COMMISSION STAFF WORKING DOCUMENT EVALUATION of the instruments applicable to State aid in the agricultural and foresty sectors and in rural areas
Date: 2021-05-11
Institutions: Directorate-General for Competition, European Commission
Subjects: EAFRD, State aid, aid to agriculture, control of State aid, farming sector, forestry economics, investment aid, regional aid, rural development, rural region

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 11.5.2021  SWD(2021) 107 final  COMMISSION STAFF WORKING DOCUMENT  EVALUATION  of the instruments applicable to State aid in the agricultural and foresty sectors and in rural areas {SEC(2021) 200 final} - {SWD(2021) 108 final}  
 
 
Table of contents 

1. 

INTRODUCTION ................................................................................................................... 3 

Purpose and scope ................................................................................................................... 3 

2.  BACKGROUND TO THE INTERVENTION ....................................................................... 8 

2.1.  Legal and policy background ........................................................................................ 8 
2.2.  Baseline scenario .......................................................................................................... 9 
2.3.  Description of the intervention and its objectives....................................................... 11 

3. 

IMPLEMENTATION / STATE OF PLAY .......................................................................... 12 

3.1.  Description of the current situation ............................................................................ 12 
3.2.  Recent relevant Commission policy developments .................................................... 14 
3.3.  Recent events .............................................................................................................. 15 

4.  METHOD .............................................................................................................................. 17 

4.1.  Short description of methodology ............................................................................... 17 
4.2.  Data collection and assessment ................................................................................... 17 
4.3.  Limitations and robustness of findings ....................................................................... 19 

5.  ANALYSIS AND ANSWERS TO THE EVALUATION QUESTIONS............................. 21 

5.1.  RELEVANCE ............................................................................................................. 22 
5.2.  EFFECTIVENESS ..................................................................................................... 30 
5.3.  EFFICIENCY ............................................................................................................. 38 
5.4.  COHERENCE ............................................................................................................ 46 
5.5.  EU ADDED VALUE.................................................................................................. 49 

6.  CONCLUSIONS ................................................................................................................... 50 

6.1.  Relevance .................................................................................................................... 50 
6.2.  Effectiveness ............................................................................................................... 52 
6.3.  Efficiency .................................................................................................................... 52 
6.4.  Coherence ................................................................................................................... 53 
6.5.  EU added value ........................................................................................................... 54 
6.6.  Lessons learned ........................................................................................................... 55 

ANNEX 1: PROCEDURAL INFORMATION ............................................................................. 57 

ANNEX 2: STAKEHOLDER CONSULTATION ........................................................................ 61 

ANNEX 3: METHODS AND ANALYTICAL MODELS ............................................................ 70 

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Glossary 

Term or acronym 

Meaning or definition 

ABER 

AIR 

CAP 

COVID-19 

DG AGRI 

DG COMP 

EAFRD 

EU 

FADN 

GBER 

RDP 

SARI 

SAM 

SME 

Agricultural Block Exemption Regulation 

Annual Implementation Report 

Common Agricultural Policy 

Coronavirus disease 2019 

Directorate General for Agriculture and Rural 
Development 

Directorate General for Competition 

European Agricultural Fund for Rural Development 

European Union 

Farm Accountancy Data Network 

General Block Exemption Regulation 

Rural Development Programme 

State aid reporting interactive 

State Aid Modernisation 

Small and Medium sized enterprises 

TFEU or Treaty 

Treaty on the Functioning of the European Union 

WTO 

World Trade Organisation 

2 

 
 
 
1. 

INTRODUCTION 

Purpose and scope 

This  document  sets  out  the  results  of  the  Commission’s  evaluation  of  the  rules  of  the 
2014 State aid framework applicable in the agricultural and forestry sectors and in rural 
areas. This framework is composed of: 

-  Commission Regulation (EU) No 702/2014 declaring certain categories of aid in the 
agricultural and forestry sectors and in rural areas compatible with the internal market 
in application of Articles 107 and 108 of the TFEU (known as the agricultural block 
exemption regulation; "the ABER")1. The ABER allows Member States to grant State 
aid to the agricultural and forestry sectors and in rural areas without prior notification 
to the Commission. 

-  2014 EU Guidelines for State aid in the agricultural and forestry sectors and in rural 
areas  2 ("the Guidelines"), laying down the conditions under which the Commission 
assesses Member States' aid notifications. The Guidelines set out the general criteria 
that will be used by the Commission when assessing the compliance of aid with the 
internal market. 

-  Commission  Regulation  (EU) No 1408/2013  on the application of  Articles 107 and 
108 of the Treaty on the Functioning of the European Union to de minimis aid in the 
agriculture sector3.  This  de minimis regulation  allows Member States to  grant  small 
amounts of aid to farmers without prior notification to the Commission. 

This State aid framework applies since July 2014. As the ABER and the Guidelines are 
set  to  expire  on  31  December  2022,  a  new  State  aid  framework  will  have  to  be 
established. This evaluation feeds into that process. 

The  purpose  of  the  evaluation  is  to  assess  the  relevance,  effectiveness,  efficiency, 
coherence  and  EU  added  value  of  this  sector-specific  framework.  However,  the 
evaluation  covers  only  the  ABER  and  the  Guidelines.  The  de  minimis  regulation  was 
revised in 2018 and will apply until the end of 2027. It is therefore not included in the 
scope of the evaluation. 

Furthermore,  horizontal  State  aid  instruments  like  the  General  Block  Exemption 
Regulation  (GBER)4  or  other  relevant  Commission  Guidelines  on  State  aid  generally 
apply  to  the  sectors  covered  by  the  instruments  under  review.  Their  applicability  is, 
however, limited for the primary production of agricultural products (traditional farming 
activities)5. 

1   OJ L 193, 1.7.2014, p. 1. 
2   OJ C 204, 1.7.2014, p. 1. Amended by the Notices published in OJ C 390, 24.11.2015, p. 4; OJ C 139, 
20.4.2018, p. 3 and OJ C 403, 9.11.2018 and OJ C 424, 8.12.2020., p. 30, and by the Corrigendum 
published in OJ C 265, 21.7.2016, p. 5. 

3   OJ L 352, 24.12.2013, p. 9. 
4   Regulation (EU) No 651/2014.  
5   This stems from the specificities of this sector and the need to define generally lower aid ceilings to 
avoid  possible  distortions  of  competition.  Primary  agricultural  production  is  for  instance  excluded 
from the scope of several GBER measures. 

3 

 
 
 
 
 
                                                           
Those horizontal State aid instruments are  not covered either by the present evaluation. 
They are subject to a separate evaluation in the context of a Fitness check6. 

This  Staff  Working  Document  (SWD)  reflects  the  findings  and  views  of  the 
Commission’s staff and does not reproduce the formal position of the Commission itself. 
It  does  not  prejudge  the  final  nature  of  any  act  or  the  content  of  any  delegated  or 
implementing acts that may be prepared by the Commission. 

This  evaluation  is  a  backward-looking  exercise.  It  seeks  to  establish  how  well  the 
agricultural State aid rules have worked since July 2014, when they started to apply, up 
until the present, based on the relevant information and data available (for example, due 
to the time lag of Member States’ reporting, the State aid Scoreboard7 data available for 
this Staff Working Document cover only aid granted until 31 December 2018). 

The  evaluation  will  assess  whether  the  State  aid  rules  under  review  are  still  fit  for 
purpose  taking  into  account  the  current  and  (already  known)  future  challenges.  It  will 
take  the  new  political  objectives  of  the  Commission,  in  particular  the  European  Green 
Deal8  (see  also  Section  3.2),  into  consideration.  The  recent  COVID-19  crisis  is  also 
considered  in  Section  3.3  and  Section  6.  However,  since  the  final  impact  of  the 
COVID-19 outbreak is not yet known, it is not dealt with in detail in this SWD. 

The  evaluation  covers  all  EU  Member  States  (including  the  UK  which  was  an  EU 
Member State during the period covered by the evaluation).  

The scope of the evaluated State aid instruments includes three sector-specific sections:  

1.  Aid for the agricultural sector;  

2.  Aid for the forestry sector; and  

3.  Rural development support for non-agricultural activities in rural areas.  

The two sections on aid for agriculture and forestry are further divided into two types of 
aid categories.  

1)  The first (and major) category covers “rural development-like measures” that may 
be  co-financed  by  the  Union  under  the  Common  Agricultural  Policy  (CAP)  or 
financed  exclusively  by  national  funds.  “Rural  development-like  measures” 
include,  for  example,  aid  for  investments,  aid  for  environmental-climate 
commitments,  aid  for  knowledge  transfer  and  information  actions,  start-up  aid 
and aid for cooperation.   

2)  The  second  aid  category  covers  measures  falling  outside  the  scope  of  rural 
development legislation. These measures can only be financed by national funds. 
For agriculture, this category includes mainly aid for risk and crisis management 
in agriculture but also certain other measures, such as aid for promotion and aid 
for  closure  of  capacity.  For  forestry,  this  category  includes  mainly  aid  with 
ecological,  protective  and recreational objectives.  It also  covers  aid  for research 
and development in both sectors. 

6   https://ec.europa.eu/competition/state_aid/modernisation/fitness_check_en.html 
7   See  https://ec.europa.eu/competition/state_aid/scoreboard/index_en.html.  The  State  aid  Scoreboard  comprises  aid 
expenditure which falls under the scope of Article 107(1) TFEU. The data is based on annual reporting by Member 
States  pursuant  to  Article  6(1)  of  Commission  Regulation  (EC)  794/2004.  The  (most  recent)  2019  State  aid 
scoreboard covers expenditures until the end of 2018. 

8   The  Communication  from  the  Commission  on  the  European  Green  Deal  (11/12/2019,  COM(2019)  640  final, 
“Green Deal Communication”) indicates that the relevant State aid guidelines will be revised by 2021 to reflect its 
policy objectives. 

4 

 
                                                           
3)  The  third  category  covers  only  measures  that  can  be  financed  under  rural 
development  programmes  by  the  European  Agricultural  Fund  for  Rural 
Development (EAFRD). This category was included in the agricultural State aid 
framework  in  2014  to  make  it  easier  for  Member  States  to  implement  those 
programmes (see Section 2.2).  

The below table shows the full scope of the agricultural State aid instruments: 

GUIDELINES FOR STATE AID IN THE AGRICULTURAL AND FORESTRY 
SECTORS AND IN RURAL AREAS  

“Rural development like” measures 

Measures financed exclusively by national funds 

AGRICULTURAL SECTOR 

Investments 
-  Primary agricultural production 
-  Cultural and natural heritage on agriculture 

holdings 

-  Relocation of farm buildings 
-  Processing and marketing of agricultural 

products 

Other RD-like 
-  Start-up aid for young farmers and 
development of small farms 
-  Transfer of agricultural holdings 
-  Agri-environmental-climate commitments 
-  Animal welfare commitments 
-  Natura 2000 and Water Framework Directive 
-  Areas facing natural constraints 
-  Organic farming 
-  Participation in quality schemes 
-  Technical support (incl. knowledge and 

information actions; advisory services; farm 
replacement services) 

-  Cooperation 

Risk and crisis management 
-  Natural disasters and exceptional occurrences 
-  Adverse climatic events 
-  Animal diseases and plant pests 
-  Fallen stock 
-  Protected animals  
- 
-  Mutual funds 

Insurance premiums 

Other 
-  Closing production capacity 
-  Livestock sector 
-  Promotion 
-  Outermost regions & Aegean islands 
-  Land consolidation 
-  Research & development 

FORESTRY SECTOR 

“Rural development like” measures 

Investments 
-  Afforestation 
-  Agro-forestry systems 
-  Prevention and restoration of damage to forests 
-  Forestry ecosystems 
-  Forestry technologies 
- 

Infrastructure for development & 
modernisation 

Other 
-  Natura 2000 forestry areas 
-  Forest environment-climate service and forest 

conservation 

-  Knowledge transfer and information actions 
-  Advisory services 
-  Cooperation 
-  Start-up aid for producer groups 

5 

Measures financed exclusively by national funds 
Ecological, protective & recreational objectives 
-  Maintenance 
ecosystems, 
landscape 

or 
biodiversity 

restoration 
or 

forest 
of 
traditional 

-  Soil quality and balanced tree growth 
-  Pathways, 

landscape  elements  and  natural 

habitats for animals 

-  Maintenance of roads to prevent forest fires 
-  Compensation  of  damage  caused  by  regulated 

animals 

-  Forest management plans 

Other 
-  Research & development 
-  Forestry land consolidation 

 
 
 
 
 
 
 
 
 
 
 
 
 
NON-AGRICULTURAL ACTIVITIES IN RURAL AREAS 

Measures financed by the EAFRD 

Investments 
-  Processing of agricultural products into non-agricultural products 
-  Cotton production 
-  Diversification into non-agricultural activities 
Other rural development measures 
-  Basic services and village renewal 
-  Start-up aid for non-agricultural activities 
-  Environmental-climate commitments (other land managers than farmers/foresters)  
-  Natura 2000 (other land managers than farmers/foresters)  
-  Knowledge transfers and information actions 
-  Advisory services 
-  Participation in quality schemes for cotton and foodstuff 
- 
-  Cooperation 
-  Setting-up of mutual funds 

Information and promotion activities 

AGRICULTURAL BLOCK EXEMPTION REGULATION 

AGRICULTURAL SECTOR 

Rural development like measures 

Measures financed exclusively by national funds 

Investments 
-  Primary agricultural production 
-  Cultural and natural heritage on agriculture 

holdings 

-  Relocation of farm buildings 
-  Processing and marketing of agricultural 

products 

Other RD-like 
-  Start-up aid for young farmers and 
development of small farms 
-  Star-up aid for producer groups 
-  Participation in quality schemes 
-  Technical support (incl. knowledge and 

information actions; advisory services; farm 
replacement services) 
-  Farm replacement services 

Risk and crisis management 
-  Natural disasters and exceptional occurrences 
-  Adverse climatic events 
-  Animal diseases and plant pests 
-  Fallen stock 
- 
Other 
-  Promotion 
-  Land consolidation 
-  Research & development 

Insurance premiums 

Measures financed by the EAFRD 

“Rural development like measures” 

FORESTRY SECTOR 

-  Knowledge transfer and information actions 
-  Advisory services 

Investments 
-  Afforestation 
-  Agro-forestry systems 
-  Prevention and restoration of damage to forests 
-  Forestry ecosystems 
-  Forestry technologies 
- 

Infrastructure for development & 
modernisation 

Other 
-  Natura 2000 forestry areas 
-  Forest environment-climate service and forest 

6 

 
 
 
 
conservation 

-  Conservation of genetic resources 
-  Start-up aid for producer groups 

Measures financed exclusively by national funds 

-  Research & development 
-  Land consolidation 

NON-AGRICULTURAL ACTIVITIES IN RURAL AREAS 

Measures financed by the EAFRD 

Investments 
-  Processing of agricultural products into non-agricultural products 
-  Cotton production 
Other 
-  Basic services and village renewal 
-  Knowledge transfers and information actions 
-  Advisory services 
-  Participation in quality schemes for cotton and foodstuff 
- 

Information and promotion activities 

The  framework  covers  a  total  of  63  measures.  Given  this  complexity,  the  evaluation  – 
while covering all measures – scrutinized more closely eight measures, chosen to provide 
a coverage of all three sectors falling within the  scope of the ABER  and  Guidelines as 
well as all aid categories and focussing on:  

-  “good  aid”,  i.e.  measures,  which  are  deemed  not  likely  to  have  major  distortive 
effects  on  competition  and  trade  (aid  mitigating  risks  inherent  to  the  agricultural 
sector, such as. plant pests, animal diseases and adverse weather events) or 

-  measures newly introduced into the framework in 2014 and/or 
-  measures with possible higher risks of distortion of competition. 

The selected measures are as follows: 

Aid for the agricultural sector: 

1)  Aid  to  make  good  the  damage  caused  by  adverse  climatic  events  that  can  be 

assimilated to natural disasters9  

2)  Aid  for  the  costs  of  the  prevention,  control  and  eradication  of  animal  diseases  and 
plant pests, aid to make good the damage caused by animal diseases and plant pests10  

3)  Aid for fallen stock11. 
4)  Aid to compensate for damage caused by protected animals12. 
5)  Aid for the payment of insurance premiums13. 

Aid for the forestry sector 

6)  Aid for the prevention and restoration of damage to  forests from  forest  fire, natural 
disasters, adverse climatic events which can be assimilated to natural disaster, other 
adverse climatic events, plant pests and catastrophic events14. 

9    Article 25 of the ABER; Section 1.2.1.2. of Part II of the Guidelines. 
10 Article 26 of the ABER; Section 1.2.1.3. of Part II of the Guidelines. 
11 Article 27 of the ABER; Section 1.2.1.4. of Part II of the Guidelines. 
12 Section 1.2.1.5. of Part II of the Guidelines. 
13 Article 28 of the ABER; Section 1.2.1.6. of Part II of the Guidelines. 

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7)  Aid  for  investments  in  forestry  technologies  and  in  processing,  mobilising  and 

marketing of forestry products15. 

Aid for non-agricultural activities in rural areas 
8)  Aid  for  investments  concerning  the  processing  of  agricultural  products  into  non-

agricultural products16.    

2.  BACKGROUND TO THE INTERVENTION 

2.1.  Legal and policy background 

State  aid  control  is  part  of  the  competition  policy  enshrined  in  the  Treaty  on  the 
Functioning  of  the  European  Union  (TFEU).  Its  objective  is  to  avoid  undue  market 
distortions  and  subsidy  races,  as  well  as  to  safeguard  the  internal  market  and  create  a 
competitive  landscape  with  a  level  playing  field  for  undertakings  and  adequate  and 
affordable choices for consumers. 

State aid is a form of support given by a Member State that provides an undertaking or 
certain  undertakings  with  an  advantage  over  its/their  competitors.  State  aid  can  be 
granted in a variety of ways, such as through the allocation of subsidies, the provision of 
interest  and  tax  relief,  State  guarantees  or  the  purchasing  of  goods  and  services  on 
preferential terms. Support financed from the Union budget is also considered to be State 
aid, if national authorities have discretion as to the use of these resources. 

Article  107(1)  TFEU  lays  down  a  negative  presumption  against  all  forms  of  State  aid. 
However,  the  State  aid  rules  enshrined  in  the  Treaty  also  include  exemptions  allowing 
State aid to  be  granted for reasons  of  economic  development  or  for the  common good. 
The exemptions that are particularly relevant for agriculture, forestry and rural areas are 
laid down in Article 107(2)(b) TFEU, which allows for aid to make good damage caused 
by  natural  disasters  and  exceptional  circumstances,  and  in  Article  107(3)(c)  TFEU, 
which  allows  for  aid  to  facilitate  the  development  of  certain  economic  activities  or 
economic areas. Aid under Article 107(2)(b) TFEU is per se compatible with the internal 
market17, whereas Article 107(3)(c) TFEU is discretionary in nature and the Commission 
has exclusive competence to decide on its application (i.e. on the compatibility of State 
aid with the internal market). When assessing the compatibility of aid, the  Commission 
balances the negative effects of the aid measure on trade and competition in the internal 
market with its positive effects on the achievement of well-defined objectives of common 
interest. 

The State aid rules are not automatically applicable to support for the agricultural sector. 
Article  42  TFEU  provides  that  State  aid  rules  shall  apply  to  production  and  trade  in 
agricultural  products18  only  to  the  extent  that  the  EU  legislator  (i.e.  the  Council  and 
European Parliament) has decided so. On that basis, the legislator has decided that State 
aid rules shall not apply to support for agriculture financed by the EU under the CAP. 
However, State aid rules and procedures fully apply to:  

-  Aid measures financed by national resources only (so-called “pure State aid”).    

14 Article 34 of the ABER; Section 2.1.3. of Part II of the Guidelines. 
15 Article 41 of the ABER; Section 2.1.5. of Part II of the Guidelines. 
16 Article 44 of the ABER; Section 3.1. of Part II of the Guidelines. 
17 However, aid under Article 107(2)(b) still has to be notified to the Commission. 
18 The scope of the notion “agricultural products” is defined by Annex I to the TFEU. 

8 

 
 
  
 
                                                                                                                                                                            
-  Rural  Development  support  falling  outside  the  scope  of  Article  42  TFEU, 

namely forestry measures and non-agricultural activities in rural areas.   

To ensure predictability and legal certainty for Member States and stakeholders on how 
the  Commission  assesses  State  aid  compatibility,  the  Commission  has  adopted  rules  in 
the form of “soft law” such as guidelines. Moreover, for less distortive aid measures, the 
Commission  has  issued  block  exemption  regulations,  pursuant  to  Article  109  TFEU, 
laying down the conditions that have to be fulfilled in order to deem a State aid measure 
compatible with the internal market without the necessity of an ex-ante notification and 
approval. 

As already described in the introduction, the Commission has set up a specific State aid 
framework for agriculture, forestry and rural areas, which comprises a block exemption 
regulation  (ABER),  Guidelines  and  a  de  minimis  regulation  for  farmers.  The  current 
framework started to apply on 1 July 2014 and was set to expire on 31 December 2020. 
However, the Commission has decided to extend its period of application until the end of 
2022. This is because the design of the future State aid rules will largely depend on the 
outcome of the CAP reform, for which the legislative procedure is still pending. 

2.2.  Baseline scenario 

The point of comparison for the present evaluation is the outcome of the previous review 
of the agricultural State aid framework applicable in the period 2007 to mid-2014. State 
aid  rules are as  a matter principle limited in time, in  order to  allow the Commission to 
update them to new challenges and policy priorities. 

The review of the 2007 State aid framework was guided by an  Impact Assessment that 
identified the following problems: 

a)  Lack  of  consistency  between  the  State  aid  rules  and  the  CAP  rules  on  rural 

development support:  

In 2013, the legislator adopted a new legal framework for rural development support 
financed by the European Agricultural Fund for Rural Development (EAFRD) under 
Regulation  (EU)  No  1305/201319.  The  lack  of  consistency  with  the  2007  State  aid 
Framework risked becoming an obstacle to the effective implementation of the Rural 
Development  policy,  in  particular  because  rural  development  measures  falling 
outside the scope of Article 42 TFEU are subject to State aid control. 

b)  Lack  of  consistency  with  the  horizontal  objectives  of  the  State  Aid  Modernisation 

initiative:  
In  2012,  the  Commission  launched  the  State  Aid  Modernisation  (SAM)  initiative 
aiming at reforming the EU State aid policies and rules20. The objectives of the SAM 
were threefold: 

- 

to foster sustainable, smart and inclusive growth in a competitive internal market 
(fostering “good aid”); 

19   Regulation (EU) No 1305/2013 of the European Parliament and of the Council of 17 December 2013 
on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) 
and repealing Council Regulation (EC) No 1698/2005, OJ L 347, 20.12.2013, p. 487. 

20   https://ec.europa.eu/competition/state_aid/modernisation/index_en.html. 

9 

 
 
 
 
    
 
 
 
 
                                                           
- 

- 

to focus the Commission’s ex-ante scrutiny on cases with the biggest impact on 
internal market whilst strengthening the Member States’ cooperation in State aid 
enforcement (“big on big, small on small”); 
to streamline the rules and provide for faster decisions (“faster access to aid”) 

Those objectives were translated into common principles and more efficient State aid 
procedures.  The previous agricultural  State aid  framework,  applicable from  2007 to 
mid-2014, did not reflect that overarching and horizontal approach.  

c)  Unnecessarily complex rules and procedures:  

-  Under  the  2007  State  aid  framework,  a  large  number  of  measures  had  to  be 
notified  to  and  approved  by  the  Commission  because  they  were  not  covered  by 
the  scope  of  the  ABER.  Moreover,  some  of  those  measures  were  not  even 
covered by the agricultural State aid Guidelines. That caused overly heavy State 
aid  procedures,  in  particular  for  rural  development  support  measures  subject  to 
State  aid  control.  These  measures  first  had  to  be  approved  by  the  Commission 
under the rural development rules and then had to be approved for a second time 
under State aid rules.  

-  There was also one frequently recurring type of aid that was not covered by the 
2007  State  aid  framework  at  all,  namely  aid  to  make  good  damage  caused  by 
protected  animals.  In  the  course  of  that  period,  the  Commission  assessed  and 
authorised  six  such  State  aid  schemes,  corresponding  to  a  total  budget  of  EUR 
3.04  million,  directly  on  the  basis  of  the  Treaty.  Otherwise,  Member  States 
preferred using the de minimis regulation21.    

As a result of the review, the following changes were brought to the agricultural State 
framework: 

-  The  specific  conditions  for  considering  aid  to  be  compatible  with  the  internal 
market  became fully  aligned with  the  conditions  for  granting rural  development 
support  under  the  CAP.  The  agricultural  State  aid  rules  adopted  in  2014  thus 
mirror the CAP rules applicable to support for rural development.   

-  The  scope  of  the  ABER  was  extended  to  cover  most  of  the  rural  development 
support  measures  financed  by  the  EAFRD.  This  means  that  Member  States  can 
implement support measures relating to forestry and non-agricultural activities in 
rural areas without having to first notify those measures to the Commission and 
wait for a Commission decision.  

-  The  objectives  of  the  SAM  and  its  ensuing  common  principles  were  fully 

integrated in the agricultural State aid framework adopted in 2014. 

