Special Report No 26 // 2016#Making cross-compliance more effective and achieving simplification remains challenging #(pursuant to Article 287(4), second subparagraph, TFEU)
Date: 2016-09-07
Institutions: European Court of Auditors
Subjects: EAFRD, EAGF, EU environmental policy, agricultural holding, aid to agriculture, common agricultural policy, environmental protection, sanction (EU), sustainable agriculture, terms for aid

EN 

2016 

NO 26

Special Report  Making cross‑compliance 

more effective and 
achieving simplification 
remains challenging

EUROPEAN
COURT
OF AUDITORS

 
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Luxembourg: Publications Office of the European Union, 2016

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EN 

2016 

NO 26

Special Report

Making cross‑compliance 
more effective and 
achieving simplification 
remains challenging

(pursuant to Article 287(4), second subparagraph, TFEU)

Audit team

02

The ECA’s special reports set out the results of its performance and compliance audits of specific budgetary areas or 
management topics. The ECA selects and designs these audit tasks to be of maximum impact by considering the risks 
to performance or compliance, the level of income or spending involved, forthcoming developments and political 
and public interest.

This performance audit was produced by Audit Chamber I — headed by ECA Member Phil Wynn Owen — which 
specialises in the sustainable use of natural resources. The audit was led by the Reporting Member Nikolaos Milionis, 
supported by Ioulia Papatheodorou, Head of private office, Kristian Sniter, Attaché of private office; Robert Markus, 
Principal Manager; Daniela Jinaru, Head of Task; Felipe Andrés Miguélez, Marius Cerchez and Michael Spang, Auditors.

From left to right: K. Sniter, I. Papatheodorou, N. Milionis, R. Markus, D. Jinaru.

Contents

03

Paragraph

Glossary

I-IX 

Executive summary

1-10 

Introduction

11-17 

Audit scope and approach

18-71  Observations

18-36 

22-27 

28-33 

34-36 

The information available did not allow the Commission to assess adequately the effectiveness of 
cross‑compliance

The performance indicators used by the Commission gave a partial view of the effectiveness of 
cross‑compliance

The Commission’s assessment of the effectiveness of cross‑compliance did not take into account the level of 
non‑compliance by farmers

The Commission did not analyse the reasons for cross‑compliance infringements and the means of 
addressing them

37-71 

The cross‑compliance management and control system can be further simplified

41-47 

The control procedures remained complex

48-52 

The Small Farmers Scheme reduced the administrative burden, but this could affect the achievement of 
cross‑compliance objectives in some Member States

53-58 

Greening introduced an additional layer of checks for mandatory environmentally friendly practices

59-64 

The specific costs associated with the implementation of cross‑compliance are not sufficiently quantified

65-71 

The basis for the calculation of cross‑compliance penalties for farmers across the EU is not sufficiently 
harmonised

 
Contents 

04

72-79 

Conclusions and recommendations

Annex I  — 

 The scope of cross‑compliance rules, as per Annex II of Regulation (EU) 
No 1306/2013 of the European Parliament and of the Council

Annex II  —  Main changes in the scope of cross‑compliance rules for the CAP 2014‑2020

Annex III  —  Stakeholders expressed a need for further simplification

Annex IV  —  Case studies included in the survey sent to Paying Agencies

Reply of the Commission

 
 
 
 
 
Glossary

05

CAP: Common Agricultural Policy

Conformity audit: On‑the‑spot inspections carried out by DG AGRI auditors that allow the Commission to verify 
whether Member States have made correct use of the funds placed at their disposal by the EAGF and EAFRD and 
in particular whether they have well‑functioning management and control systems ensuring that payments to 
beneficiaries are regular.

Control points: detailed aspects resulting from the implementation of cross‑compliance rules which are included in 
the checklists for the on the spot and administrative controls carried out or requested to other control bodies by the 
responsible managing authority in charge with cross‑compliance in each Member State (i.e. Paying Agencies).

Cross‑compliance rules: the rules on cross‑compliance consist of the statutory management requirements (SMR) 
under Union law and the standards for good agricultural and environmental condition of land (GAEC) established 
at national level, as listed in Annex II of Regulation (EU) No 1306/2013, relating to environment, climate change, and 
good agricultural condition of land; public, animal and plant health; and animal welfare. Throughout this report the 
terms ‘cross‑compliance rules’ and ‘cross‑compliance obligations’ are interchangeable.

DG AGRI: European Commission’s Directorate General for Agriculture and Rural Development, responsible for the 
implementation of agriculture and rural development policy.

DG ENV: European Commission’s Directorate‑General for Environment, responsible for the sectoral legislation on 
environment.

DG SANTE: European Commission’s Directorate‑General for Health and Food Safety, responsible for the sectoral 
legislation on public health, plant health, animal health and animal welfare.

EAFRD: European Agricultural Fund for Rural Development

EAGF: European Agricultural Guarantee Fund

Farm Advisory Body: Public or private body entrusted by a Member State with the operation of a system for 
advising farmers on land management and farm management.

Financial year: the agricultural financial year covers expenditure paid and revenue received and entered in the 
accounts of the Funds’ budget by the Paying Agencies in respect of financial year ‘N’ beginning on 16 October 
of year ‘N‑1’ and ending on 15 October of year ‘N’ (Article 39 of Regulation (EU) No 1306/2013 of the European 
Parliament and of the Council).

GAEC: Standards of good agricultural and environmental condition of land aiming to contribute to preventing 
soil erosion, maintaining soil organic matter and structure, ensuring a minimum level of maintenance, avoiding 
the deterioration of habitats and protecting and managing water. These standards were introduced by the CAP 
legislation and are applicable only to CAP beneficiaries. They have to be defined by Member States taking account 
of local conditions.

Glossary 

06

Paying Agency: The body responsible within a Member State for the proper assessment, calculation, inspection 
and payment of CAP subsidies. 

SMR: Statutory management requirements are a selected number of obligations incorporated in the scope of 
cross‑compliance rules from existing EU directives and regulations concerning environment, public health, plant 
health, animal health and animal welfare (the sectoral legislation). These requirements are already applicable 
outside the CAP framework.

Executive summary

07

I
Cross‑compliance links most CAP payments to farmers’ compliance with basic rules for the environment, food 
safety, animal health and welfare, and good agricultural and environmental conditions. It currently applies to 
7.5 million farmers who in 2015 received approximately 47 billion euro in aid1. Expectations of society are high that 
farmers receiving EU subsidies comply with cross‑compliance.

II
The legislator established an EU framework regarding cross‑compliance. The Commission is responsible for 
monitoring its implementation. Member States translated the EU rules into obligations at farmer level and verified 
whether these obligations were respected. We examined whether the cross‑compliance management and control 
system was effective and whether it can be further simplified.

III
We concluded that the information available did not allow the Commission to assess adequately the effectiveness 
of cross‑compliance. Despite the changes introduced for the CAP for the period 2014–2020, the cross‑compliance 
management and control system can still be simplified.

IV
The performance indicators used by the Commission gave a partial view of the effectiveness of cross‑compliance. 
The indicators did not take into account the level of non‑compliance by farmers. Furthermore, the Commission did 
not analyse the reasons for the infringements and the means of addressing them.

V
The changes in the CAP for the period 2014–2020 somewhat reduced the number of cross‑compliance rules, by 
removing requirements which were not sufficiently relevant to the farming activity. However, control procedures 
remain complex. Simplification measures, such as the small farmers’ scheme, relieving administrations and farmers 
of additional burdens need to be balanced against the necessity to achieve the objectives of cross compliance.

VI
The farming practices under the new greening payment have similarities with previous GAEC standards. 
Consequently, there are currently two sets of complementary agricultural practices which target the same 
objectives: the maintenance of land and the protection of bio‑diversity. Despite their similarities, the compulsory 
GAEC and greening rules are checked under two control systems. This may lead to inefficiencies in the control 
systems and an additional administrative burden.

1 

These 7.5 million farmers represent 68 % of all farmers supported by CAP and receive 83 % of all payments. Small farmers are not included in these 
figures as they are not subject to administrative penalties if they do not comply with cross‑compliance obligations (see paragraph 48).

Executive summary 

08

VII

The costs of implementing cross‑compliance are not sufficiently quantified. As long as the Commission does not 
have a reliable estimate of the overall cost at cross‑compliance level, aggregating the figures for the stakeholders 
involved (EU institutions, Member State management and control authorities, and farmers) it cannot ensure that the 
cross‑compliance system is cost‑effective.

VIII
The sanction system did not ensure a sufficiently harmonised basis for calculating administrative penalties for 
farmers across the EU who did not comply with the rules. The application of the severity, extent, permanence and 
intentionality factors when calculating penalties for similar cases, varied significantly between Member States.

IX
We make the following recommendations:

‑ 

‑ 

‑ 

‑ 

The Commission should examine as part of the impact assessment for the CAP post‑2020 how to further develop 
its set of indicators to assess the performance of cross‑compliance and how to take into account farmers’ levels 
of compliance with the cross‑compliance rules in its indicators.

The Commission should from now on improve the sharing of the information on cross‑compliance related 
infringements between concerned services in order to help them to identify the reasons for breaches and to 
take appropriate measures to address them.

For the CAP post‑2020, the Commission should propose adapting the rules regarding cross‑compliance 
on‑the‑spot checks. This would allow a more effective targeting of key control points.

The Commission should analyse as part of the impact assessment for the CAP post‑2020 the experience of 
having two systems operating with similar environmental objectives (GAEC standards and greening) with a view 
to promoting further synergy between them. This analysis should take into consideration criteria such as the 
environmental impact of the standards and the historical level of compliance by farmers.

‑  After the report on the performance of the CAP due by the end of 2018, the Commission should develop 

a methodology to measure the costs of cross‑compliance.

‑ 

For the CAP post‑2020, the Commission should encourage a more harmonised application of penalties at EU 
level by further clarifying the concepts of severity, extent, permanence, reoccurrence and intentionality.

Introduction

09

01 
Cross‑compliance links most Common Agricultural Policy (CAP) payments to 
farmers’ compliance with rules for protecting the environment, food safety, 
animal health and welfare, and for maintaining land in good agricultural and 
environmental conditions. It currently applies to 7.5 million farmers across the 
EU, who during the financial year 2015 received approximately 47 billion euro in 
aid subject to cross‑compliance rules (see Glossary)2. If a farmer does not comply 
with these rules, an administrative penalty may be imposed.

02 
Cross‑compliance is based on two main sets of rules (see Annex I for the 
current list of these rules). The statutory management requirements (SMRs) are 
requirements selected from existing directives and regulations on environment, 
food safety, plant health, animal health and welfare. The standards for good 
agricultural and environmental conditions (GAECs) are additional rules applicable 
only to beneficiaries of CAP payments. They impose sustainable practices related 
to agricultural land and deal with the protection of water, of the soil and carbon 
stock, and the maintenance of land and landscape features.

03 
Cross‑compliance aims to contribute to the following two objectives:

2 

2015 DG AGRI annual activity 
report.

3  Regulation (EU) No 1306/2013 
of the European Parliament 
and of the Council of 
17 December 2013 on the 
financing, management and 
monitoring of the common 
agricultural policy and 
repealing Council Regulations 
(EEC) No 352/78,  
(EC) No 165/94,  
(EC) No 2799/98,  
(EC) No 814/2000,  
(EC) No 1290/2005 and  
(EC) No 485/2008 (OJ L 347, 
20.12.2013, p. 549).

1 The objectives of cross‑compliance
e
r
u
g
i
F

To contribute to the development
of sustainable agriculture

To contribute to making the
CAP more compatible with the
expectations of society

through

through

better awareness on the part of
the beneficiaries of the need to
respect certain basic standards 

improving the consistency of the CAP
policy with the environment, public
health, animal health, plant health
and animal welfare policies

Source: Recital 54 of Regulation (EU) No 1306/20133.

