involvement 

The future CAP will not only be a policy that caters for a small, albeit essential, part 
of the EU economy, but also a policy of strategic importance for food security, the 
environment and territorial balance. Thus, the CAP, as a truly common policy, makes 
the  most  efficient  use  of  limited  budgetary  resources  in  maintaining  a  sustainable 
agriculture  throughout  the  EU,  addressing  important  cross-border  issues  such  as 
climate change and reinforcing solidarity among Member States. 

As mentioned in the Commission communication "A Budget for Europe 2020"5, the 
CAP  is  a  genuinely  European  policy.  Instead  of  operating  28  separate  agricultural 
policies  and  budgets,  Member  States  pool  resources  to  operate  a  single  European 
policy  with  a  single  European  budget.  This  naturally  means  that  the  CAP  accounts 
for a significant proportion of the EU budget. However, this approach is both more 
efficient and economical than an uncoordinated national approach. 

1.5.3.  Lessons learned from similar experiences in the past 

On  the  basis  of  the  evaluation  of  the  current  policy  framework,  an  extensive 
consultation with stakeholders as well as an analysis of future challenges and needs, 
a comprehensive impact assessment has been carried out. More details can be found 
in  the  impact  assessment  and  the  explanatory  memorandum  that  are  accompanying 
the legal proposals. 

1.5.4.  Coherence and possible synergy with other relevant instruments 

The legislative proposals concerned by this financial statement should be seen in the 
broader context of the proposal for a single framework regulation with common rules 
for  the  common  strategic  framework  funds  (EAFRD,  ERDF,  ESF,  Cohesion  Fund 
and  EMFF).  That  framework  regulation  will  make  an  important  contribution  to 
reducing administrative burden, to spending EU funds in an effective way, and to put 
simplification  into  practice.  This  also  underpins  the  new  concepts  of  the  common 
strategic  framework  for  all  these  funds  and  the  upcoming  Partnership  Contracts 
which will also cover these funds. 

The  common  strategic  framework,  which  will  be  established,  will  translate  the 
objectives and priorities of the Europe 2020 Strategy into priorities for the EAFRD 
together  with  the  ERDF,  ESF,  Cohesion  Fund  and  EMFF,  which  will  ensure  an 
integrated use of the funds to deliver common objectives.  

5 

COM(2011)500 final of 29 June 2011. 

- 15 - 

 
 
                                                 
The  common  strategic  framework  will  also  set  out  coordination  mechanisms  with 
other relevant Union policies and instruments. 

Moreover,  as  regards  the  CAP,  significant  synergies  and  simplification  effects  will 
be obtained by harmonising and aligning the management and control  rules for the 
first  (EAGF)  and  second  (EAFRD)  pillar  of  the  CAP.  The  strong  link  between  the 
EAGF and the EAFRD should be maintained and the structures already in place in 
the Member States be sustained. 

1.6. 

Duration and financial impact  

x  Proposal/initiative  of  limited  duration  (for  the  draft  regulations  on  direct 
payment schemes, rural development and transitional regulations) 

–  x  Proposal/initiative in effect from 01/01/2014 to 31/12/2020  

–  x  Financial impact for the period of the next multi-annual financial framework. 

For rural development, impact on payments to 2023. 

x Proposal/initiative of unlimited duration (for the draft regulation on the single 
CMO and the horizontal regulation) 

–  Implementation from 2014. 

1.7.  Management mode(s) envisaged6  

x Centralised direct management by the Commission  

(cid:133)  Centralised  indirect  management  with  the  delegation  of  implementation  tasks 
to: 

–  (cid:133)  executive agencies  

–  (cid:133)  bodies set up by the Communities7  

–  (cid:133)  national public-sector bodies/bodies with public-service mission  

–  (cid:133)  persons entrusted with the implementation of specific actions pursuant to Title 
V of the Treaty on European Union and identified in the relevant basic act within 
the meaning of Article 49 of the Financial Regulation  

x Shared management with the Member States  

(cid:133) Decentralised management with third countries  

(cid:133) Joint management with international organisations (to be specified) 

6 

7 

Details  of  management  modes  and  references  to  the  Financial  Regulation  may  be  found  on  the 
BudgWeb site: http://www.cc.cec/budg/man/budgmanag/budgmanag_en.html 
As referred to in Article 185 of the Financial Regulation. 

- 16 - 

 
 
                                                 
Comments  
No substantive change compared to the present situation, i.e. the bulk of expenditure concerned by the 
legislative proposals on the CAP reform will be managed by shared management with the Member 
States. However, a very minor part will continue to fall under centralised direct management by the 
Commission. 

2. 

MANAGEMENT MEASURES  

2.1.  Monitoring and reporting rules  

In terms of monitoring and evaluation of the CAP, the Commission will present a report to the 
European Parliament and the Council every 4 years, with the first report to be presented not 
later than end 2017. 

This  is  complemented  by  specific  provisions  in  all  areas  of  the  CAP,  with  various 
comprehensive  reporting  and  notifications  requirements  to  be  specified  in  the  implementing 
rules.  

As  regards  rural  development,  rules  are  also  provided  for  monitoring  at  programme  level, 
which will be aligned with the other funds, and which will be coupled with ex ante, on-going 
and ex post evaluations. 

2.2.  Management and control system  

2.2.1.  Risk(s) identified  

There are more than seven million beneficiaries of the CAP, receiving support under a large 
variety  of  different  aid  schemes,  each  of  which  having  detailed  and  sometimes  complex 
eligibility criteria. 