The  overall  objectives  of  those  changes  were  not  only  to  achieve  a  better  consistency 
with  CAP  legislation  and  SAM  principles  but  also  to  improve  predictability  and  legal 
certainty and to simplify procedures in the context of State aid control. The baseline for 
the  present  evaluation  is  the  counterfactual  scenario  where,  in  2014,  the  Commission 

21   No exact figures are available, because Member States are not required to report on de minimis aid, but 
available information at least showed that more than EUR 10 million of de minimis aid was spent on 
aid to make good damages caused by protected animals in the period 2007 to 2012.   

10 

 
 
 
 
 
 
 
 
 
 
                                                           
would not have revised the agricultural State aid instruments but simply prolonged them 
as they were in the previous period (2007 to mid-2014) without aligning them with the 
new rural development rules and the SAM objectives and without enlarging their scope. 

The  baseline  does  not  cover  the  unlikely  scenario  that  the  State  aid  framework  would 
have  expired  without  having  been  replaced.  The  consequence  of  the  absence  of 
substantive rules would have been the direct application of the Treaty, i.e. the notification 
of  each  and  every  measure  constituting  State  aid  in  the  meaning  of  107(1)  TFEU  and 
their compatibility assessment by the Commission directly under the Treaty without any 
guiding rules to ensure predictability and legal certainty. The absence of State aid control 
as  such  is  excluded,  given  the  general  prohibition  of  State  aid  enshrined  in  the  Treaty 
since 1957.  

2.3.  Description of the intervention and its objectives 

As indicated above, the  current  State aid  rules expire on 31 December 2022. The main 
objective  of  the  revision  is  therefore  to  replace  them  with  a  new  set  of  rules.  This 
evaluation  aims at  establishing whether the current  rules have achieved their objectives 
of  alignment  with  the  CAP  and  the  SAM,  clearer  and  simpler  rules,  enhanced 
predictability and legal certainty as well as simplified State aid procedures, compared to 
the previous State aid framework established in 2007. 

As  already  indicated  in  Section  2.2,  a  large  part  of  the  current  State  aid  rules  on 
agriculture, forestry and in rural areas mirrors the rules laid down in Regulation (EU) No 
1305/2013 on support for rural development. 

However, the agricultural  State aid  rules also  apply to  other kinds of aid  measures, not 
related  to  rural  development  support,  which  may  be  financed  exclusively  by  national 
funds. This includes aid to make good damage caused by natural disasters or exceptional 
occurrences, which is per se compatible with the internal market, or measures which are 
considered  to  be  "good"  State  aid,  such  as  aid  to  make  good  the  damage  caused  by 
adverse  climatic  events  that  can  be  assimilated  to  natural  disasters,  aid  for  maintaining 
and  improving  the  genetic  quality  of  livestock,  aid  for  the  costs  of  prevention,  control 
and  eradication  of  animal  diseases  and  plant  pests,  aid  for  fallen  stock  and  aid  for 
insurance premiums. 

All  of  the  above  aid  measures  are  subject  to  State  aid  control  (known  as  State  aid 
clearance).  No  aid  may  be  granted  until  the  envisaged  aid  measure  has  either  been 
notified  to  and  authorised  by  the  Commission  or  exempted  under  a  block  exemption 
regulation (if applicable), unless it is granted as de minimis aid.  

The key objectives of the agricultural State aid framework are to: 

-  ensure  that  State  aid  instruments  minimise  the  distortion  of  competition  in  the 

agricultural and forestry sectors and in rural areas, 

-  provide predictability and legal certainty for Member States and beneficiaries, 
-  ensure  consistency  of  agricultural  State  aid  with  the  CAP  and  the  rural 

development objectives, as well as 

- 

simplify and increase the efficiency of the procedures and reduce administrative 
costs. 

11 

 
  
 
 
 
 
 
 
 
Figure 1: Intervention logic 

3. 

IMPLEMENTATION / STATE OF PLAY 

3.1.  Description of the current situation22 

A  total  of  2 487  State  aid  cases  were  exempted  under  the  ABER  or  notified  under  the 
agricultural Guidelines by the Member States during the period July 2014 to December 
2018.  Exemptions  under  the  ABER  were  used  for  1 971  cases  (79%),  while  516  cases 
(21%) were notified under the Guidelines. Italy made the largest use of the ABER (370 
cases),  followed  by  Germany  (190  cases),  Spain  (179  cases)  and  Slovenia  (177  cases). 
With the exception of Slovenia, these are decentralised Member States with exemptions 
also submitted by regions. As for notified cases, Germany notified 117 cases during the 
evaluation period, followed by Italy (93) Czechia (43), France (29) and Spain (26). 

The total  State  aid  expenditures of those cases  at  EU-28 level  amount in this  period to 
EUR 16 277.8 million.23 Almost half of it (EUR 7 819.7 million) was disbursed by four 
Member  States,  which  are  also  the  largest  agricultural  producers  in  the  EU  in  terms  of 
agricultural  output:  Italy  (EUR  2  316 million), Germany  (EUR  1  971.5  million), Spain 
(EUR 1 790.1 million) and France (EUR 1 742.1 million). 

22   Sources:  State  aid  Scoreboard  (https://ec.europa.eu/competition/state_aid/scoreboard/index_en.html) 
and  DG  COMP  internal  case  management  system  ISIS.  The  Scoreboard  comprises  aid  expenditure 
falling  under  the  scope  of  Article  107(1)  TFEU.  The  data  is  based  on  annual  reporting  by  Member 
States  pursuant  to  Article  6(1)  of  Commission  Regulation  (EC)  794/2004.  The  (most  recent)  2019 
Scoreboard covers expenditures until the end of 2018. For sake of consistency and comparability, ISIS 
data was also limited in this sub-section to the end of 2018. 

23   This figure refers to notified and block-exempted aid. Besides, some EUR 60.4 million was disbursed 
at  EU-28  level  in  the  same  period  as  non-notified  aid  (i.e.  neither  notified  nor  block-exempted).  It 
should also be noted, that this expenditure only relates to aid schemes implemented under the current 
State  aid  rules.  Total  State  aid  expenditure  in  the  agriculture  and  forestry  sector  and  in  rural  areas 
(including from schemes put in place before) amounted to EUR 31 430.4 million in the same period. 

12 

 
 
 
 
                                                           
Member  States  at  EU-28  level  have  disbursed  under  exempted  cases  EUR  8  836.8 
million,  i.e. 54.3% of the total  amount of expenditures registered during the evaluation 
period.  Out  of  this,  Italy,  Spain,  France  and  Germany  registered  expenditures  of  up  to 
EUR 4 425 million. Under notified cases in total EUR 7 441 million were disbursed, of 
which  EUR  1  016.4  million  by  Italy,  EUR  1  010  million  by  Germany  and  EUR  930 
million by Spain. 

Figure  2:  Distribution  of  State  aid  cases  according  to  the  aid  measures  under  closer  scrutiny  (EU-28,  number  of 
cases) 

Source: COMP data 

In the period 2014-2018, support for one (or more) of the State aid measures selected for 
the special focus of the evaluation24 was provided under 751 of the exempted or notified 
aid schemes for a total amount of EUR 6 307.5 million. This corresponds to 39% of the 
total agricultural State aid expenditure (all measures, all aid schemes) in that period. Risk 
management measures account for the largest amount of expenditure, namely EUR 
4  933.1  million  (78%).  Measures  in  support  of  forestry  represent  the  second  biggest 
expenditure  share,  corresponding  to  EUR  1  289.2  million  (20%).  Support  measures 
grouped under non-agricultural investments in rural areas account for EUR 85.2 million, 
or only 2% of the total expenditure. 

Figure 3: Distribution of total expenditures (€m) per measure and per agricultural State aid instrument, and share 
in total expenditure 

Source: COMP data 

24   See Section 1. 

13 

 
 
 
 
                                                           
As shown in figure 3, aid for insurance premiums was the measure in the closer scope of 
the evaluation  with  the highest  expenditure in  the period 2014-2018. Around 70% of it 
can  be  attributed  to  two  Member  States,  namely  Spain  (50%)  and  Italy  (20%).  The 
second most important measure in terms of expenditure was aid for animal diseases and 
plant  pests.  This  measure  is  widely  used  by  the  Member  States  with  available  data 
showing that the United Kingdom has registered significant expenditure (€533.4 million), 
followed by France, Germany and Poland. 

Another large group of expenditures relates to adverse climatic events with the main part 
of the budget being spent on aid schemes exempted under the ABER in France, Poland 
and Italy. 

Italy also accounted for over 80% of the expenditure incurred for the measure regarding 
the prevention of damage to forests and restoration of forest potential in that period.  

3.2.  Recent relevant Commission policy developments 

The  new  European  Commission  took  office  on  1  December  2019.  In  its  political 
guidelines,  it  outlined  its  six  overarching  priorities  for  the  period  2019-202425.  Key 
among these priorities is the development and implementation of a European Green Deal. 
On 11 December 2019, the Commission unveiled its European Green Deal which sets out 
an action plan and a roadmap of policy initiatives and legislative proposals with the aim 
of the EU reaching climate neutrality by 2050. In the framework of the European Green 
Deal, the Commission adopted in particular the Farm-to-Fork strategy26, the Biodiversity 
strategy for 203027, a proposal for a Climate Law28 as well as a new action plan for the 
Circular Economy29, all of which address issues relevant to agriculture, forestry and rural 
areas. 

The CAP plays a key role in supporting Europe’s agricultural sector – the importance of 
the  CAP  has  been  amplified  due  to  the  ongoing  COVID-19  pandemic,  which  has  been 
putting  a  strain  on  the  resilience  of  European  farmers.  Looking  ahead,  the  future  CAP 
will be an important instrument in managing the transition to sustainable food production 
systems  and  supporting  the  efforts  of  European  farmers  to  contribute  to  the  climate 
objectives of the EU and to protect the environment. Whereas agriculture is responsible 
for 10.3% of the EU’s greenhouse gas emissions, together with forestry it plays a crucial 
role  to  increase  the  carbon  sinks,  thus  to  help  decarbonise  other  sectors.    The  CAP  is 
therefore  a  key  instrument  to  support  the  development  of  new  green  business  models 
(such  as  carbon  farming)  by  farmers  and  foresters  to  incentivise  farming  practices  that 
remove  CO2  from  the  atmosphere.  Moreover,  given  that  agricultural  land  and  forests 
cover 80% of the EU territory and that a substantial share of EU funding for biodiversity 

25   https://ec.europa.eu/commission/sites/beta-political/files/political-guidelines-next-commission_en.pdf 
26  Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic and Social Committee and the Committee of the Regions – A Farm to Fork Strategy for a 
fair, healthy and environmentally-friendly food system (COM/2020/381 final). 

27  Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic and Social Committee and the Committee of the Regions – Biodiversity Strategy for 2030 
Bringing nature back into our lives (COM/2020/380 final). 

28  Proposal for a Regulation of the European Parliament and of the Council establishing the framework 
for  achieving  climate  neutrality  and  amending  Regulation  (EU)  2018/1999  (European  Climate  Law) 
(COM/2020/80 final). 

29  Communication  from  the  Commission  to  the  European  Parliament,  the  Council,  the  European 
Economic  and  Social  Committee  and  the  Committee  of  the  Regions  –  A  new  Circular  Economy 
Action Plan For a cleaner and more competitive Europe (COM/2020/98 final). 

14 

 
 
 
 
 
 
                                                           
comes  from  the  CAP,  that  policy  will  also  play  a  major  role  in  supporting  the 
achievement  of  the  EU  biodiversity  commitments  for  2030.  The  Commission  services 
have already analysed the links between the future CAP reform proposals and the Green 
Deal30  and  concluded  that  the  CAP  reform  proposal  is  compatible  with  the  Green  Deal 
and  its  associated  strategies  such  as  the  Farm  to  Fork  Strategy  and  the  Biodiversity 
Strategy.  It  has  the potential  to  accommodate the Green Deal’s  ambitions. At the same 
time,  the  Commission  services  also  identified  the  steps  needed  to  fully  align  the  CAP 
with the Green Deal and its associated strategies. These include increased ambition with 
regard  to  environmental-  and  climate  related  objectives  set  out  in  the  Commission 
proposal  for  a  Regulation  on  CAP  Strategic  Plans31  (‘no  back-sliding  principle’);  an 
ambitious  system  of  conditionality  maintaining  key  standards  (e.g.  crop  rotation,  soil 
protection,  preservation  of  peatlands  and  wetlands  as  carbon  rich  soils,  maintenance  of 
permanent grassland, agricultural land devoted to non-productive areas or features); eco-
schemes and ring-fenced spending for the environment and climate of 30% of the rural 
development budget for each CAP Strategic Plan. The proposed eco-schemes will be an 
important  innovation  of  the  new  CAP,  dedicating  substantial  funding  to  sustainable 
farming  practices,  including  minimum  requirements  for  the  use  of  fertilisers,  plant 
protection  products,  and  in  terms  of  animal  welfare.  In  co-operation  with  the  agri-
environmental commitments from the rural development framework, they will power the 
green  transition  in  agriculture.  The  negotiations  on  the  CAP  reform  are  currently 
ongoing. 

The  findings  of  the  present  evaluation  are  based  on  how  well  State  aid  rules  in  the 
agricultural  and  forestry  sectors  and  in  rural  areas  have  worked  during  the  evaluation 
period,  which  preceded  the  publication  of  the  European  Green  Deal  and  its  associated 
strategies. However, the relevance of the rules under review in the context of these recent 
policy developments is considered in section 5.1.4.2. 

3.3.  Recent events 

The  COVID-19  outbreak  created  an  unprecedented  crisis  at  a  global  level.  The 
consequences on our societies and economies have been profound. In response to these 
times  of  crises,  the  Commission  has  deployed  all  means  at  its  disposal  to  counter  the 
impact of the pandemic and support the EU Member States on their road to recovery and 
growth.  In  this  context,  the  Commission  adopted  on  19  March  2020  a  Temporary 
Framework  for  State  aid  measures  to  support  the  economy  in  the  current  COVID-19 
outbreak (the Temporary Framework)32. 

30    Commission  Staff  Working  Document:  Analysis  of  links  between  CAP  Reform  and  Green  Deal, 

SWD(2020) 93 final, 20. May 2020. 

31   Proposal for a Regulation of the European Parliament and of the Council establishing rules on support 
for  strategic  plans  to  be  drawn  up  by  Member  States  under  the  Common  agricultural  policy  (CAP 
Strategic  Plans)  and  financed  by  the  European  Agricultural  Guarantee  Fund  (EAGF)  and  by  the 
European  Agricultural  Fund  for  Rural  Development  (EAFRD)  and  repealing  Regulation  (EU)  No 
1305/2013 of the European Parliament and of the Council and Regulation (EU) No 1307/2013 of the 
European Parliament and of the Council (COM(2019)392) 

32  Communication from the Commission - Temporary framework for State aid measures to support the 
economy in the current COVID-19 outbreak, (OJ C 91I, 20.3.2020, p. 1), as amended by Commission 
Communications C(2020) 2215 (OJ C 112I, 4.4.2020, p. 1), C(2020) 3156 (OJ C 164, 13.5.2020, p. 
3),  C(2020)  4509  (OJ  C  218,  2.7.2020,  p.  3),  C(2020)  7127  (OJ  C  340I,  13.10.2020,  p.  1)  and 
C(2021) 564 (OJ C 34, 1.2.2021, p. 6). 

15 

 
 
 
 
                                                           
On  27  May  2020,  the  Commission  also  adopted  its  Recovery  Plan33  to  tackle  the 
consequences of the crisis stemming from the COVID-19 outbreak.34  

The  aim  of  the  Temporary  Framework  is  to  tackle  the  severe  liquidity  needs  of 
undertakings  due  to  the  exceptional  circumstances  created  by  the  COVID-19  outbreak, 
supporting  the  sustainability  of  otherwise  healthy  businesses,  in  order  to  facilitate  the 
recovery of the economy and minimise the impact of the outbreak on the real economy. 

Contrary  to  the  State  aid  rules  examined  in  the  present  evaluation,  the  Temporary 
Framework is based on Article 107(3)(b) TFEU, which constitutes an exceptional legal 
basis  for  compatibility  with  the  internal  market,  according  to  which  "aid  to  remedy  a 
serious  disturbance  in  the  economy  of  a  Member  State"  may  be  declared  compatible35. 
Having  recognised  the  COVID-19  outbreak  as  such  a  serious  disturbance,  in  line  with 
case law, the Temporary Framework laid down the conditions under which the COVID-
19  measures  would  be  compatible  with  the  internal  market.  As  such,  the  Temporary 
Framework  has  been  developed  to  cater  for  an  emergency  situation  and  has  led  to 
extraordinary financial commitments. It will remain temporary and is set to expire on 31 
December 2021. It complements the existing State aid rules, which are mainly based on 
Article 107(3) (c) TFEU and serve other objectives36. 

The findings of this evaluation (which is a backward-looking exercise) are based on how 
well rules have worked since their entry into force and therefore precede the COVID-19 
crisis.  Consequently, the qualitative and quantitative data used in  the evaluation do not 
take account of the crisis. 

The  end  of  the  crisis  is  still  difficult  to  predict.  Public  support  under  the  Temporary 
Framework targets the problems undertakings are currently facing and is limited in time. 
Aggregate  data  will  need  to  be  collected  to  better  assess  the  economic  and  financial 
consequences of the crisis.  

The full impact of the COVID-19 outbreak on different sectors is not yet known either. It 
is, however, already now evident, that the agriculture, forestry and agro-tourism sectors 
have suffered substantial losses. In the agricultural sector, for instance, the fight against 
the  global  Covid-19  pandemic  is  causing  unprecedented  uncertainties  in  global  food 
supply chains, with potential bottlenecks in labour markets, input industries, agriculture 
production, food processing, transport and logistics, as well as shifts in demand for food 
and  food  services.  A  recent  OECD  report37  found  that  over  the  next  ten  years  supply 
growth is going to outpace demand growth, causing real prices of most commodities to 
remain  at  or  below  their  current  levels.  According  to  WTO  data38,  food  prices  were 

33  

https://ec.europa.eu/info/live-work-travel-eu/health/coronavirus-response/recovery-plan-
europe_en#documents “Europe's moment: Repair and Prepare for the Next Generation” COM(2020) 
456 final. 

34   Regulation  2021/241  establishing  the  Recovery  and  Resilience  Facility  (RRF)  was  adopted  on  12 

February 2021, OJ L 57, 18.02.2021, p. 17. 

35   The use of Article 107(3)(b) TFEU is very restrictive. Prior to the current Temporary Framework, aid 
measures were declared compatible under this Treaty provision only as a result of the 2008 financial 
crisis and prior to that only at a few occasions, in the 1980s and 1990s in Greece. 

36   The sector-specific rules for agriculture and forestry are based on Article 107(3)(c) TFEU, allowing 
for aid to facilitate the development of economic activities and on Article 107(2)(b) TFEU, allowing 
for aid to make good damage caused by natural disasters or exceptional occurrences. 

37  The  joint  OECD-FAO  Agricultural  Outlook  2020-2029  report,  July  2020,  https://www.oecd-

ilibrary.org/agriculture-and-food/oecd-fao-agricultural-outlook-2020-2029_1112c23b-en. 

38   Covid-19 

and  Agriculture:  A  Story 

of  Resilience,  WTO 

report,  August 

2020, 

https://www.wto.org/english/tratop_e/covid19_e/agric_report_e.pdf. 

16 

 
 
 
 
 
 
                                                           
already  on  a  downward  trend  at  the  beginning  of  2020.  The  COVID-19  crisis  exerted 
further  downward  pressure  on  prices,  and  therefore  on  producer  revenues.  Prices  are 
expected to remain at low levels amid the economic downturn. 

Following the outbreak of the pandemic, the European Union’s agri-food sector showed 
resilience and has continued to provide people in the European Union with high- quality 
and safe food. Nonetheless, farmers and producers are facing difficulties and increasing 
pressure. Ensuring food security through a strong food supply chain remains one of the 
Commission’s priorities. 

According to the Commission’s market forecasts39, many uncertainties remain around the 
economic  recovery,  and  thus  on  the  evolution  of  demand  in  the  EU  and  the  world.  In 
particular, the forecast magnitude of the recession is such that it is expected to lead to a 
sharp  increase  in  unemployment  in  the  EU,  negatively  impacting  private  consumption. 
The  effects  of  the  stimulus  measures,  the  capacity  of  individual  sectors  to  adapt  their 
production, and the strength of the recovery in particular in export markets, will all drive 
demand and supply and have a direct influence on prices and thus on the profitability of 
the agri-food sector. 

The  relevance  of  the  COVID-19  crisis  with  regard  to  the  rules  under  review  is  further 
described in Section 5.1.5. 

4.  METHOD 

4.1. 

Short description of methodology 

The current evaluation is based on (i) case experience and in-house data analysis of State 
aid statistics; (ii) an external evaluation support study carried out by a contractor and (iii) 
an open public consultation40. 

The  evaluation  is  based  on  the  evaluation  questions  summarised  in  Section  5.1,  as 
grouped  around  the  five  evaluation  criteria  (relevance,  effectiveness,  efficiency, 
coherence and EU added value). The assessment is further broken down into the sectors 
and measures referred to in the introduction in Section 1, in order to take into account the 
specific characteristics of each of the sectors concerned.  

4.2.  Data collection and assessment 

Stakeholders had the opportunity to provide their feedback on a Commission roadmap41 
from 20 April 2017 to 18 May 2017.  

External experts were commissioned for the evaluation support study for the purpose of 
obtaining an independent evidence-based assessment on how the State aid rules work and 
to conduct case studies on the eight measures chosen for closer scrutiny (see Chapter 1. 
Introduction).  The  study  used  a  vast  range  of  information  sources  and  tools,  both 
quantitative and, to a larger extent, qualitative (see Figure 4 below). 

39   Short-term 

Outlook 

2020, 
https://ec.europa.eu/info/sites/info/files/food-farming-fisheries/farming/documents/short-term-outlook-
summer-2020_en.pdf. 

Agricultural  Markets 

2020, 

June 

EU 

for 

in 

40   It  should,  however,  be  noted  that  the  responses  to  the  open  public  consultation  are  of  limited 
representativeness  and  do  not  constitute  a  representative  sample  of  the  whole  population  of 
stakeholders. 

41   https://ec.europa.eu/info/law/better-regulation/initiatives/ares-2017-2039310_en 

17 

 
 
 
 
 
 
                                                           
Figure 4: Information sources and tools used in the evaluation support study 
Information sources 
Data from DG COMP 
Regulations, evaluations, other 

  Tools 

42

 and national statistics on the 

Eurostat
agricultural and forestry sector 
RDP and 2016 AIR 
Interviews with competent authorities, managing 
authorities, beneficiaries and/or their 
representatives, competitors, EC services 
FADN (regional/national) 
Other accounting data from national sources and 
application forms 

Analysis of aid schemes and expenditures 
Documentary and literature review (regulations 
and bibliography) 

Review of RDPs 

Case studies in 8 MS (include literature review, 
RDP review, interviews with competent 
authorities, managing authorities, beneficiaries 
and/or their representatives, competitors, all 
based on interview guidelines, intervention case 
studies with a counterfactual scenario) 

Intervention case studies with counterfactual 
scenario 
Online survey 

Source: ADE 

The  information  from  those  different  sources  has  been  triangulated,  ensuring  that  the 
answers to the evaluation questions are based on solid and cross-checked evidence.  

The  Commission  carried  out  an  open  public  consultation  in  order  to  give  public 
authorities  and all stakeholders the opportunity to provide their views on the review of 
the  State  aid  instruments  for  agriculture,  forestry  and  rural  areas.  The  consultation  was 
launched on the Europa  website on 26 April 2019 and was open for responses until  19 
July 201943. The public consultation generated a total of 190 responses from respondents 
in 24 Member States44. The questionnaire was divided into five sections. Section I sought 
respondents’  opinions  on  the  overall  performance  of  the  current  State  aid  rules,  on  the 
State  aid  objectives  to  be  pursued  and  on  future  challenges,  including  simplification 
possibilities.  Sections  II,  III,  and  IV  concerned  more  specifically  State  aid  issues  in 
relation to, respectively, agriculture, forestry and non-agricultural activities in rural areas. 
Section V concerned the EU added value of detailed rules for State aid control.  

The evaluation is strongly based on the Commission’s own internal assessment. In fact, 
one of the most valuable sources for the Commission to understand whether the current 
rules  work  well  and  what  needs  improvement  are  (formal  and  informal)  contacts  with 
Member  States  in  the  notification  procedure  of  State  aid  cases.  To  date,  almost  700 
notifications  were  analysed  under  the  current  rules.  Furthermore,  some  2  500  block-
exempted measures were screened for their compliance with formal requirements45. This 
provides  valuable  insight  and  a  sound  basis  for  conclusions  to  be  drawn.  This  “case 
experience”  is  complemented  by  quantitative  data  from  the  internal  case  management 

42   Eurostat as well as the statistical publication on agriculture and forests (edition 2017).  
43 

https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/2089-Review-of-Agricultural-
State-aid-Guidelines/public-consultation 

44   The majority of the replies came from respondents in Italy (36), Germany (24), Portugal (21), France 
(17),  Czech  Republic  and  Austria  (11  each).  The  two  largest  categories  of  respondents  were  aid 
beneficiaries  (55,  of  which  39  were  undertakings  active  in  the  agricultural  sector)  and  public 
authorities  handling  State  aid  (39).  The  other  types  of  respondents  were  farmers’  organisations  (20) 
and foresters’ organisations (15), public citizens (19, most of them farmers), NGOs (14), academics or 
other experts (13) and undertakings active in downstream sectors to agriculture and forestry (6). 
45   Under the  ABER, Member  States are required to submit to the  Commission a summary  information 
sheet  on  the  intended  aid  measures,  10  working  days  prior  to  its  implementation.  The  Commission 
then checks whether the formal requirements of the planned aid measure are complied with and offers 
the  Member  States  the  possibility  to  still  remedy  possible  shortcomings.  The  Commission,  however 
does not give a formal approval of the aid measure, since the responsibility for block-exempted aid lies 
solely with the Member States. 