 
10

4 

‘Special Eurobarometer 440 
Europeans, Agriculture and 
the CAP’ released on 
21 January 2016, reflecting the 
views taken between 17 and 
26 October 2015 by TNS 
opinion & social, at the request 
of the European Commission. 
All interviews were conducted 
face‑to‑face in the homes of 
randomly selected EU citizens.

5 

See, for example, the 2014 DG 
AGRI annual activity report, 
Annex 10, part 6 Cross 
compliance.

6  As a general rule, on‑the‑spot 
checks must be performed on 
a sample of minimum 1 % of 
CAP beneficiaries. For certain 
requirements however, such 
as the identification and 
registration of animals, the 
minimum control rate is 3 % of 
farmers, as foreseen in the 
sectoral legislation. As a result, 
the total number of farmers 
checked for cross‑compliance 
exceeds in practice the 1 % 
sample. For example, during 
the 2015 financial year the 
percentage of farmers 
checked was 2.31 %. For SMRs, 
Member States may decide to 
combine these checks with 
those done under the sectoral 
legislation in order to reach 
the 1 % control rate of 
cross‑compliance.

Introduction 

04 
Expectations of society are high that farmers receiving EU subsidies comply with 
the cross‑compliance obligations. According to the latest Eurobarometer4 survey 
published in January 2016, more than four out of five EU respondents considered 
it is ‘justified’ to reduce farmers’ subsidy payments if they do not respect the 
rules.

05 
As one of the instruments of the CAP, cross‑compliance is implemented through 
shared management, where tasks are shared between the Commission and 
Member States. In this context, the Commission’s responsibilities are:

‑ 

‑ 

‑ 

‑ 

to follow the general EU framework established in the regulations issued 
by the European Parliament and Council, as well as the recommendations 
received from the European Parliament during the discharge of the annual 
accounts related to the implementation of the EU budget;

to set‑up the detailed EU framework, through implementing and delegated 
regulations, as well as implementing guidelines for the Member States;

to verify that the Member States carry out their responsibilities in accordance 
with the legal provisions, and to apply financial corrections when it is found 
that their systems are deficient;

to check that the objectives of cross‑compliance are met and to report the 
results5.

06 
DG ENV and DG SANTE are responsible for monitoring the implementation and 
the achievement of the objectives of the sectoral legislation from which SMRs 
are drawn, whereas DG AGRI is responsible for GAECs. DG AGRI performs audits 
to verify that Member States have adequate management of and control systems 
for cross‑compliance.

07 
Member States are responsible for adopting all the legislative, regulatory and 
administrative provisions to set‑up a national framework compliant with the EU 
general and detailed framework for cross‑compliance, and in particular for:

‑ 

putting in place systems which prevent, detect and correct instances of 
non‑compliance;

‑ 

carrying out on‑the‑spot checks of a sample of at least 1 % of farmers6;

11

7 

Special report No 8/2008 ‘Is 
cross‑compliance an effective 
policy?’ (http://eca.europa.eu).

8  Council Regulation (EC) 

No 73/2009 of 19 January 2009 
establishing common rules for 
direct support schemes for 
farmers under the common 
agricultural policy and 
establishing certain support 
schemes for farmers, 
amending Regulations (EC) 
No 1290/2005, (EC) 
No 247/2006, (EC) No 378/2007 
and repealing Regulation (EC) 
No 1782/2003 (OJ L 30, 
31.1.2009, p. 16) actually added 
two compulsory GAEC in the 
newly created area of 
protection and management 
of water and three new 
optional GAEC in the area of 
minimum level of 
maintenance of land; at the 
same time, four out of the 
existing GAEC as per 
Regulation (EC) No 1782/2003 
were made optional. Minor 
changes have been noted also 
for SMR, whereby the 
requirement from Regulation 
(EC) No 2629/97 as regards 
eartags, holding registers and 
passports was removed.

9 

See Annex II for the detailed 
presentation of the changes 
introduced for the period 
2014–2020.

Introduction 

‑ 

‑ 

applying penalties and recovering unduly paid amounts from farmers who 
have breached the rules;

reporting to the Commission (audited annual accounts, financial reports, and 
control statistics).

08 
CAP beneficiaries must respect all the cross‑compliance rules as defined by the 
national legislation. They risk having their annual EU payment reduced if they 
are found to be in breach of any of these rules, as a result of an act or omission 
directly attributable to them.

09 
In 2008 we published a special report on the effectiveness of cross‑compliance7. 
The report concluded that cross‑compliance had not been an effective policy, 
emphasising that the framework of cross‑compliance posed considerable 
difficulties, notably because of its complexity.

10 
The simplification of the scope and rules related to the cross‑compliance system 
has been a constant subject of discussion between the Commission, the Council 
and the Member States, because of the complexity of the framework and the 
need to ensure that the rules can be checked and are sufficiently relevant for 
farming activity. Between 2008–2013 following a ‘health check’ of the CAP, 
changes were made to the cross‑compliance system8. Additional changes made 
for the current period 2014–2020 aimed9:

‑ 

‑ 

to streamline the scope of the standards by organising them into a single 
list, grouped by areas and issues, to make the cross‑compliance system more 
consistent and more visible, and

to remove from their scope a number of the requirements which were not 
sufficiently relevant to the farming activity or the area of the holding, or 
concerned national authorities rather than beneficiaries.

Audit scope and approach

12

11 
Simplification is a process that aims at streamlining rules, checks and reducing 
compliance costs. Simplification measures, while relieving administrations and 
farmers of additional burdens, need to be balanced against the necessity to 
achieve the objectives of cross‑compliance.

12 
We examined the cross‑compliance management and control system put in place 
by the Commission and the Member States to assess whether cross‑compliance 
is effective and to which extent simplification has been achieved under the new 
legal framework.

13 
The overall audit question was:

‘Is the cross‑compliance management and control system effective and can it 
be further simplified?’

The present report is structured along the two main aspects of effectiveness and 
simplification.

14 
We analysed the following evidence regarding implementation of 
cross‑compliance to date:

‑ 

‑ 

‑ 

the control statistics sent by the Member States to the Commission for 
the financial years 2011–2014. These reports contained data related to 
the number of farmers checked for any given standard, the number of 
non‑compliances found, and the level and categories of penalties applied;

the Court’s audits of legality and regularity (Statement of Assurance audits ‑ 
SoA) carried out in the financial years 2011–2014;

conformity audits carried out by the Commission’s Directorate General 
for Agriculture and Rural Development (DG AGRI) in the financial years 
2011–2014.

Audit scope and approach 

13

15 
We analysed information related to the management and control system 
put in place at Commission level, obtained through interviews with DG AGRI 
representatives and through the review of various analyses, studies and reports 
prepared or commissioned by DG AGRI. We also assessed the potential effects 
of the changes introduced for the CAP period 2014‑2020, on the basis of the 
following documents: preparatory impact assessment, approved Regulations and 
Commission statements.

10  We surveyed 64 out of the 82 
existing Paying Agencies, as in 
some Member States not all 
Paying Agencies have 
responsibilities for 
cross‑compliance.

11  Croatia was not included in 
the scope of this audit 
because of lack of historical 
data, due to its accession to 
the EU on 1 July 2013.

16 
We carried out two surveys covering topics such as: awareness, compliance and 
simplification. The surveys were sent to Paying Agencies and Farm Advisory 
Bodies. We received replies from the 6410 Paying Agencies surveyed in 27 Member 
States11, while 72 out of the 186 Farm Advisory Bodies contacted replied to the 
second survey.

17 
We visited three regions in the Member States (Germany: Schleswig‑Holstein, 
Spain: Catalonia and United Kingdom: Northern Ireland), where we interviewed 
representatives of the Paying Agencies and farmers’ associations, to collect their 
views in relation to the impact of cross‑compliance at farm level.

Observations

14

The information available did not allow the 
Commission to assess adequately the effectiveness of 
cross‑compliance

18 
In the first part of the report, we examine whether the performance indicators 
used by the Commission gave a complete view of the effectiveness of 
cross‑compliance, whether they took into account the level of compliance of 
farmers and whether the Commission analysed the reasons for infringements 
and means to address them. The standards for our examinations are set out in 
paragraphs 19 to 21.

19 
In order to measure the achievement of the cross‑compliance objectives 
(see paragraph 2), the Commission should define appropriate performance 
indicators12. These should be in line with sound financial management principles 
(economy, efficiency and effectiveness)13. The Commission should analyse and 
act upon performance issues.

20 
Member States should also prevent, detect and deal effectively with any 
irregularities or non‑compliance with cross‑compliance obligations by farmers14 
and report back annually on the results of their checks to the Commission.

21 
The effectiveness of cross‑compliance should be assessed by taking into account 
the level of compliance by farmers with the cross‑compliance rules, as a key 
indicator of the policy’s contribution to protecting the environment, public 
health, animal health, plant health and animal welfare. In order to make the 
policy more effective, the design of the cross‑compliance framework should 
include measures to identify and address the reasons why farmers do not comply 
with the rules.

12  As per Recital 2 of Commission 
Implementing Regulation (EU) 
No 834/2014 of 22 July 2014 
laying down rules for the 
application of the common 
monitoring and evaluation 
framework of the common 
agricultural policy (OJ L 230, 
1.8.2014, p. 1).

13  Article 30 of Regulation (EU, 
Euratom) No 966/2012 of the 
European Parliament and of 
the Council of 25 October 2012 
on the financial rules 
applicable to the general 
budget of the Union and 
repealing Council Regulation 
(EC, Euratom) No 1605/2002 
(OJ L 298, 26.10.2012, p. 1) 
(Financial Regulation) provides 
the following definitions: 
The principle of economy 
requires that the resources 
used by the institution in the 
pursuit of its activities shall be 
made available in due time, in 
appropriate quantity and 
quality and at the best price. 
The principle of efficiency 
concerns the best relationship 
between resources employed 
and results achieved. 
The principle of effectiveness 
concerns the attainment of 
the specific objectives set and 
the achievement of the 
intended results.

14  As per Recital 39 of Regulation 

(EU) No 1306/2013.

Observations 

15

The performance indicators used by the Commission gave 
a partial view of the effectiveness of cross‑compliance

The situation for the period 2007‑2013

22 
For the first objective (to contribute to the development of sustainable 
agriculture through better awareness on the part of the beneficiaries of the need 
to respect the basic standards) the Commission used the indicator ‘Percentage 
of CAP payments covered by cross‑compliance’, which shows the proportion of 
CAP payments for which farmers have to comply with cross‑compliance rules. 
However, this indicator does not measure the farmers’ awareness of those rules 
or their level of compliance with them.

23 
To measure the second objective (to contribute to making the CAP more 
compatible with the expectations of society through improving the consistency 
of the CAP policy with the environment, public health, animal health, plant 
health and animal welfare policies), the indicator used was the ‘Opinion 
expressed by the public on cross‑compliance’, measured by the Commission in 
the Eurobarometer survey. The question and answer options in the survey are 
shown in Box 1.

1
x
o
B

Extract from the Eurobarometer survey

Question: ‘Under the rules of the Common Agricultural Policy (CAP), farmers’ payments are linked to the 
requirements to comply with rules for the environment, food safety and animal welfare (so called ’cross 
compliance’). To what extent do you think that it is justified or unjustified to reduce farmers’ subsidy 
payments to farmers who do not respect Food Safety Standards, Environmental Standards, Animal Welfare 
Standards?’

Proposed answers: ‘Totally justified; Somewhat justified; Somewhat unjustified; Totally unjustified; Don’t 
know’.

Outcome of the survey: More than four out of five EU respondents considered it is ‘justified’ to reduce farmers’ 
subsidy payments if they do not respect the rules (answering either ‘Totally justified’ or ‘Somewhat justified’). 
Public opinion since the previous survey taken in November 2007 remained stable.