The reduction in the error rate in the domain of the common agricultural policy can already be 
considered  as  a  trend.  Thus,  most  recently  an  error  rate  close  to  2%  confirms  the  overall 
positive  assessment  of  previous  years.  It  is  the  intention  to  continue  the  efforts  in  order  to 
achieve an error rate below 2%. 

2.2.2.  Control method(s) envisaged  

The  legislative  package,  in  particular  the  proposal  for  the  regulation  on  the  financing, 
management  and  monitoring  of  the  common  agricultural  policy,  envisages  maintaining  and 
reinforcing the current system established by Regulation (EC) No 1290/2005. It provides for a 
compulsory administrative structure at Member State level, centred around accredited paying 
agencies,  which  are  responsible  for  carrying  out  controls  at  final  beneficiary  level  in 
accordance  with  the  principles  set  out  under  point  2.3.  Every  year,  the  head  of  each  paying 
agency  is  required  to  provide  a  statement  of  assurance  which  covers  the  completeness, 
accuracy and veracity of the accounts, the proper functioning of the internal control systems 
and  the  legality  and  regularity  of  the  underlying  transactions.  An  independent  audit  body  is 
required to provide an opinion on all these three elements. 

The Commission will continue to audit agricultural expenditure, using a risk-based approach 
in order to ensure that its audits are targeted to the areas of highest risk. Where these audits 

- 17 - 

 
 
reveal that expenditure has been incurred in breach of Union rules, it will exclude the amounts 
concerned from Union financing under the conformity clearance system. 

As  regards  the  cost  of  controls,  a  detailed  analysis  is  provided  in  annex  8  to  the  impact 
assessment accompanying the legislative proposals. 

Furthermore the publication of information on the beneficiaries of the EAGF and EAFRD will 
reinforce the public control of the use of the money and contribute to the visibility and better 
understanding of the CAP. 

2.3.  Measures to prevent fraud and irregularities  

The  legislative  package,  in  particular  the  proposal  for  the  regulation  on  the  financing, 
management  and  monitoring  of  the  common  agricultural  policy,  envisages  maintaining  and 
reinforcing the current detailed systems for controls and penalties to be applied by the paying 
agencies, with common basis features and special rules tailored to the specificities of each aid 
regime. The systems generally provide for exhaustive administrative controls of 100% of the 
aid  applications,  cross-checks  with  other  databases  where  this  is  considered  appropriate  as 
well as pre-payment on-the-spot checks of a minimum number of transactions, depending on 
the  risk  associated  with  the  regime  in  question.  If  these  on-the-spot  checks  reveal  a  high 
number of irregularities, additional checks must be carried out. In this context, the by far most 
important  system  is  the  Integrated  Administration  and  Control  System  (IACS),  which  in 
financial  year  2010  covered  around  80%  of  total  expenditure  under  the  EAGF  and  the 
EAFRD. For Member States with properly functioning control systems and low error rates, the 
Commission will be empowered to allow for a reduction of the number of on-the-spot checks. 

The  package  further  envisages  that  Member  States  shall  prevent,  detect  and  correct 
irregularities and fraud, impose effective, dissuasive and proportionate penalties as laid down 
in  Union  legislation  or  national  law,  and  recover  any  irregular  payments  plus  interests.  It 
includes  an  automatic  clearance  mechanism  for  irregularity  cases,  which  provides  that  if 
recovery has not taken place within four years of the date of the recovery request, or within 
eight years in the case of legal proceedings, the amounts not recovered shall be borne by the 
Member  State  concerned.  This  mechanism  will  be  a  strong  incentive  for  Member  States  to 
recover irregular payments as quickly as possible.  

3. 

ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE  

The  amounts  indicated  in  this  financial  statement  are  expressed  in  current  prices  and  in 
commitments. 

In  addition  to  the  changes  resulting  from  the  legislative  proposals  as  listed  in  the 
accompanying  tables  below,  the  legislative  proposals  imply  further  changes  which  have  no 
financial impact. 

- 18 - 

 
 
For any of the years in the period 2014-2020, the application of financial discipline cannot be 
excluded at this stage. However, this will not depend on the reform proposals as such, but on 
other  factors,  such  as  the  execution  of  direct  aids  or  future  developments  in  the  agricultural 
markets. 

As concerns direct aids, the extended  net ceilings for 2014 (calendar year 2013)  included in 
the Commission proposal regarding the application of direct payments in the transitional year 
2013  (COM(2011)630)8 are higher than the amounts allocated  to direct aids indicated in the 
accompanying tables. The purpose of this extension is to ensure a continuation of the existing 
legislation  in  a  scenario  in  which  all  the  other  elements  would  remain  unchanged,  without 
prejudice to the possible need for applying the financial discipline mechanism.  

The  reform  proposals  contain  provisions  giving  Member  States  a  set  degree  of  flexibility  in 
relation  to  their  allocation  of  direct  aids  respectively  rural  development.  In  case  Member 
States  decide  to  use  that  flexibility,  this  will  have  financial  consequences  within  the  given 
financial amounts, which cannot be quantified at this stage.  

The  reform  proposal  for  direct  payments  contains  a  provision  on  progressive  reduction  and 
capping  of  direct  payments.  The  product  of  capping,  to  be  transferred  to  rural  development, 
has been estimated in order to determine the net ceilings of direct payments (Annex III of the 
proposal). This estimation was based on assumptions as concerns the implementation of direct 
payments by Member States and will therefore be revised once Member States have notified 
their decisions on the implementation. Moreover, for Croatia, it is not possible to estimate the 
product of capping at this stage due to unavailability of data. A first rough estimate, based on 
preliminary information, showed that the product of capping would be null for Croatia. It will 
be revised once data are available.  

