Source: EURLEX
Language: en
Format: md

**Council of the**
**European Union**

**Interinstitutional File:**

**2018/0218 (COD)**

**PROPOSAL**

**Brussels, 1 June 2018**
**(OR. en)**

**9556/18**

**AGRI 259**
**AGRIFIN 50**
**AGRIORG 32**
**AGRILEG 82**
**CODEC 906**

From: Secretary-General of the European Commission,
signed by Mr Jordi AYET PUIGARNAU, Director

date of receipt: 1 June 2018

To: Mr Jeppe TRANHOLM-MIKKELSEN, Secretary-General of the Council of
the European Union

No. Cion doc.: COM(2018) 394 final

Subject: Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND
OF THE COUNCIL amending Regulations (EU) No 1308/2013 establishing
a common organisation of the markets in agricultural products, (EU) No
1151/2012 on quality schemes for agricultural products and foodstuffs,
(EU) No 251/2014 on the definition, description, presentation, labelling and
the protection of geographical indications of aromatised wine products,
(EU) No 228/2013 laying down specific measures for agriculture in the
outermost regions of the Union and (EU) No 229/2013 laying down specific
measures for agriculture in favour of the smaller Aegean islands

Delegations will find attached document COM(2018) 394 final.

Encl.: COM(2018) 394 final

9556/18 JU/io

## DGB 1 A EN

EUROPEAN

COMMISSION

Brussels, 1.6.2018
COM(2018) 394 final

2018/0218 (COD)

Proposal for a

**REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL**

**amending Regulations (EU) No 1308/2013 establishing a common organisation of the**
**markets in agricultural products, (EU) No 1151/2012 on quality schemes for agricultural**

**products and foodstuffs, (EU) No 251/2014 on the definition, description, presentation,**

**labelling and the protection of geographical indications of aromatised wine products,**

**(EU) No 228/2013 laying down specific measures for agriculture in the outermost**

**regions of the Union and (EU) No 229/2013 laying down specific measures for**

**agriculture in favour of the smaller Aegean islands**

# **EN EN**

**EXPLANATORY MEMORANDUM**

**1.** **CONTEXT** **OF** **THE** **PROPOSAL**

**•** **Reasons for and objectives of the proposal**

The Commission proposal for the Multiannual Financial Framework (MFF) for 2021-2027
(the MFF proposal) [1] sets the budgetary framework and main orientations for the Common
Agricultural Policy (CAP). On this basis, the Commission presents a set of regulations laying
down the legislative framework for the CAP in the period 2021-2027, together with an impact
assessment of alternative scenarios for the evolution of the policy. These proposals provide
for a date of application as of 1 January 2021 and are presented for a Union of 27 Member
States, in line with the notification by the United Kingdom of its intention to withdraw from
the European Union and Euratom based on Article 50 of the Treaty on European Union
received by European Council on 29 March 2017.

The latest reform of the CAP was decided in 2013 and implemented in 2015. Since then, the
context in which that reform was forged has shifted significantly. In particular:

Agricultural prices have fallen substantially – depressed by macroeconomic factors,
geopolitical tensions and other forces.

The emphasis of trade negotiations has moved more visibly from multilateral to bilateral deals
and the EU has become more open to world markets.

The EU has signed up to new international commitments – e.g. concerning climate change
mitigation (through COP 21) and broad aspects of international development (through the
UN's Sustainable Development Goals – SDGs), as well as efforts to better respond to other
geopolitical developments including migration.

These shifts have prompted a public debate about whether the 2013 reform goes far enough to
help the CAP adequately meet broad ongoing challenges related to the economic health of the
farm sector, care for the environment, action over climate change, and a strong and economic
and social fabric for the EU's rural areas – especially in view of emerging opportunities for
action in the areas of trade, the bioeconomy, renewable energy, the circular economy and the
digital economy.