Source: The Commission’s Eurobarometer survey.

 
Observations 

16

24 
This indicator does not provide any information about whether CAP consistency 
with the cross‑compliance rules has improved or not. It merely reflects 
a policy choice by those surveyed, without assessing the actual results of the 
implementation of cross‑compliance.

15  Under both the pre‑ and 

post‑2014 CAP, the minimum 
control rate for GAEC was set 
at 1 % of farmers.

16  Annex to the Commission 

Implementing Regulation (EU) 
No 834/2014.

25 
Two other result indicators: the control rate for GAEC15 and the ratio of permanent 
pasture are also reported by DG AGRI. The first indicator measures if Member 
States had complied with the minimum rate of controls. This is solely an 
indicator of compliance with the regulation, which, as such, does not measure 
the effectiveness of cross‑compliance. The second indicator, which measures 
the percentage of land occupied by permanent pastures within a Member State 
in relation to its total agricultural area, had two weaknesses; it only referred to 
one single aspect of cross‑compliance and it did not highlight the contribution 
of cross‑compliance specifically, i.e. permanent pastures may be maintained as 
a result of a series of factors, only one of which is cross‑compliance.

The situation for the period 2014–2020

26 
For the period 2014–2020, two indicators16 directly related to cross‑compliance 
were used: the number of hectares subject to cross‑compliance and the share 
of CAP payments subject to cross‑compliance. These are quantitative indicators 
which only measure the size of the populations to which they are addressed (i.e. 
agricultural land and CAP payments), not the effects of cross‑compliance.

27 
Other indicators covering areas influenced by cross‑compliance rules were 
defined at the overall level of the CAP, such as farmland bird index, water quality, 
soil organic matter in arable land, soil erosion by water. However, the specific 
impact of cross‑compliance alone on these overall indicators was unknown. 
Furthermore, other aspects targeted by cross‑compliance, such as food safety, 
animal identification and registration or animal welfare, are not addressed by any 
impact indicators.

Observations 

The Commission’s assessment of the effectiveness of 
cross‑compliance did not take into account the level of 
non‑compliance by farmers

28 
The Commission also collects data on the extent to which farmers meet their 
cross‑compliance obligations, by means of the control statistics sent by Member 
States. However, this information is not used as a performance indicator and 
monitored against pre‑defined targets.

29 
The results of the Court’s audits17 of legality and regularity over the past 4 years 
(see Table 1) and the statistics reported by Member State control authorities for 
farmers checked on‑the‑spot (see Table 2) showed high levels of infringement of 
cross‑compliance standards.

17

17  As regards cross‑compliance, 
we focused our testing on 
selected GAEC obligations 
(avoiding the encroachment 
of unwanted vegetation, 
retention of terraces, 
maintenance of olive groves 
and respect of minimum 
livestock stocking rates or 
mowing obligations) and 
selected SMR (requirements 
for the SMR regarding the 
Nitrates Directive and the SMR 
concerning the identification 
and registration of animals) for 
which evidence could be 
obtained and a conclusion 
reached at the time of the 
audit visits. During 
2011 and 2012 the scope of 
testing for EAFRD was larger 
than for EAGF, because it 
included all the GAEC and the 
SMR related to animal welfare. 
Moreover, for EAGF the SMR 
related to the identification 
and registration of animals 
were not tested in 
2011 and 2012.

1
e
l
b
a
T

2
e
l
b
a
T

Our results regarding the testing of cross‑compliance on random samples of farmers

Fund

Data

EAGF

EAFRD

Number of payments subject to 
cross‑compliance
Number of cases in which 
infringements were found
Infringements (%)
Number of payments subject to 
cross‑compliance
Number of cases in which 
infringements were found
Infringements (%)

Source: European Court of Auditors.

2011

155

22

14 %

73

26

36 %

Financial Year

2012

146

24

16 %

75

25

33 %

2013 

164

44

25 %

61

24

39 %

2014

170

46

27 %

64

17

27 %

Cross‑compliance infringements reported by Member States based on checks 
performed on a mix of random and risk‑based samples of farmers

Frequency of infringements (%)

2011

21 %

2012

20 %

Source: Member States’ cross‑compliance statistics.

Financial Year

2013 

20 %

2014

25 %

2015

29 %

 
 
Observations 

18

30 
Farmers have become more aware over the past 5 years of their obligations to 
respect the cross‑compliance rules, as indicated by approximately 90 % of the 
Paying Agencies and Farm Advisory Bodies which we surveyed. However, the 
non‑compliance rates remain high and, both the Member State checks and our 
own audits show a rising trend.

18  Expressed as the proportion of 

farmers where infringements 
were found versus the total 
number of farmers controlled.

31 
From 2011 to 2013 the total number of infringements identified by the Member 
State control authorities remained relatively constant at almost 60 000 cases/year 
at EU level, while in 2014 the figure increased by almost 20 % to approximately 
70 000 cases of non‑compliance (mainly due to an increase in infringements 
of the SMRs relating to the Nitrates Directive and to the identification and 
registration of pigs and bovines). As shown in Figure 2, five main areas accounted 
for almost 90 % of the total number of infringements and also showed the 
highest frequency of non‑compliance18. These five areas cover a total of 10 SMRs 
and four GAECs.

2
e
r
u
g
i
F

Areas where cross‑compliance rules are most often breached

Other; 14 %

Avoiding the encroachment
of unwanted vegetation; 5 %

Protection against soil erosion; 8 %

Food and feed safety; 8 %

Use of fertilisers and plant
protection products; 15 %

Source: European Court of Auditors.

Keeping animals; 50 %

32 
For the two biggest areas, Figure 3 shows where the frequency of infringement 
at the level of individual standards / requirements exceeded 5 % in the financial 
year 2014:

 
Observations 

19

3 Frequency of infringements for the two biggest areas of non‑compliances
e
r
u
g
i
F

Keeping animals

30 %

Use of fertilizers and plant
protection products

25 %

20 %

15 %

10 %

5 %

0 %

SMR on the 
identification and 
registration of 
bovines

SMR on the 
identification and 
registration of 
ovines and caprines

Source: European Court of Auditors.

GAEC standard 
related to stocking 
rates

SMR on the 
identification and 
registration of pigs

SMR on the animal 
welfare of pigs

SMR stemming 
from the Nitrates 
Directive

SMR on the use of 
plant protection 
products

33 
Our analysis also shows that several standards presented infringement rates of 
less than 1 %, such as: the SMR on the conservation of wild birds and natural 
habitats, the GAEC standards on soil organic matter, the maintenance of soil 
structure and the retention of landscape features.

The Commission did not analyse the reasons for 
cross‑compliance infringements and the means of addressing 
them

34 
DG AGRI analyses the information in the control statistics at the level of each 
reporting entity individually (province / region / central government) in order 
to ensure that they comply with EU requirements, such as, for example, meeting 
the minimum 1 % control rate set in the regulation. It also carries out conformity 
audits to ensure that the management and control systems put in place by 
Member States comply with the applicable EU rules. The purpose of such audits 
is to protect the funds out of which CAP payments were made, by checking if 
Member States’ reductions of payments to farmers are properly applied. The 
Commission applies net financial corrections to Member States with deficient 
systems.

 
Observations 

20

35 
DG AGRI does not analyse the figures on cross‑compliance breaches at EU level, 
nor does it perform audits in order to identify the standards which are most often 
breached, the potential causes for infringements and the possible solutions for 
remedying the situation. The other Commission Directorates General responsible 
for the policies underlying the SMRs do not perform such analyses either. For 
example, the Directorate‑General for Environment (DG ENV), which is responsible 
for policies such as that of the Nitrates Directive, stated that their departments 
did not receive the statistics on the checks carried out by Member States and, 
therefore, DG ENV could not, and did not, take any follow‑up measures in 
this regard. Thus, the Commission only checks the financial aspects, without 
analysing the impact of cross‑compliance on the underlying policy goals for the 
environment, food safety and animal health and welfare.

19  Evaluations at the level of 

farmers have so far only 
provided information 
regarding elements of cost of 
cross‑compliance, as shown in 
paragraph 61.

20  Penalties reached a total of 
67.5 million euro in the 2014 
claim year as indicated in DG 
AGRI’s annual activity report.

36 
Until July 2016, the Commission had not carried out evaluations with regard to 
the reasons why rules might have been breached or the means of preventing 
such situations in the future19. Such evaluations might also reveal useful 
information about the need to simplify the cross‑compliance system further. 
Possible reasons for not complying with cross‑compliance requirements 
might be either due to a lack of understanding of the sometimes complex 
rules (see Annex III) or to a lack of incentive, as cost of compliance might be 
disproportionate in relation to the low minimum control rate of 1 % and the level 
of penalties applied20.

The cross‑compliance management and control system 
can be further simplified

37 
In the second part of the report, we examine whether the rules and control 
procedures for cross‑compliance had been simplified, whether the small 
farmers scheme achieved a balanced reduction in the administrative burden, 
whether there were risks that greening and cross‑compliance might not be well 
coordinated, whether the costs of implementation were measured and whether 
penalties were being implemented in a consistent way across the EU. The 
standards for our examinations are set out in paragraphs 38 to 40.

38 
In special report No 8/2008 we concluded that the cross‑compliance framework 
posed considerable difficulties, notably because of its complexity. We 
recommended that the Commission simplify the framework, in particular by 
prioritising the requirements and standards, and organising them around the 
principal elements of farming activity.

Observations 

21

39 
The costs of implementing cross‑compliance should be proportionate to the 
benefits expected from farmers’ compliance with the applicable rules21. When 
presenting revised or new spending proposals, the Commission should estimate 
the costs and benefits of control systems22 in relation to the objectives to be 
achieved.

40 
The Commission should also contribute to promoting a simple and harmonised 
system of penalties across the EU to ensure equal and proportionate treatment 
of farmers. The Commission is empowered23 to adopt delegated acts to 
establish a harmonised basis for calculating administrative penalties due to 
cross‑compliance breaches. It may also issue interpretative guidance to Member 
States.

21  Recital 57 of Regulation (EU) 

No 1306/2013.

22  Article 33 of the Financial 

Regulation.

23  According to Article 101 of 
Regulation No 1306/2013.

24  Joint statement attached to 

Regulation (EU) No 1306/2013.

25  Opinion No 1/2012 on certain 
proposals for regulations 
relating to the common 
agricultural policy for the 
period 2014‑2020 (http://eca.
europa.eu).

The control procedures remain complex

41 
For the period 2014–2020, the list of standards was reduced from 15 to seven 
GAECs (by the removal of all seven previous voluntary standards and of one 
compulsory standard) and from 18 to 13 SMRs (see Annex II). Four of the SMRs 
removed were those which were not considered by the Commission to be 
sufficiently relevant to farming activity. This is a good example of a simplification 
of the cross‑compliance framework. However, the scope of cross‑compliance is 
now likely to be enlarged. The ‘joint statement by the European Parliament and 
the Council on cross‑compliance’24 requested that the Water Framework Directive 
and the Sustainable Use of Pesticides Directive become part of cross‑compliance 
once they have been implemented in all the Member States.

42 
In our opinion on the Commission’s proposal regarding the changes in the CAP 
for the period 2014–202025, we expressed the view that the ‘list of requirements 
is still too dispersed across too many legal texts, not focused enough on key 
requirements and the lower number of standards does not really correspond to 
a reduction in the level of complexity of this policy’.

Observations 

22

43 
53 % of the Farm Advisory Bodies which replied to our survey considered that the 
CAP for the period 2014–2020 has brought about no significant changes to the 
cross‑compliance system, while 28 % of them considered that the new system 
is even more complicated. Also, less than 10 % of Paying Agencies considered 
that the changes in cross‑compliance had a moderate or very positive impact 
on the resources spent in areas such as: on‑the‑spot and administrative checks, 
sanctions system and providing information to farmers.