This  financial  statement  does  not  take  into  account  the  possible  use  of  the  crises  reserve.  It 
should  be  underlined  that  the  amounts  taken  into  account  for  market-related  expenditure  are 
based  on  no  public  intervention  buying-in  and  other  measures  related  to  a  crisis  situation  in 
any sectors. 

3.1. 

Heading(s)  of  the  multiannual  financial  framework  and  expenditure  budget  line(s) 
affected  

8  

The European Parliament and Council are expected to adopt the regulation in autumn 2012. 

- 19 - 

 
 
                                                 
Table 1: Amounts for the CAP including complementary amounts foreseen in the MFF proposals and the CAP reform proposals 

Budget year 

2013 

2013 
adjusted 
(1) 

2014 

2015 

2016 

2017 

2018 

2019 

2020 

TOTAL 
2014-2020 

In million EUR (current prices) 

Inside MFF 

Heading 2 

Direct aids and market-related expenditure (2) (3) (4) (5)
Estimated assigned revenue 

44 939
672

45 304
672

44 956
672

45 199
672

45 463
672

45 702
672

45 729
672

45 756
672

45 783 
672 

318 589 
4 704 

P1 Direct aids and market-related expenditure (with 
assigned revenue) (5) 

45 611 

45 976 

45 628 

45 871 

46 135 

46 374 

46 401 

46 428 

46 455 

323 293 

P2 Rural development (4)

14 817

14 451

14 784

14 784

14 784

14 784

14 784

14 784

14 784 

103 488 

Total 

Heading 1 

60 428

60 428

60 412

60 655

60 919

61 159

61 186

61 212

61 239 

426 781 

CSF Agricultural research and innovation 
Most deprived persons
Total 

N.A.
N.A.
N.A.

N.A.
N.A.
N.A.

682
379
1 061

696
387
1 082

710
394
1 104

724
402
1 126

738
410
1 149

753
418
1 172

768 
427 
1 195 

5 072 
2 818 
7 889 

Heading 3 

Food safety 

Outside MFF 

   Reserve for agricultural crises 

   European Globalisation Fund (EGF) 

N.A.

N.A.

352

352

352

352

352

352

352 

2 465 

N.A. 

N.A. 

531 

541 

552 

563 

574 

586 

598 

3 945 

Of which maximum available for agriculture: (6)

N.A.

N.A.

379

387

394

402

410

418

427 

2 818 

TOTAL 

TOTAL Commission proposals (MFF + outside MFF) + 
assigned revenue 

TOTAL MFF proposals (i.e. excluding Reserve and EGF) + 
assigned revenue 

60 428 

60 428 

62 735 

63 017 

63 322 

63 602 

63 671 

63 740 

63 810 

443 898 

60 428 

60 428 

61 825 

62 089 

62 376 

62 637 

62 686 

62 736 

62 786 

437 136 

- 20 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes: 
(1) 
(2) 

(3) 
(4) 

(5) 
(6) 

Taking into account legislative changes already agreed, i.e. voluntary modulation for the UK and Article 136 "unspent amounts" will cease to apply by the end of 2013. 
The amounts relate to the proposed annual ceiling for the first pillar. However, it should also be noted that it is proposed to move negative expenditure from accounting clearance 
(currently under budget item 05 07 01 06) to assigned revenue (under item 67 03). For details, see estimated revenue table on the page below.  
The 2013 figures include the amounts for veterinary and phytosanitary measures as well as market measures for the fisheries sector. 
The amounts in the table above are in line with those in the Commission communication "A Budget for Europe 2020" (COM(2011)500 of 29 June 2011) and the Commission's amended 
proposal for the MFF 2014-2020 (COM(2012)388 of 6 July 2012). However, it remains to be decided if the MFF will reflect the transfer that is proposed for the envelope of one Member 
State of the cotton national restructuring programme to rural development as from 2014, implying an adjustment (4 million EUR per year) of the amounts for respectively the EAGF sub-
ceiling and for pillar 2. In the tables in the sections below, the amounts have been transferred, irrespective of them being reflected in the MFF. 
It includes the maximum amounts of the special reserve for de-mining for Croatia. 
In accordance with the Commission communication "A Budget for Europe 2020" (COM(2011)500 final), a total amount of up to 2.5 billion EUR in 2011 prices will be available under 
the European Globalisation Fund for providing additional support to farmers suffering from effects of globalisation. In the table above, the breakdown by year in current prices is only 
indicative. The proposal for the inter-institutional agreement between the European Parliament, the Council and the Commission on cooperation in budgetary matters and on sound 
financial management (COM(2011)403 final of 29 June 2011) sets out, for the EGF, an overall maximum annual amount of 429 million EUR in 2011 prices. 

- 21 - 

 
3.2. 

Estimated impact on expenditure  

3.2.1. 