18 

 
                                                           
database  and  analysis  of  State  aid  statistics  (including  the  State  Aid  Scoreboard46).  A 
further valuable source are Member States’ interpretation questions. 

While  no  weighting  of  the  different  sources  was  applied,  it  has  to  be  noted  that  the 
sources were complementary. The Commission’s internal assessment was complemented 
by  the  evaluation  support  study,  conducted  by  independent  experts  and  relying  on  a 
number of sources, and by the open public consultation reflecting various stakeholders’ 
views.  

4.3.  Limitations and robustness of findings 

a)  Data availability 

The general difficulty of gathering data in State aid control stems from the fact that the 
counterpart of the Commission in the proceedings is the Member States and information-
gathering  tools  are  extremely  limited.  Quantitative  data  on  State  aid  expenditure  is 
collected from Member States in the context of the State aid scoreboard (see Section 1), 
based  on  annual  reporting  pursuant  to  Article  6(1)  of  Commission  Regulation  (EC) 
794/2004. The most recently published data includes State aid expenditure until the end 
of 2018 (see also Section 1). 

The  limited  availability  of  data  at  the  time  the  contractor  carried  out  the  evaluation 
support  study  was  a  particular  challenge  for  that  study.  The  main  cause  was  the  short 
examination period of the study (unavoidable, because the duration of State aid rules is 
limited  to  seven  years).  Another  reason  lies  with  the  way  in  which  aid  schemes  are 
registered  in  the  Commission  database,  as  one  single  registered  scheme  may  include 
several  distinct  measures,  which  pursue  multiple  objectives.  Furthermore,  in  the  period 
2014-2020, the Rural  Development  Programmes expenditures for projects linked to  the 
aid  measures  selected  for  the  study  were  low  and  not  completely  reflected  in  the  data 
reported  by  Member  States.  The  reference  period  (2007-2014)  was  used  when  relevant 
and,  in  the  case  of  non-agricultural  investments,  expenditures  after  2016  were  also 
assessed.  For  forestry  investments,  only  few  expenditures  were  registered  and  the 
evaluation support study was only able to obtain detailed data for Germany. 

The evaluation support study used publicly available data on beneficiaries but could do 
so only to a limited extent, as data on individual aid is published only if it is of a larger 
size47. The online survey of the evaluation support study was addressed only to national 
authorities; for forestry and non-agricultural activities the views of managing authorities 
for the rural development programmes were collected only through case studies. 

b)  Methodological issues 

It  should  be  noted  that  there  was  no  control  group  to  assess  the  effectiveness  of  the 
examined  aid  measures.  For  example,  where  a  Member  State  grants  aid  to  compensate 
for  damage,  it  usually  grants  it  to  all  undertakings  affected  by  the  damaging  event. 
Member  States  have  also  provided  similar  compensation  for  similar  damage.  In  this 
context, it was not possible to observe directly the situation of an undertaking affected by 
an adverse event but which was not compensated. The evaluation support study tackled 

https://ec.europa.eu/competition/state_aid/scoreboard/index_en.html#what  

46  
47   From  individual  aid  grants  of  EUR  60  000  for  primary  producers  of  agricultural  products  and  from 

EUR 500 000 for all other undertakings. 

19 

 
 
 
 
 
 
                                                           
this  by  developing  a  counterfactual  scenario  and  adopted  the  same  approach  for 
investment measures.  

The assessment of effects on trade and competition was carried out qualitatively, which 
is  limiting.  However,  it  seemed  not  to  affect  the  conclusion  regarding  whether  the 
positive effects of the aid measures outweigh the potential distortive effects. Indeed, the 
potential  distortive  effects  of  risk  management  measures  in  the  agriculture  and  forestry 
sectors  are  limited  by  the  specificity  of  those  measures  and  the  types  of  beneficiaries, 
which are mostly micro, small and medium-sized enterprises (SMEs). 

c) Public consultation not representative 

The response to  the public consultation  is  of limited representativeness  as it comprised 
only 190 replies in total. This is a small number compared to the reference population of 
stakeholders, like the companies potentially affected by State aid. The main category of 
respondents  were  State  aid  beneficiaries  (30%),  public  authorities  (21%)  and  farmers’ 
associations (11%). Some environmental NGOs responded as well (7% of respondents). 
Some stakeholders who  answered did  so  because of their specific interests and thus  do 
not  constitute  a  representative  sample  of  the  whole  population  of  stakeholders48.  The 
Commission  takes  this  limitation  into  account  when  analysing  the  results  of  the  public 
consultation. As a result of this limitation it was difficult to obtain quantitative data on 
certain effects, as for instance the reduction of administrative costs. While a total of 35 
public authorities responsible for granting State aid replied to the qualitative questions on 
the reduction of administrative costs linked to block-exemptions and notifications, only 
18 provided data on average time spent on notifications/submission of information sheets 
for block exempted aid and average costs of those two procedures. In addition, the replies 
were very heterogeneous, ranging from 0.5 to 10 500 hours per notification and from 3 to 
500 hours per block-exemption. 

d) Unprecedented events 

Finally,  as  explained  above  in  section  3.3,  this  evaluation  cannot  take  into  account  the 
impact of the COVID-19 crisis which is an unprecedented situation and possible future 
policy measures which might be adopted by the Commission to deal with the impact of 
the crisis on the economy. The rules under review were only to a limited extent relevant 
given  that  they  serve  a  different  purpose  than  to  provide  liquidity  to  companies  hit  by 
unprecedented events, for which the Commission has designed a specific State aid tool, 
namely the Temporary State aid Framework (see section 5.1.5). 

5.  ANALYSIS AND ANSWERS TO THE EVALUATION QUESTIONS 

This  section  presents  the  assessment  of  the  performance  of  the  State  aid  rules  for 
agriculture, forestry and non-agricultural activities in rural areas. The assessment is based 
on  the  five  evaluation  criteria  (relevance,  effectiveness,  efficiency,  coherence  and  EU 
added value) using the evaluation questions as listed below. 

48  It has to be noted though that replies to the specific questions in the public consultation do not show any 
important  variations  depending  on  the  respondent  category  (being  it  public  authority,  beneficiary  of 
aid,  NGO  or  general  public,  see  also  in  Annex  2).  In  some  cases,  differences  between  respondent 
categories exist, that are inherent to the issues/sectors concerned. 

20 

 
 
 
 
                                                           
EVALUATION QUESTIONS 

Relevance – Section 5.1 

To  what  extent  are  the  State  aid  rules  relevant  for  the  needs  of  the  agricultural  and 
forestry  sectors  and  rural  areas,  in  particular  in  relation  to  the  objectives  of  the  rural 
development policy under the CAP? 

To  what  extent  are  the  State  aid  rules  relevant  against  the  future  policy  context,  in 
particular the European Green Deal and the future CAP? 

Effectiveness – Section 5.2 

To  what  extent  have  the  following  objectives  of  the  current  State  aid  rules  been 
achieved?  

-  Minimise distortion of competition and trade in the agricultural and forestry sectors; 
-  Provide predictability and legal certainty for Member States and beneficiaries; 
-  Assure  consistency  of  the  agricultural  State  aid  rules  with  the  CAP  and  the  rural 

development objectives; 

-  Achieve societal objectives such as ecological and economic development. 

Efficiency – Section 5.3 

To what extent are the rules efficient in terms of State aid procedures applicable to aid 
for, respectively, agriculture, forestry and non-agricultural activities in rural areas? 

To what extent have the revised rules brought simplification and reduction of 
administrative costs compared to the baseline scenario?  

Coherence – Section 5.4 

To  what  extent  are  the  State  aid  rules  coherent  with  other  EU  policies/legislation,  in 
particular the rural development policy under the CAP and the EU veterinary and public 
health policy? 

Are they coherent with the relevant horizontal State aid instruments? 

EU value added – Section 5.5 

To what extent have the State aid rules ensured EU added value? 

5.1.  RELEVANCE 

This  section  evaluates  whether  the  current  State  aid  rules  for  agriculture,  forestry  and 
rural areas meet the needs of those sectors, in particular in relation to the objectives of the 
rural development policy under the CAP. 

State  aid  to  promote  the  economic  development  of  the  agricultural  and  forestry  sectors 
and of rural areas is embedded in the broader CAP. The economic effects of State aid do 
not change depending on whether it is (even partly) financed by the Union, or whether it 
is financed by a Member State alone. Consequently, the use of State aid can be justified 
only if it is in line with the CAP and, in particular, meet the underlying objectives of the 

21 

 
 
 
 
 
 
 
 
 
rural development policy. Those objectives are, largely, to ensure viable food production 
and  to  promote  the  efficient  and  sustainable  use  of  resources  in  order  to  achieve 
intelligent  and  sustainable  growth.  A  majority  of  the  respondents  to  the  public 
consultation accorded very high importance to climate change mitigation and adaptation 
(62% and 60% respectively), ecosystem services and biodiversity (61%) and protection 
of public and animal health (53%) as well as sustainable forest management (53%).49 

Figure 5: Stakeholders’ view on importance of objectives pursued by the granting of State aid 

Source: Public consultation 

Most  of  the  State  aid  rules  for  agriculture  are  long-standing  and  have  proven  their 
relevance  over  the  years.  As  indicated  in  the  baseline  scenario  (Section  2.2),  the 
substance of the current rules have not changed significantly compared to previous State 
aid  frameworks, other than adaptations to  ensure coherence with  the rural  development 
rules and to integrate the common assessment principles introduced by the SAM50. Case-
handling practice in the period 2014 – 2020 has not revealed any significant difficulties. 
Nor did the evaluation support study or the response to the public consultation reveal any 
important failures in meeting the needs of the farm and forestry sectors.  

To remain relevant, the rules under review will however have to be considered also in the 
light  of  recent  policy  developments  and  new  Commission  priorities,  in  particular  the 
European Green Deal, the 2030 targets of the Farm to Fork and Biodiversity Strategy and 
the  future  CAP,  including  its  enhanced  environmental  ambition.  In  that  context,  the 
relevance analysis largely depends on the aid category; i.e. is it a “rural development-like 
aid  measure”,  a  measure  financed  under  a  rural  development  programme  or  a  measure 
falling outside the scope of rural development? 

The  relevance  of  the  first  two  categories,  seen  also  in  a  Green  Deal  context,  is  closely 
linked  to  the  rules  and  objectives  of  CAP  legislation.  State  aid  rules  on  “rural 
development-like  measures”  are  tailor-made  to  contribute  to  the  rural  development 
objectives embedded in the CAP. Rural development support for the forestry sector and 

49   The replies to the specific questions do not show any important variation depending on the respondent 
category (being it public authority, beneficiary of aid, NGO or general public, see also in Annex 2). On 
sustainable use of natural resources for instance, all stakeholders’ predominant reply is that this issue 
is  of  very  high  importance,  in  some  respondent  categories  scoring  even  100%  (foresters’ 
organisations). On climate change mitigation, similar tendency is observed. All respondent categories’ 
predominant reply is that this is issue is of very high importance ranging from more than a half of all 
beneficiaries in the agricultural sector up until close 90% of the responding forester’s organisations. In 
some  cases  variations  exist,  that  are  logical:  for  forester’s  organisations  or  beneficiaries  the  animal 
health and animal welfare objectives are less relevant. 

50   The performance of the SAM is already evaluated in the horizontal State aid Fitness Check. 

22 

 
 
                                                           
for non-agricultural  activities in rural areas is subject to State aid rules and procedures. 
For these two categories, the current State aid rules are therefore almost identical to the 
provisions  laid  down  in  Regulation  (EU)  No  1305/2013.  A  challenge  in  this  context  is 
the subsidiarity approach (known as the “delivery model”) envisaged for the future CAP 
Strategic  Plans  Regulation,  which  should  replace  the  current  Rural  Development 
Regulation (EU) No 1305/2013 as of 2023.  

As  regards  the  State  aid  category  falling  outside  the  scope  of  rural  development,  the 
relevance of aid  for  risk and crisis  management  in  agriculture  and forestry  has become 
even  more  accentuated  in  recent  years  and  is  closely  related  to  the  Commission’s  new 
political  objectives  addressing  climate  change  and  environmental  concerns.  The 
evaluation therefore gives specific attention to the aid categories related to risk and crisis 
management. 

5.1.1.  The agricultural sector 

The relevance of the State aid rules for the agricultural sector is assessed with a particular 
focus on the needs that farmers are facing in terms of risk and crisis management. 

Most  of  the  State  aid  rules  on  risk  and  crisis  management  are  long-standing.  The 
assessment  of  whether  the  rules  are  still  relevant  takes  into  account  overarching  risk 
elements  such  as  adverse  climatic  events,  animal  diseases  and  plant  pests,  fallen  stock 
and damage caused by protected animals. It looks in particular at the market failures that 
farmers hit by such events would be facing in the absence of public support. 

A study on risk management in EU agriculture carried out in 201851 shows that farmers 
are  increasingly  exposed  to  risks  affecting  their  income  and  agronomic  assets.  Those 
risks are to a certain extent considered to be normal business risks that should be borne 
by the farmers themselves as entrepreneurs. However, they are becoming more frequent 
and more severe, because of climate change, and can put in particular small farmers in a 
dire financial situation. Certain  tools for risk management are  available  under the CAP 
but they are of limited availability and unevenly used, according to the risk study.  

Moreover,  adverse  climatic  events,  animal  diseases  and  plant  pests  do  not  only  have  a 
direct effect on the economic situation of the undertakings affected by an adverse event, 
but can also impact negatively on related public policy objectives.  The risk management 
measures  falling  within  the  scope  of  the  current  State  aid  framework  address  farmers’ 
needs and contribute to public policy objectives in the following ways: 

-  The evaluation shows that aid to make good damage caused by adverse climatic 
events  associated  with  natural  disasters  (such  as  hail,  heavy  precipitation  and 
drought) still meets the need of farmers to overcome major financial difficulties 
generated by the  event so that they can stay in business. 

-  Aid related to animal diseases and plant pests helps safeguarding the viability of 
farm holdings and, even more importantly, prevents the spread of animal diseases 
and  plant  pests.  Aid  for  the  disposal  of  fallen  stock  prevents  the  negative 
consequences of a potential mismanagement of dead animals and thus contributes 
to  the  protection  of  public  and  animal  health.  Moreover,  it  also  addresses 

51  Ecorys  and  Wageningen  Economic  Research  Study  on  risk  management  in  EU  agriculture 

(forthcoming 2018), Study to the European Commission. 

23 

 
 
 
 
 
 
                                                           
environmental concerns by preventing the pollution of soil, air and ground water 
that would occur if fallen stock was to be buried or burned. 

-  Aid to make good damage caused by protected animals supports the co-existence 
of livestock farmers and protected animals and thus contributes to the wider CAP 
objectives  of  promoting  biodiversity.  Unlike  the  long-standing  risk  and  crisis 
management measures referred to above, aid related to protected animals was not 
covered  by  the  agricultural  State  aid  framework  until  2014.  Case-handling 
practice  shows  that  the  inclusion  of  this  aid  category  in  the  Guidelines  has 
strengthened the relevance of the agricultural State aid framework in comparison 
to the baseline scenario. 

-  Finally,  aid  for  payment  of  insurance  premiums  favours  the  emergence  of  an 
insurance market for agricultural producers that would not exist in the absence of 
public  support.  Even  if  the  European  agricultural  insurance  market  is  highly 
diverse in terms  of products  and implementation,  it appears to  be developing in 
Member States where there is public support (for example in Spain and Poland). 
However,  the  availability  of  affordable  insurance  for  farmers  is  still  limited  in 
most  Member  States.  Aid  for  insurance  premiums  therefore  remains  a 
complement to aid for compensation of damage as it is not in itself sufficient to 
mitigate the risks that farmers are facing.  

The  relevance  of  aid  for  risk  and  crisis  management  is  confirmed  by  case-handling 
practice as well as by the evaluation support study and the public consultation. Interviews 
with  competent  authorities  showed  that  the  compatibility  conditions  and  rules  are 
adequate  to  meet  the  farmers’  needs  and  this  finding  was  also  confirmed  by  the  online 
survey.  In  terms  of  expenditure,  support  measures  related  to  animal  diseases,  adverse 
climatic  events  and  insurance  premiums  are  among  the  most  important  aid  categories 
falling within the scope of the agricultural State aid framework. 

The  evaluation  thus  shows  that  aid  for  risk  and  crisis  management  continue  to  help 
achieving  the  CAP  objectives  of  viable  food  production  and  balanced  territorial 
development.  According  to  the  responses  to  the  public  consultation,  risk  management 
objectives  rank  among  the  most  important  objectives  pursued  by  the  granting  of  State 
aid.  

Nevertheless, the interviews held in the context of the evaluation support study, as well 
as the response to the public consultation, pointed towards certain difficulties in relation 
to aid to mitigate risks caused by animal diseases, as follows: 

-  Aid may only be granted in respect of diseases listed by the World Organisation for 
Animal  Health  or  listed in  Regulation  (EU)  No  652/201452,  which  means  that  State 
aid cannot be granted to compensate for loss caused by emerging diseases. 

52  Regulation (EU) No 652/2014 of the European Parliament and of the Council of 15 May 2014 laying 
down  provisions  for  the  management  of  expenditure  relating  to  the  food  chain,  animal  health  and 
animal  welfare,  and  relating  to  plant  health  and  plant  reproductive  material,  amending  Council 
Directives 98/56/EC, 2000/29/EC and 2008/90/EC, Regulations (EC) No 178/2002, (EC) No 882/2004 
and (EC) No 396/2005 of the European Parliament and of the Council, Directive 2009/128/EC of the 
European  Parliament  and  of  the  Council  and  Regulation  (EC)  No  1107/2009  of  the  European 
Parliament  and  of  the  Council  and  repealing  Council  Decisions  66/399/  EEC,  76/894/EEC  and 
2009/470/EC (OJ L 189, 27.6.2014, p. 1). 

24 

 
 
   
 
 
 
 
                                                           
-  Damage incurred during the phase of mere suspicion  of a disease requires a formal 

recognition of the outbreak of the disease53. 

-  The  rules  on  eligible  costs  do  not  allow  for  full  compensation  of  income  losses 
related to quarantine or multiannual losses and require products to be destroyed even 
if they can still be consumed. 

The evaluation support study and the outcome of the public consultation also highlighted 
that, for losses caused by protected animals, the provisions on eligible costs do not take 
into  account  indirect  costs  such  as  reduced  production  capacity.  Farmers  also  find  it 
disproportionate to have to take measures to prevent the risk of damage given that there 
are very few preventive tools that are really effective. 

The evaluation  nonetheless  concludes that the State aid rules  for the agricultural  sector 
remain relevant for farmers’ needs in terms of risk and crisis management. 

5.1.2.  The forestry sector 

The  relevance  of  the  current  State  aid  rules  for  the  forestry  sector  was  assessed  in  the 
light of the question of whether they meet the forestry objectives as defined by the rural 
development policy. The assessment was mainly based on whether the forestry State aid 
measures are used by a large majority of Member  States and whether the compatibility 
conditions,  eligible  costs  and  maximum  aid  intensities  are  adequate  in  relation  to  the 
needs of the sector. 

The  evaluation  shows  that  a  large  majority  of  the  Member  States  (24  out  of  28) 
implement aid for the prevention and restoration of damage to forests or for investments 
in forestry technologies. More than 90% of the expenditure in the period covered by that 
study concerned the prevention of damage. The major part of that expenditure was aimed 
at preventing forest fires and certain serious plant pests such as root rot and bark beetle. 
That aid was mainly implemented through rural development programmes, where 65 to 
75 programmes (out of 109) include forestry support. Only two Member States, Finland 
and  Ireland,  and  a  few  regions  in  France,  Germany  and  Italy  implemented  forestry 
measures outside the rural development programme. 

The  evaluation  shows  that  national  authorities  and  beneficiaries  find  compatibility 
conditions,  eligible  costs  and  aid  intensities  to  be  overall  adequate.  Nevertheless, 
interviews with Member States’ authorities in the context of the evaluation support study 
highlighted the following constraints: 

-  Aid  for  the  restoration  of  forests  requires  that  the  damaging  event  has  caused  “the 
destruction  of  at  least  20%  of  the  relevant  forest  potential  affected”,  a  condition 
which is considered to be unclear54. 

-  Some  entities  that  fall  outside  the  definition  of  SMEs  (such  as  rural  municipalities 
and  national  parks)  have  difficulties  complying  with  the  incentive  effect  conditions 
imposed on large enterprises, in particular the requirement to submit a counterfactual 
scenario. 

53  However, the requirement of formal recognition reflects the Green Box criteria laid down Annex 2 to 
the  Uruguay  Round  Agreement on  Agriculture of the World Trade Organisation (WTO). The Green 
Box criteria define domestic support that is exempted from reduction commitments.   

54   However, the condition merely reflects what is laid down in rural development regulation 1305/2013. 

25 

 
 
 
 
 
 
 
 
                                                           
In  addition,  several  respondents  to  the  public  consultation,  comprising  both  Member 
States  authorities  and  forestry  stakeholders,  complained  about  some  overly  restrictive 
conditions for granting aid. Among the concrete examples were aid for afforestation and 
agroforestry  (e.g.  limits  in  time  and  number  of  annual  payments)  and  difficulties  to 
support the functioning of forest management associations because of the ineligibility of 
running costs. 

The evaluation  nonetheless  concludes that the State aid  rules for the forestry sector are 
relevant  in  the  sense  that  they  largely  meet  the  forestry  objectives  defined  by  the  rural 
development policy. 

5.1.3.  Non-agricultural activities in rural areas 

The rules on aid for non-agricultural activities in rural areas were included in the scope of 
the agricultural State aid framework only to make it easier for Member States’ authorities 
to  obtain  State  aid  clearance  for  measures  financed  under  the  rural  development 
programmes. They do not allow for measures financed exclusively by national funds and 
they are therefore relevant only in the sense that they facilitate the State aid procedures 
applicable to rural development support. 

Analysis  of  statistical  data  shows  that  this  possibility  was  up  to  now  only  moderately 
used by Member States. In total, 192 aid schemes were notified or block-exempted in the 
period  July  2014  until  end  of  August  2020  in  relation  to  non-agricultural  activities  in 
rural areas55. This represents a mere 4.8% of all block-exempted cases in this period and 
close to 10% of all notified cases. Considerable differences in the uptake of the different 
sub-measures  can  however  be  observed.  While  42  aid  schemes  were  either  notified  or 
block-exempted for investments in non-agricultural activities, 40 for knowledge transfer 
and 28 for co-operation56, other measures, notably setting up of mutual funds and aid for 
disadvantages related to Natura 2000 areas were not used at all57. 

5.1.4.  Relevance of the current framework against a new policy context 

5.1.4.1. CAP Strategic Plans Regulation 

As already explained above, the State aid rules on rural development-like measures and 
measures  that  can  only  be  financed  under  a  rural  development  program  are  almost 
identical  to  the  provisions  laid  down  in  Rural  Development  Regulation  (EU)  No 
1305/2013. 

However, the subsidiarity approach envisaged in the Commission’s proposal for the CAP 
Strategic Plans Regulation will be a challenge for the next State aid framework. This is 
not  so  much  because  of  substance,  as  State  aid  objectives  and  measures  will  have  to 
remain closely linked to and coherent with the CAP, but because the level of detail in the 
current  State  aid  rules  could  interfere  with  the  implementation  of  future  rural 
development  support  measures.  Under  the  CAP  Strategic  Plans  Regulation,  the  Union 
will  define  the  basic  policy  parameters  (CAP  objectives,  broad  types  of  interventions, 

55   Source: COMP data. 
56   The cooperation measure is only foreseen in the Guidelines and cannot be block-exempted. 
57   Some  other  measures,  such  as  business  start-up  aid  for  non-agricultural  activities  or  aid  measures 
related to quality schemes for cotton and foodstuff (which are not agricultural products) were only used 
under the ABER and not a single case was notified under the Guidelines. 

26 

 
 
 
 
 
 
 
 
 
 
                                                           
basic  requirements),  but  it  will  belong  to  the  Member  States  to  tailor  the  CAP 
interventions  in  their  national  strategic  plans.  Therefore,  the  future  CAP  rules  will  not 
provide  any  precise  eligibility  criteria.  The  absence  of  detailed  rules  under  the  CAP 
means  that  also  the  design  of  the  future  State  aid  rules  will  have  to  change,  while  still 
contributing to the achievement of the objectives and targets of the EU Green Deal, the 
Farm  to  Fork  and  Biodiversity  Strategies,  the  provisions  of  the  future  CAP  and  its 
enhanced environmental ambition. 