44 
The Paying Agencies and the Farm Advisory Bodies replied to our survey that 
the main reason why farmers do not comply with cross‑compliance obligations 
is that the requirements are too complicated. The farmers’ associations visited 
during the audit further confirmed this analysis. Simplification could be seen 
as a solution to ensure increased compliance by farmers with the most relevant 
rules, thus contributing to the effectiveness of the system. In this context, a need 
for further simplification of the cross‑compliance system has been put forward 
during our audit by the Paying Agencies, Farm Advisory Bodies and farmers’ 
associations, together with convergent proposals (see Annex III for more details).

45 
Complexity was also due to the level of detail of the applicable rules. Box 2 gives 
an example of the detailed cross‑compliance requirements in Member States. 
While detailed rules may be justified to take into account various environmental 
situations, farmers risk finding difficulties in applying them correctly and paying 
agencies in checking them.

46 
In United Kingdom‑Northern Ireland, we compared the number of control points 
included in the on‑the‑spot checklists for cross‑compliance used by control 
authorities for the CAP until 2013 and after, and we found that the changes in 
the CAP for the period 2014‑2020 had a limited impact on the number of control 
points (see Box 3). The authorities in the other two Member States visited 
confirmed during the interviews that the changes in cross‑compliance for the 
period 2014‑2020 did not trigger a significant reduction in the number of control 
points.

Observations 

23

2
x
o
B

3
x
o
B

Examples of requirements included in the cross‑compliance control manual in the 
United Kingdom – Northern Ireland

Three of the 40 cross‑compliance control points resulting from the SMR on the Nitrates Directive are captured 
in the inspectors’ checklist by question 3.1.12, split into three sub‑questions, which read:

‘3.1.12. Has organic manure (including dirty water) been applied within: 10 m of any waterway other than 
lakes*; 20 m of lakes; 50 m of a borehole, spring or well; 250 m of a borehole used for a public water supply; 
15 m of exposed cavernous or karstified limestone features? (*See Inspectors’ Guidance)

3.1.12a. On grassland with an average incline of greater than 15 % and on any other land with an average 
incline of greater than 12 % has organic manure (including dirty water) been applied within 30 m of a lake or 
15 m of any waterway other than lakes (*See Inspectors’ Guidance)

3.1.12b. On grassland with an average incline of greater than 15 % and on any other land with an average 
incline of greater than 12 % has chemical fertiliser been applied within 10 m of a lake or 5 m of any waterway 
(*See Inspectors’ Guidance)’.

Source: Paying Agency of Northern Ireland.

Limited impact of the changes in the CAP for the period 2014 – 2020 on the 
checklists used by the control authorities in the United Kingdom – Northern Ireland

The number of control points for a full‑scope cross‑compliance inspection was 257 for the CAP until 2013 and 
249 for the CAP after 2014.

For GAEC, the number of control points has increased from 19 to 27 in the two periods compared.

Source: Paying Agency of Northern Ireland.

47 
During on‑the‑spot checks, all the obligations regarding the GAEC standards and 
SMR requirements for which the farmers have been selected must be checked. 
As mentioned above, these checks often include hundreds of control points in 
the various checklists. Even if the control systems were effective, the legislative 
framework26 would not allow for a more targeted risk‑based approach according 
to which certain rules or control points could be checked more or less frequently 
by taking account, for example, of the level of breaches, the likelihood of 
a breach, or the magnitude of the effects of a potential breach.

26  See Article 71 of Commission 
Regulation (EU) No 809/2014 
of 17 July 2014 laying down 
rules for the application of 
Regulation (EU) No 1306/2013 
of the European Parliament 
and of the Council with regard 
to the integrated 
administration and control 
system, rural development 
measures and cross 
compliance.

 
 
24

27  As per Article 92 of Regulation 

(EU) No 1306/2013.

28  As per Recital 57 of Regulation 

(EU) No 1306/2013.

Observations 

The Small Farmers Scheme reduced the administrative 
burden, but this could affect the achievement of 
cross‑compliance objectives in some Member States

48 
The CAP for the period 2014–2020 introduced the Small Farmers Scheme (SFS) 
as a simplified direct payment scheme granting up to 1 250 euro as direct aid to 
those farmers who decide to participate in the scheme. 15 Member States have 
decided to implement this optional scheme. For these countries, the number 
of farmers participating in this scheme varies between 3 % (Slovenia) and 77 % 
(Malta). The Commission calculated that at overall EU level, the SFS covers 4 % of 
the total agricultural area.

49 
SFS beneficiaries are not subject to the application of administrative penalties 
if they do not meet cross‑compliance obligations27. Therefore they do not risk 
having their CAP payments reduced due to infringements of cross‑compliance 
rules. This exemption from cross‑compliance is justified by the fact that for 
‘farmers participating in the small farmers scheme (…) the efforts to be made 
under the cross‑compliance system might be considered to exceed the benefit of 
keeping those farmers under that system’28.

50 
This measure also has the potential of reducing the costs of implementing, 
managing and controlling cross‑compliance: SFS was indicated as the main 
source of savings by 10 out of the 12 Paying Agencies which estimated that the 
CAP for the period 2014–2020 will lead to a reduction in costs. This message was 
reiterated by the Paying Agencies in the three Member States visited.

51 
SFS is a step towards simplification that relieves administrations and farmers 
of additional burdens, leading at the same time to cost savings. However, its 
implementation at the level of each Member State should be guided by the 
need to ensure an appropriate balance between administrative simplification 
and achieving the objectives of cross‑compliance and the sectoral legislation. 
Differences exist between Member States or regions. For example, in Romania 
small farmers represent around 71 % of the farmers and 16 % of the total area 
claimed. In contrast, in Slovenia, the total number of small farmers is around 3 % 
and the area covered by this scheme is only 1 %.

Observations 

25

52 
Although not applying the SFS, Lithuania followed similar principles in 
excluding farmers below certain threshold from the application of specific 
cross‑compliance rules. Box 4 illustrates the potential risks linked to the 
application of such simplification measures:

4
x
o
B

Exemption of farmers from cross‑compliance obligations related to the Nitrates 
Directive in Lithuania

Farmers with a utilised agricultural area of 10 hectares or less do not need to declare their level of fertiliser 
use. Such farmers account for more than 70 % of all farmers and use 14 % of the agricultural area.

At the same time, livestock farmers who keep less than 10 livestock units in one place do not need to have 
manure storage of the relevant capacity. Such farmers constitute 87 % of all livestock farmers and keep 28 % 
of all livestock units.

The Nitrates Directive is intended to protect the environment and citizens’ health. While the use of thresholds 
may reduce red tape for smaller farmers, excluding significant parts of the farmers’ land and/or animals from 
cross‑compliance checks may also adversely affect the achievement of the objectives of the Nitrates Directive.

Source: European Court of Auditors – 2015 annual report – Figure 7.10.

Greening introduced an additional layer of checks for 
mandatory environmentally friendly practices

53 
One of the objectives of the new CAP is the enhancement of environmental 
performance through a mandatory ‘greening’ component of direct payments 
which supports agricultural practices beneficial for the climate and the 
environment applicable throughout the Union29. Those practices include crop 
diversification, the maintenance of permanent grassland and the establishment 
of ecological focus areas. 30 % of the annual national ceiling is to be paid in the 
form of such a greening payment for each eligible hectare30.

29  Recital 37 of Regulation (EU) 

No 1307/2013 of the European 
Parliament and of the Council 
of 17 December 2013 
establishing rules for direct 
payments to farmers under 
support schemes within the 
framework of the common 
agricultural policy and 
repealing Council Regulation 
(EC) No 637/2008 and Council 
Regulation (EC) No 73/2009 
(OJ L 347, 20.12.2013, p. 608).

30  Article 47 of Regulation (EU) 

No 1307/2013.

54 
A new greening payment was introduced in the CAP for the period 2014–2020. 
The farming practices under greening have similarities with previous GAEC 
standards which covered agricultural practices such as crop rotation, the 
protection of permanent pastures, or the retention of landscape features. Thus, 
for the period 2014–2020 there are two sets of complementary agricultural 
practices which target the same objectives: the maintenance of land and the 
protection of bio‑diversity.

 
Observations 

26

55 
In its 2014 annual activity report, DG AGRI explained that both these compulsory 
instruments – greening and GAEC – contribute towards the same objective: 
‘Therefore, the CAP will be able to improve its environmental performance 
by ensuring that a substantial part of the agricultural area in Europe is 
affected by cross‑compliance requirements, ‘greening’ obligations as well as 
agri‑environmental commitments’.

31  Title III of Commission 

Regulation (EU) No 809/2014.

32  Title V of Commission 

Regulation (EU) No 809/2014.

33  Article 96 of Regulation (EU) 

No 1306/2013.

56 
On‑the‑spot checks for greening are performed on a sample of 5 % of farmers as 
part of the verifications regarding the eligibility criteria for the direct payment 
schemes31, in a system outside the control framework for GAEC, which verifies 
a sample of 1 % of farmers subject to cross‑compliance checks32. As a result, 
compliance with complementary mandatory environmentally beneficial practices 
is checked within two different frameworks.

57 
Under greening, farmers have to comply with the obligation to have at least 5 % 
of the arable land of the holding as Ecological Focus Areas. The regulation also 
provides that cross‑compliance protected elements (such as landscape features 
or buffer strips) may as well count to fulfil this obligation. These are therefore 
managed under two different set of rules and checks.

58 
Thus, with the introduction of greening, there are now two control systems 
for compulsory environmentally‑friendly practices which complement each 
other and contribute to the same objective of improving the environmental 
performance of the CAP. While the cross‑compliance regulation states 
that Member States may make use of existing control systems to check 
cross‑compliance obligations33, there are risks of inefficiencies in the Member 
State control systems and of additional burdens on farmers.

27

34  DG AGRI 2014 annual activity 

report.

35  For example: Council Directive 

91/676/EEC of 
12 December 1991 concerning 
the protection of waters 
against pollution caused by 
nitrates from agricultural 
sources (OJ L 375, 31.12.1991, 
p. 1); Regulation (EC) 
No 1760/2000 of European 
Parliament and of the Council 
of 17 July 2000 establishing 
a system for the identification 
of bovine animals and 
regarding the labelling of beef 
and beef products and 
repealing Council Regulation 
(EC) No 820/97 (OJ L 204, 
11.8.2000, p. 1).

36  Recital 57 of Regulation (EU) 

37 

No 1306/2013: The 
cross‑compliance system 
implies certain administrative 
constraints for both 
beneficiaries and national 
administrations since records 
keeping has to be ensured, 
checks have to be carried out 
and where necessary penalties 
have to be applied.

‘Assessing farmers’ cost of 
compliance with EU legislation 
in the fields of environment, 
animal welfare and food 
safety’ (AGRI‑2011‑EVAL‑08). 
Study undertaken by: CRPA 
‑ Centro Ricerche Produzioni 
Animali (IT), in association 
with: TI ‑ Thünen Institute of 
Farm Economics (DE), IFCN 
‑ International Farm 
Comparison Network on Dairy 
(DE), UGHENT – University of 
Ghent (BE).

Observations 

The specific costs associated with the implementation of 
cross‑compliance are not sufficiently quantified

59 
The Commission needs a reliable estimate of the overall cost of cross‑compliance, 
aggregating the main stakeholders involved (EU institutions, Member State 
management and control authorities, and farmers) in order to ensure that the 
system is cost‑effective.

60 
DG AGRI has estimated that the total costs of managing and controlling 
agricultural expenditure are close to 4 billion euro or approximately 7 % of the 
total EU‑funding34. However, as far as cross‑compliance is concerned, the costs 
are not quantified and no reliable estimate exists.