The CAP must be modernised to meet these challenges, simplified to do so with a minimum
of administrative burden, and made even more coherent with other EU policies to maximise
its contribution to the ten Commission Priorities and the Sustainable Development Objectives.
Indeed, as the Commission recalled in its recent Communication on the MFF, a modernised
Common Agricultural Policy will need to support the transition towards a fully sustainable
agricultural sector and the development of vibrant rural areas, providing secure, safe and highquality food for over 500 million consumers. Europe needs a smart, resilient, sustainable and
competitive agricultural sector in order to ensure the production of safe, high-quality,
affordable, nutritious and diverse food for its citizens and a strong socio-economic fabric in
rural areas. A modernised Common Agricultural Policy must enhance its European added
value by reflecting a higher level of environmental and climate ambition and addressing
citizens' expectations for their health, the environment and the climate.

As foreseen in its Programme of Work for 2017, the Commission consulted widely on the
simplification and modernisation of the CAP to maximise its contribution to the
Commission's ten priorities and to the Sustainable Development Goals (SDGs). This focused

1 [COM(2018) 322 final – MFF Regulation].

# EN 1 EN

on specific policy priorities for the future without prejudice to the financial allocations for the
CAP in the next MFF. The process included a large consultation, as well as analysis of
available evidence on the performance of the CAP, including the relevant REFIT Platform
opinions.

The outcome was presented in the Communication adopted on 29 November 2017 and
entitled "the Future of Food and Farming". The Communication enables a structured dialogue
on the future CAP in EU Institutions as well as with stakeholders. This policy document
outlined challenges, objectives and possible avenues for a "future-proof" CAP that needs to be
simpler, smarter and modern, and lead the transition to a more sustainable agriculture.

In particular, the Commission identified higher environmental and climate action ambition,
the better targeting of support and the stronger reliance on the virtuous Research-InnovationAdvice nexus as top priorities of the post-2020 CAP. It also proposed as a way to improve the
performance of the CAP a new delivery model (NDM) to shift the policy focus from
compliance to performance, and rebalances responsibilities between the EU and the Member
State level with more subsidiarity. The new model aims at better achieving EU objectives
based on strategic planning, broad policy interventions and common performance indicators,
thus improving policy coherence across the future CAP and with other EU objectives.

**•** **Consistency with existing policy provisions in the policy area**

Article 39 TFEU sets out the objectives of the CAP:

        - to increase agricultural productivity by promoting technical progress and by
ensuring the rational development of agricultural production and the optimum
utilisation of the factors of production, in particular labour;

        - thus to ensure a fair standard of living for the agricultural community, in
particular by increasing the individual earnings of persons engaged in agriculture;

        - to stabilise markets;

        - to assure the availability of supplies;

        - to ensure that supplies reach consumers at reasonable prices.

This proposal is fully consistent with the CAP Treaty objectives. It modernises and simplifies
the way the Treaty provisions are implemented.

**Consistency with other Union policies**

Agriculture and forestry cover 84% of the EU territory. The sectors both depend on and
influence the environment. Therefore, a number of the proposed CAP specific objectives will
trigger environmental and climate action in line with the respective EU policies.

It is well known that consumption patterns have an influence on public health. Via its link to
food and sometimes also the way food is produced agricultural policies are linked to health
policies. The proposals reinforce the links to health policy, in particular as regards healthy
diets and the decrease of the use of anti-microbials.

The EU is a major importer of commodities and an exporter of valuable agriculture and food
products and has therefore an impact on food systems outside the EU. The proposal, in line
with Art 208 of TFEU, takes into account the EU development cooperation’s objectives of
poverty eradication and sustainable development in developing countries, in particular by
ensuring that EU support to farmers has no or minimal trade effects.

# EN 2 EN

Finally, like in other sectors, agriculture and rural areas can make better use of new
technology and knowledge, in particular of digital technologies. The proposals reinforce the
links to research policy by putting the organisation of knowledge exchange prominently in the
policy delivery model. Similarly, the emphasis placed on digitisation allows linking up to the
EU Digital Agenda.

**2.** **LEGAL** **BASIS,** **SUBSIDIARITY** **AND** **PROPORTIONALITY**

**•** **Legal basis**

Article 43(2) TFEU as regards amendments to Regulation (EU) No 1308/2013 and Article
114 TFEU and first paragraph of Article 118 TFEU as regards amendments to Regulations
(EU) No 1151/2012, (EU) No 251/2014 and Articles 43(2) and 349 as regards amendments to
Regulation (EU) No 228/2013 and Article 43(2) as regards Regulation (EU) 229/2013.