Summary of estimated impact on expenditure  

Table 2: Estimated revenue as well as expenditure for Policy Area 05 within Heading 2 

In million EUR (current prices) 

Budget year 

2013 (1) 

2013 
adjusted 
(1) 

2014 

2015 

2016 

2017 

2018 

2019 

2020 

REVENUE 

123 – Sugar production charge (own resources) 

123 

123 

125 

125 

67 03 - Assigned revenue 

  of which: ex 05 07 01 06 - Accounting clearance 

Total 

EXPENDITURE 

05 02 - Markets (2) 

672 

0 

795 

672 

0 

795 

741 

69 

866 

741 

69 

866 

741 

69 

741 

741 

69 

741 

741 

69 

741 

741 

69 

741 

741 

69 

741 

3 311 

3 311 

2 652 

2 671 

2 700 

2 729 

2 752 

2 740 

2 729 

18 974 

05 03 - Direct aids (before capping) (3)  

42 170 

42 535 

42 970 

43 193 

43 428 

43 637 

43 641 

43 678 

43 715 

304 261 

05 03 – Direct aids (after capping) (3) (4) 

42 170 

42 535 

42 970 

43 028 

43 256 

43 453 

43 455 

43 492 

43 530 

303 184 

05 04 - Rural development (before capping) 

14 817 

14 451 

14 788 

14 788 

14 788 

14 788 

14 788 

14 788 

14 788 

103 516 

05 04 - Rural development (after capping) (4) 

14 817 

14 451 

14 788 

14 952 

14 960 

14 973 

14 974 

14 974 

14 974 

104 594 

05 07 01 06 - Accounting clearance 

-69 

-69 

0 

0 

0 

0 

0 

0 

0 

0 

Total 

60 229 

60 229 

60 410 

60 652 

60 916 

61 155 

61 181 

61 207 

61 232 

426 751 

NET BUDGET after assigned revenue  

59 669 

59 911 

60 175 

60 414 

60 440 

60 466 

60 491 

421 564 

- 22 - 

TOTAL 
2014-2020 

250 

5 187 

483 

5 437 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes: 
(1) 
(2) 

(3) 

(4) 

For comparison purposes, the 2013 figures are kept unchanged to the figures in the initial Commission proposals of 12 October 2011. 
For 2013, preliminary estimate based on Draft Budget 2012 taking into account legal adjustments already agreed for 2013 (e.g. wine ceiling, abolition of potato starch premium, dried 
fodder) as well as some foreseen developments. For all years, the estimates assume that there will be no additional financing need for support measures due to market disturbances or 
crises.  
The 2013 amount includes an estimate of wine grubbing-up 2012. The amounts for 2014-2020, shown in Table 2, do not include the special reserve for de-mining for Croatia, whereas the 
corresponding amounts, shown in Table 1 include the special reserve.  
The product of capping was estimated based on assumptions as concerns the implementation of direct payments by Member States and will therefore be revised once they have notified 
their decisions on the implementation. Moreover, for Croatia, it is not possible to estimate the product of capping at this stage due to unavailability of data. A first rough estimate, based 
on preliminary information, showed that the product of capping would be null for Croatia. It will be revised once data are available.  

- 23 - 

 
Table 3: Calculation of the financial impact by budget chapter of the CAP reform proposals as regards revenue and CAP expenditure 

Budget year 

2013 (1) 

2013 
adjusted 
(1) 

REVENUE 

2014 

2015 

2016 

2017 

2018 

2019 

2020 

In million EUR (current prices) 

TOTAL 
2014-2020 

123 – Sugar production charge (own resources) 

123 

123 

0 

0 

0 

0 

0 

0 

0 

0 

67 03 - Assigned revenue 

  of which: ex 05 07 01 06 - Accounting clearance 

Total 

EXPENDITURE 

05 02 - Markets (2) 

05 03 - Direct aids (before capping) (3) 

05 03 - Direct aids – Estimated product of capping (4) to be 
transferred to rural development 

672 

0 

795 

672 

0 

795 

69 

69 

69 

3 311 

3 311 

42 170 

42 535 

-659 

-460 

05 04 - Rural development (before capping) (5) 

14 817 

14 451 

05 04 - Rural development – Estimated product of capping (4) to 
be transferred from direct aids 

05 07 01 06 - Accounting clearance 

-69 

-69 

0 
4 

0 
69 

69 

69 

69 

-640 

-492 

-164 
4 

69 

69 

69 

-611 

-534 

-172 
4 

69 

69 

69 

-582 

-577 

-185 
4 

69 

69 

69 

-559 

-617 

-186 
4 

69 

69 

69 

-571 

-617 

-186 
4 

69 

69 

69 

-582 

-617 

-186 
4 

164 
69 

172 
69 

185 
69 

186 
69 

186 
69 

186 
69 

Total 

60 229 

60 229 

-1 046 

-1 059 

-1 072 

-1 085 

-1 103 

-1 114 

-1 126 

483 

483 

483 

-4 203 

-3 913 

-1 078 
28 

1 078 
483 

-7 605 

NET BUDGET after assigned revenue  

-1 115 

-1 128 

-1 141 

-1 154 

-1 172 

-1 183 

-1 195 

-8 088 

- 24 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes: 
(1) 
(2) 

(3) 

(4) 

(5) 

For comparison purposes, the 2013 figures are kept unchanged to the figures in the initial Commission proposals of 12 October 2011. 
For 2013, preliminary estimate based on Draft Budget 2012 taking into account legal adjustments already agreed for 2013 (e.g. wine ceiling, abolition of potato starch premium, dried 
fodder) as well as some foreseen developments. For all years, the estimates assume that there will be no additional financing need for support measures due to market disturbances or 
crises. 
The 2013 amount includes an estimate of wine grubbing-up 2012. The amounts for 2014-2020, shown in Table 3, do not include the special reserve for de-mining for Croatia , whereas 
the corresponding amounts, shown in Table 1 include the special reserve. 
The product of capping was estimated based on assumptions as concerns the implementation of direct payments by Member States and will therefore be revised once they have notified 
their decisions on the implementation. Moreover, for Croatia, it is not possible to estimate the product of capping at this stage due to unavailability of data. A first rough estimate, based 
on preliminary information, showed that the product of capping would be null for Croatia. It will be revised once data are available. 
The change compared to 2013 is solely due to the proposed transfer of the cotton national envelope to rural development (4 million EUR per year). In addition, the updated MFF 
proposals (COM(2012)388) foresee an additional amount of 333 million EUR per year. 