61 
At Member State level, significant costs are due to the requirements of the 
cross‑compliance control system. Firstly, checks are required for GAEC, which 
are an additional set of rules applicable only to farmers benefiting from CAP 
payments. Secondly, in relation to SMRs, which are based on existing directives 
and regulations (‘sectoral legislation’)35, specialised control bodies have to check 
a minimum control rate of 1 % required under cross‑compliance rules and have 
additional reporting obligations regarding these checks.

62 
At farm level, the introduction of SMRs created more administrative obligations 
for farmers, such as record keeping and participating in cross‑compliance 
inspections36. Furthermore, compliance with GAECs, implies costs concerning 
the agricultural practices required (labour costs, costs of machinery, fuel and 
other consumables), the income forgone because the GAECs prohibit or impose 
certain practices (e.g. reduction in yield), but also other costs such as the use 
of third‑party service providers (e.g. consultants for certain cross‑compliance 
topics).

63 
A report commissioned by DG‑AGRI37 and published in 2014 assessed the actual 
costs that EU farmers incurred in order to comply with selected legislation in the 
fields of the environment, animal welfare and food safety. The study was built on 
case studies from the eight most representative agricultural sectors in the EU. It 
gives an indication of the financial impact such obligations have on farmers (see 
Box 5 for a summary of the results for the wheat sector).

Observations 

28

5
x
o
B

Impact of compliance with selected obligations on production costs in the wheat 
sector

Out of the full cross‑compliance scope applicable until 2013, the study for the wheat sector took into 
consideration the cumulative effects of five compulsory GAECs (minimum soil cover, land management, 
establishment of buffer strips and avoiding the encroachment of unwanted vegetation and retention of 
landscape features), one optional GAEC (crop rotation) and the legislation underlying the basis of two SMRs 
(the Nitrates Directive and the Regulation on plant protection products). Another requirement outside the 
scope of cross‑compliance was also taken into account: the Directive on the sustainable use of pesticides.

The authors of the survey concluded that the actions taken by farmers to ensure compliance with the rules 
listed above would increase production costs by amounts ranging from 1.97 % in Hungary to 3.42 % in 
Denmark.

64 
Furthermore, in the view of the majority of the Paying Agencies, the changes in 
the CAP for the period 2014 – 2020 are not likely to lead to a decrease in costs. 
When asked in the survey whether these changes will lead to lower, similar or 
higher costs for implementing, managing and controlling cross‑compliance 
obligations, the Paying Agencies’ replies were:

4 Paying Agencies’ estimate of the impact of the CAP 2014–
e
r
u
g
i
F

2020 changes on their cross‑compliance management and 
control system

No opinion; 6 %

Lower costs; 19 %

Higher costs; 14 %

Similar costs; 61 %

Source: European Court of Auditors.

 
 
Observations 

29

The basis for the calculation of cross‑compliance penalties 
for farmers across the EU is not sufficiently harmonised 

65 
The EU legislation stipulates that where a farmer does not comply with the 
rules on cross‑compliance, an administrative penalty should be imposed if the 
non‑compliance results from an act or an omission directly attributable to that 
beneficiary. Such penalties should be established having regard to the principle 
of proportionality (graded according to the seriousness of the non‑compliance 
committed38 and calculated as a percentage on the CAP payment) and only 
be applied where the non‑compliance is attributable to the farmer’s actions, 
committed either negligently or intentionally.

38  Recital 35 of Commission 

Delegated Regulation (EU) 
No 640/2014 of 11 March 2014 
supplementing Regulation 
(EU) No 1306/2013 of the 
European Parliament and of 
the Council with regard to the 
integrated administration and 
control system and conditions 
for refusal or withdrawal of 
payments and administrative 
penalties applicable to direct 
payments, rural development 
support and cross compliance 
(OJ L 181, 20.6.2014, p. 48).

66 
When calculating those penalties, account should be taken of the severity, 
extent, permanence and reoccurrence of the non‑compliance found. In the case 
of non‑compliance due to negligence, the maximum reduction is 5 % and, in the 
case of reoccurrence, 15 %. In the case of intentional non‑compliance, there is 
a minimum reduction of 20 % and it may go as far as total exclusion from one or 
several aid schemes for one or more calendar years.

67 
We found that the practical application of the concept of intentional 
non‑compliance raises significant uncertainties at Member State level. The 
representatives of the Paying Agencies and the farmers’ associations in the three 
Member States visited indicated that the proof of intentionality is difficult to 
sustain, unless the farmer is caught ‘red‑handed’.

68 
The review of the control statistics for cross‑compliance shows that some 
Member States were stricter than others in applying the concept of intentional 
non‑compliance: no farmer was penalised during the period 2011–2014 for 
intentional breaches in certain Member States (Czech Republic, Bulgaria), or very 
few were (Romania, Portugal, Hungary), while other Member States used this 
concept much more frequently (Lithuania, Greece, Poland, France, Ireland).

Observations 

30

69 
To examine how the same types of non‑compliance are assessed by the Member 
States, the survey we sent to the Paying Agencies contained two case studies on 
breaches of the SMRs on cattle identification and registration and the Nitrates 
Directive (full text of the case studies is included in Annex IV). The Paying 
Agencies were asked to quantify the percentage of penalties that would be 
applied in these two case studies. Box 6 shows a summary of the case studies 
presented and the replies received.

6
x
o
B

Case studies regarding the penalties applied in Member States

Summary of the case studies proposed to the Member States

During the calendar year, the farmer sent late 
notification of the registration of animals for 
20 cattle. The farmer had an average of 75 cattle 
during the year.

During on‑the‑spot checks, the inspectors calculated 
that the farmer’s manure storage capacity was 10 % 
less than the minimum required.

Number of Paying Agencies applying each of the possible reduction percentages

2

10

10

13

29

5

3

8

19

29

0 % 1 % 3 % 5 % NR

0 % 1 % 3 % 5 % NR

NR for ‘No Reply’ – indicates that several Paying Agencies did not quantify the breach.

Source: European Court of Auditors.

 
Observations 

31

70 
Thus, for the same breach of 20 cattle not registered in due time, almost half of 
the Member States would apply a 3 % penalty, whereas a fifth of the Member 
States would apply a 1 % penalty, with the remaining ones applying either a 0 % 
or a 5 % reduction. An insufficient manure storage capacity would be penalised 
at 1 % by almost half of the Member States, while a third would apply a 3 % 
penalty, while a sixth of the Member states would apply either a 0 % or 5 % 
penalty.

71 
Furthermore, the understanding of the severity of a breach varied significantly 
between Member States, so there is a risk that similar cases were not treated in 
the same way. Such a situation was confirmed by the different sanction rules put 
in place in the Member States visited, as shown in Box 7.

7
x
o
B

Example of penalty for the late registration of animals

In Germany‑ Schleswig‑Holstein, the Paying Agency has established that no penalty is to be applied for late 
registration, if the number of bovines concerned by the breach represents less than 30 % of the total number 
of bovines present on the holding.

On the contrary, in Spain‑Catalonia, no such threshold exists.

 
Conclusions and 
recommendations

32

72 
Cross‑compliance has been applicable since 2005, as a mechanism to link 
most CAP payments to farmers’ compliance with the rules stemming from the 
environment, public health, animal health, plant health and animal welfare 
policies. The objectives of cross‑compliance were to improve the consistency of 
the CAP with those policies (and thus to respond to the expectations of society) 
and to make farmers aware of the need to respect those rules (and thus to 
contribute to the development of sustainable agriculture). The purpose of the 
report is to assess to what extent the cross‑compliance management and control 
system has been effective and can be further simplified, and, on that basis, to 
offer recommendations for improving the implementation of cross‑compliance in 
the medium and long term.

73 
We conclude that the information available did not allow the Commission to 
assess adequately the effectiveness of cross‑compliance. Despite the changes 
made to the CAP for the period 2014–2020, the cross‑compliance management 
and control system can still be simplified.

74 
We found that the performance indicators used by the Commission gave a partial 
view of the effectiveness of cross‑compliance. The indicators did not take into 
account the level of non‑compliance by farmers (paragraphs 18 to 27).

Recommendation 1

The Commission should examine as part of the impact assessment for the CAP 
post 2020 how to further develop its set of indicators to assess the performance 
of cross‑compliance and how to take into account farmers’ levels of compliance 
with the cross‑compliance rules in its indicators.

Conclusions and recommendations 

33

75 
The legislator established an EU framework regarding cross‑compliance. The 
Commission is responsible for monitoring its implementation. Member States 
translated the EU rules into obligations at farmer level and verified whether 
these obligations were respected. However, a quarter of the farmers checked 
on‑the‑spot during the financial years 2011–2014 had breached at least one of 
the rules, despite the fact that the underlying purpose of cross‑compliance was 
to ensure the consistency of the CAP with such rules. The Commission did not 
analyse the reasons for the infringements and the means of addressing them 
(paragraphs 28 to 36).

Recommendation 2

The Commission should from now on improve the sharing of the information on 
cross‑compliance related infringements between concerned services in order to 
help them to identify the reasons for breaches and to take appropriate measures 
to address them.

76 
The changes in the CAP for the period 2014–2020 somewhat reduced the 
number of cross‑compliance rules, by removing requirements which were not 
sufficiently relevant to the farming activity. However, control procedures remain 
complex. Even if the control systems were effective, the legislative framework 
would not allow for a more targeted risk‑based approach according to which 
certain rules or control points could be checked more or less frequently by taking 
account, for example, of the level of breaches, the likelihood of a breach, or the 
magnitude of the effects of a potential breach. Simplification measures, such as 
the small farmers’ scheme, relieving administrations and farmers of additional 
burdens need to be balanced against the necessity to achieve the objectives of 
cross‑compliance (paragraphs 41 to 52).

Recommendation 3

For the CAP post‑2020, the Commission should propose adapting the rules 
regarding cross‑compliance on‑the‑spot checks. This would allow a more 
effective targeting of key control points.

Conclusions and recommendations 

34

77 
A new greening payment was introduced in the CAP for the period 2014–2020. 
The farming practices under greening have similarities with previous GAEC 
standards which covered agricultural practices such as crop rotation, the 
protection of permanent pastures, or the retention of landscape features. 
Consequently, there are currently two sets of complementary agricultural 
practices which target the same objectives: the maintenance of land and the 
protection of bio‑diversity. Despite their similarities, the compulsory GAEC 
and greening rules are checked under two control systems. This may lead to 
inefficiencies in the control systems and an additional administrative burden 
(paragraphs 53 to 58).

Recommendation 4

The Commission should analyse as part of the impact assessment for the 
CAP post‑2020 the experience of having two systems operating with similar 
environmental objectives (GAEC standards and greening) with a view to 
promoting further synergy between them. This analysis should take into 
consideration criteria such as the environmental impact of the standards and the 
historical level of compliance by farmers.

78 
The costs of implementing cross‑compliance are not sufficiently 
quantified. However, it would be necessary to assess the aggregate costs of 
cross‑compliance at EU, Member State and farmer level in order to design and 
implement a cost‑effective policy. This calculation should be an important input 
for any policy changes, in order to ensure that disproportionate costs are not 
incurred in trying to achieve the intended results, or that alternative instruments 
which would provide a better cost‑benefit ratio are considered (paragraphs 59 to 
64).

Recommendation 5

After the report on the performance of the CAP due by the end of 2018, 
the Commission should develop a methodology to measure the costs of 
cross‑compliance.

Conclusions and recommendations 

35

79 
Penalties for non‑compliance are calculated on the basis of the severity, 
extent, permanence and reoccurrence of the non‑compliance found, as well as 
depending on whether the farmer breached the rules negligently or intentionally. 
In practice, we observed that the application of penalties varied significantly 
between Member States (paragraphs 65 to 71).

Recommendation 6

For the CAP post‑2020, the Commission should encourage a more harmonised 
application of penalties at EU level by further clarifying the concepts of severity, 
extent, permanence, reoccurrence and intentionality.