The provisions on support for investments are an illustrating example. The current rural 
development  rules  define  a  set  of  investment  operations  eligible  for  support.  Each  of 
those operations corresponds to a given measure (or sub-measure), which is subject to a 
number  of  specific  conditions.  Maximum  support  rates  differ  depending  on  the  type  of 
measure. The CAP strategic plans proposal, on the other hand, outlines one single broad 
type  of  intervention  called  “investment”,  which  encompasses  the  current  forms  of 
support  but  without  defining  any  specific  measures  matched  by  detailed  eligibility 
criteria.  The  proposal  includes  instead  a  negative  list  of  ineligible  investments  and 
categories of expenditure. 

In  short,  the  future  CAP  legislation  will  no  longer  establish  any  detailed  eligibility 
criteria that the State aid rules could reproduce. 

5.1.4.2. European Green Deal 

As described under section 3.2, the policy initiatives under the European Green Deal are 
highly relevant for the agriculture and forestry sectors and for rural areas. 

As  also  described  under  section  3.2,  the  CAP  reform  proposal  has  the  potential  to 
accommodate  the  Green  Deal’s  ambitions,  in  particular  its  implementing  policy 
initiatives, such as the Farm to Fork Strategy and the Biodiversity Strategy. The current 
State aid framework has the potential to contribute to the transition to a sustainable and 
biodiversity-friendly  agriculture  by  reaching  the  overall  goals  of  the  Green  Deal,  in 
particular in relation to the Farm to Fork and Biodiversity strategies. Aid for investments 
in agriculture must pursue objectives such as sustainable food production, environmental 
and climate performance and animal welfare. Aid for investments in forestry must pursue 
objectives  related  to  forest  area  development  and  improvement  of  the  sustainability  of 
forests  in  terms  of  resilience,  health  and  quality.  There  is  nonetheless  scope  for 
strengthening the incentive for farmers and foresters to invest in practices contributing to 
the  achievement  of  the  Green  Deal  objectives,  taking  into  account  also  the  rules  on 
investments support under the future CAP.  

Many  of  the  other  aid  categories  falling  within  the  scope  of  the  current  State  aid 
framework also contribute to environmental and climate performance. The aid measures 
that are particularly relevant for achieving the objectives of the Green Deal are indicated 
in the table below. 

STATE AID MEASURES CONTRIBUTING TO GREEN DEAL OBJECTIVES 

Agriculture 

Forestry 

Investment aid for: 
- 
- 

sustainability of agricultural holdings 
improvement of the natural environment, 
hygiene an animal welfare standards, beyond 
Union standards 

Investment aid for: 
- 
- 
- 

afforestation and creation of woodland 
agro-forestry systems 
improvement  of 

the 

resilience  and 

the 

27 

 
 
 
 
 
 
 
 
- 

- 

infrastructure related to supply and saving of 
energy and water 
achievement of agri-environment-climate 
objectives, including biodiversity, Natura 2000 
and other high natural value systems. 

Aid for agri-environment-climate commitments and 
animal welfare  commitments 

Aid for disadvantages related to Natura 2000 and 
Water Framework Directive 

Aid for organic farming 

Aid for cooperation for joint actions undertaken 
with a view to mitigating or adapting to climate 
change 

environmental value of forests ecosystems 

Aid for disadvantages related to Natura 2000 forest 
areas 

Aid for forest-environment, climate services and 
forest conservation 

Aid for maintenance and restoration of forest 
ecosystems, biodiversity and traditional landscapes 

Aid for maintenance and improvement of soil 
quality and a balanced and healthy tree growth 

Aid for restoration and maintenance of natural 
pathways, landscape elements and features and 
natural habitat for animals 

Aid for cooperation for joint actions undertaken 
with a view to mitigating or adapting to climate 
change 

Aid for agri-environment-climate commitments to land managers not active in agriculture 
Aid for disadvantages related to Natura 2000 areas to land managers not active in agriculture 

Non-agricultural activities in rural areas 

Aid for cooperation  for joint actions undertaken with a view to mitigating or adapting to climate change 

Aid schemes for agri-climate-environment and for sustainable forests are widely used by 
Member  States.  For  instance,  in  the  period  July  2014  to  August  2020,  Member  States 
notified  or  exempted  62  measures  for  agri-environment-climate  commitments58,  35 
measures  for  forest-environment  climate  services  and  55  measures  for  afforestation. 
Under  these  three  categories  of  State  aid  measures  alone,  EUR  1  315  million  were 
disbursed in the period 2014-201859, representing some 8% of total State aid expenditure 
under the current rules in this period. 

Already  in  the  public  consultation,  which  took  place  before  the  presentation  of  the 
European Green Deal, a considerable number of respondents highlighted the importance 
of  tackling  climate  and  environment  related  challenges  in  the  State  aid  context.  In 
particular, the sustainable use of natural resources, climate change mitigation/adaptation, 
the  ecosystem  services  and  biodiversity  as  well  as  the  protection  of  public  and  animal 
health  and  sustainable  forest  management  were  perceived  as  important  objectives 
pursued  when  granting  State  aid.60  Stakeholders  would  also  favour  activities  with 
environmental and climate objectives, including an increase of the maximum aid levels 
for  environment-climate  actions  targeting  biodiversity,  ecosystem  services  and  carbon 
sequestration61. 

5.1.5.  COVID-19 context 

The rules under review were only to a limited extent relevant in the context of the current 
COVID-19  crisis,  given  that  they  in  general  serve  a  different  purpose  than  to  provide 

58   Where  beneficiaries  undertake  to  carry  out  measures  aiming  at  the  preservation  as  well  as  at  the 
promotion of the  necessary changes  to agricultural practices that  make a positive contribution to the 
environment and climate. 

59   For which statistical data on State aid expenditure is available, see section 3.1. 
60   Around  60%  of  respondents  considered  climate  change  mitigation  and  adaptation  to  be  objectives 
pursued by the granting of State aid of very high importance. This percentage is even higher for some 
respondent categories (up to close 90% for foresters’ organisations). 

61   Only 36% of respondents found that aid to the agriculture sector had until present contributed to climate 

change mitigation and/or adaptation. 

28 

 
 
 
 
                                                           
liquidity  to  companies  hit  by  unprecedented  events,  for  which  a  specific  State  aid  tool 
was designed, as explained in Section 3.3. 

The Guidelines, however, foresee the possibility to grant aid to make good the damage 
caused  by  natural  disasters  or  exceptional  occurrences  in  the  agriculture  sector  (see 
section 1.2.1.1 of the Guidelines). Contrary to the other aid categories in the Guidelines, 
this section is based on Article 107(2)(b) of the TFEU. Its application is very restrictive, 
in particular when it comes to the definition of an exceptional occurrence62. The COVID-
19 outbreak in spring 2020 was recognised as an exceptional occurrence, both because of 
its  unprecedented  character  and  its  magnitude.  In  this  context,  for  instance  the 
Netherlands  used  the  possibility  to  compensate  undertakings  in  the  horticulture, 
floriculture  and  potato  sectors  for  damages  caused  by  the  COVID-19  outbreak63. 
Lithuania  also  made  use  of  this  possibility  and  set  up  a  scheme  to  compensate  poultry 
and egg producers for income losses incurred due to the COVID-19 outbreak64. 

Several other measures in the Guidelines, in particular investment aid measures, can also 
be  used  by  Member  States  to  respond  to  such  unprecedented  declines  of  or  shifts  in 
consumer  demand,  as  observed  in  spring  2020  in  the  context  of  the  COVID-19  crisis. 
These measures can, on a more structural basis, stimulate diversification and lead to new 
economic activity in (sub)sectors hit particularly hard by the crisis. 

The rules under review are, however, relevant for the Commission crisis response under 
the  Recovery  and  Resilience  Facility  (RRF)65,  to  which  State  aid  rules  fully  apply.  In 
particular investment aid measures (such as in irrigation infrastructure or in the forestry 
sector) or measures linked to knowledge transfer and R&D in the agriculture and forestry 
sectors will contribute to fostering the digital and green transition, which the RRF aims 
to support66.  

62  See recital 330 of the Guidelines. 
63   See State aid case SA.57217 (2020/N), as modified by State aid case SA.57552 (2020/N). The full (non 
the  website 

confidential) 
https://ec.europa.eu/competition/elojade/isef/index.cfm?clear=1&policy_area_id=3. 

the  State 

decisions 

found 

text 

can 

aid 

on 

be 

of 

64   See State aid case SA.57508 (2020/N). 
65   See Section 3.3. 
66  For more information on the RRF, please see https://ec.europa.eu/info/business-economy-euro/recovery-

coronavirus/recovery-and-resilience-facility_en. 

29 

 
 
 
 
 
 
                                                           
5.2.  EFFECTIVENESS 

This  section  evaluates  to  which  extent  the  State  aid  rules  established  in  2014  for 
agriculture, forestry and rural areas have been effective in achieving their objectives of: 

  minimising distortion of competition and trade; 
  ensuring predictability and legal certainty for Member States and beneficiaries; 
  ensuring consistency with the CAP and the rural development objectives. 

The evaluation  also  looks at  whether the rules provide for “good  aid” in  the sense that 
they contribute to societal objectives such as ecological and economic development, with 
focus  on  the  measures  referred  to  in  sections  5.2.1,  5.2.2  and  5.2.3.  The  societal 
objectives are nonetheless secondary to the overall objective of State aid control, which 
is to minimise distortions of competition in the internal market. 

The  analysis  suggests  that,  as  a  whole,  the  current  State  aid  rules  have  reached  their 
objectives. The higher level of detail has allowed for a more transparent and streamlined 
compatibility assessment as regards both the Commission’s handling of notified aid and 
the  Member  States’  use  of  the  ABER.  The  implementation  of  the  common  assessment 
principles introduced by the SAM seems to have contributed to a clearer methodological 
framework.  Overall,  State  aid  control  has  become  more  predictable,  compared  to  what 
would  have  been  the  case  under  the  baseline  scenario,  and  has  thus  brought  enhanced 
legal  certainty  to  Member  States  and  aid  beneficiaries.  Better  consistency  with  rural 
development rules and objectives under the CAP was achieved through the alignment of 
the State aid rules with the Rural Development Regulation (EU) No 1305/2013. 

According to the evidence collected in the case studies, the current State aid rules have 
reached their overriding  objective of minimising  distortion of competition  and trade on 
the  internal  market.  In  the  absence  of  quantifiable  aggregate  data  on  the  effects  on 
competition and trade, the evolution of the number of complaints can be taken as proxy 
to  indicate  whether  this  objective  was  met.  According  to  internal  data,  the  number  of 
complaints  went  from  119  in  the  period  2007-2014  to  36  in  the  period  2014  -  2020. 
Moreover, most of the complaints received since 2014 concerned potential local impacts 
and  did  not  involve  intra-EU  trade  at  any  significant  scale.  The  response  to  the  public 
consultation points in the same direction. 

Moreover, State aid rules follow the logic that the smaller the size of the aid, the smaller 
is the likelihood of distortion of competition. Several aid measures under the ABER are 
therefore subject  to  notification thresholds limiting the application of that  regulation.  If 
the  aid  amount  for  an  undertaking  or  project  exceeds  a  certain  threshold,  the  Member 
State will have to notify the aid to the Commission for closer scrutiny.  

The  notification  thresholds  under  the  ABER  are  in  general  set  at  the  same  level  as  the 
thresholds for corresponding measures under the GBER, whereas investments linked to 
the primary production of agricultural products have a specific, lower ceiling: EUR 500 
000  per  undertaking  per  investment  project.  This  stems  from  the  fact  that,  due  to  the 
specificities of this sector, even low levels of aid could bear a risk of potential distortion 
of  competition.  The  lower  notification  threshold  reflects  approximately  the  ratio  of  the 
general  de  minimis  ceilings  (EUR  200  000)  and  the  specific  de  minimis  ceiling  for 
farmers (EUR 15 000 at the time the ABER was adopted). In 2018, the latter de minimis 
ceiling was raised to EUR 20 000 (and EUR 25 000 under certain conditions), pointing to 
a  possible  leeway  to  also  increase  the  notification  threshold.  However,  for  investments 

30 

 
 
 
 
 
  
 
 
linked to primary agricultural production, the notification thresholds seem to play a very 
marginal role.  

Case experience shows that only a small fraction of notifications is due to aid amounts 
above the notification threshold. The specific notification threshold of EUR 500 000 for 
investments linked to primary agricultural production can therefore be considered to be 
adequate. 

5.2.1.  The agricultural sector 

As already indicated in Section 5.1, most of the aid measures for the agricultural sector 
are  long-standing  and  the  current  rules  are,  in  substance,  mainly  the  same  as  those 
applied  under  the  previous  State  aid  framework.  The  analysis  suggests  that  these  rules 
remain  effective  in  ensuring  predictability  and  legal  certainty  but  that  there  is  no 
significant  change  compared  to  the  base-line  scenario.  However,  case-handling 
experience shows that the alignment with the rural development rules has improved the 
consistency with the CAP, notably by allowing for a streamlined interpretation of the two 
set  of rules. Otherwise, the main development  compared to  the baseline scenario is  the 
simplification resulting from the inclusion in the Guidelines of aid to compensate damage 
caused  by  protected  animals.  Previously,  this  kind  of  aid  had  to  be  assessed  directly 
under the Treaty. Since 1 July 2014, the Commission has adopted 51 State aid decisions 
under the Guidelines. 

Regarding the objective of minimising distortion on competition and trade, the evaluation 
takes into account the fact that State aid in the agricultural sector is mostly granted under 
schemes  benefiting  a  very  large  number  of  beneficiaries  (from  hundreds  to  thousands), 
which  are  almost  exclusively  undertakings  falling  within  the  category  of  SMEs.  This 
largely reflects the structure of the European agricultural sector. In 2016, there were 10 
467 760 agricultural holdings within the EU-28. An analysis by economic size shows that 
82.6%  of  these  holdings  were  small  (standard  output  <  EUR  25  000),  10.4%  were 
medium-sized and only 7% were of larger size with a standard output of more than EUR 
100 000. The average size in terms of area was around 17 ha per farm. 

The  effectiveness  in  terms  of  impacts  on  competition  and  trade  was  analysed  more 
closely  in  relation  to  the  aid  for  risk-  and  crisis  management.  This  was  done  by  a 
qualitative  assessment,  supported  by  online  survey  results,  which  showed  that  the 
distortive effects were limited for the following reasons: 

- 

-  case  studies  showed  that  the  aid  payments  did  not  increase  the  production  of  the 

recipient undertakings; 
there  were  no  signs  of  distortive  effects  on  competition  within  the  Member  States 
granting aid, because all undertakings affected by the adverse event had access to aid; 
-  potential  distortive  effects  on  competition  and  trade  between  Member  States  is  not 
excluded but is very limited, because aid amounts per undertaking are small and most 
Member States offer similar aid measures. 

Counterfactual scenarios show that aid to make good damage improves the beneficiary’s 
economic  situation,  even  if  the  aid  does  not  completely  compensate  for  the  losses 
incurred due to the adverse event. The impact on the economic situation also depends on 
the  share  of  CAP  support  (mainly  direct  payments)  in  the  farmers’  income,  which  by 
itself has an income-stabilizing effect. It ensures notably the viability of undertakings in 
fragile farming systems. 

31 

 
 
 
 
  
 
 
 
The  evaluation  thus  shows  that  the  impact  of  risk  management  aid  on  competition  and 
trade is  negligible and that  the positive  effects  largely outweigh the potential  distortive 
effects.  Overall,  the  evidence  collected  through  case-studies  indicate  that  the  aid  has 
effectively  contributed  to  societal  objectives  such  as  public  and  animal  health  and  the 
protection of biodiversity: 

  aid related to animal diseases and plant pests contributes to an increased acceptance 

of biosecurity measures in the event of epidemics; 

  aid for fallen stock guarantees a safe disposal of carcasses; 
  aid  to  make  good  damage  caused  by  protected  animals  promotes  co-existence  of 

livestock farmers and protected animals like wolves and lynxes.  

Regarding aid for the payment of insurance premiums, the support study showed that aid 
for  insurance  premiums  in  Spain  and  Poland  had  a  positive  effect  on  the  uptake  of 
insurance  but  that  other  factors  also  determine  uptake,  such  as  the  types  of  production 
and risk covered, the quality of insurance products offered or the specific conditions for 
intervention of an insurance. Some distortive impacts on competition and trade between 
Member  States  cannot  be  excluded  but  they  are  mitigated  by  the  condition  that  the  aid 
may cover only part of the insurance premium costs (65%). 

In response to the public consultation, some stakeholders pointed out that Member States 
have different financial means for granting State aid. This is a valid comment but it also 
confirms the added value of State aid control. The very reason for why the Commission 
lays  down  State  aid  rules  is  to  ensure  that  national  budgets  are  spent  on  actions  that 
contribute to public goods and do not hamper the functioning of the internal market. 

In that regard, the evaluation shows that the State aid rules have made it possible to grant 
public  support  for  which  the  positive  effects,  in  particular  the  achievement  of  public 
health objectives, exceed the very limited potential effects on competition and trade. 

Figure 6: Statements by stakeholders on State aid in the agricultural sector 

Source: Public consultation. 

32 

 
 
 
 
 
   
 
 
 
 
5.2.2.  The forestry sector 

Until the adoption of a revised State aid framework for agriculture and forestry in 2014, 
forestry aid measures were dealt with under the horizontal State aid rules or granted as de 
minimis  aid  under  Commission  Regulation  (EU)  No  1407/201367.  Case-handling 
experience shows that the inclusion of forestry aid measures in the agricultural State aid 
framework,  together  with  the  alignment  of  those  measures  with  the  rural  development 
forestry  measures,  has  not  only  led  to  a  better  consistency  with  the  CAP  but  has  also 
enhanced the predictability of State aid control. The alignment has in particular led to a 
harmonised  interpretation  of  State  aid  rules  and  rural  development  rules,  which 
contributes to ensuring legal certainty for both Member States and aid beneficiaries. As 
concerns the objective of simplifying procedures and reducing  administrative costs, the 
use of the ABER in the forestry sector is a benchmark of success (until the end of 2020, 
678 block exemptions were registered, containing a total of 892 forestry measures). 

The  achievement  of  the  objective  to  minimise  impacts  on  competition  and  trade  was 
assessed mainly on the basis of case studies relating to the following two aid measures: 

-  aid for the prevention of damage to forests and restoration of forest potential; 
-  aid  for  investment  in  forest  technologies,  processing,  mobilising  and  marketing  of 

forest products.    

The  effects  on  competition  and  trade  were  assessed  qualitatively,  based  on  the  equal 
access  to  aid  for  forest  holders/areas  within  the  Member  State  concerned  and  on  the 
influence of the aid on the volume of wood produced. 

a)  Aid for prevention of damage to forests and restoration of forest potential 

The prevention of forest fires is one of the State aid measures that Member States use the 
most to support the forestry sector. Six out of eight Member States that were subject to 
case  studies  have  set  up  schemes  to  prevent  forest  fires  and  to  restore  forest  potential 
damaged by fires. The aid is used to support infrastructure, such as fire walls, fire tracks 
and water storage, as well equipment to detect forest fires. These measures are available 
in all regions with medium or high risk exposure to forest fires. 

The case studies carried out in France showed that regions exposed to high forest fire risk 
are  mainly  located  in  the  south  of  the  country.  These  forests  are  of  low  productivity, 
except for those in Aquitaine (1.25 million ha), where the “Landes” (almost 557 000 ha), 
is a large and productive forest area. The average public investment in infrastructure and 
equipment to prevent forest fires in Aquitaine was estimated at EUR 1/ha per year. The 
contribution from forest holders was around EUR 1.6/ha per year. Together, the support 
made it possible to maintain more than 20 000 km of forest tracks and 25 000 bridges in 
557 000 ha of the Landes forest. The amount of EUR 1/ha per year represents 0.4% of 
the current value of harvested wood after 40 years, which is estimated at around EUR 8 
750.  The  case  study  thus  concluded  that  the  aid  did  not  influence  the  volume  of  wood 
produced and did not lead to an increase in production volume compared to the situation 
before the aid was granted. 

67   Commission Regulation (EU) No 1407/2013 of 18 December 2013 on the application of Articles 107 
and  108  of  the  Treaty  on  the  Functioning  of  the  European  Union  to  de  minimis  aid  (OJ  L  352, 
24.12.2013, p. 1). 

33 

 
 
 
 
 
 
 
 
                                                           
The  prevention  measure  in  Aquitaine  has  been  very  effective  in  limiting  forest  fires. 
Although  there  were  numerous  fire  outbreaks  (between  2000  and  4000  per  year  from 
2007-2016),  over  80%  of  those  fires  affected  less  than  1  ha.  The  damage  was  thus 
limited,  despite  the  fact  that  the  period  subject  to  study  included  years  with  record 
summer  temperatures,  increasing  population  in  the  concerned  departments  and  an 
increase in tourists in the summer. The measure had major positive effects on the security 
of  the  local  population  (including  tourists),  the  local  forestry-based  economy  and  the 
environment (including CO2 emissions). The case study thus concluded that the positive 
effects  of  the  aid  largely  outweighed  any  distortive  effects  on  competition  and  trade 
between Member States. That conclusion was confirmed by the respondents to the online 
survey of the evaluation study. 

The  evaluation  support  study  also  comprised  two  case  studies  on  aid  for  prevention  of 
plant  pests,  namely  prevention  of  bark  beetle  in  Germany  and  root  rot  in  Finland.  The 
scale of the two aid schemes differs in terms of expenditure in the evaluation period. The 
German scheme is small-scale (< EUR 0.4 million), whereas the Finnish scheme is large-
scale and nationwide (EUR 8.4 million). 

The  aid  aims  at  encouraging  forest  holders  to  implement  prevention  measures  that  are 
environmentally  friendly  but  cumbersome  (preferring  the  mechanical  preventive 
measures instead of insecticides in Bavaria for Bark Beetle) or using them systematically 
when harvesting (Root Rot in Finland). 

In Germany (Bavaria), aid for mechanical preventive measures was available to all forest 
holders (i.e. private forest managers, their associations and municipalities). The measures 
concern small volumes of wood (80-160m³), small amounts per application (EUR 1 300 
– EUR 2 800/application) for a total expenditures of less than EUR 0.4 million. The case 
study concluded that these very small volumes did not affect trade in the internal market. 
The  overall  conclusion  was  that  the  environmental  benefit  of  avoiding  the  use  of 
insecticides  largely  exceeds  any  distortive  effects  that  the  aid  might  have.  Despite  the 
fact  that  aid  amounts are small, they still create  incentives for  forest  holders to  use the 
laborious mechanical treatment. 

In Finland, aid for urea treatment to combat root rot when harvesting wood was available 
to all forest holders for a standard amount (EUR 75/ha). The case study showed that the 
aid  allowed  to  limit  losses  of  wood  due  to  root  rot  but  did  not  increase  the  volume  of 
wood  produced.  For  forest  holdings,  the  costs  of  the  treatment  indicatively  represents 
0.45% of the gross income from felling. However, although the treatment costs appears 
small in relation to gross income, not all foresters were treating stumps left after thinning 
or felling, even with the subsidy. The limited incentive effect of the aid explains why the 
treatment was made mandatory from mid-2016 onwards. The Finnish forest output was 
estimated at EUR 1.7 billion and EUR 1.8 billion in 2015 and 2016 respectively. Aid to 
prevent root rot represented less than 1% of the forest output and operating profit of non-
industrial forestry. It was thus unlikely that the aid would have distortive effects on the 
internal market, whereas the positive effects of limiting the spread of a serious plant pest 
was important, also for neighbouring Member States. 

The analysis of the use of aid for prevention of damage to forests and restoration of forest 
potential thus confirms that achievement of societal objectives, notably the development 
of resilient  and healthy forests that  contribute to  biodiversity  and climate  goals,  can be 
deemed to outweigh the limited effects of the aid on competition and on trade. 

34 

 
  
 
 
 
 
 
b)  Aid for investment in forest technologies and in processing, mobilising and marketing 

of forest products 

The  assessment  was  largely  based  on  a  case  study  for  Baden-Württemberg,  where  the 
rural development programme supports investment in soil-friendly forwarding machines 
(machines that carry felled logs from the stump to a roadside storage point). The aid aims 
at creating incentives for SMEs to change their equipment in order to achieve sustainable 
forwarding  of  wood.  Sustainable  forwarding  is  essential  for  the  maintenance  and 
restoration of biodiversity  and natural  regeneration. When assessing  potential  distortive 
effects on competition and trade, the study took into account the fact that the aid amount 
was very small (20% aid intensity, unique investment, aid of EUR 2 500 for moor belts 
to  EUR  11  500  for  forwarding  machines),  but  also  the  fact  that  competitors  in  other 
countries and regions did not necessarily have access to similar types  of aid. According 
to the findings of the study, the potential distortive effects were limited for the following 
reasons:  (i)  the  aid  was  small  in  absolute  terms  and  by  m³  (EUR  0.2-0.3/m³);  (ii)  the 
volume concerned small amounts of wood in difficult areas (mountainous, steep slopes, 
wet  areas);  and  (iii)  the  beneficiaries  were  mainly  micro  and  small  enterprises.  The 
competition  authority  of  a  neighbouring  region  did  not  find  the  aid  distortive.  This 
opinion  was  also  shared  by  the  respondents  to  the  online  survey.  It  was  therefore 
concluded that the environmental benefits exceeded the limited effect on competitors. 

c)  Results from the public consultation 

According to the response to the public consultation, aid in the forestry sector has had a 
generally  positive  impact.  Even  though  about  one  third  of  the  respondents  replied  that 
they had no strong views, two thirds of the respondents found that the aid has helped to 
achieve viable forest area development. Many of them also confirmed that State aid had 
helped the development of the bioeconomy, had increased the resilience and protection of 
forest ecosystems and contributed to carbon sequestration as well as to the recreational or 
ecological  function  of  forests.  Nevertheless,  three  environmental  Non-Governmental 
Organisations argued that the aid could lead to lower prices in raw materials, resulting in 
increased biomass use. 