- 25 - 

 
 
Table 4: Calculation of the financial impact of the CAP reform proposals as regards CAP market-related expenditure 

BUDGET YEAR 

Legal base 

Exceptional measures: streamlined and extended 
scope of legal base 

Removal of intervention for durum wheat and 
sorghum 

Food programmes for most deprived 

Art. 154, 155, 156 

ex Art.10 

(2) 

Ex-Art. 27 of Reg 
1234/2007 

Private storage (Flax fibre) 

Art. 16 

Aid for cotton - Restructuring 

(3) 

ex Art. 5 of Reg. 
637/2008 

Setting-up aid for F&V producer groups 

School fruit scheme 

Abolition hops PO 

ex Art. 117 

Art. 21 

ex Art. 111 

Optional private storage for skimmed-milk powder 

Art. 16 

Abolition aid for use of skimmed milk/SMP as 
feedingstuff/casein and use of casein 

ex Art. 101, 102 

Estimated 
needs 

2013  
(1) 

pm 

pm 

Changes to 2013 

In million EUR (current prices) 

2014 

2015 

2016 

2017 

2018 

2019 

2020 

pm 

pm 

pm 

pm 

pm 

pm 

pm 

- 

- 

- 

- 

- 

- 

- 

TOTAL 
2014-2020 

pm 

- 

500.0 

-500.0 

-500.0 

-500.0 

-500.0 

-500.0 

-500.0 

-500.0 

-3 500.0 

N.A. 

10.0 

30.0 

90.0 

2.3 

N.A. 

pm 

pm 

-4.0 

pm 

-4.0 

pm 

-4.0 

pm 

-4.0 

pm 

-4.0 

pm 

-4.0 

pm 

-4.0 

0.0 

0.0 

0.0 

-15.0 

-15.0 

-30.0 

-30.0 

60.0 

60.0 

60.0 

60.0 

60.0 

60.0 

60.0 

-2.3 

pm 

- 

-2.3 

pm 

- 

-2.3 

pm 

- 

-2.3 

pm 

- 

-2.3 

pm 

- 

-2.3 

pm 

- 

-2.3 

pm 

- 

Pm 

-28.0 

-90.0 

420.0 

-15.9 

pm 

- 

Optional private storage for butter 

(4) 

Art. 16 

14.0 

[-1.0] 

[-14.0] 

[-14.0] 

[-14.0] 

[-14.0] 

[-14.0] 

[-14.0] 

[-85.0] 

Abolition milk promotional levy 

ex Art. 309 

pm 

- 

- 

- 

- 

- 

- 

- 

- 

TOTAL 05 02 

Net effect of reform proposals (5) (6) 

-446.3 

-446.3 

-446.3 

-461.3 

-461.3 

-476.3 

-476.3 

-3 213.9 

- 26 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes: 
(1) 

(2) 
(3) 

(4) 
(5) 

(6) 

The 2013 needs are estimated based on the Commission's Draft Budget 2012, except for (a) the fruit & vegetables sectors where the needs are based on the financial statement of the 
respective reforms and (b) any legal changes already agreed. 
The 2013 amount corresponds to the ceiling set by Regulation (EU) No 121/2012  . As from 2014, the measure will be financed within Heading 1. 
The envelope for the cotton restructuring programme for Greece (4 million EUR/year) will be transferred to rural development as from 2014. The envelope for Spain (6.1 million 
EUR/year) will go to the Single Payment Scheme as from 2018 (already decided). 
Estimated effect in case of non-application of the measure. 
In addition to expenditure within chapters 05 02 and 05 03, it is anticipated that direct expenditure within chapters 05 01, 05 07 and 05 08 will be financed by revenue that will be assigned 
to the EAGF. 
Table 4 shows the net effect of the reform proposals for affected market measures, whereas in table 3 the figures for "05 02 Markets" show the difference between the adjusted 2013 
amount and the estimated amounts available for market-related expenditure during 2014-2020. 

- 27 - 

 
 
Table 5: Calculation of the financial impact of the CAP reform proposals as regards direct aids 

In million EUR (current prices) 

BUDGET YEAR 

Legal base 

Estimated needs 

Changes to 2013 

2013 (1) 

2013 
adjusted 
(2) 

2014 

2015 

2016 

2017 

2018 

2019 

2020 

TOTAL 
2014-2020 

Direct aids (3) 

42 169.9 

42 535.4 

434.2 

493.0 

720.1 

917.2 

919.7 

957.0 

994.3

5 435.6 

- Changes already 
decided: 

Phasing-in EU 12 

Cotton 
restructuring 

Health Check  

Previous reforms  

- Phasing-in Croatia (3) 

- Changes due to new CAP reform proposals 

Of  which:  capping 
(4) 

TOTAL 05 03 
Net effect of reform proposals 
TOTAL EXPENDITURE 

875.0 

1 133.9 

1 392.8 

1 651.6 

1 651.6 

1 651.6 

1 651.6

10 008.1 

0.0 

0.0 

0.0 

0.0 

6.1 

6.1 

6.1

18.4 

-64.3 

-9.9 

-64.3 

-32.4 

-64.3 

-32.4 

-90.0 

-32.4 

-90.0 

-32.4 

-90.0 

-32.4 

-90.0

-32.4

-552.8 

-204.2 

93.3 

111.9 

130.6 

149.2 

186.5 

223.8 

261.1

1 156.3 

-459.8 

-656.1 

-706.5 

-761.3 

-802.2 

-802.2 

0.0 

-164.1 

-172.1 

-184.7 

-185.6 

-185.6 

-802.2

-185.6

-4 990.3 

-1 077.7 

42 169.9 

42 535.4 

-459.8 
42 969.7 

-656.1 
43 028.4 

-706.5 
43 255.6 

-761.3 
43 452.6 

-802.2 
43 455.2 

-802.2 
43 492.5 

-802.2
43 529.8

-4 990.3 
303 183.6 

Notes: 
(1) 
(2) 
(3) 
(4) 