**•** **Subsidiarity (for non-exclusive competence)**

The Treaty on the Functioning of the European Union provides that the competence for
agriculture is shared between the Union and the Member States, while establishing a common
agricultural policy with common objectives and a common implementation. The current CAP
delivery system relies on detailed requirements at EU level, and features tight controls,
penalties and audit arrangements. These rules are often very prescriptive, down to farm level.
In the Union's highly diversified farming and climatic environment, however, neither topdown nor one-size-fits-all approaches are suitable to delivering the desired results and EU
added value.

In the delivery model in this proposal, the Union sets the basic policy parameters (objectives
of the CAP, broad types of intervention, basic requirements), while Member States bear
greater responsibility and are more accountable as to how they meet the objectives and
achieve agreed targets.

Greater subsidiarity will make it possible to better take into account local conditions and
needs, against such objectives and targets. Member States will be in charge of tailoring CAP
interventions to maximise their contribution to EU objectives. While maintaining current
governance structures – that must continue to ensure an effective monitoring and enforcement
of the attainment of all policy objectives - the Member States will also have a greater say in
designing the compliance and control framework applicable to beneficiaries (including
controls and penalties).

**•** **Proportionality**

The economic, environmental and social challenges facing the EU's farm sector and rural
areas require a substantial response which does justice to the EU dimension of those
challenges. The greater power of choice to be offered to MS in selecting and adapting
available policy tools within the CAP to meet objectives, in a more results-based model,
should make it even less likely that the CAP oversteps a proportionate level of action.

**•** **Choice of the instrument**

Since the original acts are all European Parliament and Council regulations the amendments
must be introduced by European Parliament and Council regulation.

# EN 3 EN

**3.** **RESULTS** **OF** **EX-POST** **EVALUATIONS,** **STAKEHOLDER**
**CONSULTATIONS** **AND** **IMPACT** **ASSESSMENTS**

**•** **Ex-post evaluations/fitness checks of existing legislation**

The CAP is deeply rooted in the construction and in the development of the European Union
(EU). Established in the early sixties around goals enshrined in the Treaty, it has since
undergone several waves of reforms to improve the competitiveness of the agricultural sector,
to foster rural development, to address new challenges and to better reply to societal demands.
The latest major reform was adopted in 2013. In the **2013 reform**, the **general objectives of**
**the CAP were** streamlined around three blocks:

i. Viable food production

ii. Sustainable management of natural resources and climate action

iii. Balanced territorial development

To assess progress towards achieving the above objectives and identify future challenges, a
wide consultation process encouraged a structured debate with all stakeholders, including
non-agricultural actors. Furthermore, evidence on the performance of the CAP was gathered
from a wealth of information available on the CAP (briefly summarised in Box 1 below),
which served as background for assessing the achievements and shortcomings of the CAP
over the years, but especially with respect to its most recent reform. This concerns in
particular:

        - evidence collected through the Common Monitoring and Evaluation and
Framework (CMEF) which serves for measuring the performance of the CAP [2] ;

        - A series of evaluation studies scheduled over the current Multiannual Financial
Framework (2014-2020) to assess current CAP objectives, with first findings
available in 2017/18 [3] .

Results concerning progress towards targets and corresponding financial envelopes
available in the Annual Implementation Reports (AIR) for Rural Development.

        - Additional background documents, data, facts, figures relevant for the impact
assessment have been published on the internet page of DG AGRI [4] .