Figure 7: Statements of Stakeholders related to State aid in forestry 

Source: Public consultation 

5.2.3.  Non-agricultural activities in rural areas 

As already pointed out above, the rules on aid for non-agricultural activities in rural areas 
were included in the scope of the agricultural State aid framework only to make it easier 
for Member States’ authorities to obtain State aid clearance for measures financed under 
the rural development programmes. The effectiveness of this kind of rural development 
support was nonetheless assessed in relation to the balance between the positive impacts 

35 

 
 
 
 
 
 
 
of  the  aid  on  jobs  and  growth  in  rural  areas  and  the  potential  distortive  effects  on 
competitors and on trade. 

The  scope  of  this  assessment  was  narrow,  because  it  turned  out  that  Member  States 
continue  using  the  same  venues  as  in  the  past  (mainly  the  GBER  and  the  general  de 
minimis rules set out in Regulation (EU) No 1407/2013) to seek State aid clearance for 
non-agricultural investments, whereas the agricultural State aid rules are applied only to 
very limited extent68. 

The assessment of the potential impact on competition and trade was done by simulating 
counterfactual  scenarios  (with  or  without  support)  based  on  accounting  information 
provided in  case studies in  four Member States.  This  was complemented by interviews 
with beneficiaries, competitors and managing authorities. 

The case studies covered investments in processing of agricultural products into a great 
variety  of  non-agricultural  products  (notably  bread  and  bakery  products,  including 
gluten-free products, craft beers, distilled products (coriander oil), fruit drinks, ice cream, 
meat products, potato snacks). Many projects were innovative and often concerned niche 
markets. 

The  scarcity  of  relevant  data  made  it  difficult  to  assess  distortive  effects  on  trade.  As 
many  projects  concerned  niche  markets  and  very  specific  products,  no  statistics  were 
publicly available on trade in the EU. It was however concluded that the aid is unlikely to 
have distortive effects on competitors or to have an impact on the internal market, for the 
following reasons: 

- 
- 

- 

- 

the aid beneficiaries are almost exclusively SMEs; 

the allowed aid intensities are as low as 10-20% (unless the investment takes place in 
a  region  with  constraints  such  as  sparsely  populated,  less  developed  or  transition 
regions, for which higher aid intensities may apply); 

the size of the investment projects were small and the aid of the large majority of the 
projects amounted to less than EUR 2 million;  

support for the same type of investments is available in a majority of Member States’ 
rural development programmes.  

Moreover,  the  projects  were  funded  under  rural  development  programmes  and 
contributed to rural development priorities, by promoting a food chain organisation with 
processing  and  marketing  of  foodstuff,  in  particular  by  ensuring  a  better  integration  of 
farmers in the agri-food chain and by promoting resource efficiency69.  
The  response  to  the  public  consultation  regarding  the  rules  on  aid  for  non-agricultural 
activities  was  weak.  However,  among  those  who  responded,  a  vast  majority  took  the 
view that the aid has favoured the creation and development of SMEs in rural areas and 
has thus had a positive impact on employment and growth as well as on the social fabric 
in those areas. 

Figure 8. Statement by stakeholders on State aid in rural areas 

68  Member States have a choice between various State aid instruments. 
69  The support study illustrated this by referring to measures supporting local and regional investments 

projects under the Finnish, German and Spanish rural development programmes. 

36 

 
 
 
 
 
 
 
  
                                                           
Source: Public consultation 

Based  on  the  various  (internal  and  external)  sources,  the  evaluation  confirms  that  the 
State  aid  rules  are  effective  in  preventing  distortive  impacts  on  competition  and  trade. 
The fact  that Member States often use GBER  instead of ABER  as a State aid  basis for 
measures  in  rural  areas  (see  under  section  5.4.5  below)  also  underpins  that  the  sector 
specific rules are not overly favourable and thus their potential for distorting competition 
is  limited.  Moreover,  any  potential  impact  on  competition  and  trade  is  balanced  by  the 
contribution of the aid to the creation of growth and jobs in rural areas. 

5.2.4.  Conclusions 

The overall conclusion drawn from case-handling practice, case-studies and the response 
to the public consultation is that that the current State aid rules have proven to be largely 
effective  in  achieving  their  objectives.  The  evaluation  confirms  that  the  rules  have 
reached  the  Treaty  objective  of  minimising  the  impact  of  domestic  support  on  the 
functioning  of  the  internal  market.  The  analysis  of  specific  aid  measures  also  suggests 
that the positive effects of those measures largely outweigh any negative effect that they 
might have had on competition and trade, in the sense that the aid has helped achieving 
the rural development objectives of viable food production, a sustainable use of resources 
in both agriculture and forestry as well as the creation of growth and jobs in rural areas. 
The analysed aid measures also seem to have achieved their societal objectives in terms 
of protecting public and animal health and contributing to the ecological development of 
the  forestry  sector.  Overall,  the  evaluation  shows  that  the  current  rules  surpasses  the 
baseline scenario when it comes to ensuring the predictability and legal certainty in State 
aid control.  

However, the evaluation also revealed some elements that may need further clarification 
or  fine-tuning  in  the  context  of  the  upcoming  revision  of  the  rules  in  order  to  enhance 
their effectiveness. 

37 

 
 
 
 
 
 
 
 
5.3.  EFFICIENCY 

This section evaluates the efficiency of the agricultural State aid rules. Besides analysing 
how  the  State  aid  rules  per  sector  have  performed  in  relation  to  the  procedure  for 
obtaining  State  aid  clearance,  it  looks  in  particular  at  whether  the  rules  have  led  to  an 
overall  simplification  and  reduction  of  administrative  costs  compared  to  the  baseline 
scenario. 

It  is  in  this  context  important  to  understand  how  block-exempted  versus  notified  aid 
measures work in praxis. In the case of exemptions, the Member State designs its project 
to be fully in line with all the conditions of the ABER, which implies that the measure is 
per  se  compatible  with  the  internal  market.  The  Member  State  can  then  implement  the 
aid measure without having to seek the Commission’s approval70. Notified measures, on 
the other hand, require the Commission’s assessment of the compatibility of the aid with 
the  internal  market  and  cannot  be  implemented  without  first  being  authorised  by  the 
Commission. 

In-house data show an overall increase in the number of exemptions under the ABER and 
a decrease of notifications under the Guidelines, since the enlargement of the scope of the 
ABER in 2014. The larger ABER uptake implies that State aid measures are processed 
more rapidly than what would be the case under the baseline scenario, since aid measures 
under  the  ABER  do  not  require  any  Commission  decision  before  being  implemented. 
This also has an impact on the undertakings benefitting from the measure, because they 
get  access  to  aid  faster.  The  figure  below  indicates  the  share  of  notifications  and 
exemptions under the previous State aid framework established in 2007 and those of the 
current State aid framework established in 2014, subject of the evaluation. 

Figure 9: Share of notifications under the Guidelines and exemptions under the ABER 

In-house  data  also  suggest  that  the  Commission’s  case  assessment  process  has  become 
more  efficient,  in  the  sense  that  the  average  number  of  days  required  for  handling 
notifications  in  the  period  2014  to  2020  has  shortened  considerably  compared  to  the 
previous period. The length of case-handling is illustrated by figure 10. The deviations in 
years  2013  and  2020  from  the  overall  trend  can  be  explained  by  the  use  of  simplified 

70   The ABER provides for an ex-ante check, but this is only a service offered to Member States and does 
not prevent the implementation of the aid (see also footnote  45). Otherwise, the Commission carries 
out an ex-post check of exempted aid based on samples.  

38 

 
 
 
   
 
 
 
                                                           
notification procedures to extend existing aid schemes that otherwise would have expired 
at the end of those years71. 

Figure 10: Length of the notification procedures in the period 2007 to 2020 (number of days) 

Source: COMP data 

5.3.1.  The agricultural sector 

The assessment mainly looked at Member States’ choices   as  regards  which  State  aid 
instrument to use in terms of efficiency considerations as well as the time that Member 
States and the Commission services spend on State aid procedures. Most of the current 
aid  measures  in  agriculture  fell  within  the  scope  also  of  the  previous  State  aid 
instruments  applicable  in  the  period  2007  to  mid-2014.  The  only  major  change, 
compared  to  the  baseline  scenario,  was  the  inclusion  in  the  Guidelines  of  aid  to  make 
good damage caused by protected animals and aid for closing production capacity. 

Statistics and interviews with  national  authorities show that State aid  procedures in  the 
field of agriculture, including preparations within the Member State, are at an acceptable 
level.  It  takes the Commission  on average five months from  the notification to  adopt  a 
decision. However, the length of that procedure is strongly influenced by the quality of 
the  notification  and  the  need  to  obtain  further  clarification  and  information  from  the 
Member State.  

The  support  study  showed  that  the  average  length  of  notification  procedures  for  risk 
management aid is more or less the same (ranging from 3.3 months for aid for insurance 
premiums to 6.5 months for aid regarding protected animals)  as for other aid categories 
within  the  agricultural  sector,  as  illustrated  by  figure  11.  The  slightly  longer  average 
duration  for  approving  aid  to  make  good  damage  caused  by  protected  animals  can  be 
explained  by  the  learning  curve  for  both  national  authorities  and  the  Commission 
services since this aid measure was included in the Guidelines only in 2014. 

71   Member States were allowed to notify prolongations of schemes in one single block-notification, on 

the basis of which the Commission adopted one single authorising decision. 

39 

 
 
 
 
 
 
 
 
                                                           
Figure  11:  Average  length  of  notification  procedures  for  agricultural  risk  management 
measures 

Statistics  show72  that  Member  States  favour  using  the  ABER  and  national  authorities 
have explained that exemptions entail less administrative costs compared to notifications. 
According  to  the  statistics  on  risk  management  aid  measures,  an  average  of  seven  aid 
schemes  is  exempted  for  every  notified  scheme.  Also  the  response  to  the  public 
consultation  showed  that  notifications  under  the  Guidelines  are  associated  with  heavier 
administrative costs than exempting aid under the ABER.  The assessment suggests that 
some Member States may even adapt their schemes to fit the rules of the ABER in order 
to escape the notification obligation. 

Interviews with Member States’ authorities showed that the main reason for notifying aid 
under  the  Guidelines  is  to  extend  the  scope  of  the  aid  scheme  to  large  undertakings. 
Some Member States  also notify aid to meet specific needs that are not  covered by the 
ABER or to ensure legal certainty. 

Member States’ authorities also confirmed that the inclusion of compensation for damage 
caused  by  protected  animals  in  the  Guidelines  has  facilitated  notification,  which  is 
supported  by  statistics  showing  that  the  aid  is  widely  used73,  but  highlighted  that 
procedures remain burdensome as the ABER does not apply to this category of aid. 

The evaluation thus concludes that the efficiency of the State aid rules for agriculture is 
generally satisfactory,  given that Member States  have a choice between the ABER  and 
the  Guidelines  and  make  that  choice  based  on  efficiency  considerations.  However  it 
poses questions as regards the need to notify aid for compensation of damage caused by 
protected animals. 

72 See section 3.1. 
73 Up to 31 December 2020, a total of 52 measures in relation to damage caused by protected animals had 

been notified to the Commission (Source: COMP data). 

40 

 
 
 
 
 
 
                                                           
5.3.2.  The forestry sector 

The  assessment  of  whether  the  State  aid  rules  for  forestry  have  become  more  efficient 
compared  to  the  baseline  scenario  mainly  looked  at  the  inclusion  of  rural  development 
support measures for forestry in the scope of the ABER. 

In that regard, the evaluation partly drew its conclusions from the case studies conducted 
on  aid  for  forestry  risk  prevention  and  investments  in  forestry  technologies.  A  large 
majority of Member States (24 out of 28) implement such forestry aid measures and do 
so mainly under the rural development programmes. The support study showed that the 
ABER  is  widely  used  for  such  support  and  interviews  with  Member  States’  authorities 
also confirmed that the inclusion of forestry measures in the ABER is perceived as a real 
simplification  compared  to  the  baseline  scenario.  For  instance,  as  many  as  66  schemes 
supporting  investments  in  forestry  technologies  have  been  exempted  under  the  ABER 
since 2014. 

However, the scope of the ABER is limited to forestry measures co-financed under rural 
development  programmes.  State  aid  for  forestry  financed  exclusively  by  national  funds 
must still be notified under the Guidelines (with a few minor exceptions). 

The  evaluation  study  showed  that  the  rules  of  the  agricultural  Guidelines  and  their 
application  are  perceived  as  cumbersome.  This  was  in  particular  the  case  of  some 
decentralised  Member  States,  where  umbrella  forestry  schemes  were  notified  for  all 
regions  and  where  it  took  the  Commission  considerable  time  to  adopt  the  authorising 
decision.  Some  Member  States  (Finland  and  Ireland,  and  a  few  regions  in  France, 
Germany  and  Italy)  nevertheless  favoured  notifying  forestry  aid  under  the  Guidelines. 
The main reason for this was that they wished to finance the aid measures exclusively by 
national  funds,  instead  of  including  them  in  their  rural  development  programmes,  in 
order to escape the budgetary constraints and administrative costs (e.g. management and 
control of expenditures) associated with rural development support. As a simpler option 
to notification, some of the Member States granted aid under the de minimis aid rules. 

The evaluation thus concludes that the inclusion of rural development support measures 
for forestry in the scope of the ABER has significantly improved efficiency compared to 
what  would  have  been  the  case  under  the  baseline  scenario,  but  that  the  need  to  notify 
forestry measures financed exclusively by national funds continues to give rise to lengthy 
procedures. 

5.3.3.  Non-agricultural activities in rural areas 

Regarding aid for non-agricultural activities in rural areas, efficiency is the most central 
of the five evaluation criteria. This is because the sole reason for extending the scope of 
the agricultural State aid framework to such aid was to speed up the State aid control of 
support under rural development programmes (see section 2.2 on the baseline scenario). 
The provisions in this area are thus a simple blue-copy of the rules on aid co-financed by 
the EAFRD or granted as top-ups to such co-financed measures. 

Rural development support covers not only investments in the processing of agricultural 
products into non-agricultural products but also diversification into other non-agricultural 
activities,  for  example  agro-tourism.  Support  for  the  latter  activities  is  covered  by  the 
scope of the agricultural Guidelines but not by the scope of the ABER. 

41 

 
 
 
 
 
 
 
 
  
 
Member States can still choose to apply other State aid instruments, such as the GBER74, 
to  obtain  State  aid  clearance  for  this  type  of  rural  development  support.  The  analysis 
therefore focused on whether the enlarged scope of the agricultural State aid framework 
has facilitated the implementation of rural development support. 

The  conclusion  is  that  the  efficiency  impact  is  moderate.  Support  for  processing  of 
agricultural  products  into  non-agricultural  product  was  exempted  under  the  ABER  in 
only 16 out of 55 rural development programmes. There were no notifications under the 
agricultural  Guidelines.  Instead,  Member  States  continued  to  use  the  State  aid 
instruments already used in the past, in particular the GBER and the general de minimis 
rules. 

The effects of extending the scope of the ABER to aid for the processing of agricultural 
products into non-agricultural products are therefore limited. Member States’ authorities 
nonetheless  expressed  their  dissatisfaction  with  the  fact  that  rural  development  support 
for diversification into activities such as agro-tourism still falls outside the scope of the 
ABER and thus requires notification. 

The evaluation therefore finds that efficiency in this area has improved, compared to the 
baseline scenario, but only to a limited extent. 

5.3.4.  Overall simplification 

The evaluation of the overall simplification and reduction of administrative costs was to 
a certain extent based on qualitative assessment, because of a lack of quantitative data. In 
the  public  consultation,  Member  States’  authorities  were  asked  to  provide  estimates  of 
the  administrative  costs  associated  with  State  aid  procedures  under,  respectively,  the 
ABER and the Guidelines. However, the response was limited and did not allow for any 
reliable measurement. 

By nature, exempting State aid under the ABER is a simpler and more efficient approach 
than  notifying  aid  to  the  Commission.  Therefore,  an  increased  use  of  the  ABER  can 
already be seen as an indication for achieved simplification. While in the period January 
2007  to  June  2014,  64%  of  cases  were  block-exempted  under  the  previous  ABER  and 
36% notified under the previous Guidelines, the uptake of the ABER  was considerably 
increased in the evaluation period, with a total of 79% of all State aid cases being block-
exempted in the time frame July 2014 until end of December 2020. 

As  could  be  expected,  Member  States’  authorities  associate  the  notification  procedure 
with  a  heavier  workload  than  exempting  aid  under  the  ABER.  Notifying  aid  under  the 
Guidelines  is  considered,  by  almost  half  of  the  public  authorities,  always  burdensome, 
for one third mostly burdensome and for one fourth sometimes burdensome (see Annex 
2). Submitting an information  sheet  under the  ABER  is  generally  considered to  be less 
burdensome (figure 12). 

Figure  12:  Perception  of  MS  authorities  on  the  administrative  burden  related  to  State  aid 
procedures 

74 See section 5.4.5. 

42 

 
 
 
 
 
 
 
 
 
 
 
 
                                                           
Source: Public consultation 

Both  the  support  study  and  the  response  to  the  public  consultation  confirmed  that  the 
widening of the scope of the ABER has largely achieved its simplification objective and 
allowed for efficiency gains, compared to the baseline scenario, in terms of time savings 
and  reduction  of  the  administrative  costs  associated  with  State  aid  procedures.  This  is 
particularly true for the inclusion in the ABER of rural development support for forestry, 
whereas  the  inclusion  such  support  for  non-agricultural  activities  had  a  rather  modest 
impact. 

Figure 13: On-line survey on the impact on efficiency (N=27) 
Do the following changes in the design and coverage of agricultural State Aid rules 
adopted in 2014 represent an improvement to the efficiency of managing State aid 
in your country, compared to those used between 2007 and 2013?  

20%

40%

60%

80%

100%

Alignment of the ABER / GL rules with RDR

Extension of ABER’s scope covering forestry 
measures (Art. 34 and Art. 41) 

Extension of ABER’s scope covering non-Annex I 
activities (Art. 44) 

41% 

41% 

33% 

4% 

15% 

4% 

4% 

22% 

4% 

22% 

7% 

4% 

22% 

37% 

7% 

26% 

7% 

Significant improvement
No opinion

Limited improvement
inconsistent responses*

No improvement
No response

Source: ADE 

As  regards  the  impact  on  undertakings,  speedier  procedures  mean  faster  access  to  aid. 
There  are  no  administrative  costs  for  undertakings  other  than  those  associated  with  the 
requirement  to  show  that  the  aid  has  incentive  effect.  For  SMEs,  this  means  having  to 
make an aid application indicating the name and size of the undertaking, a description of 
the  project  or  activity,  location,  start  and  end  dates,  the  amount  of  aid  needed  and  the 
eligible  costs.  Large  undertakings  have  to  describe  in  their  applications  the  situation 
without  aid  and  to  submit  documentary  evidence  in  support  of  that  counterfactual 
scenario. Some undertakings consider those requirements to be burdensome, but it should 
be  kept  in  mind  that  receiving  State  aid  is  a  benefit  and  not  an  obligation  imposed  on 
them. Compliance with eligibility and compatibility conditions is necessary to safeguard 
the  ultimate  objective  of  State  aid  control,  namely  to  minimise  the  potential  distortive 
impacts of aid on the internal market. 

However,  interviews  with  Member  States  and  the  response  to  the  public  consultation 
indicate  that  some  conditions  set  out  in  the  agricultural  State  aid  Guidelines  could  be 
simpler.  The  incentive  effect  requirement  is  frequently  cited  as  causing  difficulties,  in 
particular  for  aid  paid  in  the  form  of  subsidised  services.  Member  States  also  find  that 
some aid categories (e.g. cooperation and LEADER projects) are particularly difficult to 
manage  because  of  their  multidimensionality  and  the  many  actors  involved.  Case 
handling  experience  reveal  similar  difficulties  and  has  identified  some  further  flaws 
linked to the eligibility conditions set out in the Guidelines. 

The main issues identified are the following: 

43 

 
 
 
 
 
 
  
 
  
a)  Obsolete or partly outdated rules 

Conditions linked to the Common Market Organisation (CMO) 

Aid for investments in the agricultural sector is subject to the condition that it must 
not  lead to  an increase in production beyond the restrictions or limitations imposed 
by the CMO (e.g. quotas for milk and sugar production). That condition has become 
obsolete, since the production restrictions have been removed from the CMO in the 
context of the market orientation of the CAP. 

Conditions for aid to irrigation investments 

State  aid  for  investments  in  irrigation  on  agricultural  holdings  are  subject  to  very 
detailed eligibility conditions, which reproduce those laid down in the rules on rural 
development  support.  However,  several  of  those  conditions  have  become  outdated 
over time.  

Simplified cost options 

Article  67  of  Regulation  (EU)  No  1303/2013  on  common  provisions  on  EU 
investments  and  structural  funds75  provides  for  the  use  of  simplified  cost  options 
subject to certain conditions. In the light of that provision, the ABER, as amended in 
2017, sets out explicit provisions on the possibility to use simplified costs options for 
aid  co-financed  by  the  EAFRD.  However,  there  are  no  similar  explicit  rules  in  the 
Guidelines,  although  simplified  cost  options  have  been  accepted  by  way  of 
interpretation.  The  lack  of  clarity  gives  rise  to  frequent  questions  from  Member 
States authorities. 

b)  Unclear legal definitions or terms 

The following definitions or terms give rise to recurring interpretation requests: 

Protected animals 

The Guidelines provide for the possibility to compensate damage caused by wildlife 
to  both  agriculture  and  forestry.  The  provisions  applicable  to  agriculture  refer  to 
damage  caused  by  “protected  animals”  (defined  as  “animals  protected  either  by 
Union or national legislation”).  Some Member States have difficulties applying the 
definition  of  protected  animals,  especially  as  regards  animals  that  are  not  fully 
protected  but  are  the  object  of  a  certain  degree  of  protection  under  national 
legislation. 

Definition of Small and Medium sized Enterprises (SMEs) 

75   Regulation (EU) No 1303/2013 of the European Parliament and of the Council of 17 December 2013 
laying down common provisions on the European Regional Development Fund, the European Social 
Fund, the Cohesion Fund, the European Agricultural Fund for Rural Development and the European 
Maritime  and  Fisheries  Fund  and  laying  down  general  provisions  on  the  European  Regional 
Development  Fund,  the  European  Social  Fund,  the  Cohesion  Fund  and  the  European  Maritime  and 
Fisheries Fund and repealing Council Regulation (EC) No 1083/2006 (OJ L 347, 20.12.2013, p. 608).  

44 

 
 
 
 
 
 
 
 
 
 
 
 
 
                                                           
The  SME  definition  causes  difficulties  in  relation  to  municipalities,  which  must  be 
considered  large  undertakings,  regardless  their  actual  size,  and  are  thus  required  to 
submit  a  counterfactual  scenario  when  applying  for  aid.  That  can  dissuade  small 
municipalities  from  seeking  aid  for  investments  in  local  infrastructure  or  in  the 
forestry sector because of the costs and efforts involved in setting up such a scenario. 

Promotion and advertising 

In  previous  State  aid  rules,  a  distinction  was  made  between  promotion  actions  (i.e. 
any  action  aiming  at  providing  information  about  agricultural  products)  and 
advertising  campaigns  (i.e.  any  action  encouraging  consumers  to  buy  agricultural 
products). Within the concept of advertising, a further distinction was made between 
ordinary  advertising,  where  a  reference  could  be  made  to  the  origin  of  the  product, 
and generic advertising, where no reference to the origin of the product was allowed. 

In the 2014 State aid framework, promotion and advertising have been merged into 
one  single  concept  called  “promotion”,  for  the  sake  of  coherence  with  the 
terminology  used  in  Regulation  (EU)  No  1144/2014  on  promotion  of  agricultural 
products76. Moreover, the definition of what used to be called generic advertising has 
become ambiguous due to the absence of a clear description of the generic character 
of an action and the presence, in the Guidelines, of an additional phrase stating that 
the promotion action has to be for the benefit of all producers of the type of product 
concerned.  

Because  of  those  changes,  Member  States  have  had  difficulties  in  determining 
whether  the  promotion  measures  they  intended  to  implement  were  promotion  or 
advertising  actions  according  to  the  old  definitions  used  and  whether  what  they 
considered as advertising was generic or not. They also have problems in identifying 
the  applicable  aid  rates  (the  aid  rate  for  ordinary  advertising  is  50  %,  whereas  it  is 
100%  for  promotion  actions  and  generic  advertising  according  to  the  previous 
definitions). 

c)  Overly complex aid measures 

Subsidised services 

Regarding  aid  for  subsidised  services,  (e.g.  knowledge  transfer  and  information 
actions, advisory services, replacement services, keeping of herd books, removal and 
destruction  of  fallen  stock,  carrying  out  of  tests,  etc.),  Member  States’  authorities 
have  difficulties  to  distinguish  between  the  aid  recipient  (i.e.  the  service  provider) 
and  the  final  beneficiaries  (i.e.  the  undertakings  to  which  the  service  is  provided). 
They  often  also  have  difficulties  in  identifying  the  final  beneficiaries,  especially 
where  the  potential  scope  is  very  broad  like  in  the  case  of  promotion  measures  or 
information actions.  