The 2013 amount includes an estimate of wine grubbing-up 2012. 
Taking into account legislative changes already agreed, i.e. voluntary modulation for the UK and Article 136 "unspent amounts" will cease to apply by the end of 2013. 
It does not include the special reserve for de-mining for Croatia. 
The product of capping was estimated based on assumptions as concerns the implementation of direct payments by Member States and will therefore be revised once they have notified 
their decisions on the implementation. Moreover, for Croatia, it is not possible to estimate the product of capping at this stage due to unavailability of data. A first rough estimate, based 
on preliminary information, showed that the product of capping would be null for Croatia. It will be revised once data are available.  

- 28 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Table 6: Components of direct aids 

BUDGET YEAR 

2015 

2016 

2017 

2018 

2019 

2020 

TOTAL 
2015-2020 

In million EUR (current prices) 

Annex II 

Payment  for  agricultural  practices  beneficial  for  the  climate  and 
environment (30%) 
Maximum that can be allocated to the Payment for young farmers 
(2%) 

Basic  Payment  Scheme,  Payment  for  areas  with  Natural 
Constraints, Voluntary Coupled Support 
Maximum  that  can  be  taken  from  the  above  lines  to  finance  the 
Small Farmer Scheme (10%) 
Wine transfers included in Annex II (1) 

Capping (2) 
Cotton 
POSEI/Small Aegean Islands 

42 519.1 
12 900.1 

42 754.0 
12 894.5 

42 963.3 
12 889.0 

42 966.8 
12 890.0 

43 004.1 
12 901.2 

43 041.4
12 912.4

257 248.6 
77 387.2 

860.0 

859.6 

859.3 

859.3 

860.1 

860.8

5 159.1 

28 759.0 

28 999.9 

29 215.1 

29 217.4 

29 242.8 

29 268.1

174 702.2 

4 300.0 

4 298.2 

4 296.3 

4 296.7 

4 300.4 

4 304.1

25 795.7 

159.9 

159.9 

159.9 

159.9 

159.9 

159.9

959.1 

-164.1 
256.0 
417.4 

-172.1 
256.3 
417.4 

-184.7 
256.5 
417.4 

-185.6 
256.6 
417.4 

-185.6 
256.6 
417.4 

-185.6
256.6
417.4

-1 077.7 
1 538.6 
2 504.4 

(1) 

(2) 

Direct aids for the period 2014-2020 include an estimate of the wine transfers to SPS based on the decisions taken by the Member States for 2013. For Croatia, it was not possible to 
estimate as the wine national programme will not be implemented in 2013 and Croatia has not notified any transfer at this stage. 
The product of capping was estimated based on assumptions as concerns the implementation of direct payments by Member States and will therefore be revised once they have notified 
their decisions on the implementation. Moreover, for Croatia, it is not possible to estimate the product of capping at this stage due to unavailability of data. A first rough estimate, based 
on preliminary information, showed that the product of capping would be null for Croatia. It will be revised once data are available. 

- 29 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Table 7: Calculation of the financial impact of the CAP reform proposals as regards transitional measures for granting direct aids in 2014 

In million EUR (current prices) 

BUDGET YEAR 

Legal base 

Estimated needs 

Changes to 
2013 

2013  
(1) 

2013 
adjusted 

2014  
(2) 

Annex IV to Council Regulation (EC) No 73/2009 

40 165.0 

40 530.5 

541.9
616.1

-64.3

-9.9

Phasing-in EU 10 

Health Check  

Previous reforms  

TOTAL 05 03 
TOTAL EXPENDITURE 

40 165.0 

40 530.5 

41 072.4

Notes: 
(1) 
(2) 

The 2013 amount includes an estimate of wine grubbing-up 2012. 
The extended net ceilings include an estimate of the wine transfers to SPS based on the decisions taken by the Member States for 2013. 

- 30 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Table 8: Calculation of the financial impact of the CAP reform proposals as regards rural development 

BUDGET YEAR 

Legal base 

(2) 
(3) 

(4) 

(4) 
(5) 

Rural development programmes 

Aid for cotton - Restructuring 
Product of capping of direct 
aids 
RD envelope excluding 
technical assistance 

Technical assistance 
Prize for local innovative co-operation 
projects 
Additional RD amount (in line with 
COM(2012)388) 

TOTAL 05 04 
Net effect of reform proposals 
TOTAL EXPENDITURE (before 
capping) 
TOTAL EXPENDITURE (after 
capping) 

Rural development 
allocation 

2013 

14 788.9 

2013 
adjusted 
(1) 
14 423.4 

In million EUR (current prices) 

Changes to 2013 

2014 

2015 

2016 

2017 

2018 

2019 

2020 

TOTAL 
2014-2020 

4.0 

4.0 
164.1 

4.0 
172.1 

4.0 
184.7 

4.0 
185.6 

4.0 
185.6 

4.0 
185.6 

28.0 
1 077.7 

-9.3 

-9.3 

-9.3 

-9.3 

-9.3 

-9.3 

-9.3 

-65.2 

27.6 
N.A. 

N.A. 