This Report was adopted by Chamber I, headed by Mr Phil WYNN OWEN, Member 
of the Court of Auditors, in Luxembourg at its meeting of 7 September 2016.

For the Court of Auditors

Vítor Manuel da SILVA CALDEIRA 
President

 
 
 
Annexes

36

The scope of cross‑compliance rules, as per Annex II of Regulation (EU) No 1306/2013 
of the European Parliament and of the Council

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Annexes 

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37

 
Annexes 

38

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Main changes in the scope of cross‑compliance rules for the CAP 2014–2020

Pursuant to Article 93 and Annex II of Regulation (EU) No 1306/2013, the rules were grouped in a single list of  
13 SMRs and seven GAECs. The main changes compared to the previous legislation and the justification 
provided by the Commission were:

‑ 

‑ 

‑ 

‑ 

‑ 

‑ 

‑ 

removal of the seven optional GAECs (in order to promote a more even implementation of GAECs by 
Member States);

removal of the SMR on the use of sewage sludge ( requirements generally applied to sewage 
companies rather than to farmers);

removal of three SMRs on notification of animal diseases (the systematic cross‑compliance controls 
were not suitable for exceptional disease occurrences);

reducing the scope of the two SMRs on the conservation of wild birds and natural habitats 
(infringements could only be identified if farmers were caught ‘red handed’. The cross compliance 
controls, by nature systematic, were not appropriate for this kind of infringement);

converting the SMR on the protection of groundwater against pollution into a new GAEC;

converting the GAEC standard on the protection of permanent pastures into one of the three 
practices of the ‘green’ payment;

the GAEC standard on preventing the encroachment of unwanted vegetation has become an 
eligibility criterion under the basic direct payment scheme.

 
Annexes 

39

I Stakeholders expressed a need for further simplification
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During the 38th Conference of Directors of Paying Agencies held in Luxembourg in November 2015, the ad‑hoc 
working group with the theme ‘Simplification – cross‑compliance’ concluded that, in the long‑term for the 
CAP post‑2020, the cross‑compliance system ‘needs to be reformed and simplified’. Three priority areas were 
identified:

‑ 

‑ 

‑ 

limit the checks performed on‑the‑spot to relevant, objectively controllable cross‑compliance that 
can be applied in a way that provides full legal certainty;

make sure that the rules which form part of cross‑compliance are relevant, by taking into account 
their importance for the agricultural sector, the number of farmers concerned, the frequency of the 
related activity and the difficulties of legal certainty when checking certain rules;

remove the general rule on reductions for intentional non‑compliance and add more proportionate 
rules on reductions and penalties.

One of the open‑answer questions in our survey was to request suggestions for the main three measures that 
could help simplify the cross‑compliance system and/or make it more effective. The three proposals most often 
mentioned by the Paying Agencies were, in frequency order:

‑ 

‑ 

‑ 

reducing the number of cross‑compliance requirements by focusing on those which are considered to 
be the most important and strictly relevant to the farming activity;

changing the sanctions system by, for example: eliminating the concept of intentional 
non‑compliance; introducing an element of tolerance before a non‑compliance is determined 
(for example, where animal registration and identification is involved); simplifying the method of 
calculating reductions and penalties (which is currently based on the concepts of extent, severity and 
permanence);

reducing the extent of on‑the‑spot checks by: sample‑based testing, for example in the case of farms 
with large herds; focused testing on the most risky areas, with reduced levels of checks for standards 
where insignificant levels of non‑compliance are found; eliminating those control points which 
cannot always be reliably verified on‑the‑spot.

In addition, Farm Advisory Bodies surveyed also proposed giving farmers more help by, for example: providing 
training in record‑keeping; practical guides and manuals; more reader‑friendly information; campaigns on 
cross‑compliance’s positive effects on the environment, food safety and animal welfare.

The farmers’ associations we met in the three Member States also identified priorities for simplification along 
the same lines: reducing the number of cross‑compliance rules, changing the sanction system (eliminating the 
concept of intentionality, more tolerance, and simplification of the penalty calculation methodology) and better 
targeting of controls towards the riskiest farmers.

 
Annexes 

40

V

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Case studies included in the survey sent to Paying Agencies

Farmer WZ was randomly selected for an on‑the‑spot 
cross‑compliance check of SMR 4 for the 2014 claim 
year. The farmer had not been selected for 
on‑the‑spot checks in the previous 3 years.

The farmer inspected owns 964.35 ha and 145 cattle, 
for which he needs a manure storage capacity of 
4 400 cubic meters (6 months storage). The capacity 
found and calculated by the inspectors during the 
on‑the‑spot inspection was 10 % less than that 
required.

Please indicate whether you would apply a penalty 
for the 2014 claim year. If so, please indicate the % 
of penalty to be applied in accordance with national 
and/or regional legislation and norms. If your answer 
is no, please indicate ‘no penalty’.

Farmer XY was randomly selected for an on‑the‑spot 
cross‑compliance check of SMR 7 for the 2014 
claim year. The farmer had not been selected for 
on‑the‑spot checks in the previous 3 years. The 
farmer submitted a claim for the 2014 claim year, 
where he declared 70 ha and 80 bovines. The total 
amount of direct payments to which the farmer is 
entitled is 25 000 euro.

During the on‑the‑spot check, the inspectors 
checked the farm register for animals and supporting 
documents attesting to the declaration and 
registration of animals (births, deaths). The inspectors 
found that 20 animals were registered after the 
deadline of 7 days (periods of 8 to 20 days were 
noted). The average number of animals during the 
2014 calendar year was 75.

The inspectors also found that during the 
2013 calendar year the farmer had declared 
10 animals after the 7 day deadline. The average 
number of animals in 2013 was 70. Please indicate 
whether you would apply a penalty for the 2014 claim 
year. If so, please indicate the % of penalty to be 
applied in accordance with national and/or regional 
legislation and norms. If you answer is no, please 
indicate ‘no penalty’.

 
Reply of the  
Commission

Executive summary

41

II
When describing the cross‑compliance system it has to be made clear that for SMRs, these basic rules incorporated 
in cross‑compliance are anyhow already applicable in Member States due to the overlaying sectorial legislation. 

III
Since 2005 the continuous process of reviewing and simplifying the cross‑compliance scope provided the following 
results:

Control procedures were simplified during the period 2005‑2013 by introducing provisions on harmonisation of 
control rates, advance notice, timing and elements of on‑the‑spot checks and selection control sample. 

Furthermore, with the last CAP reform, the number of SMRs has been reduced from 18 to 13 and the number of 
GAEC standards was reduced from 15 to 7. The obligations included in the scope of cross‑compliance were reviewed 
in light of the fact if they were controllable, directly attributable to farmers (and not to Member States) and if they 
were linked to agricultural activity.

The Commission considers that the scale of the effort already put into simplification makes it most unlikely that any 
further simplification can be achieved without undermining e.g. the environmental goals of cross‑compliance.

IV
It is the Commission's view that the performance indicators used for measuring the effectiveness of cross‑
compliance in meeting its objectives are the most appropriate on the basis of the available information. The cross‑
compliance objectives are to contribute to the development of sustainable agriculture through awareness‑raising 
of farmers and making the CAP more compatible with the expectations of society. The GAEC objectives are to 
contribute to preventing soil erosion, maintaining soil organic matter and soil structure, ensuring a minimum level 
of maintenance, avoiding the deterioration of habitats and protecting and managing water. In this respect cross‑
compliance is not the implementing tool for other policies, which have their own objectives. 

Analysing the reasons for infringements is done in the context of the implementation of the sectorial legislation. 
However cross‑compliance and the Farm Advisory System play a role in addressing the reasons for the 
infringements.

VI
Environmental objectives (e.g. maintenance of land and biodiversity) are pursued not only by greening payments 
and GAEC standards but also by environmental and climate measures under Pillar II as well as the environmental 
legislation. However, the nature, rationale and functioning of these various instruments are different and 
complementary. Their complementarity is illustrated by Figure 1 of SWD (2016) 218 final.

Both greening rules and GAEC are managed by the Integrated Administration and Control System (IACS) and 
this ensures the best use of resources. There are, however, reasons for the fact that GAECs and greening may not 
necessarily be checked together. Since greening is a criterion for eligibility it is controlled ex‑ante by administrative 
checks and on‑the spot checks for 5 % of beneficiaries. GAEC are checked under cross‑compliance which is 
managed differently than the eligibility requirements.

Reply of the Commission 

42

VII
The SMRs stem from sectorial legislations and Member States may make use of their existing administration and 
control systems (Article 96 of Regulation (EU) No 1306/2013). Existing control systems can thus synergistically be 
used for the cross‑compliance control system. GAEC should not either entail significant costs for farmers since 
they are meant to be basic standards. Costs of their controls are born by the IACS which serve also other CAP 
instruments.

The Commission quantified in its Annual Activity Report 2014 the overall costs related to control in Member 
States taking the reservation that ‘the deterrent effect of ex‑post controls’ (such as cross‑compliance) ‘also bring 
unquantifiable benefits’.

VIII
While the framework is set at EU level, on‑farm obligations under SMRs and GAEC are largely defined by Member 
States to take into account the challenges and agricultural structures in the national or regional conditions. In this 
respect it is important that a margin of implementation is left to Member States for the calculation of penalties 
for each of these on‑farm obligations. The EU regulation sets the principle that sanctions are calculated on a case 
by case basis taking into account the severity, extent, permanence, reoccurrence or intent of the non‑compliance 
determined. The harmonised implementation of these principles across Member States is ensured in particular 
through the audits carried out by the Commission. Should weaknesses be found in a particular Member State in this 
respect, appropriate follow‑up is brought in the framework of the clearance of accounts.

IX First indent
The Commission accepts this recommendation. 

IX Second indent
The Commission accepts this recommendation.

IX Third indent
The Commission does not accept this recommendation. The recommendation by the Court would not simplify 
cross‑compliance but de facto reduce its scope. The simplification of the cross compliance scope has been already 
carried out several times in the past. Moreover Member States have now a wide margin of manoeuvre to take into 
account the risks in the control sampling and to optimise their control systems. The Commission considers that this 
recommendation might result in loosening the rules on on‑the‑spot checks which would ultimately undermine the 
effectiveness of cross‑compliance. 

IX Fourth indent
The Commission accepts this recommendation.

Reply of the Commission 

43

IX Fifth indent
The Commission partially accepts this recommendation. The implementation of this recommendation will depend 
on the outcome of the planned study on administrative burden. The administrative costs of cross‑compliance 
should be viewed in the context of the costs of non‑compliance for society, public finances and the environment 
and of the potential benefits of cross‑compliance.

IX Sixth indent
The Commission accepts this recommendation.

The Commission envisages organising exchanges of best practice on these issues.

Introduction

06
The sectorial legislation was already applicable in Member States before cross‑compliance was introduced.

09
The Commission implemented all accepted recommendations made by the Court in its special report 8/2008.

10
The changes for 2014‑2020 were implemented and the cross‑compliance system underwent substantial changes 
with the last CAP reform. 

10 Second indent
The obligations included in the scope of cross‑compliance were reviewed in light of the fact if they were 
controllable, directly attributable to farmers (and not to Member States) and if they were linked to agricultural 
activity.

Observations

Common Commission's reply to paragraphs 18 to 21 
The cross‑compliance objectives are to contribute to the development of sustainable agriculture, making the CAP 
more compatible with the expectations of society and preventing soil erosion, maintaining soil organic matter and 
soil structure, ensuring a minimum level of maintenance, avoiding the deterioration of habitats and protecting 
and managing water. Cross‑compliance is not the implementing tool for other policies. This was already clarified 
when introducing cross‑compliance, as cross compliance is not an eligibility rule (see Presidency Compromise of 
26 June 2003). It acts indirectly by raising the beneficiary's awareness. It is for the underlying sectorial policies 
and not for cross‑compliance to identify and address the reasons why farmers do not comply with the sectorial 
legislation from which SMR are drawn. 