76   Regulation (EU) No 1144/2014 of the European Parliament and of the Council of 22 October 2014 on 
information  provision  and  promotion  measures  concerning  agricultural  products  implemented  in  the 
internal market and in third countries (OJ L 317, 4.11.2014, p. 56). 

45 

 
 
 
 
 
 
 
 
 
 
                                                           
5.3.5.  Conclusions 

The evaluation of efficiency concludes that the revised rules introduced in 2014 have had 
an  overall  positive  simplification  impact,  compared  to  the  baseline  scenario.  However, 
there are still some short-comings that should be addressed under future State aid rules to 
improve  the  efficiency  of  State  aid  control  and  do  away  with  unnecessarily  unclear  or 
complex provisions under the agricultural State aid Guidelines.    

5.4.  COHERENCE 

This  section evaluates the coherence of the agricultural  State aid  framework with  other 
EU policies and legislations, in particular the rural development policy under the CAP.  
The  evaluation  also  looked  at  whether  the  State  aid  rules  are  coherent  with  the  EU 
veterinary and public health policy and with the rules laid down in Regulation (EU) No 
652/2014 on the management of expenditure relating to the food chain, animal health and 
animal welfare, plant health and plant reproductive material. 

5.4.1.  The agricultural sector 

One of the key objectives of the agricultural State aid framework is to ensure consistency 
and  coherence  with  the  CAP  and,  in  particular,  the  underlying  objectives  of  the  rural 
development  policy in  terms of viable food production, efficient  and sustainable use of 
resources  and  intelligent  and  sustainable  growth.  The  revised  rules  introduced  in  2014 
therefore  mirror,  to  a  large  extent,  the  CAP  rules  applicable  to  support  for  rural 
development, as already pointed out above. State aid case-practice is also aligned, as far 
as possible, with the interpretation of the rural development legislation. Coherence with 
the CAP is therefore an inherent element of the State aid rules for the agricultural sector. 

However, self-standing State aid rules apply to aid for risk and crisis management. In this 
area,  the  evaluation  focussed  on  coherence  with  EU  and  national  veterinary  and  public 
health policies. The case studies carried out  in  that context  confirmed the coherence of 
the State aid rules for combatting animal diseases and plant pests with EU legislation and 
national  policies.  The  studies  nevertheless  showed  some  variation  between  Member 
States  as  regards  the  relationship  between  measures  financed  exclusively  by  national 
funds and interventions co-financed by the EU under Regulation (EU) No 652/2014. In 
some Member States, State aid is used to co-finance EU programmes to cover costs that 
are not eligible under that  regulation,  such  as compensation for  restocking  costs. Other 
Member  States  use  State  aid  to  finance  measures  falling  outside  the  scope  of  EU  co-
financed programmes, but which are still coherent with the rules of Regulation (EU) No 
652/2014,  for  example  aid  for  vaccination  campaigns  at  regional  level  in  Spain.  The 
support  study  also  confirmed  that  State  aid  for  the  disposal  of  fallen  stock  are  aligned 
with the rules of the “Animal by-products Regulation (EC) No 1069/2009. 

Member  States  can  subsidise  insurance  premiums  under  both  State  aid  rules  and  rural 
development rules. However, the latter are slightly stricter and the study confirmed that 
most  Member  States  prefer  to  finance  such  subsidies  exclusively  by  national  funds  in 
accordance with State aid rules. 

The response to the public consultation showed that 27% stakeholders find the State aid 
rules  to  be  fully  or  largely  coherent  with  the  EU  veterinary  and  public  health  policy, 
whereas 21% agreed to some extent. 

46 

 
 
 
 
 
 
  
 
 
 
The  evaluation  thus  concludes  that  the  rules  on  State  aid  for  the  agricultural  sector  are 
largely coherent with both the CAP and the EU veterinary and public health policy. 

5.4.2.  The forestry sector 

The  evaluation  focussed  on  whether  the  State  aid  rules  for  forestry  have  become  more 
coherent,  compared  to  the  baseline  scenario,  with  the  rules  on  co-financed  rural 
development measures and national top-ups. 

The support study used a qualitative approach to assess this issue. It first compared legal 
frameworks and then validated the findings through interviews with national authorities 
in the case studies and the outcome of the online survey. The comparison of rules showed 
a significant improvement compared to the baseline scenario, which is the obvious result 
of the almost complete alignment between the State aid rules introduced in 2014 and the 
underlying 
rules.  Moreover,  coherence  with  other  EU 
policies/legislation mostly depends on the effects of that alignment. 

rural  development 

The  study  nevertheless  identified  some  slight  differences  at  the  level  of  both  eligible 
costs  and  aid  intensities.  Working  capital  linked  to  a  new  investment  in  forest 
technologies  is  an  eligible  cost  in  rural  development  but  not  under  the  State  aid  rules. 
This  is  because  aid  for  working  capital  constitutes  operating  aid,  which  is  generally 
prohibited under the agricultural State aid framework. Member States therefore have to 
use  the  de  minimis  aid  to  obtain  State  aid  clearance  if  they  wish  to  subsidise  working 
capital. Moreover, the maximum aid rate for some investments in less developed regions 
(e.g. investments in new technologies) is slightly lower (50%) than the aid rate provided 
for in the rural development regulation (65%). 

However, the interviewed national authorities did not find the differences to be much of a 
constraint or blocking factor for the implementation of rural development support. It was 
generally  considered  that  the  differences  had  not  influenced  the  design  of  support 
measures  and  that  the  aid  beneficiaries  were  not  even  aware  of  the  differences  in  aid 
rates. 

The evaluation thus concludes that the rules on State aid for the forestry sector are largely 
coherent with the rural development rules under the CAP. 

5.4.3.  Non-agricultural activities in rural areas 

The  evaluation  assessed  only  the  coherence  between  State  aid  rules  and  rural 
development rules, given that aid for non-agricultural activities in rural areas are included 
in  the  agricultural  State  aid  framework  only  to  facilitate  the  implementation  of  rural 
development support measures. To achieve this, tailor made provisions were included in 
the ABER and the Guidelines for measures co-financed by the EAFRD. Coherence with 
other EU policies/legislation is just the knock-on effect of that alignment. 

The support study showed that the  alignment of State aid  rules  with  rural  development 
legislation led to an almost complete coherence with the CAP, compared to the baseline 
scenario. There are some differences in aid rates, but they stem only from the necessity to 
stay in line with the State aid rules on regional aid (as also reflected in the GBER) under 
which  the  Commission  may  also  authorise  national  support  for  non-agricultural 
investments). 

47 

 
  
 
  
   
 
  
  
 
   
 
The evaluation therefore concludes that the current State aid rules are fully coherent with 
the rural development rules under the CAP. 

5.4.4.  Overall coherence with other EU policies and legislation 

To sum  it  up, coherence with  other EU policies  and legislation is  largely dependent  on 
the alignment of the State aid rules with CAP legislation. 

The  close  link  to  the  CAP  has  a  particular  impact  on  the  coherence  between  State  aid 
rules  and  the  EU  environmental  protection  policy.  State  aid  rules  with  climate-  and 
environmental objectives fully mirror the rural development rules. However, in addition, 
the State aid Guidelines require that Member States in their State aid notifications make 
an assessment on whether or not the aided activity is expected to have any environmental 
impact. If there is such an impact, the Member State must demonstrate that the aid will 
not  result  in  an  infringement  of  EU  environmental  protection  legislation.  Moreover,  all 
notified State aid measures with a potential impact on environment are submitted to DG 
Environment for further scrutiny in the context of interservice consultations. 

In the public  consultation,  44% of the stakeholders considered the State  aid  rules to  be 
fully  or  largely  coherent  with  the  CAP  legislation,  while  33%  agreed  to  some  extent. 
Regarding coherence with the EU environmental protection policy, 32% fully or largely 
agreed while 35% agreed to some extent. 

It  should  also  be  noted  that  one  of  the  objectives  of  the  2014  reform  was  to  bring 
agricultural  State  aid  rules  in  line  with  horizontal  objectives  of  the  State  Aid 
Modernisation  (SAM)  initiative  (see  section  2.2).  This  has  been  achieved  to  a  large 
extent. The objectives of the SAM and its ensuing common principles were integrated in 
the current agricultural State aid framework. Around 62% of stakeholders recognized in 
the public consultation that agricultural State aid rules are (at least to some extent) now 
coherent with horizontal State aid rules. 

Figure 14: Perception of stakeholders on coherence of State aid rules with EU policies 

Source: Public consultation 

5.4.5.  Coherence with horizontal State aid instruments 

The  State  aid  framework  for  agriculture,  forestry  and  rural  areas  is  coherent  with  the 
GBER  and the Regional Aid Guidelines77, which  are the  most relevant  horizontal State 
aid instruments for the sectors concerned. 

77    Guidelines on regional State aid for 2014-2020 (OJ C 209, 23.7.2013, p. 1). 

48 

 
 
 
  
  
 
 
 
 
 
                                                           
The  GBER  fully  applies  to  processing  and  marketing  of  agricultural  products,  forestry 
and  any  non-agricultural  measures  in  rural  areas  (i.e.  the  sectors  covered  by  the 
instruments  under  review).  Its  applicability  is,  however,  limited  for  the  primary 
production of agricultural products. This stems from the specificities of this sector78 and 
the  need  to  define  generally  lower  aid  ceilings  to  avoid  possible  distortion  of 
competition.  Therefore,  primary  agricultural  production  is  excluded  from  the  scope  of 
several GBER measures.  

Within  these  limits,  Member  States  have  a  choice  either  to  apply  the  more  tailor-made 
measures in the State aid framework for agriculture, forestry and rural areas, or to apply 
horizontal State aid rules. This is spelled out in Article 1(2) of the ABER. 

The  Guidelines  include  all  horizontal  SAM  requirements  (in  particular  the  common 
assessment principles) and the ABER mirrors the horizontal GBER provisions. 

Notification  thresholds  under  the  ABER  are  aligned  to  those  for  SME  investment  aid 
under the GBER (with specific lower ceilings for primary agriculture production). 
For  measures  in  rural  areas  (i.e.  which  fall  outside  agriculture  and  forestry),  the  sector 
specific framework is aligned with the horizontal rules in order not to undermine those 
rules. In particular, when investment aid is involved, both ABER and Guidelines provide 
for  aid  intensities,  which  are  in  line  with  the  GBER  and  the  Regional  Aid  Guidelines 
respectively. 

As explained above, Member States have a choice to apply either the sector specific rules 
or the horizontal State aid rules. Especially for measures in rural areas, they sometimes 
opt  to  use  the  GBER.  This  is  rather  a  good  sign  as  it  shows  the  coherence  of  the  two 
instruments  and  confirms  that  no  “shopping  around”  for  more  favourable  conditions  in 
the sector specific instruments takes place. 

5.5.  EU ADDED VALUE 

This  section  evaluates  the  overall  added  value  of  the  existence  of  State  aid  rules  for 
agriculture, forestry and rural areas.  

As a starting point, it should be recalled that State aid  rules, as part of the competition 
policy, are enshrined in the Treaty and that their added value results from the fact that, if 
the Commission had not adopted tailor made State aid provisions, it would have had to 
assess national support measures only at the basis of the Treaty. In the absence of State 
aid  guidelines,  frameworks  and  regulations,  Member  States  would  have  had  to  notify, 
one by one, all planned State aid measures and the Commission would have had to assess 
them  directly  under  107  TFEU  and  take  individual  decisions  on  each  notification.  The 
mere existence of specific State aid  rules  thus  intrinsically reduces administrative costs 
for both Member States’ authorities and the Commission services. 

In  addition,  the  Commission  State  aid  rules  allow  Member  States  and  potential 
beneficiaries  to  know  ex-ante  the  rules  that  the  Commission  will  use  to  assess  the 
compatibility of notified aid with the internal market. This guarantees predictability and 
increases the legal certainty of State aid control. 

78   The  sector  of  primary  agricultural  production  (classical  farming  activities)  is  very  small  structured 

with the vast majority of undertakings being small or even micro enterprises. 

49 

 
 
 
 
 
 
 
 
 
 
                                                           
This  is  also  true  for  the  agricultural  State  aid  framework.  The  evaluation  shows  that  it 
allows Member States to grant State aid in a common and transparent  manner and thus 
ensures  predictability,  transparency  and  legal  certainty  for  both  Member  States  and 
undertakings. In their absence, Member States could take different approaches leading to 
market  distortion  and  unequal  treatment.  The  evaluation  also  shows  that  the  State  aid 
rules introduced in 2014 has strengthened the coherence with the rural development rules 
under the CAP, thereby facilitating public intervention to respond to the specific needs of 
farmers  and  foresters,  while  still  providing  sufficient  safeguards  to  minimise  potential 
distortive  impacts  on  competition  and  trade  on  the  internal  market.  In  the  public 
consultation, an overwhelming majority of the respondents (82%) agreed that there is EU 
added  value  in  having  a  common  framework  of  detailed  rules  for  assessing  the 
compatibility of State aid with the internal market. 

Figure 15. Stakeholder perception on the EU added value of the State aid framework 

Source: Public consultation 

The evaluation  thus  concludes that the agricultural  State aid  framework adopted by the 
Commission  provides  clarity,  stability  and  predictability  for  Member  States  when  they 
design their aid schemes and that it also reduces administrative costs.  

6.  CONCLUSIONS 

6.1.  Relevance 

The  evaluation  concludes  that  the  agricultural  State  aid  framework  set  up  in  2014  has 
until  now  adequately  met  the  needs  of  farms  and  foresters  and  contributed  to  the 
achievement  of  rural  development  objectives  under  the  CAP  as  well  as  other  public 
policy  objectives,  in  particular  those  related  to  environmental  protection  and  veterinary 
and  public  health.  The  widespread  use  in  terms  both  of  number  of  aid  schemes  and 
expenditure also shows that the scope of the State aid rules is appropriate to meet those 
needs.  However,  the  subsidiarity  approach  envisaged  for  the  future  CAP  will  be  a 
challenge for the design  of the next State aid  framework. To remain relevant,  the State 
aid rules will also have to contribute to the achievement of Green Deal objectives and in 
particular those of the Farm to Fork and Biodiversity strategies.    

The  overall  conclusion  is  that  the  current  State  aid  framework  is  relevant.  Notably,  it 
adequately meets the needs of the agricultural and the forestry sectors and contributes to 
achieving the CAP objectives of viable food production, sustainable use of resources as 
well as intelligent and sustainable growth. 

50 

 
  
  
 
 
 
 
 
 
However, some challenges, and in particular climate change and environmental concerns, 
have become more accentuated in recent years. These challenges are closely linked to the 
Commission’s new political objectives, and in particular those under the European Green 
Deal,  which  set  the  goal  of  achieving  climate  neutrality  at  EU  level  by  2050,  and  the 
2030  Climate  Target  Plan  that  raised  the  EU’s  ambition  of  greenhouse  gas  emissions 
reductions  to  55%  by  2030.  In  this  context,  the  Farm  to  Fork  Strategy  and  the 
Biodiversity  Strategy  are  the  most  relevant  of  the  recent  Commission  policy  initiatives 
for the sectors concerned by the agricultural State aid rules. 

The  relevance  of  the  State  aid  rules  for  the  agricultural  sector  was  assessed  with 
particular focus on aid for risk and crisis management. This assessment took into account 
risks  and  crises  such  as  adverse  climatic  events,  animal  diseases  and  plant  pests.  The 
evaluation  showed  that  State  aid  rules  still  meet  the  needs  of  farmers  to  overcome 
financial difficulties caused by such events.  It also showed that State aid is relevant for 
the protection of public and animal health and meeting environmental concerns. This was 
confirmed by case-handling practice, the public consultation and the evaluation support 
study.    The  evaluation  nonetheless  revealed  some  weaknesses  in  relation  to  aid  to 
mitigate  risks  caused  by  animal  diseases,  for  which  the  current  provisions  do  not  take 
into account emerging diseases. Moreover, the provisions on eligible costs do not always 
allow for full compensation of income losses and require products to be destroyed even if 
they could still be put to some sort of use. 

The  relevance  of  the  State  aid  rules  for  the  forestry  sector  was  mainly  assessed  in 
relation  to  whether  those  rules  meet  the  forestry  objectives  defined  by  the  rural 
development  policy  under  the  CAP.  The  evaluation  support  study  showed  that  a  large 
majority of the Member States implement aid for forestry and do so  mainly under rural 
development programmes. Compatibility conditions, eligible costs and aid intensities are 
perceived  to  be  overall  adequate.  However,  smaller  rural  municipalities  and  national 
parks  face  administrative  difficulties  in  presenting  the  contra-factual  scenarios  required 
for the aid applications of large undertakings. 

The rules on aid for non-agricultural activities in rural areas are relevant only in the 
sense that they facilitate the State aid procedures applicable to rural development support. 

The evaluation further showed the State aid framework has the right tools to achieve the 
targets  of  the  European  Green  Deal  but  that  more  can  be  done  to  contribute  to  the 
objectives  of  the  Farm  to  Fork  Strategy  and  the  Biodiversity  Strategy.  There  is  in 
particular  scope  for  initiatives  to  strengthen  the  incentive  for  farmers  and  foresters  to 
invest in practices contributing to the achievement of initiatives taken under those three 
strategies. 

Moreover,  the  subsidiarity  approach  envisaged  in  the  Commission’s  proposal  for  the 
future Regulation on CAP Strategic Plans Regulation will be a challenge for the design 
of the next State aid Framework, given that CAP legislation will no longer establish any 
detailed eligibility criteria that the State aid rules could reproduce. 

51 

 
 
  
 
 
 
 
 
6.2.  Effectiveness 

As a whole, the current State aid rules have reached their objectives, in particular the 
overriding objective of  minimising distortive impacts  on competition  and trade in  the 
internal  market.  The  analysis  of  specific  aid  measures  also  suggests  that  the  positive 
effects  of  those  measures  largely  outweigh  potential  negative  impacts  on  competition 
and  trade.  Moreover,  the  alignment  of  the  current  State  aid  rules  with  rural 
development  legislation  and  the  common  assessment  principles  introduced  under  the 
SAM  has  helped  enhancing  the  predictability  and  legal  certainty  of  State  aid  control. 
However,  the  evaluation  has  also  revealed  some  elements  that  may  need  further 
clarification  or  fine-tuning  in  the  context  of  the  upcoming  revision  of  the  eligibility 
conditions.  

The assessment focussed on how effective the State aid rules are in minimising potential 
distortive effects on competition and trade, for each sector. It  showed that the potential 
distortive effects on competition and trade are overall negligible. To begin with, the aid 
beneficiaries  in  agriculture and forestry  are almost  exclusively SMEs. Aid amounts are 
generally small and low aid intensities mitigate aid measures with a higher potential for 
distortive impacts, such as aid for non-agricultural investments. 

The evaluation therefore concludes that the State aid rules have reached their overriding 
objective  of  minimising  potential  distortive  impacts  on  competition  and  trade.  It  also 
concludes  that  aid  granted  under  the  current  State  aid  framework  has  effectively 
contributed to the development of the agriculture and forestry sectors in the sense that the 
aid  has  helped  achieving  the  rural  development  objectives  of  viable  food  production,  a 
sustainable  use  of  resources  and  the  creation  of  growth  and  jobs  in  rural  areas.  In 
addition,  the  aid  has  contributed  to  the  achievement  of  societal  objectives  such  as 
ecological development  and public health. Overall, those positive impacts outweigh the 
limited negative impact on competition and trade. 

Moreover, the alignment with the rural development legislation, including a higher level 
of detail under the current rules, has led to a more streamlined assessment of aid at both 
Commission and national level. The evaluation thus shows that the current State aid rules 
have  surpassed  the  previous  ones  in  terms  of  enhancing  the  predictability  and  legal 
certainty of State aid control. 

However,  the  evaluation  has  also  revealed  some  elements,  in  particular  outdated  or 
ambiguous rules, which may need further clarification or fine-tuning in the context of the 
upcoming revision of the rules in order to enhance their effectiveness. 

6.3.  Efficiency 

The  revision  of  the  agricultural  State  aid  instruments  has  at  least  partly  reached  its 
objective  of  simplification  and  reduced  administrative  costs.  This  was  mostly  achieved 
by  including  rural  development  support  measures  for  forestry  and  non-agricultural 
activities  in  the  scope  of  the  ABER.  However,  notification  of  State  aid  under  the 
Guidelines  remains  burdensome  for  Member  States  and  sometime  gives  rise  to  lengthy 
procedures.  

The  evaluation  looked  at  how  the  revised  State  aid  rules  have  performed  in  relation  to 
State aid procedures. In particular, it examined to what extent they have simplified those 

52 

 
 
 
 
 
 
 
procedures  and  led  to  a  reduction  of  administrative  costs  compared  to  the  baseline 
scenario. 

For agriculture, the assessment shows that Member States favour using the ABER, as it 
means  less  administrative  costs  compared  to  notifying  aid  under  the  Guidelines.  The 
main  reason  for  notifying  aid  is  to  extend  the  scope  of  the  aid  scheme  to  large 
undertakings. Some Member States also notify aid in response to specific needs that are 
not covered by the ABER or to ensure legal certainty. The support study confirmed that 
the inclusion of compensation for damage caused by protected animals in the Guidelines 
has facilitated the notification of relevant measures by the Member States. However, it 
highlighted that procedures remain cumbersome for low levels of aid. 

The inclusion of rural development support measures in the forestry sector in the scope 
of  the  ABER  has  significantly  increased  the  efficiency  of  State  aid  procedures.  The 
support study showed that the ABER is widely used and that Member States’ authorities 
perceive this  to  be a real  simplification. However, the scope of the ABER  is  limited to 
forestry  measures  co-financed  under  rural  development  programmes.  Aid  measures 
financed  exclusively  by  national  funds  remain  subject  to  the  notification  obligation.  In 
that  regard,  Member  States  authorities  find  that  the  rules  of  the  Guidelines  and  their 
application  remain  complex.  The  inclusion  of  rural  development  support  measures  for 
forestry  in  the  scope  of  the  ABER  is  therefore  considered  a  success,  whereas  Member 
States  find  it  demanding  to  have  to  fulfil  the  notification  obligation  applicable  to 
measures financed outside the scope of rural development programmes. 

As  regards  aid  for  non-agricultural  activities,  the  evaluation  shows  that  the  impact  on 
efficiency  is  moderate.  The  sole  reason  for  including  such  aid  in  the  scope  of  the 
agricultural  State  aid  framework  was  to  facilitate  the  implementation  of  rural 
development  programmes.  However,  the  support  study  showed  that  Member  States 
continued  to  use  the  State  aid  instruments  already  used  in  the  past,  in  particular  the 
GBER and the general de minimis rules. 

From  an  overall  simplification  point  of  view,  the  evaluation  thus  concludes  that  the 
revised rules have at least partly achieved their efficiency objectives. This is particularly 
true  for  the  extended  scope  of  the  ABER,  which  has  allowed  for  time  savings  and 
reductions of administrative costs. As to the impact on undertakings, speedier procedures 
mean faster access to aid. The revised agricultural Guidelines are seen as a simplification 
to  a  lesser  extent  as  Member  States’  authorities  still  associate  the  notification  process 
with  a heavy  workload  and lengthy procedures.  The evaluation has thus  revealed some 
flaws to  be addressed under future State aid  rules in  order to  improve the efficiency of 
State aid control and do away with unnecessarily unclear or complex provisions. 

6.4.  Coherence 

The  agricultural  State  aid  rules  are  overall  coherent  with  the  other  EU  policies.  In 
particular  the  almost  complete  alignment  between  State  aid  rules  and  the  rural 
development rules has reached its objective of ensuring coherence with CAP objectives 
and  legislation.  Coherence  with  the  State  Aid  Modernisation  (SAM)  initiative  has  also 
been achieved, by integrating the SAM objectives and its ensuing common principles in 
the agricultural State aid framework. 

The evaluation shows an overall coherence between the agricultural State aid framework 
and other EU policies and legislations. 

53 

 
 
 
 
 
 
 
 
In  particular  the  alignment  of  the  State  aid  rules  with  the  rural  development  rules  has 
fully  reached  the  key  objective  of  ensuring  consistency  and  coherence  with  the  CAP. 
This is the obvious result of the almost complete alignment between the State aid rules 
introduced  in  2014  and  the  underlying  rural  development  rules.  Although  the  support 
study identified some slight differences in eligible costs and aid intensities in the areas of 
forestry  and  non-agricultural  investments,  interviewed  national  authorities  did  not  see 
those differences as a major constraint or blocking factor. 

The close link to the CAP also influences the assessment of coherence between State aid 
rules  and  the  EU  environmental  protection  policy.  This  is  because  State  aid  rules  with 
climate and environmental objectives mirror the rural development provisions.  
Besides assessing the coherence with the CAP, the evaluation also compared the rules on 
State  aid  for  risk  and  crisis  management  in  agriculture  with  those  laid  down  under  EU 
veterinary and public health policy and legislation. Coherence was largely confirmed also 
in this field. 

It  should  also  be  noted  that  one  of  the  objectives  of  the  2014  reform  was  to  bring  the 
agricultural  State  aid  rules  in  line  with  horizontal  objectives  of  the  State  Aid 
Modernisation  (SAM)  initiative.  This  has  been  achieved  by  integrating  the  SAM 
objectives  and  its  ensuing  common  principles  in  the  current  agricultural  State  aid 
framework. 