**•** **Stakeholder consultations**

An open public consultation was held with more than 322.000 submissions, structured
dialogue with stakeholders, five expert workshops, opinions of the REFIT Platform,
contributions from the European Economic and Social Committee, the Committee of the

2 Established in art. 110 of European Parliament and Council Regulation (EU) No 1306/2013 of 17
[December 2013 on the financing, management and monitoring of the common agricultural policy and](http://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:32013R1306)
[repealing Council Regulations and the Commission Implementing Regulation (EU) No 834/2014 of 22](http://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:32013R1306)
[July 2014 laying down rules for the application of the common monitoring and evaluation framework of](https://publications.europa.eu/en/publication-detail/-/publication/06ab9386-193b-11e4-933d-01aa75ed71a1/language-en)
[the common agricultural policy.](https://publications.europa.eu/en/publication-detail/-/publication/06ab9386-193b-11e4-933d-01aa75ed71a1/language-en)
3 European Commission (2017) [Evaluation and studies plan 2017-2021, Direction General for](https://ec.europa.eu/agriculture/sites/agriculture/files/evaluation/plan_en.pdf)
Agriculture and Rural Development.
4 See:
[https://ec.europa.eu/agriculture/statistics/facts-and-figures_en](https://ec.europa.eu/agriculture/statistics/facts-and-figures_en)

                                                 [https://ec.europa.eu/agriculture/sites/agriculture/files/consultations/cap](https://ec.europa.eu/agriculture/sites/agriculture/files/consultations/cap-modernising/eco_background_final_en.pdf)

[modernising/eco_background_final_en.pdf](https://ec.europa.eu/agriculture/sites/agriculture/files/consultations/cap-modernising/eco_background_final_en.pdf)

                                                 [https://ec.europa.eu/agriculture/sites/agriculture/files/consultations/cap](https://ec.europa.eu/agriculture/sites/agriculture/files/consultations/cap-modernising/env_background_final_en.pdf)

[modernising/env_background_final_en.pdf](https://ec.europa.eu/agriculture/sites/agriculture/files/consultations/cap-modernising/env_background_final_en.pdf)

                                                 [https://ec.europa.eu/agriculture/sites/agriculture/files/consultations/cap](https://ec.europa.eu/agriculture/sites/agriculture/files/consultations/cap-modernising/soc_background_final_en.pdf)

[modernising/soc_background_final_en.pdf](https://ec.europa.eu/agriculture/sites/agriculture/files/consultations/cap-modernising/soc_background_final_en.pdf)

# EN 4 EN

Regions, and from National Parliaments. The process also took into account recommendations
of the Agricultural Market Task Force (AMTF) [5] and the Cork Conference on Rural
Development (2016). [6]

**•** **Collection and use of expertise**

In order to gather evidence/knowledge from experts on CAP-related issues a set of specialised
workshops were organised between March 2017 and February 2018. These workshops
allowed to exchange views between experts and Commission officials, and to advance in the
formulation of the key conclusions/ issues to take into account in the modernisation and
simplification process.

The five issues to be tackled by workshops were selected in order to cover the most relevant
areas where gaps on knowledge and disagreements on policy approaches had been detected.
The workshops were designed according to a similar methodology based on the following:

1. collection of the latest evidence available at the level of experts, academics,
practitioners and international institutions;

2. focus on practical experiences on the ground;

3. assessment on the potential of new technologies/approaches to improve future policy
design in the specific area covered.

The summaries of the workshops and presentations are available at:
https://ec.europa.eu/agriculture/events/cap-have-your-say/workshops_en

Workshop 1: Best practices addressing environmental and climate needs (23/24 March 2017)

This two-day workshop involved a wide range of experts on the environmental and climate
challenges. It examined:

        - tools available for assessing the environmental needs;

        - methods to improve the uptake of the measures (with a focus on the role of
behavioural approaches).

Workshop 2: Risk management (18/19 May 2017)

This two-day workshop tried to advance in the collection of evidence in the debate on the
tools to support the farming community to better face the production, price and income risks.
It examined:

        - the challenges of the EU market safety net and the recent developments in the risk
management system in force in the US;

        - the case of future markets in the EU, the EU agricultural insurance and
reinsurance sector, the case of a public-private partnership and a crop insurance
scheme;

        - behavioural aspects of risk management.