27.6 
N.A. 

9.3 
0.0 

4.3 
5.0 

4.3 
5.0 

4.3 
5.0 

4.3 
5.0 

4.3 
5.0 

4.3 
5.0 

35.2 
30.0 

N.A. 

333.0 

333.0 

333.0 

333.0 

333.0 

333.0 

333.0 

2 331.0 

14 816.6 

14 451.1 

4.0 
14 788.1 

168.1 
14 788.1 

176.1 
14 788.1 

188.7 
14 788.1 

189.6 
14 788.1 

189.6 
14 788.1 

189.6 
14 788.1 

1 105.7 
103 516.5 

14 816.6 

14 451.1 

14 788.1 

14 952.2 

14 960.2 

14 972.8 

14 973.7 

14 973.7 

14 973.7 

104 594.2 

Notes: 
(1) 
(2) 

(3) 

(4) 

(5) 

Adjustments in line with the existing legislation only applicable until the end of financial year 2013. 
The amounts in table 1 (section 3.1) are in line with those in the Commission communication "A Budget for Europe 2020" (COM(2011)500 final) and the Commission's 
amended proposal for the MFF 2014-2020 (COM(2012)388 of 6 July 2012). However, it remains to be decided if the MFF will reflect the transfer that is proposed for the 
envelope of one Member State of the cotton national restructuring programme to rural development as from 2014, implying an adjustment (4 million EUR per year) of the 
amounts for respectively the EAGF sub-ceiling and for pillar 2. In table 8 above, the amounts have been transferred, irrespective of them being reflected in the MFF. 
The product of capping was estimated based on assumptions as concerns the implementation of direct payments by Member States and will therefore be revised once they 
have notified their decisions on the implementation. Moreover, for Croatia, it is not possible to estimate the product of capping at this stage due to unavailability of data. A 
first rough estimate, based on preliminary information, showed that the product of capping would be null for Croatia. It will be revised once data are available. 
The 2013 amount for technical assistance was fixed based on the initial rural development envelope (transfers from pillar 1 not included).  
Technical assistance for 2014-2020 is fixed at 0.25% of the total rural development envelope. 
Covered by the amount available for technical assistance. 

- 31 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Heading of multiannual financial 
framework:  

5 

" Administrative expenditure " 

Note: 

It is estimated that the legislative proposals will have no impact on appropriations of an administrative nature, i.e. it is the intention 
that the legislative framework can be implemented with the present level of human resources and administrative expenditure. The 
impact of Croatia's accession has not yet been taken into account in the figures indicated below. 

EUR million (to 3 decimal places) 

DG: AGRI 

(cid:121) Human resources  
(cid:121) Other administrative expenditure  

Year 
2014 

Year 
2015 

Year 
2016 

Year 
2017 

Year 
2018 

Year 
2019 

Year 
2020 

TOTAL 

136.998  136.998  136.998  136.998  136.998  136.998  136.998 

9.704 

9.704 

9.704 

9.704 

9.704 

9.704 

9.704 

958.986 

67.928 

TOTAL DG AGRI 

Appropriations  

146.702  146.702  146.702  146.702  146.702  146.702  146.702 

1 026.914 

TOTAL appropriations 
under HEADING 5 
of the multiannual financial framework  

(Total commitments  
= Total payments) 

TOTAL appropriations  
under HEADINGS 1 to 5 
of the multiannual financial framework  

Commitments 

Payments 

146.702  146.702  146.702  146.702  146.702  146.702  146.702 

1 026.914 

Year 
N9 

Year 
N+1 

Year 
N+2 

Year 
N+3 

… enter as many years as 
necessary to show the duration 
of the impact (see point 1.6) 

TOTAL 

EUR million (to 3 decimal places) 

9 

Year N is the year in which implementation of the proposal/initiative starts. 

- 32 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
3.2.2.  Estimated impact on operational appropriations  

–  (cid:133)  The proposal/initiative does not require the use of operational appropriations  

–  x  The proposal/initiative requires the use of operational appropriations, as explained below: 

Indicate 
objectives and 
outputs  

(cid:216) 

Type 
of 
output 

Year 
2014 

Year 
2015 

Year 
2016 

Year 
2017 

OUTPUTS 

Commitment appropriations in EUR million (to 3 decimal places) 

Year 
2018 

Year 
2019 

Year 
2020 

TOTAL 

Average 
r
e
cost  
b
m
of the 
u
output  N

s
t
u
p
t
u
o

f
o

Cost 

r
e
b
m
u
N

s
t
u
p
t
u
o

f
o

Cost 

r
e
b
m
u
N

s
t
u
p
t
u
o

f
o

Cost 

r
e
b
m
u
N

s
t
u
p
t
u
o

f
o

Cost 

r
e
b
m
u
N

s
t
u
p
t
u
o

f
o

Cost 

r
e
b
m
u
N

s
t
u
p
t
u
o

f
o

Cost 

r
e
b
m
u
N

s
t
u
p
t
u
o

f
o

Cost 

Total 
number 
of 
outputs 

Total  
cost 

TOTAL COST 

Note: For the specific objectives, the outputs are still to be determined (see section 1.4.2 above). 