The  policy  initiatives  under  the  European  Green  Deal  are  highly  relevant  for  the 
agriculture and forestry sectors as well as the rural areas. Given that the green transition 
is  funded via different  EU instruments  – including the RRF in  the future  -  a consistent 
application  of  the  State  aid  rules  across  different  instruments  gets  an  increasing 
importance.  The  Commission’s  State  aid  decisions  made  on  the  basis  of  compatibility 
with  the internal  market  - serves  as  an important filter contributing to  complementarity 
among different funding instruments at Union level.  

6.5.  EU added value 

The agricultural State aid framework has a clear added value as it ensures predictability, 
transparency  and  legal  certainty.  Thus,  it  allows  Member  States  to  grant  State  aid  in  a 
common and transparent way. 

Overall, the mere existence of a tailor-made State aid framework has an EU added value; 
it reduces administrative costs and provides clarity, predictability, and legal certainty for 
both  Member States and undertakings.  It  allows  Member States to  design aid  measures 
on the basis of common and transparent compatibility conditions, which helps to prevent 
unequal treatment and market distortions.  

The revised State aid rules reinforce the EU added value as they ensure consistency with 
the  rural  development  measures  co-financed  under  the  CAP  and  facilitate  State  aid 
control of those measures. 

54 

 
 
 
 
 
  
 
 
 
 
 
6.6.  Lessons learned 

As highlighted in Sections 6.1 to 6.3 above, there are some lessons to be learned from the 
past six years of application of the State aid instruments under review. 

  The scope of the ABER  

It  is  an  undisputed  finding  that  the  obligation  to  notify  aid  to  the  Commission  implies 
administrative  costs  and,  sometimes,  lengthy  procedures  before  the  Member  State 
concerned  is  allowed  to  grant  the  aid.  The  Commission,  in  turn,  has  to  use  its  limited 
resources to prepare decisions. In some cases, the process leads to a mismatch between 
the objectives achieved through these decisions, vis-à-vis the resources employed in their 
preparation.  Against  this  background,  the  evaluation,  drawing  namely  from  the  support 
study,  concluded  that  widening  the  scope  of  the  ABER  has  significantly  improved  the 
efficiency of the agricultural State aid framework. Hence, it also recommended to include 
further aid measures in the ABER, such as risk management aid for large undertakings as 
well  as  forestry  measures  not  co-financed  under  rural  development  programmes. 
However, there are compelling reasons for keeping such aid under Commission scrutiny. 
In  fact,  the  same  reasons  were  strongly  considered  when  the  State  aid  rules  were 
previously revised. 

Aid for large undertakings increases the risk for market distortions. Aid measures that are 
not  co-financed  under  rural  development  programmes  must,  under  the  Guidelines, 
undergo  an  assessment  of  potential  environmental  impacts.  Member  States  must  also 
prove  that  the  aid  will  not  result  in  an  infringement  of  EU  environmental  protection 
legislation. There are no such stipulations in the ABER, for the simple reason that block-
exempted aid has to be based on clear compatibility conditions not requiring any further 
assessment.  Potential efficiency gains must therefore be carefully weighed against other 
criteria  such  as  relevance  and  effectiveness.  This  is  the  task  for  an  ensuing  impact 
assessment. 

  Clarification needs  

The  evaluation  reveals  that  certain  provisions  of  the  Guidelines  raises  interpretation 
problems or are otherwise difficult to apply. The concerns are obsolete or partly outdated 
rules,  unclear  definitions  and  terms  giving  rise  to  recurring  interpretation  requests  (e.g. 
the  definition  of  protected  animals)  as  well  as  overly  complex  requirements  for 
subsidised  services.  These  shortcomings  should  be  duly  taken  into  account  in  the 
upcoming Impact Assessment. 

  Weaknesses in availability of relevant data 

The evaluation revealed the lack of relevant quantitative data, especially data needed to 
assess the impact on competition and trade.  

The general difficulty of gathering data in State aid control stems from the fact that the 
counterpart of the Commission is the Member States and information-gathering tools are 
limited. The information on Member States’ expenditures, as summarised in the annual 
State  aid  scoreboard,  is  too  general  to  allow  for  any  concrete  conclusions  on  market 
impacts.  This  is  also  partly  because  State  aid  in  the  agricultural  and  forestry  sectors  is 
usually granted under schemes with a large number of beneficiaries and covering several 

55 

 
 
 
 
 
  
 
 
 
 
 
types  of  aid  measures.  The  external  study  commissioned  to  collect  more  quantitative 
market data gave limited results and its conclusions were largely based on a qualitative 
analysis. The difficulties is quantifying impacts therefore show that data collection needs 
to be improved for the future.  

In  that  context,  the  evaluation  acknowledges  in  particular  the  present  lack  of  ex-post 
evaluations  of  State  aid  schemes  at  Member  State  level  as  well  as  the  challenges  that 
Member States have as regards   conducting ex post assessments (no baseline, difficulties 
in identifying a counterfactual situation, no beneficiary monitoring system). 

The current Guidelines give the Commission the possibility to require Member States to 
carry  out  an  evaluation  of  schemes  where  the  potential  distortions  of  competition  are 
particularly  high.  However,  in  order  not  to  impose  a  disproportionate  cost  on  Member 
States, the Guidelines also state that the evaluation requirement should be limited to aid 
schemes  with  large  aid  budgets,  containing  novel  characteristics  or  when  significant 
market,  technology  or  regulatory  changes  are  foreseen.  This  partly  explains  why  the 
Commission did not ask Member States to evaluate any of the aid schemes authorised in 
the period 2014 to 2020, although in the case of some schemes it would have been duly 
justified. 

For the future, there are various remedies to the data weaknesses that should be explored 
in the forthcoming impact assessment. First, the ex-post monitoring tool, which is used to 
check  if  the  implementation  of  existing  national  aid  measures  actually  complies  with 
State  aid  rules,  could  be  a  source  of  more  concrete  information.  Second,  the  ex-post 
evaluation,  the  Commission’s  possibility  to  request  Member  States  to  conduct 
evaluations of existing schemes, should be put to better use. At present, Member States 
have  not  carried  out  any  such  evaluations  in  relation  to  State  aid  in  agriculture  and 
forestry.  Finally,  the  definition  of  additional  relevant  result/impact  indicators  will  be 
envisaged. 

  Knowledge-sharing between Commission services and Member States 

The  evaluation  support  study  also  revealed  that  measures  could  be  taken  to  improve 
knowledge-sharing between the Commission services and the Member States’ authorities 
when  it  comes  to  State  aid  for  agriculture  and  forestry.  To  remedy  this  weakness,  the 
Commission  services  will  start  to  make  better  use  of  the  Wiki-sites  for  interpretation 
questions in those sectors. 

56 

 
 
  
 
 
 
 
 
Annex 1: Procedural information 

1.  LEAD DG, DeCIDE PLANNING/CWP REFERENCES 

Lead DG: Directorate-General Agriculture and Rural Development until 10 June 2020;    

Directorate-General for Competition since that date.  

Decide planning references:  

DG AGRI:  PLAN/2018/4730; PLAN/2018/4736 

DG COMP: PLAN/2020/9341; PLAN/2020/9342 

2.  ORGANISATION AND TIMING 

The  present  evaluation  was  a  policy  evaluation  project  included  in  the  DG  AGRI 
evaluation plan. It followed the Better Regulation guidelines with regard to evaluations. 
The  evaluation  carried  was  based  on  the  Commission’s  internal  assessment,  case 
experience,  data  analysis,  complemented  by  a  public  consultation  and  an  external 
evaluation  support  study.    The  external  study  was  contracted  through  an  open  call  for 
tenders conducted in conformity with  the DG AGRI procedure for the organisation and 
management of policy evaluations carried out by external contractors. 

That project was supervised under the technical as well as the contractual management of 
AGRI unit C.4 in charge of Monitoring and Evaluation. 

An  Inter-service  Steering  Group  (ISSG)  was  set  up  by  the  Commission  on  20  March 
2017, with the mandate to provide information, prepare the terms of reference, monitor 
the work of the external study team, discuss and give advice on the approval of the final 
report, comment on the draft evaluation SWD. 

The ISSG was composed of the Secretariat-General of the Commission and DGs AGRI, 
BUDG, CLIMA, COMP, ENV, GROW, MARE, REGIO, SANTE and TRADE as well 
as the Joint Research Centre. The Steering Group started its meetings on 30 March 2017 
and held seven meetings79, of which the first six were dedicated to the interim and final 
reports  delivered  by  the  contractor  chosen  for  the  evaluation  support  study.  The  draft 
SWD was discussed in the ISSG meeting held on 25 May 2020. At the time of that last 
meeting, the responsibility for the SWD was still in the hands of DG AGRI. The file was 
subsequently transferred to DG COMP on 10 June 2020.   

The  evaluation  roadmap  was  published  on  the  20  April  2017  and  set  out  the  context, 
scope  and  aim  of  the  exercise.  The  roadmap  presented  the  questions  to  be  addressed 
under the five categories of effectiveness, efficiency, relevance, coherence and EU added 
value. During the feedback period on the roadmap, 2 contributions were received.  These 
did not require changes of the approach towards the evaluation. 

The  evaluation  support  study  carried  out  by  the  external  contractor  started  on  18 
December 2017. The final deliverable of the evaluation support study was received on 17 

79   The  ISSG  meetings  were  held  on  30.03.2017,  04.05.2017,  19.12.2017,  09.02.2018,  02.03.2018, 

28.08.2018 and 25.05.2020,  

57 

 
 
 
 
 
 
                                                           
December  2018.  The  study  report  was  published  on  4  April  201980.  Subsequently,  the 
Commission  launched  a  12-week  open  public  consultation  that  took  place  between  26 
April  and  19  July  2019.  The  external  support  study,  together  with  the  outcome  of  the 
public consultation, provided the basis for this SWD.  

On 1 January 2020, the competence in the field of monitoring State aid for the agriculture 
and forestry sectors and in rural areas was reattributed from DG AGRI to DG COMP. As 
a consequence, the responsibility for the draft SWD on the evaluation of the agricultural 
State aid instruments was transferred to DG COMP on 10 June 2020. 

3.  EXCEPTIONS TO THE BETTER REGULATION GUIDELINES 

None. 

4.  CONSULTATION OF THE RSB (IF APPLICABLE) 

The RSB scrutinized this evaluation SWD in the meeting held on 21 October 2020. The 
opinion  of  the  board  was  positive.  The  comments  raised  have  been  addressed  in  the 
following way:    

-  Firstly, the revised draft clearer defines the scope of the evaluation and explains how 
it covers the full content of the ABER and Guidelines, in terms of both  sectors and 
aid  categories,  while  also  clarifying  why  it  was  decided  to  scrutinize  more  closely 
some aid measures falling within that scope. 

-  Secondly,  the  intervention  logic  and  baseline  were  redrafted  together  with  the 
sections  on  assessment  of  efficiency  and  effectiveness  in  order  to  better  show  the 
links  between  objectives  and  evaluation  analysis.  In  addition,  data  gaps  are  further 
explicited  and  evidence  gained  from  case-handling  experience  is  explained  in  more 
detail. 

-  Finally,  the  revised  draft  discusses  in  more  detail  how  the  current  State  aid 
framework could  stay  relevant  and coherent  in  a future policy context,  in particular 
the relation to the European Green Deal and the subsidiarity approach envisaged for 
the rural development policy under the future CAP Strategic Plans Regulation. It also 
identifies  additional  shortcomings  to  be  taken  into  account  in  the  upcoming  impact 
assessment.  

RSB recommendations 

How the recommendations are taken into 
account 

The  report  should  clarify  upfront  what  falls 
under  the  scope  of  the  evaluation.  It  should 
better explain the rationale behind the choice of 
investment 
and 
insurance 
focussing  on 
categories.  This  should 
include  a  clear 
presentation of the relation with the horizontal 

Section 1 is amended to better explain that the 
evaluation  covers  the  total  scope  of  the  aid 
including  giving  a 
rules  under 
the  various  aid 
complete  overview  of 
categories  falling  within 
that  scope.  The 
amendments  to  section  1  also  aim  to  better 

review, 

80   https://op.europa.eu/en/publication-detail/-/publication/e01b61f0-504f-11e9-a8ed-01aa75ed71a1 

58 

 
 
 
 
 
 
                                                           
 
State  aid  rules,  in  particular  where  there  is 
overlap  with  the  sectoral  framework.  The 
report  should  clarify  how  the  evaluation  will 
inform  the  future  reform  of  the  State  aid 
framework. 

The intervention logic identifies objectives and 
results/impacts,  but  lacks  indicators  against 
which  to  measure  success.  The  report  should 
clarify  which  baseline  it  uses  and  how  it 
measures  effectiveness  and  efficiency.  The 
effectiveness  analysis  should  go  beyond  the 
assessment  of effects  of  the  aid  on  the  sectors 
concerned.  It  should  also  analyse  to  what 
extent  the  aid  achieved  its  societal  objectives, 
such 
economic 
ecological 
development. 

as  of 

and 

The  report  should  clearly  identify  the  lack  of 
data  to  perform  a  more  solid  analysis  and 
acknowledge the limitations of the results from 
the stakeholder consultation. It should point to 
the  gaps 
the  current  monitoring  and 
evaluation  provisions.  This  could  help  to 
address the lack of data for future evaluations. 
The  report  should  also  consider  making  better 
and more systematic use of the evidence gained 
from the extensive case handling experience. 

in 

The report assesses the relevance of the current 
rules mainly with regard to the current needs of 
the sector. It should also check the relevance of 
the current framework against the future policy 
report  should  discuss  and 
context.  The 
conclude on how the current rules are coherent 
with  the  European  Green  Deal  ambitions  and 
the revised delivery model of the future CAP. 

to 

take 
the 

the 
the  comments  above, 
In 
light  of 
into  account 
the 
conclusions  should 
uncertainties  due 
limited  available 
evidence.  The  report  should  formulate  more 
comprehensive 
learned.  It  should 
define  the  challenges  for  the  revision  of  the 
framework that will be further developed in the 
future impact assessment. 

lessons 

explain 
measures more closely. 

the  choice 

to  scrutinise  certain 

Sections 5.2.2 and 5.4.5 have been redrafted in 
order  to  clarify  the  interplay  between  the 
sector-specific  rules  under  review  and  the 
horizontal State aid rules.  

More detail is added to section 6.6 in order to 
better  describe  how  the  lessons  learned  from 
the evaluation could feed into the forthcoming 
revision of the rules.  

Sections  2.2  (baseline)  and  2.3  (intervention 
logic) have been revised together with sections 
5.2  and  5.3  on  effectiveness  and  efficiency  in 
order  to  better  show  what  has  been  achieved 
under the 2014 State aid framework, compared 
to  the  previous rules  and  in  relation to  overall 
in 
objectives.  The  effectiveness  analysis 
section  5.2  is  enlarged  to  cover  also  the 
achievement of societal objectives.  

Lack of indicators and data made it difficult to 
quantify  effectiveness  achievements,  but  this 
has  as  far  as  possible  been  addressed  in 
sections 4 and 5.  

The  data  gaps  and  the  reasons  behind  are 
further  detailed  in  sections  4  and  5  and  in 
Annex  I.  Evidence  gained  from  case-handling 
experience,  which  is  the  most  valuable  source 
of  information  for  the  present  evaluation,  is 
analysed in more depth in sections 4.2, 5.2 and 
5.3. 

The relevance of the current State aid rules in a 
future  policy  context  is  further  explored  in 
section  5.1,  and  in  particular  sub-sections 
5.1.4.1 (CAP reform), 5.1.4.2 (Green Deal) and 
5.1.5 (Recovery and Resilience Facility). 

from 

flaws  stemming 

The 
limited  data 
availability  are  spelled  out  throughout  this 
SWD. Section 6.6 is amended to point out the 
potential remedies to the lack of data; remedies 
that  should  also  feed  into  the  forthcoming 
impact assessment. 

59 

 
 
 
5. 

 EVIDENCE, SOURCES AND QUALITY 

INFORMATION SOURCES: 

 
In-house statistical data; 
  Case-handling experience; 
  Member States’ annual reports; 
  External support study; 
  Online public consultation. 

QUALITY: 

The  evaluation  is  based  on  the  Commission’s  internal  assessment,  case  handling 
experience  and  in-house  data  analysis  of  State  aid  statistics  complemented  by  an 
evaluation support study, conducted by an independent external evaluator, and an open, 
internet based public consultation that ran from 26 April to 19 July 2019. These sources 
valuably complement each other.  

However,  limited  data  availability  was  a  particular  challenge.  The  general  difficulty  of 
gathering  data  in  State  aid  control  stems  from  the  fact  that  the  counterpart  of  the 
Commission in the proceedings is the Member States and information-gathering tools are 
extremely limited. Quantitative data on State aid expenditure is collected from Member 
States  in  the  context  of  the  State  aid  scoreboard  based  on  annual  reporting  pursuant  to 
Article 6(1) of Commission Regulation (EC) 794/2004. The most recently published data 
includes State aid expenditure until the end of 2018 (see also Section 4).  

The  assessment  of  effects  on  trade  and  competition  was  carried  out  qualitatively.  In 
addition, concerning the public consultation, even though 190 replies received, this does 
not constitute a representative sample. These limitations were taken into account. 

60 

 
 
 
 
 
 
 
 
 
Annex 2: Stakeholder consultation 

The open, internet-based public consultation ran from 26 April to 19 July 2019. Its aim 
was  to  gather  the  views  of  public  authorities,  stakeholders  and  EU  citizens  on  the 
application of the agricultural State aid instruments and on their possible future design. 
The instruments concerned are the Guidelines for State aid in the agricultural and forestry 
sectors  and  in  rural  areas  (the  “Guidelines”)81  and  the  Agricultural  Block  Exemption 
Regulation (“ABER”)82. Both instruments expire on 31 December 2022. 

1.  Results of the public consultation 

The consultation questionnaire included closed and open questions on the performance of 
the current State aid rules, the State aid objectives to be pursued and the challenges for 
the future. Stakeholders could also submit position papers.  

1.1. Overview of the respondents 

The consultation received 190 contributions from respondents in 24 Member States. The 
majority of the replies came from respondents in Italy (36), Germany (24), Portugal (21), 
France  (17),  Czech  Republic  and  Austria  (11  each).  The  two  largest  categories  of 
respondents  were  aid  beneficiaries  (55,  of  which  39  were  undertakings  active  in  the 
agricultural  sector)  and  public  authorities  handling  State  aid  (39).  The  other  types  of 
respondents  were  farmers’  organisations  (20)  and  foresters’  organisations  (15),  public 
citizens  (19,  most  of  them  farmers),  NGOs  (14),  academics  or  other  experts  (13)  and 
undertakings active in downstream sectors to agriculture and forestry (6). 

Figure 1: Distribution of replies by country in absolute numbers 

81   EU Guidelines for State aid in the agricultural and forestry sectors and in rural areas 2014 to 2020 (OJ 

C 204, 1.7.2014, p. 1) 

82   Regulation  (EU)  No  702/2014  declaring  certain  categories  of  aid  in  the  agricultural  and  forestry 
sectors and in rural areas compatible with the internal market in application of Articles 107 and 108 of 
the TFEU (OJ L 193, 1.7.2014, p. 1). 

61 

 
 
 
 
 
 
 
 
                                                           
1.2. Overview of the key responses 

The first part of the consultation concerned the overall performance of the current State 
aid  rules,  their  coherence  with  other  EU  policies  and  the  importance  of  various  aid 
objectives. It also included questions on future challenges, tools to limit distortive effects 
on  the  internal  market  and  potential  for  simplification.  The  second  part  of  the 
consultation concerned specifically aid for each of the three areas falling within the scope 
of  the  ABER  and  the  Guidelines,  namely  agriculture,  forestry  and  non-agricultural 
activities  in  rural  areas.  The  last  part  raised  the  question  of  EU  added  value  and  also 
allowed respondents to comment freely on the subject of the consultation. 

The  results,  as  summarised  below,  mirror  to  a  large  extent  the  response  given  to  the 
inception impact assessment published in January 2019. 

It has to be noted that replies to the specific questions as analysed below do not show any 
important  variations  depending  on  the  respondent  category  (being  it  public  authority, 
beneficiary  of  aid,  NGO  or  general  public,  see  also  under  section  1.1  above).  In  some 
cases,  differences  between  respondent  categories  exist,  that  are  inherent  to  the 
issues/sectors concerned83. 

1.2.1.  General issues 

1.2.1.1. 

Effectiveness and efficiency of the current State aid rules 

The outcome was fairly positive as regards the State aid rules’ performance in terms of 
ensuring a useful spending of taxpayers’ money (50% fully/largely agree, 39% to some 
extent), coherence with Rural Development objectives (48% fully/largely agree, 32% to 
some  extent)  and  a  transparent,  consistent  and  coherent  handling  of  cases  (46% 
fully/largely agree, 30% agree to some extent).  

The rules also seem to have ensured legal certainty (44% fully/largely agree, 33% agree 
to some extent), created a level playing field for undertakings (39% fully/largely agree, 
31% agree to some extent) and addressed market failures (27% fully/largely agree, 47% 
agree to some extent). They are also fully or largely clear, according to 32%, or clear to 
some extent, according to 44%.  

On  the  negative  side,  more  than  half  of  the  respondents  (51%)  consider  that  the  rules 
have not led to a reduction of administrative costs for public authorities and slightly less 
than half of the respondents  (38%) consider that the rules  has  not  led to  a reduction of 
regulatory burdens for aid beneficiaries. 

1.2.1.2.  Coherence of with other EU policies and legislation 

83    For instance for forester’s organisations or beneficiaries in the forestry sector, the animal health and 
animal welfare issues are less known or relevant. For environmental NGOs climate change adaptation 
and mitigation are to over 90% very important objectives to be pursued. 

62 

 
 
 
 
 
                                                           
In  perceiving  the  coherence  of  the  rules  with  other  policies,  replies  are  fairly  balanced 
and no major incoherence emerges. 

Slightly less than half of the respondents (44%) think that the agricultural State aid rules 
are  fully  or  largely  coherent  with  the  CAP  legislation,  while  one-third  (33%)  agree  to 
some extent. About one-third also thinks that they are coherent with horizontal State aid 
instruments (32% agree fully/largely, while 29% agree to some extent). 

Concerning coherence with other policies, the tendency is around one-third full or large 
agreement  and  one-third  agreement  to  some  extent:  EU  cohesion  policy  (28%  agree 
fully/largely,  36%  to  some  extent);  EU  environmental  protection  policy  (32%  agree 
fully/largely,  35%  to  some  extent);  EU  2030  climate  and  energy  (31%  agree 
fully/largely,  24%  to  some  extent);  EU  veterinary  and  public  health  policy  (27% 
fully/largely  agree,  21%  to  some  extent);  EU  research  and  development  policy  (28% 
fully/largely agree, 31% to some extent); EU policy on SMEs (32% agree fully/largely, 
39% to some extent). 

1.2.1.3. 

Importance of objectives pursued by the granting of State aid 

As  to  the  aid  objectives  pursued,  a  majority  accorded  very  high  importance  to  the 
competitiveness  and  viability  of  undertakings  (63%),  socio-economic  development  in 
rural areas (62%), sustainable use of natural resources (63%), climate change mitigation 
and adaptation (62% and 60% respectively), ecosystem services and biodiversity (61%), 
protection of public and animal health (53%) and sustainable forest management (53%).  
Fewer,  but  still  almost  half  of  the  respondents,  found  it  highly  important  to  achieve 
access to knowledge and new technologies (49%), viable food production (47%), animal 
welfare (47%) and growth of the bioeconomy sector (41%). 

The  replies  to  the  open  questions  are  along  the  same  line.  A  common  theme  is  the 
importance of environmental and  climate objectives.  Stakeholders  interested in  forestry 
(mostly  NGOs)  emphasise  the  importance  of  the  circular  economy,  carbon  stocks  and 
carbon sink capacity. In the agriculture sector, risk management seems to be one of the 
most important objectives for farmers and their associations. 

It  must  be  noted  however  that  it  is  not  yet  possible  to  assess  the  potential  impact  the 
COVID-19 outbreak on the perceived importance of these objectives. 

1.2.1.4. 

Important challenges to be pursued by the future State aid rules 

Looking  forwards,  stakeholders  consider  the  most  important  challenges  for  the  future 
State  aid  rules  to  be  useful  spending  of  taxpayers  money  and  avoidance  of  harmful 
environmental  impacts  rank  first  (76%  and  74%  respectively  consider  them  as  highly 
important).  

Similarly, a majority sees highly important challenges in greenhouse gases and enhance 
carbon  sinks  (72%),  biodiversity  loss  (69%),  jobs  and  growth  in  rural  areas  (68%), 

63 

 
 
 
 
 
 
competitiveness and viability of undertakings (66%), adverse climatic events (66%) and 
generational renewal in rural areas (64%).  

Slightly  fewer,  but  still  a  majority,  see  highly  important  challenges  in  animal  diseases 
and plant pests (57%), administrative costs and burdens (55%), societal demands on food 
and health (53%) and changes in production conditions and technology (50%). Damage 
caused  by  wild  animals  and  market  developments  are  the  only  two  categories  that  less 
than  half  of  the  respondents  find  to  be  highly  important  (44%  and  43%).  However, 
looking only at the replies of public authorities and aid beneficiaries, 50% also see these 
challenges as highly important. 