5 [Report of the Agricultural Markets Task Force (the AMTF report) (2016) Improving market outcomes](https://ec.europa.eu/agriculture/sites/agriculture/files/agri-markets-task-force/improving-markets-outcomes_en.pdf)
[enhancing the position of farmers in the supply chain.](https://ec.europa.eu/agriculture/sites/agriculture/files/agri-markets-task-force/improving-markets-outcomes_en.pdf)
6 [European Commission (2016) Cork 2.0: European Conference on Rural Development, website.](https://ec.europa.eu/agriculture/events/rural-development-2016_en)

# EN 5 EN

Workshop 3: Food and related issues (31 May 2017)

The Workshop on food and related issues examined the CAP's alignment to health policy and
its capacity to facilitate farmers' adaptation to changes in consumption patterns. In particular
Anti-Microbial Resistance warrants increased attention.

                 Workshop 4: Socio economic issues (9 June 2017)

The workshop on socio-economic issues focused on the analysis of the dynamics of growth
and jobs in EU agri-food sector. It examined the links between global agriculture and food
value chains in the EU from both a conceptual perspective and a practical perspective, based
on case-studies.

Workshop 5: Measuring the CAP environmental and climate performance (26 February 2018)

The workshop examined what basic policy objectives can be set at EU level, how they can be
implemented at Member State level, and how they can be monitored, controlled and
evaluated.

**•** **Impact assessment**

The impact assessment supporting the legislative proposals, as well as the opinions of the
Regulatory Scrutiny Board (RSB), are available on the following site:
_List of impact assessments and the accompanying opinions of the Regulatory Scrutiny Board_

The RSB initially issued a negative opinion. While appreciating the ambition to modernise
and simplify the CAP and the in-depth analysis of different scenarios that usefully highlight
the trade-offs between the policy objectives, the Board considered that the report should better
explain the rationale, feasibility and functioning of the proposed new delivery model. The
required complements were added in the impact assessment report, including in a special
Annex on the proposals for the new delivery model. On this basis, the RSB gave a positive
opinion with reservations. While acknowledging improvements in the report, the Board
requested further specifications on the precise safeguards for mitigating the identified risks.
Annex 1 of the impact assessment report (Staff Working Document) spells out adjustments
undertaken to meet the requirements of the Board _._

Different policy options are presented and discussed in the impact assessment report. There is
no preferred option in the impact assessment. Instead various combinations of elements of the
proposals were tested in the different options to see what optimum mix could be distilled.

The options essentially test contrasted approaches to achieve the identified objectives:

1. varying levels of environmental and climate ambition, focussing on the potential
effects of obligatory and voluntary systems of delivery;

2. different ways to support farm income and in particular its distribution between
different farmers, focussing on the potential effects on small and medium-sized
farms.

3. broader socio-economic interventions, in particular under the rural development
policy, as well as cross-cutting approaches for modernisation.

The first option tests the potential of a voluntary eco-scheme to increase environmental and
climate ambition. It also examines the potential role of risk management tools with lower

# EN 6 EN

direct payments in supporting farmers' income. Two sub-options reflect different MS
environmental ambitions and approaches to direct payments within the new delivery model.

In another option, direct payments are better targeted and the implementation of conditionality
is more ambitious in order to improve the joint economic and environmental performance of
the CAP, as well as address climate challenges. Sub-options are also developed to illustrate
possible differences in MS ambition regarding environmental and climate objectives.

A final option places strong emphasis on environmental care and employment – and shifts the
focus on small and medium size farmers as a way to keep jobs in rural areas. MS are obliged
to allocate 30% of pillar I payments to provide top ups for four schemes that would be
voluntary for farmers - organic farming, permanent grassland, Areas with Natural Constraints
(ANC) and linear landscape elements, to further encourage climate action and sustainable
management of natural resources.

The impact assessment points out the difficult trade-offs that are inherent to a policy
addressing so many diverse objectives, when basic parameters are significantly changed.

A key basic parameter is the level of CAP support. The cut of 5% proposed by the
Commission in its May 2018 Communication for the 2021-2027 MFF is within the range
considered in the impact assessment.