- 33 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3.2.3.  Estimated impact on appropriations of an administrative nature 

3.2.3.1.  Summary  

–  (cid:133)  The  proposal/initiative  does  not 

require 

the  use  of  administrative 

appropriations  

–  x  The  proposal/initiative  requires  the  use  of  administrative  appropriations,  as 

explained below:  

Year 
2014 

Year 
2015 

Year 
2016 

Year 
2017 

Year 
2018 

Year 
2019 

Year 
2020 

TOTAL 

EUR million (to 3 decimal places) 

HEADING 5 
of the multiannual 
financial framework 

Human resources 10 

136.998 

136.998 

136.998 

136.998 

136.998 

136.998 

136.998 

958.986 

9.704 

9.704 

9.704 

9.704 

9.704 

9.704 

9.704 

67.928 

Other administrative 
expenditure  

Subtotal HEADING 5 
of the multiannual 
financial framework  

Outside HEADING 5 
of the multiannual 
financial framework  

Human resources  

Other expenditure  
of an administrative 
nature 

Subtotal  
outside HEADING 5 
of the multiannual 
financial framework  

TOTAL 

146.702 

146.702 

146.702 

146.702 

146.702 

146.702 

146.702 

1 026.914

10 

Based on an average cost of 127 000 EUR for establishment plan post of officials and temporary agents. 

- 34 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
3.2.3.2.   Estimated requirements of human resources  

–  (cid:133)  The proposal/initiative does not require the use of human resources  

–  x  The  proposal/initiative  requires  the  use  of  human  resources,  as  explained 

below: 

Note:  It  is  estimated  that  the  legislative  proposals  will  have  no  impact  on 
appropriations of an administrative nature, i.e. it is the intention that the 
legislative framework can be implemented with the present level of human 
resources and administrative expenditure. The figures for the period 2014-
2020 are based on the situation for 2011. The impact of Croatia's accession 
has not yet been taken into account in the figures indicated below. 

Estimate to be expressed in full amounts (or at most to one decimal place) 

Year 
2014 

Year 
2015 

Year 
2016 

Year 
2017 

Year 
2018 

Year 
2019 

Year 
2020 

(cid:121) Establishment plan posts (officials and temporary agents) 

XX 01 01 01 (Headquarters and 
Commission’s Representation 
Offices) 

1 034 

1 034 

1 034 

1 034 

1 034 

1 034 

1 034 

XX 01 01 02 (Delegations) 

3 

3 

3 

3 

3 

3 

3 

XX 01 05 01 (Indirect research) 

10 01 05 01 (Direct research) 

(cid:121) External personnel (in Full Time Equivalent unit: FTE)11 

78 

78 

78 

78 

78 

78 

78 

XX 01 02 01 (CA, INT, SNE from 
the "global envelope") 

XX 01 02 02 (CA, INT, JED, LA 
and SNE in the delegations) 

XX 01 04 
yy  

- at 
Headquar
ters 

- in 
delegation
s  

XX 01 05 02 (CA, INT, SNE - 
Indirect research) 

10 01 05 02 (CA, INT, SNE - Direct 
research) 

Other budget lines (specify) 

TOTAL12 

1 115 

1 115 

1 115 

1 115 

1 115 

1 115 

1 115 

11 

12 

CA= Contract Agent; INT= agency staff ("Intérimaire"); JED= "Jeune Expert en Délégation" (Young 
Experts in Delegations); LA= Local Agent; SNE= Seconded National Expert;  
This does not include the sub-ceiling on budget line 05.010404. 

- 35 - 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
XX is the policy area or budget title concerned. 

The human resources required will be met by staff from the DG who are already assigned to 
management of the action and/or have been redeployed within the DG, together if necessary 
with any additional allocation which may be granted to the managing DG under the annual 
allocation procedure and in the light of budgetary constraints. 

Description of tasks to be carried out: 

Officials and temporary agents 
External personnel 

- 36 - 

 
 
 
 
 
3.2.4.  Compatibility with the current multiannual financial framework  

–  x  Proposal/initiative  is  compatible  with  the  PROPOSALS  FOR  THE  2014-

2020 multiannual financial framework. 

–  (cid:133)  Proposal/initiative  will  entail  reprogramming  of  the  relevant  heading  in  the 

multiannual financial framework. 

–  (cid:133)  Proposal/initiative requires application of the flexibility instrument or revision 

of the multiannual financial framework. 

3.2.5.  Third-party contributions  

–  The proposal/initiative does not provide for co-financing by third parties  

–  X  The  proposal  regarding  rural  development  (EAFRD)  provides  for  the  co-

financing estimated below: 

Specify the co-financing 
body  

TOTAL appropriations 
cofinanced 13 

Appropriations in EUR million (to 3 decimal places) 

Year 
2014 

MS 

Year 
2015 

MS 

Year 
2016 

MS 

Year 
2017 

MS 

Year 
2018 

MS 

Year 
2019 

MS 

Year 
2020 

MS 

Total 

MS 

To be 
determin
ed 

To be 
determin
ed 

To be 
determin
ed 

To be 
determin
ed 

To be 
determin
ed 

To be 
determin
ed 

To be 
determin
ed 

To be 
determined 

3.3. 

Estimated impact on revenue  

–  x  Proposal/initiative has no financial impact on revenue. 

–  (cid:133)  Proposal/initiative has the following financial impact: 

– 

– 

x  on own resources  

x  on miscellaneous revenue  

Budget revenue line: 

Appropriations 
available for the 
ongoing budget 
year 

EUR million (to 3 decimal places) 

Impact of the proposal/initiative14 

Year 
N 

Year 
N+1 

Year 
N+2 

Year 
N+3 

… insert as many columns as necessary 
in order to reflect the duration of the 
impact (see point 1.6) 

For miscellaneous assigned revenue, specify the budget expenditure line(s) affected. 
See tables 2 and 3 in section 3.2.1.  

13 
14 

This will be set out in the rural development programmes to be submitted by the Member States. 
As regards traditional own resources (customs duties, sugar levies), the amounts indicated must be net 
amounts, i.e. gross amounts after deduction of 25% for collection costs. 

- 37 -