The main message drawn from the replies to the open question is that State aid rules must 
not undermine the subsidiarity approach envisaged for the future legal framework of the 
CAP,  concerning  support  co-financed  by  the  European  Agricultural  Fund  for  Rural 
Development  (EAFRD)  under  the  proposed  Regulation  on  CAP  Strategic  Plans84. 
Challenges  relating  to  environment  and  climate  is  another  common  theme.  Many  also 
asked for new types of aid measures and eligible costs, in particular with regard to risk 
management.  

1.2.1.5.  How to limit undue distortive effects on the internal market 

Concerning  the  tools  to  limit  undue  distortive  effects  on  the  internal  market,  stricter 
conditions  for  large  undertakings  scored  highest  for  47%  or  the  respondents,  whereas 
maximum aid levels scored highest for 46%. Thereafter followed stricter conditions for 
investment aid for processing and marketing of agricultural products (35%), type of aid 
instrument (33%) and limitation of eligible costs (32%).   

1.2.1.6. 

Potential for simplification under future State aid rules 

The  highest  potential  identified  for  simplification  is  clearer  rules  (67%),  followed  by 
simplified  cost  options  (61%),  streamlining  with  CAP  strategic  plans  (56%)  and 
simplified  incentive  effect  requirements  for  subsidised  services  (52%).  Around  half  of 
the  respondents  also  see  a  very  high  potential  in  a  simplified  approach  for  cooperation 
(50%) and LEADER (46%).  

As  specifically  concerns  the  ABER,  one-third  (36%)  sees  a  very  high  simplification 
potential in extending the scope of the regulation and one fourth (27%) sees a very high 
potential in increased notification thresholds. However, both items score very high for a 
vast  majority  of  the  public  authorities,  which  actually  deal  with  State  aid  procedures 
(74% and 47% respectively). 

Concrete  suggestions  for  simplification  came  mainly  from  Member  States’  authorities. 
Recurring  themes  were  the  clarification  of  various  legal  concepts  and  definitions, 
simplified  cost  options,  less  prescriptive  eligibility  conditions,  harmonised  aid  rates,  a 

84   Proposal for a Regulation of the European Parliament and of the Council establishing rules on support 
for  strategic  plans  to  be  drawn  up  by  Member  States  under  the  Common  agricultural  policy  (CAP 
Strategic  Plans)  and  financed  by  the  European  Agricultural  Guarantee  Fund  (EAGF)  and  by  the 
European Agricultural Fund for Rural Development (EAFRD) 

64 

 
                                                           
simplified  approach 
large 
towards  subsidised  services  and  more 
undertakings. There were also strong demands for extending the scope of the ABER, for 
example (e.g. to all types of forestry measures and to aid relating to damage caused by 
wild  animals). Some Member States also  suggested including  large undertakings in  the 
ABER for aid measures of general public interest. 

leniency  for 

Otherwise,  many  aid  beneficiaries  complained  about  bureaucracy,  but  in  general  terms 
and without giving concrete examples or making suggestions for simplification.  

1.2.1.7.  Difficulties encountered by Member States’ authorities  

Member States’ authorities were specifically asked to provide information on difficulties 
and  administrative  burdens  associated  with  State  aid  procedures  and  the  design  of  the 
rules.  

As  for  State  aid  procedures,  notifying  aid  under  the  Guidelines  is  associated  with  a 
heavier  administrative  burden  than  applying  the  ABER,  as  expected  given  that  the  two 
procedures are of different nature. Almost half of the authorities (45%) find notifying aid 
to  always  be  burdensome,  one-fourth  (26%)  sees  it  as  mostly  burdensome  and  another 
fourth (23%) sees it as sometimes burdensome. Submitting information under the ABER 
is,  for 29% of public authorities, not  burdensome, for 20% sometimes burdensome, for 
14% mostly burdensome and for 20% always burdensome. 

Moreover, 20 out of 35 of the authorities (54%) indicated that they have had difficulties 
in  applying  the  current  State  aid  rules.  Many  referred  to  problems  with  the  incentive 
effect requirement, in particular in relation to subsidised services and large undertakings. 
Several also referred to difficulties associated with  multidimensional aid measures such 
as cooperation and LEADER. 

These  responses  reflect  the  replies  to  the  questions  on  efficiency  (see  section  2.2.1.1.), 
where respondents express their views on administrative burdens.  

1.2.1.8. 

Level of detail in the State aid rules 

One third of the public authorities think that the current rules have a level of detail that is 
well  balanced  (31%).  However,  54%  find  them  too  detailed,  while  12%  find  them  too 
general.  

1.2.2.  State aid for the agricultural sector 

1.2.2.1. 

Positive impact of granted aid and potential distortive effects 

Concerning the impact of aid granted to the agricultural sector, the majority of replies are 
positive.  Most  respondents  think  that  the  aid  has  helped  to  achieve  viable  food 
production  (61%)  and  fostered  competitiveness  in  the  agri-food  sector  (56%).  When 
asked  if  State  aid  has  helped  to  achieve  a  sustainable  use  of  natural  resources  in 
agriculture,  around  half  of  the  respondents  agree,  while  around  one-third  of  them 
disagree.  

65 

 
 
 
Regarding  potential  distortive  effects  on  the  internal  market,  aid  to  large  undertakings 
that already have economies of scale and a robust market position is an issue identified. 
Several  stakeholders  also mentioned the disparities between Member States in  terms  of 
financial means.  

Nevertheless,  more than half of the respondents  find that  the positive effects  of the aid 
outweigh potential distortive effects on the internal market (56%). 

1.2.2.2.  Difficulties in complying with the current State aid rules 

30  respondents  (16%  of  all  respondents),  of  which  almost  half  were  aid  beneficiaries 
(47%)  said  that  they  had  had  difficulties  complying  with  State  aid  rules  but  gave  very 
few  concrete  examples.  Those  that  were  mentioned  mainly  concerned  restrictive 
eligibility criteria and incentive effect requirements. 

1.2.2.3. 

Potential changes to the State aid rules for agriculture 

A majority of the respondents are in favour (i.e. agree or agree strongly) of the following 
potential changes to the rules: 

  no investment aid for the purchase of land unless it serves environmental and climate 

objectives or young farmers (65%); 

  better  targeting  of  investment  aid  for  irrigation  towards  protection  of  water  bodies 

(57%); 
 
inclusion of emerging diseases in the scope of aid to combat animal diseases (79%); 
  compensation for damage caused by animal diseases or plants pests in the case of 1) 
loss of value of products even if they are not destroyed (60%) and 2) indirect costs 
for damage to plants (75%); 

  compensation for damage caused by wild animals for income losses such as reduced 

production capacity (73%). 

1.2.3.  State aid for the forestry sector 

1.2.3.1. 

Positive impact of granted aid and potential distortive effects 

There  was  a  largely  positive  response  also  with  regard  to  the  impact  of  aid  for  the 
forestry sector. Although many replied that they had no strong views (about one-third), a 
majority  of  those  that  actually  took  position  replied  positively.  Consequently,  most  of 
those  respondents  confirmed  that  State  aid  has  helped  to  achieve  viable  forest  area 
development (66%) and development of the bioeconomy (63%), increased the resilience 
and protection of forest ecosystems (64%) and contributed to carbon sequestration (53%) 
as well as to the recreational or ecological function of forests (62%).  

As to potential distortive effects, environmental NGOs referred to the risk of lower prices 
in raw materials and increased biomass use. 

Nevertheless,  a majority of the respondents  taking position considered that the positive 
effects  outweigh potential distortive effects  on the internal  market  (72% agree or agree 
strongly). 

66 

 
 
 
1.2.3.2.  Difficulties in complying with the current State aid rules 

Several  respondents,  comprising  both  Member  States  and  forestry  stakeholders, 
complained  about  overly  restrictive  conditions  for  granting  aid.  Among  the  concrete 
examples were aid  for afforestation and agroforestry (e.g. limits in time and number of 
annual  payments)  and  difficulties  to  support  the  functioning  of  forest  management 
associations because of the ineligibility of running costs.  

1.2.3.3. 

Potential changes to the State aid rules for forestry 

A  vast  majority  of  the  respondents  are  in  favour  (i.e.  agree  or  agree  strongly)  of  the 
following potential changes to the rules: 

  no investment aid for the purchase of land unless it serves environmental and climate 

 

objectives (70%); 
investments  in  afforestation  must  be  consistent  with  climate  and  environmental 
objectives as governed by sustainable forest management principles (96%); 

  100%  aid  intensity  for  non-productive  investments  in  the  context  of  cooperation 

(85%); 

  extension of the scope of the ABER to all forestry measures (85%). 

1.2.4.  State aid for non-agricultural activities in rural areas 

Around  one-third  of  the  respondents  had  no  strong  views  on  the  impact  of  aid  to  non-
agricultural activities. However, a majority of those that actually took position responded 
positively. More than two-thirds (69 to 76%) of those respondents agree or agree strongly 
that  the  aid  has  led  to  employment  and  growth  in  rural  areas,  boosted  the  creation  and 
development  of  SMEs,  strengthened  the  economic  and  social  fabric  and  contributed  to 
cultural and recreational activities. As many as 76% also agree or agree strongly that the 
positive effects outweigh potential distortive effects on the internal market. 

There were no concrete examples of difficulties to comply with the rules for this category 
of aid. 

1.2.5.  EU added value 

A  vast  majority  of  the  respondents  agreed  to  that  there  is  added  value  in  having  a 
common framework of detailed rules for assessing the compatibility of State aid with the 
internal market (82% and even 92% when taking only into account the 162 respondents 
who expressed an opinion). 

2.  Summary of position papers 

Eight Member States’ authorities at both national and regional levels submitted position 
papers,  either  ad  hoc  or  through  the  public  consultation,  as  did  three  farmers’ 
associations,  two  forestry  associations,  two  environmental  NGOs,  one  public  financial 
institute  and  one  State-owned  forestry  company.  The  most  common  views  are  briefly 
summarised as follows: 

67 

 
 
 
  CAP legal framework post 2022 
A common theme for most submissions is that State aid rules must not undermine the 
subsidiarity  approach  pursued  by  the  proposal  on  CAP  Strategic  Plans.  Member 
States  must  be  allowed  to  freely  decide  the  content  and  nature  of  their  national 
strategic plans. 

  Environment and climate 
incentives  for  activities  with 
Most  submissions  also  call  for  strengthened 
environmental  and  climate  objectives,  including  an  increase  of  the  maximum  aid 
levels for environment-climate actions targeting biodiversity, ecosystem services and 
carbon  sequestration.  One  NGO  argues  that  State  aid  should  benefit  only  practices 
that are beneficial for environment and human health and not be granted to industrial 
farming (e.g. intensive livestock farming). 

  Scope of the State aid instruments  
Several  submissions  ask  for  new  aid  measures  to  be  included  in  the  State  aid 
instrument.  References  are  made  inter  alia  to  aid  for  animal  identification,  species 
protection,  the  reduction  of  antibiotics,  land  improvement  systems,  the  purchase  of 
breeding animals, forestry insurance and additional non-agricultural activities. There 
are  also  numerous  requests  for  adding  new  eligible  costs  to  existing  aid  measures 
(e.g.  extend  the  scope  of  diseases  eligible  for  aid  to  combat  animal  disease  and  the 
scope of eligible costs  in relation to damage caused by wild animals). Many also ask 
for a more flexible approach towards forestry aid schemes, for example in respect of 
aid to forestry associations and State-owned companies. 

  ABER  
Most  submissions  also  asks  for  an  extension  the  scope  of  the  ABER.  The  various 
demands concern for example aid relating to damage caused by wild animals, all aid 
measures  co-financed  by  the  EAFRD,  all  forestry  measures  (also  those  that  are  not 
co-financed by the EAFRD), LEADER support, aid for outermost regions and aid for 
diversification  into  non-agricultural  activities.  Some  also  ask  for  the  inclusion  of 
large undertakings for aid measures of public interest, such as environmental services 
or the prevention of animal diseases and plant pests.  

  Simplified cost options 
Both Member States’ authorities and farmers’ associations ask for a broader scope of 
simplified cost options.  

  Maximum aid intensities/amounts 
There are numerous requests for increased maximum aid levels for measures such as 
environment-climate  actions,  agro-forestry  investments,  animal  welfare,  young 
farmers, fallen stock, advisory services, genetic tests and insurance premiums. 

68 

 
 
 
 
 
 
 
 
 
  Subsidised services 
Both Member State authorities and farmers’ associations complain about difficulties 
associated  with  aid  in  the  form  of  subsidised  services  (e.g.  information  actions, 
advisory  services  and  veterinary  services),  in  particular  when  it  comes  to  the 
application  of  the  incentive  effect  requirement  as  well  as  the  identification  of 
undertakings  in  difficulty  and  large  undertakings.  A  common  suggestion  is  to  let 
service providers submit aid applications on behalf of the final beneficiaries. Others 
ask for the possibility to pay aid directly to final beneficiaries instead of paying it in 
kind to the service provider. 

  Incentive effect requirement 
The  incentive  effect  requirement  is  generally  seen  as  a  source  of  administrative 
burden, not only in relation to subsidised services (see bullet above) but also for aid 
granted in the form of guarantees via financial institutes.  

  Large undertakings/SME definition 
Several  Member  States  call  for  a  clarification  of  the  SME  definition  and  refer  in 
particular  to  the  difficulties  caused  by  the  classification  of  municipalities  as  large 
undertakings  (i.e.  even  very  small  municipalities  have  to  submit  a  contra  factual 
scenario when applying for aid to investments in local infrastructure). 

  Undertakings in difficulty 
Some Member State authorities and farmers’ associations ask for a more widespread 
inclusion  of  undertakings  in  financial  difficulty  in  the  scope  of  the  ABER  and 
Guidelines, in particular in respect of aid to combat animal diseases and plant pests, 
aid for farm replacement services and aid financed through tax exemptions. 

  Multidimensional aid measures 
Both 
multidimensional aid measures such as cooperation and LEADER. 

regions  and  Member  States 

to  difficulties 

refer 

in 

implementing 

69 

 
 
 
 
 
Annex 3: Methods and analytical models 

The  evaluation  is  based  on  case  experience  and  in-house  data  analysis  of  State  aid 
statistics, an evaluation support study, conducted by an external evaluator, and an open, 
internet based public consultation that ran from 26 April to 19 July 2019. 

This Annex describes the method and analytical models used in the evaluation support 
study. 

The  support  study  started  by  the  reconstruction  of  the  intervention  logic  of  the 
agricultural  State  Aid  framework  and  the  development  of  the  judgement  criteria  and 
indicators  on  which  the  evaluation  is  primarily  based.  This  was  followed  by  the 
development  of  a  comprehensive  descriptive  part,  which  includes  an  overview  of  the 
agricultural State Aid framework (regulations and rules) as well as the implementation of 
agricultural State aid by measure, aid scheme and expenditure (EU-28 and in more detail 
in selected MS). 

The main source of information on the use of State aid was the State aid cases database 
from  DG  COMP85.  The  information  was  cross-checked  and  completed  with  the  2017 
State  aid  scoreboard86,  which  includes  aid  expenditure  made  by  MS  before 
31 December 2016 falling under the scope of Art. 107(1) TFEU. The data are based on 
the  annual  reporting  by  Member  States  in  SARI  pursuant  to  Art.  6(1)  of  Commission 
Regulation (EC) No. 794/2004. In order to delineate the relevant temporal and thematic 
study scope, several selection criteria have been applied to the data sources to identify the 
aid schemes relevant to the evaluation. 

Table 1: Selection criteria for aid schemes under closer scrutiny in the evaluation support study 

Scoping 
Temporal scope 

Thematic scope 

Criteria applied  
The study covers the period 1 July 2014 - 31 December 2016. Aid schemes were selected as falling 
within the temporal scope if: (i) the EC decision date is between 1 July 2014 and 31 December 2016 
for notified schemes; or (ii) the registration date is between 1 July 2014 and 31 December 2016 for 
block-exempted schemes. 
Aid schemes cover one or more aid measures. A scheme has been included in the thematic scope if it 
covers at least one of the eight specific aid measures. In total, 29 aid schemes cover more than one 
measure subject of this evaluation study. When counting the number of aid schemes at the level of 
each aid measure under review, these schemes are counted as many times as the relevant aid 
measures are included. 

Source: ADE 

Farm Accountancy Data Network (FADN) and national bookkeeping data 

FADN data at regional or national level was used to assess the direct effects of State aid 
on  the  economic  performance  of  undertakings  confronted  with  adverse  events 
(Evaluation Question 2). This approach allows the comparison of the economic results of 
an  undertaking  with  and  without  compensation  measures  (counterfactual  scenario).  In 
some aid schemes the evaluator relied on other sources of farmers’ accounting.  

Documentary and literature review 

A  comprehensive  documentary  review  was  conducted  covering  numerous  regulations, 
the  State  aid  modernisation  initiative,  policy  briefs  and  roadmaps.  Relevant  legislative, 

85

   The State aid cases database is publicly available and includes all State aid cases subject of a Commission decision 

since 1 January 2000; it also provides information on block-exempted cases (extraction of 12/02/2018)  
http://ec.europa.eu/competition/elojade/isef/index.cfm?clear=1&policy_area_id=3 

86

   Source: http://ec.europa.eu/competition/state_aid/scoreboard/index_en.html (29/01/2018) 

70 

 
 
 
 
 
 
                                                           
  
policy or guidance documents, studies and evaluations were considered for the different 
subjects  of  the  evaluation.  They  included  among  other  things  the  Study  on  risk 
management  in  the  EU  agriculture,  the  mid-term  evaluation  of  Regulation  (EU)  No 
652/2014, the Evaluation study of the forestry measures under Rural Development, and 
the Special Report of the European Court of Auditors “Is EU support for prevention and 
restoring damage to forests caused by fire and natural disasters well managed?”. Specific 
studies were reviewed on agricultural insurance in Spain and Poland.   

Review of Rural Development Programmes (Rural Development Programmes)  

83  Rural  Development  Programmes  corresponding  to  the  eight  case  studies  of  the 
Member States were reviewed in detail, providing information on the forestry measures 
and  the  investments  related  to  non-agricultural  products.  The  Rural  Development 
Programme sets the objectives of the Rural development measures of the Member State 
or  region,  useful  for  the  reconstruction  of  the  intervention  logic  of  aid  schemes  under 
Evaluation  Question  5  and  Evaluation  Question  8.  The  2016  annual  implementation 
reports  (AIR)  were  also  consulted,  providing  additional  information  on  the  rural 
development  expenditures  for  the  relevant  measures.  This  information  has  been  cross-
checked with information from the State aid database.   

Online survey  

Between late May and  mid-July 2018, an online survey  was conducted among national 
authorities  in  charge  of  State  aid  at  the  level  of  EU-28  identified  by  DG  AGRI.  27 
Member States responded to the questionnaire (N=27), the response rate being 96%. 

Country case studies  

Eight Member States were selected for the conduct of an in-depth case study, taking into 
account the following criteria: (i) geographic distribution at EU level, with representation 
of  the  four  climatic  areas87;  (ii)  coverage  of  the  specific  State  aid  measures  within  a 
Member State or region (at the same time the non-mobilisation of certain measures was 
also an interesting source of information); and (iii) different administrative contexts (i.e. 
centralized  or  decentralized  management  of  public  support  for  agriculture,  forestry  and 
processing).  Based  on  the  aforementioned,  the  following  Member  State  were  selected: 
the Czech Republic, Estonia, Finland, France, Germany, Italy, Poland and Spain.  

Case  studies  were  based  on  desk  work  and  in-depth  interviews  and  meetings  with 
different  stakeholders  (competent  authorities  at  national  and  regional  levels,  Rural 
Development  Programme  managing  authorities,  representatives  of  beneficiaries,  and  in 
some  Member  States,  beneficiaries  and  competitors).  A  State  aid  authority  within  each 
Member  State  was  provided  by  DG  AGRI.  The  assessment  involved  different  policy 
levels in ministries, different ministries and, particularly in decentralised Member States, 
different  management  levels  (national,  regional).  This  process  required  time  as 
confidence had to be built and a large number of people had to be interviewed in multiple 
rounds.  Precise  information  was  collected  on  the  use  of  the  State  aid  instruments 
(agricultural  or others) and the actual expenditures  related to  the specific aid  measures. 
Finally, the case studies also served to collect the views of the competent authorities with 
regard to the relevance and coherence of the State aid rules, their efficiency, added value, 
and  the  administrative  burden  related  to  them.  Case  studies  provided  a  deeper 
understanding  of  the  implementation  of  agricultural  State  aid,  and  fed  directly  into  the 
different Evaluation Questions. 

Intervention case studies – counterfactual scenario 

87

   DG AGRI (2008), Fact Sheet, Climate Change : the challenges for agriculture.  

71 

 
                                                           
A  number  of  interventions  were  selected  for  more  in-depth  analysis  with  regard  to  the 
relevance and effectiveness of the aid provided. These intervention case studies provided 
as much information as possible on the aid provided in response to a given event (or in 
support of a given investment) and the beneficiaries.  

In  order  to  conduct  the  intervention  case  studies,  the  evaluator  adopted  the  following 
approach:  

-  Reconstruction  of  the  intervention  logic  of  each  State  aid  measure  in  order  to 
identify  the  expected  direct  effects  of  each  measure  on  the  beneficiaries  and  the 
expected indirect effects. 

-  Assessment of the direct effects using a counterfactual scenario. The direct economic 
effects of an aid measure on a beneficiary were assessed on the basis of a simulation 
of the economic situation of a beneficiary with and without aid. The objective of the 
simulation  was  to  assess  the  significance  of  the  aid,  defined  in  terms  of  support 
relative  to  the  net  income.  In  some  cases  aid  can  make  the  difference  between 
continued operations and bankruptcy, while in other cases it would shorten the period 
needed  for  a  return  to  profitability.  In  addition  to  the  assessment  of  the  economic 
effects  on  the  beneficiaries,  the  incentive  effect  was  assessed  based  on  interviews 
with competent authorities and with beneficiaries or their representatives. 

-  Assessment  of  the  possible  indirect  effects  on  public  policy  based  on  a  qualitative 
analysis  of  the  contribution  of  the  public  policy  to  the  CAP  objectives  or  other  EU 
policy objectives. 

-  Assessment of the effects on competition, mainly based on two elements: an analysis 
of the characteristics of the aid and of its capacity to have a significant effect on trade 
and competition.  

o  Do all enterprises have access to the aid?  
o  Does the aid influence production volumes? For instance, aid compensating for 

losses has no effect on production.  

o  Does the amount of aid (total and share in gross income or operating accounts) 
provide a comparative advantage to the beneficiary vis-à-vis non-beneficiaries? 
This is illustrated in the case studies. 

o  For  investment  measures  (Themes  2  and  3),  in  addition  to  the  foregoing, 
consideration of aid intensity; competitors were interviewed in this regard.  

This  analysis  was  completed  with  the  point  of  view  of  the  authorities  on  the  effects  of 
their State aid on trade and competition and the effects of aid provided by other MS. 

Assessment  of  the  aid’s  effects  on  trade:  the  evolution  of  trade  was  considered  when 
available  and  relevant;  for  compensatory  measures,  the  aid  compensates  for  losses  in 
order to restore a situation to how it was prior to the event. Regarding agricultural risk 
management, data were available to two major animal diseases. 

The effects on trade and competition were not measured quantitatively, for different 
reasons.  Trade trends depend on many factors and the causal link cannot be established. 
The  measures  affect  too  few  producers  to  have  a  significant  impact  on  trade.  Third,  as 
regards the  effect  on competition  of the  compensatory  measures, it was  not  possible to 
identify  comparable  competitors  (i.e. experiencing  the  same  adverse  impact  yet  not 
receiving State aid) in order to compare both situations in terms of trade.  

72 

 
  
 
 
For investment in non-agricultural activities, no data on trade of the specific sub-products 
or niche markets were publicly available. The effects were discussed qualitatively.   

Source of accounting 
data 
INOSYS Breeding 
Network 
FADN public database 

Literature review 

FADN public database 

FADN public database, 
Ministry of Food and 
Agriculture 
FADN public database 
FADN public database 
Literature review 
Regional ASA  

/ 
National database 
‘LUKE’ 
Cost price data from 
public enterprises 
Accounting data from 
undertakings and 
competitors 

Level of the area studied 

Regional (Limousin 
region) 
Regional (Mazowsze i 
Podlasie) 
National 

Regional (Aquitaine and 
Pays de la Loire) 
Regional (Lower Saxony) 

National 
National 
National 
Aquitaine region 

Bavaria region 
National  

Baden Württemberg 

Baden Württemberg 

Table 2: Use of accounting data by intervention case study  
Measure 

Specific intervention 

Country 

Adverse climatic 
events 

Animal diseases and 
plant pests 

France 

Poland 

Estonia 

France 

Fallen stock 

Germany 

Severe drought of 2015  

Severe drought of 2015 

Outbreak of African 
swine fever in 2015 
H5N1 epidemic outbreak 
of 2015 
Fallen stock 

Protected animals 
Insurance premiums 
Prevention and 
restoration of forests 
from damages  

Finland 
Finland 
Poland, Spain 
France 

Germany 
Finland 

Fallen stock 
Protected animals 
/ 
Prevention against forest 
fires 
Prevention of plant pests 
Prevention of root rot 

Forestry investments 

Germany 

Soil friendly harvesting  

Non-agricultural 
investments 

Germany 

Increased automation and 
diversification 

73