With respect to farm income, both the level and the distribution of support matter. Securing an
adequate level of support and thus farm income remains a key element for the future, in order
to ensure food security, environmental and climate ambition, as well as rural vitality. **Better**
**targeting of support** to small and medium sized farms and areas with natural constraints can
help keeping more jobs on farms and farming activity on the whole territory, hence
strengthening the socio-economic fabric of rural areas. Capping and convergence can improve
the distribution of direct payments. It is clear that any option that significantly redistributes
direct payments towards farms and regions of lower productivity will, in the short-term, lead
to a reduction of EU competitiveness, while it enhances the protection of the environment.
Less clear, however, is the appropriate combination of measures that could mitigate negative
income effects while at the same time better addressing challenges that are also pertinent for
agriculture - such as environment and climate, or societal expectations. This requires
incentivising adjustments that improve both the socio-economic as well as the environmental
performance of the sector.

Contributions from the stakeholder consultation and analyses demonstrate that this is possible,
provided that the necessary accompanying measures addressing a **higher environmental and**
**climate action ambition** enable the adoption of best practices (in both conventional and other
forms of farming) that include knowledge, innovation and the latest pertinent technology.

On the basis of the assumptions and choices made in the analysis, there are potential tradeoffs in the achievement of economic, environmental and social objectives of the CAP, as well
as with respect to its desired modernisation and simplification. In summary, redistribution
could lead to manageable income impacts, and support the desired increased ambition of
environmental and climate action and other **CAP synergies** . This, however, would require
that the sector and the policy grasp the opportunities offered by innovation and technologies
already allowing modernisation and simplification.

Other assumptions and choices would certainly alter detailed results, but not the main
underlying message – that _the preferred option for the future CAP should combine the most_

# EN 7 EN

_performing elements of the various options, but avoid their weaknesses by introducing the_
_necessary safeguards to ensure an EU level-playing field_ . This implies the need for clear
criteria for the level and the distribution of income support (e.g. capping and/or degresivity),
the climate and environmental ambition, conditionality, the incentives for modernisation and
the appropriate degree of subsidiarity/simplification.

**•** **Regulatory fitness and simplification**

The complexity of the current policy implementation to a large extent is linked to the stress on
compliance with detailed rules, laid down at EU level. The proposed new delivery model will
remove the layer of EU level eligibility criteria for support which will allow the Member
States to define eligibility conditions that are most suited to their particular circumstances.
This is expected to produce a substantial simplification.

Historically the CAP developed in successive reforms into different instruments. Sometimes
the coordination of these instruments has proved to be difficult. Under the current proposal all
the different support elements of the CAP are brought together into one single and coherent
framework which will reduce the administrative burden of the CAP implementation.

**•** **Fundamental rights**

The proposal respects the fundamental rights and observes the principles recognised in
particular by the Charter of Fundamental Rights of the European Union.

**4.** **BUDGETARY** **IMPLICATIONS**

The Commission proposal on the multiannual financial framework for 2021-2027
(COM(2018) 322 final) provides that a significant part of the EU budget should continue to be
dedicated to agriculture, which is a common policy of strategic importance. Thus, in current
prices, it is proposed that the CAP should focus on its core activities with EUR 286.2 billion
allocated to the EAGF and EUR 78.8 billion for the EAFRD.

These agricultural funds are complemented by additional funding from Horizon Europe, as
the proposed envelope for this programme includes EUR 10 billion to support research and
innovation in food, agriculture, rural development and the bioeconomy. A new agricultural
reserve will be established in the EAGF to finance additional support for the agricultural
sector. Unused amounts of the reserve in one year shall be carried over to the following.

As regards distribution of the direct payments among Member States, it is proposed that all
Member States with direct payments below 90% of the EU average will see a continuation of
the process started in the period of 2014-2020 and will close 50% of the existing gap to 90%.
All Member States will contribute to financing this external convergence of direct payments
levels. The Member States’ allocations for direct payments in the CAP Strategic Plan
regulation are calculated on this basis.

For rural development, it is proposed to rebalance the financing between the EU and Member
States’ budgets. In line with what is foreseen for the European Structural and Investment
Funds, anincrease in national co-financing rates will allow keeping public support to
European rural areas largely unchanged. The distribution of EAFRD support is based on
objective criteria linked to the policy objectives and taking into account the current
distribution. As is the case today, less developed regions should continue to benefit from
higher co-financing rates, which will also apply to certain measures such as LEADER and the
payments for management commitments.