Moreover, in accordance with Annex II of Regulation (EU) No 1306/2013 only selected articles or paragraphs 
stemming from sectorial legislation would be of relevance for such analysis, which should take into account the 
wider scope of the policies. 

Reply of the Commission 

44

As far as the environmental legislation is concerned specific performance indicators have been developed for each 
sectorial Directive covered by SMRs and indicators are being developed as part of the EU Soil Strategy. The trends 
in the state of the environment under the reporting information under the Directives included in the scope of cross 
compliance are linked to the effectiveness of the implementing provisions of those Directives. 

Outside cross‑compliance, at EU level, in the policy cycle every CAP‑measure, with or without budgetary impact, is 
subject to constant evaluation. Specific performance indicators are included in each sectorial Directive covered by 
SMRs and e.g. indicators are being developed in the Soil Policy.

22
The Commission considers that the result indicator ‘Percentage of CAP payments covered by cross‑compliance’ 
reflects the effect of cross‑compliance among the farming population. Indeed the more payments are covered by 
cross compliance, the higher the financial impact of possible breaches on each individual farmer, which increases 
the farmers' awareness to respect the rules. Cross‑compliance has increased awareness among farmers and has 
triggered some changes in farming practices.

24
The Commission considers that the result indicator ‘Opinion expressed by the public on cross‑compliance’ reflects 
the effectiveness of cross compliance in meeting the expectations of the society through improving the consistency 
of the CAP policy with other concerned policies. The questions of the Eurobarometer survey precisely deal with the 
acceptance of the link between the CAP payments and the respect of the rules. The results are in this respect to 
a large extent positive. 

25
The Commission considers that the result indicator ‘control rate for GAEC’ is a good proxy of the expected 
environmental outcome. Provided that the national GAEC standards are properly defined by Member States, the 
respect of these standards by farmers should lead to a positive environmental outcome. The respect of the control 
rate allows ensuring to the extent possible that farmers are respecting the rules. This is the best proxy with the 
available information.

The Commission considers also the result indicator ‘percentage of land occupied by permanent pastures’ as a good 
proxy for the effectiveness of this instrument. This indicator is monitored to check that Member States have taken 
the necessary remedial actions when the ratio decreases beyond the threshold allowed. It is clear that the evolution 
of the ratio is driven by various factors but this is not what the indicator measures here.

26
The Commission considers its indicators appropriate for the objectives of cross‑compliance. The result indicators 
‘number of hectares subject to cross compliance’ properly reflects the effectiveness of cross compliance and is 
useful to complement existing result indicators. Rules covered by cross compliance are to a large extent practices 
to be undertaken on agricultural area (GAEC standards, practices under environmental legislation, use of pesticides, 
etc.). The more hectares are covered by the cross compliance system, the higher the effectiveness of the system.

Reply of the Commission 

45

27
The indicators quoted by the Court, such as farmland bird index, water quality, etc. are impact indicators reflecting 
the general objective of the CAP and other EU policies. Several instruments, of which cross compliance is only one 
element, contribute to meeting these general objectives. The specific objectives of cross compliance, reflecting the 
specific contribution of this instrument to the general objectives of the CAP, are reflected by the result indicators 
presented in paragraphs 22 to 26.

28
The Commission does not consider the number of infringements being an appropriate indicator for the 
performance of cross‑compliance. The cross‑compliance control statistics are used in the context of the DG AGRI 
audits as an indicator for the performance of Member State´s control systems. A high rate of non‑compliance in 
a certain sector can also be an indicator that cross‑compliance controls are effective. 

29
The infringements are mainly linked to two sets of requirements (see paragraph 31 and Figures 2 and 3).

30
The rise in non‑compliance rates may result from an improvement in the control system rather than an increase of 
non‑compliant behaviour. 

33
The statement e.g. regarding wild birds does not apply to all Member States. The Commission would like to 
comment that e.g. concerning wild birds it has to be considered that though the overall rate of infringements is 
as described by the Court, there are some few Member States where the Commission's audits identified serious 
problems with controls. Hence, low rates of infringements may also be due to lenient control system in Member 
States. 

34
The analysis of the reasons for infringements and the means of addressing them is not a task for cross‑compliance 
but for sectorial policies. However, regarding cross‑compliance, DG AGRI analyses control statistics with a view to 
feeding its risk analyses in the framework of establishing its audit programme.

35
The Commission considers that cross‑compliance is not an enforcement tool for sectorial policies.

In claim years 2014, concerning cross‑compliance the Commission performed specific audits in certain Member 
States focussing on animal related issues. However, it has to be borne in mind that Commission's cross‑compliance 
audits have as a starting point the protection of the EU´s financial interests in the area of agriculture.

The DG ENV receives the audit reports and will receive the statistics from DG AGRI. DG ENV will analyse the reasons 
for breaches, following this up with Member States as appropriate.

Reply of the Commission 

46

36
Cross‑compliance is not the implementing tool for other policies. This was already clarified when introducing cross‑
compliance, as cross compliance is not an eligibility rule (see Presidency Compromise of 26 June 2003). Further, the 
minimum control rate has to be increased in case of a significant degree of non‑compliances.1 

For animal and public health, plant health and animal welfare legislation, the Commission is carrying out audits to 
ensure that national authorities are fulfilling their legal obligations. For environmental legislation, the Commission 
is working on a policy initiative to help Member States improve compliance assurance (i.e. the monitoring, 
promotion and enforcement of compliance on the basis of risk), while respecting the proportionality and 
subsidiarity principles.

39
The Commission does consider that when presenting revised or new spending proposals it should not estimate the 
costs and benefits of control systems because cross‑compliance also includes e.g. animal and public health where 
costs and benefits calculations can hardly take sufficient account of e.g. public health.

40
Proportionality is already inherent, as sanctions are calculated as a percentage of the beneficiary´s CAP payment 
flanked with the possibility not to apply sanctions or intentionality and repetition. 

The EU legislation2 provides a harmonised basis for the evaluation and sanctioning of non‑compliances for cross 
compliance at EU level. However, the layout of national sanction grids must be left to Member States to take 
account of the variety of the rules under cross compliance. The Commission envisages organising exchanges of best 
practice with Member States on the issues.

While the framework is set at EU level, on‑farm obligations under SMRs and GAEC are largely defined by Member 
States to take into account the challenges and agricultural structures in the national or regional conditions. In this 
respect it is important that a margin of implementation is left to Member States for the calculation of penalties 
for each of these on‑farm obligations. The EU regulation sets the principle that sanctions are calculated on a case 
by case basis taking into account the severity, extent, permanence, reoccurrence or intent of the non‑compliance 
determined. The harmonised implementation of these principles across Member States is ensured in particular 
through the audits carried out by the Commission. Should weaknesses be found in a particular Member State in this 
respect, appropriate follow‑up is brought in the framework of the clearance of accounts.

41
In light of the fact that the GAEC standards were reduced by more than 50 % (from 15 to 7), DG AGRI expected that 
the administrative burden for farmers was reduced by the Member States.

1  Concerning ‘the low minimum control rate of 1 %’, as said under IX (second indent): According to Article 68(4) of Regulation (EU) No 809/2014 the 
number of on‑the‑spot checks has to be increased in case a significant degree of non‑compliances with a given act or standard was revealed. In 
2009, the Commission issued a working document on the issue) DS/2009/28/rev3) which is still in force. Hence the minimum control rate can be 
adapted if needed.

2 

In particular, in Chapter II of Commission Delegated Regulation (EU) No 640/2014 and in Chapter III of Commission Implementing Act Regulation 
(EU) No 809/2014.

Reply of the Commission 

47

42
The list of SMRs and GAECs was shortened considerably. The SMRs and GAECs were joined in one list, the Annex 2 
of Regulation (EU) No 1306/2013. Further, the SMRs were reviewed and only those provisions maintained which are 
directly addressed to farmers and linked to farming activity. The Commission considers that it is hard to see how any 
further reduction could avoid cutting into major issues linking e.g. agriculture and environment, and so result in an 
undermining of e.g. EU environmental objectives. 

44
Based on the Commission’s experience, the Paying Agencies, farmers’ associations and Farm Advisory Bodies’ 
perceptions about complexity appear to relate more to sectorial legislation than to cross‑compliance. Further, the 
Member States have the flexibility to define the requirements which are needed to achieve the objectives of the 
EU Directive, so the complexity is also under their responsibility. In the context of simplification, the obligations 
included in the scope of cross ‑compliance were reviewed in several occasions in order to make them better 
targeted in relation to its controllability, its attribution directly to farmers (and not to Member States) and its 
link to agricultural activity. The relation between agriculture and the environment is complex by its nature so 
any implementation provision takes into account this level of complexity. The implementation of environmental 
legislation tends to be more complex when Member States seek to ensure that farming practices have to change as 
little as possible while protecting the environment. Where this is the case, the introduction of simplification could 
lead to stricter rules than currently apply to some farmers. Box 2 is a good example of this: rules and controls would 
be simpler if all the distances were increased to the longest distance, but that would place avoidable burdens on 
many farmers. 

45
The example of the Court illustrates the level of complexity of the relation between agriculture and the 
environment. It is appropriate to impose more distance for applying manure around a well which is used for 
drinking water than around other waterways. The standardisation of these requirements would not sufficiently 
reflect the local environmental situations.

See also Commission's reply to paragraph 44.

Box 2 – Examples of requirements included in the cross‑compliance control manual in 
the United Kingdom – Northern Ireland
The content of Box 2 describes the way a Member State has implemented sectorial legislation.

46
The Commission considers that the number of control points implemented by the visited Member States cannot 
illustrate the variety of sectorial legislation incorporated in the scope of cross compliance. Further according to 
Article 96 of Regulation (EU) No 1306/2013, ‘Member States may make use of their existing administration and 
control systems to ensure compliance with the rules on cross‑ compliance.’ 

Box 3 – Limited impact of the changes in the CAP for the period 2014 – 2020 on the 
checklists used by the control authorities in the United Kingdom – Northern Ireland – 
Second alinea
The list of GAECs was shortened by more than 50 % with the last CAP reform, so it is up to the Member States' 
decision to increase control points.

The ‘groundwater directive’ was converted from an SMR (2) into a GAEC.

Reply of the Commission 

48

47
According to Article 96 of Regulation (EU) No 1306/2013 ‘Member States may make use of their existing 
administration and control systems to ensure compliance with the rules on cross‑ compliance.’ 

 A low level of breach may mask an insufficient control system and may lead to a risk for the EU's financial interests 
in the area of agriculture. Moreover, just because there is a low level of breaches, it cannot be considered that this 
will remain the case if controls are further reduced: the existence of cross‑compliance controls can be expected to 
act as a disincentive to breach the rules.

48
The proportion of farmers participating to SFS to direct payment beneficiaries (2014) varies between 3 % (Slovenia) 
and 77 % (Malta). The SFS covers 4 % of total EU agricultural area.3 

50
Due to the exemption from cross‑compliance requirements (and from greening), the costs of administration and 
control should logically decrease. Not only as the population subject to on‑the‑spot checks for cross compliance 
(and greening) decreases in the same proportion, but also because a simplified application process applies (less 
data to handle). Further, the content of on‑the‑spot checks for the Small Farmers Scheme is itself more limited to 
the eligibility conditions. 

51
These differences are explained by the different national agricultural structures and potentially also by different 
calculation methods applied under the Small Farmers Scheme. Countries like Romania and Italy have potentially 
a large proportion of farmers eligible for the scheme, compared to other countries.

According to data provided by Member States, in Romania small farmers represent around 71 % of direct payment 
beneficiaries (2014) and 16.4 % of total agricultural land. 

52
The Commission took note of the Court´s observation and would like to point‑out that the described exclusion does 
not stem from cross‑compliance legislation. 

Box 4 – Exemption of farmers from cross‑compliance obligations related to the Nitrates 
Directive in Lithuania
The cross‑compliance system is fundamentally a control and penalty system applying to payments received under 
the CAP. Therefore, exempting farms from cross‑compliance rules will not exempt them from having to comply 
with environmental legislation, including the Nitrates Directive. The different exemption thresholds mentioned in 
Box 4 are related to the implementation of the Nitrates Directive in the country in question and not to the cross‑
compliance system. In addition, excluding farmers from cross‑compliance penalties does not exclude them from 
control and checks stemming from environmental legislation.

3  Commission staff working document on the 'review of greening after one year' SWD(2016)218 final, p. 19.

Reply of the Commission 

49

54
Greening and the GAECs are two mechanisms that complement each other to address the objective of improving 
the environmental performance of EU agriculture: The green direct payment is a payment provided to farmers 
applying practices beneficial for the climate and the environment (crop diversification, maintenance of permanent 
grassland and having 5 % of EFA). 

The crop diversification, maintenance of permanent grassland and having 5 % of EFA are inherent in greening. 
These practices differ from the GAEC standards: a crop rotation is not a crop diversification, the protection of 
permanent pastures is different from the maintenance of permanent grassland as referred to in greening legislation 
and retention of landscape features on all agricultural lands differs from having 5 % of EFA on arable land. The last 
reform of the CAP led to streamline and simplify the GAEC framework removing some GAEC standards, such as 
those relating to crop rotation and protection of permanent pastures.

56
Member States have the possibility to select the 1 % minimum cross‑compliance control rate sample from the 5 % 
eligibility sample. Therefore, there is a synergy between both elements. Moreover, landscape elements protected 
under GAEC standards may be taken into account for the ecological focus area included in greening. 

57
Protecting landscape features on all agricultural land and having 5 % of arable land covered by EFA are different 
measures relating to biodiversity. The first requirement ensures that existing landscape features beneficial for 
biodiversity are retained while the second guarantees that any farmer benefiting from the green direct payment 
has dedicated at least 5 % of his/her arable land to EFA. These are two different objectives relating to biodiversity 
justifying two different sets of rules and checks.

Common Commission's reply for paragraph 59 and 60
The pure costs of cross‑compliance have to be distinguished from the costs occurring to farmers and Member States 
applying sectorial legislation. Concerning sectorial legislation, the costs of compliance should be confronted with 
the costs occurring for the society in case of non‑compliance due to e.g. pollution of natural resources, eradication 
of diseases etc.

Cross‑compliance will be taken into account in a planned study on administrative burden.

61
Even if sectorial legislation already specifies minimum control rates, these are not additional controls as they may 
be used for cross‑compliance at the same time creating cost efficient synergetic effects.

62
In practice, there are no additional records keeping obligations imposed by the Commission as the obligations 
under the SMRs existed before the introduction of cross‑compliance under the sectorial EU legislation. Further, 
nor Commission Delegated Regulation (EU) No 640/2014 neither Commission Implementing Regulation (EU) No 
809/2014, laying down the details of the cross‑compliance system, introduced to farmers additional recording 
requirements. 

Reply of the Commission 

50

63
The quoted study initiated by the European Parliament and commissioned be DG AGRI did not focus on cross‑
compliance but considered legislation outside the cross‑compliance scope (Directive on the sustainable use of 
pesticides). Moreover, it is outdated as in the meantime certain requirements left the scope of cross‑compliance 
(e.g. avoiding of encroachment of unwanted vegetation and crop rotation). 

64
This is a statement based on assumptions made by Paying Agencies which is contrary to the fact that the list of 
SMRs and GAECs was considerably shortened with the last CAP reform. The Commission doubts the factual content 
of such statements, as the Paying Agencies do not back it up with figures.

65
The legislation already sets the framework for the calculation of penalties by defining severity, extent, and 
permanence as well as for the percentage to be applied for first time infringements, reoccurred infringements and 
infringements committed with intent. Hence, there is already a harmonised basis.

66
While the framework is set at EU level, on‑farm obligations under SMRs and GAEC are largely defined by Member 
States to take into account the challenges and agricultural structures in the national or regional conditions. In this 
respect it is important that a margin of implementation is left to Member States for the calculation of penalties 
for each of these on‑farm obligations. The EU regulation sets the principle that sanctions are calculated on a case 
by case basis taking into account the severity, extent, permanence, reoccurrence or intent of the non‑compliance 
determined. The harmonised implementation of these principles across Member States is ensured, in particular, 
through the audits carried out by the Commission. Should weaknesses be found in a particular Member State in this 
respect, appropriate follow‑up is brought in the framework of the clearance of accounts. Moreover, taking account 
of the Court's concerns, DG AGRI envisages organising best practice seminars with Member States on the issues.

67
The concept of intentionality is an element to keep cross‑compliance reductions proportional, as it balanced 
the former minor non‑compliances without sanctions and now the early warning system. The issue was largely 
discussed in the last CAP reform and it was finally decided by Member States to maintain it. There is judgement by 
the European Court of Justice of 27 February 2014 (C‑396/12) providing guidance on the concept of intentionality.

68
Member States have a certain liberty to design their evaluation grids (see Commission's comments under paragraph 
40, to paragraph VIII and paragraph IX 6th indent).

70
In the Commission’s view, the diverse responses by Member States can be explained by several factors, including 
the number of animal movements that took place on the farm, the mitigation action undertaken by the farmer, the 
delays in notification and the location of the farm in a Nitrate Vulnerable Zone. 

Reply of the Commission 

51

Common Commission reply to paragraph 71 and Box 7
According to the evaluation grid used in Schleswig Holstein, which is based on the same grid applied in the 
whole of Germany, the mentioned threshold is only a recommendation to the inspector which only applies to late 
notifications which were already rectified before the farmers knew that s/he would be subject to an on‑the‑spot 
check. In case the farmer did had not remedied before the control was announced, a sanction would be applied. 
Similar approaches were already observed by DG AGRI in other Member States. 

Conclusions and recommendations

73
Since 2005, the continuous process of reviewing and simplifying the cross‑compliance scope provided the following 
results:

Control procedures were simplified during the period 2005‑2013 by introducing provisions on harmonisation of 
control rates, advance notice, timing and elements of on‑the‑spot checks and selection control sample.

Further, with the last CAP reform the scope of cross‑compliance has been reviewed taken into account the 
controllability and the link with agricultural activity of farmers' obligations. Thus, the number of SMRs has been 
reduced from 18 to 13 and the number of GAEC standards was reduced from 15 to 7. 

The Commission considers that the scale of the effort already put into simplification makes it most unlikely that any 
further simplification can be achieved without undermining e.g. the environmental goals of cross‑compliance.

74
The cross‑compliance objectives are to contribute to the development of sustainable agriculture through 
awareness‑raising of farmers and making the CAP more compatible with the expectations of society. The GAEC 
objectives are to contribute to preventing soil erosion, maintaining soil organic matter and soil structure, ensuring 
a minimum level of maintenance, avoiding the deterioration of habitats and protecting and managing water. In this 
respect cross‑compliance is not the implementing tool for other policies, which have their own objectives. It is the 
Commission's view that the performance indicators used for measuring the effectiveness of cross‑compliance in 
meeting its objectives are the most appropriate on the basis of the available information.

Recommendation 1
The Commission accepts this recommendation. 

75
Half of the infringements are linked to animal related SMRs. This was taken into account by the Commission when 
performing specific scope missions in 2014 focusing on animal related SMRs. 

Analysing the reasons for infringements is done in the context of the implementation of the sectorial legislation. 
However cross‑compliance and the Farm Advisory System play a role in addressing the reasons for the 
infringements.

Reply of the Commission 

52

Recommendation 2
The Commission accepts this recommendation. 

76
The cross‑compliance legislation foresees that the on‑the‑spot checks are targeted to the most risky farms through 
a selection of the sample based on a risk analysis. In this respect Member States have already flexibility to optimise 
their cross‑compliance controls. 

Recommendation 3
The Commission does not accept this recommendation. The recommendation by the Court would not simplify 
cross‑compliance but de facto reduce its scope. The simplification of the cross compliance scope has been already 
carried out several times in the past. Moreover Member States have now a wide margin of manoeuvre to take into 
account the risks in the control sampling and to optimise their control systems. The Commission considers that this 
recommendation might result in loosening the rules on on‑the‑spot checks which would ultimately undermine the 
effectiveness of cross‑compliance. 

77
Environmental objectives (e.g. maintenance of land and biodiversity) are pursued not only by greening payments 
and GAEC standards but also by environmental and climate measures under Pillar II as well as the environmental 
legislation. However, the nature, rationale and functioning of these various instruments are different and 
complementary. Their complementarity is illustrated by Figure 1 of SWD (2016) 218 final.

Both greening rules and GAEC are managed by the IACS and this ensures the best use of resources. There are 
however reasons for the fact that GAECs and greening may not necessarily be checked together. Since greening 
is a criterion for eligibility it is controlled ex ante by administrative checks and on‑the spot checks for 5 % of 
beneficiaries. GAEC are checked under cross‑compliance which is managed differently than the eligibility 
requirements.

Recommendation 4
The Commission accepts this recommendation. 

78
The SMRs stem from sectorial legislations and Member States may make use of their existing administration and 
control systems (Article 96 of Regulation (EU) No 1306/2013). Existing control systems can thus synergistically be 
used for the cross‑compliance control system. GAEC should not either entail significant costs for farmers since 
they are meant to be basic standards. Costs of their controls are born by the IACS which serve also other CAP 
instruments.

The Commission quantified in its Annual Activity Report 2014 the overall costs related to control in Member 
States taking the reservation that ‘the deterrent effect of ex‑post controls’ (such as cross‑compliance) ‘also bring 
unquantifiable benefits’.

Reply of the Commission 

53

Recommendation 5
The Commission partially accepts this recommendation. The implementation of this recommendation will depend 
on the outcome of the planned study on administrative burden. The administrative costs of cross‑compliance 
should be viewed in the context of the costs of non‑compliance for society, public finances and the environment 
and of the potential benefits of cross‑compliance.

79
While the framework is set at EU level, on‑farm obligations under SMRs and GAEC are largely defined by Member 
States to take into account the challenges and agricultural structures in the national or regional conditions. In this 
respect it is important that a margin of implementation is left to Member States for the calculation of penalties 
for each of these on‑farm obligations. The EU regulation sets the principle that sanctions are calculated on a case 
by case basis taking into account the severity, extent, permanence, reoccurrence or intent of the non‑compliance 
determined. The harmonised implementation of these principles across Member States is ensured, in particular, 
through the audits carried out by the Commission. Should weaknesses be found in a particular Member State in this 
respect, appropriate follow‑up is brought in the framework of the clearance of accounts.

Recommendation 6
The Commission accepts this recommendation.

The Commission envisages organising exchanges of best practice on these issues.

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Event

Adoption of the Audit Planning Memorandum/Start of audit

Official sending of draft report to Commission (or other auditee)

Adoption of the final report after the adversarial procedure

Commission’s (or other auditee’s) official replies received in all languages

Date

15.7.2015

16.6.2016

7.9.2016

31.8.2016

 
Cross-compliance applies to 7.5 million farmers and links 
most CAP payments (around 47 billion euro in 2015) to 
farmers’ compliance with basic rules for the environment, 
food safety, animal health and welfare, and good 
agricultural and environmental conditions. We concluded 
that the information available did not allow the Commission 
to assess adequately the effectiveness of cross-compliance. 
The performance indicators did not take into account the 
level of non-compliance by farmers and the Commission did 
not analyse the reasons for the infringements. Even though 
the changes in the CAP for the period 2014–2020 reduced 
the number of cross-compliance rules, control procedures 
remain complex. Furthermore, the costs of implementing 
cross-compliance are not sufficiently quantified.

EUROPEAN
COURT
OF AUDITORS