# EN 8 EN

A certain level of flexibility for transfers between allocations will be offered to the Member
States. Up to 15% of respective direct payments can be transferred to EAFRD allocation and
vice versa. A higher percentage can be transferred from direct payments to EAFRD allocation
for interventions addressing environmental and climate objectives and installation grants for
young farmers.

Details on the financial impact of the CAP proposal are set out in the financial statement
accompanying the proposal.

**5.** **OTHER** **ELEMENTS**

**•** **Implementation plans and monitoring, evaluation and reporting arrangements**

A shift towards a more performance-oriented policy requires the establishment of a solid
performance framework that, based on a set of common indicators, will allow the
Commission to assess and monitor the performance of the policy. The current **Common**
**Monitoring and Evaluation Framework (CMEF)** and the current monitoring system of
Direct Payments and Rural Development would be used as a basis for monitoring and
assessing policy performance, but they will have to be streamlined and further developed
(including consistency between the two pillars). Further investment into developing
appropriate indicators and ensuring sufficient data streams would be needed.

A new **Performance Monitoring and Evaluation Framework (PMEF)** will cover all
instruments of the future CAP: the CAP Strategic Plans as well as those elements of the CAP
not covered by the CAP Strategic Plans (some parts of the Common Markets Organisation,
specific schemes). Performance would be measured in relation to the Specific Objectives of
the policy by using a set of common indicators.

The new model will be organised around the following principles:

        - Context indicators remain pertinent, as they reflect relevant aspects of the general
trends in the economy, environment and society, and are likely to have an
influence on performance.

        - A selection of a limited, but more targeted set of indicators should be made
primarily in a way to choose those that reflect as closely as possible whether the
supported intervention contributes to achieving the objectives versus established
baseline and using clear definitions.

        - Overall policy performance will be assessed multi-annually on the basis of impact
indicators. Annual policy performance follow-up will rely on the full list of result
indicators.

        - Output indicators would annually link expenditure with the performance of policy
implementation. The latter is an annual exercise, and relies on a list of (primarily
already available) output indicators.

        - The reliability of relevant performance indicators can be facilitated by synergies
between statistical and administrative data, but requires the presence of a system
of quality controls.

In essence, what is being proposed is a shift in responsibilities and opportunities within a
common framework, clearly defined and enforced, to deliver on more than one key objective
at the same time, namely simplification, result-orientation (rather than compliance) and policy
efficiency and effectiveness.

# EN 9 EN

An annual performance review is foreseen as the key element of the ongoing monitoring and
steering of policy implementation. In order to make an annual performance review
operational, adequate output indicators and result indicators will have to be submitted jointly
in an annual report on the implementation of the CAP Strategic Plan, the so-called _Annual_
_Performance Report_ . MS will report annually on realised output and expenditure as well as
distance to targets set for the whole period, expressed as values of result indicators.

Evaluations will be carried out in line with paragraphs 22 and 23 of the Interinstitutional
Agreement on Better Law-Making of 13 April 2016 [7], where the three institutions confirmed
that evaluations of existing legislation and policy should provide the basis for impact
assessments of options for further action. The evaluations will assess the programme's effects
on the ground based on the programme indicators/targets and a detailed analysis of the degree
to which the programme can be deemed relevant, effective, efficient, provides enough EU
added value and is coherent with other EU policies. They will include lessons learnt to
identify any lacks/problems or any potential to further improve the actions or their results and
to help maximise their exploitation/impact.

**•** **Explanatory documents (for directives)**

Not relevant.

**•** **Detailed explanation of the specific provisions of the proposal**

The proposal concerns three regulations:

        - Regulation of the European Parliament and of the Council on 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 (hereinafter: CAP Strategic Plan
Regulation)

        - Regulation of the European Parliament and of the Council on the financing,
management and monitoring of the common agricultural policy and repealing
Regulation (EU) No 1306/2013 (hereinafter: CAP Horizontal Regulation)

        - Regulation of the European Parliament and of the Council amending Regulations
(EU) No 1308/2013 establishing a common organisation of the markets in
agricultural products, (EU) No 1151/2012 on quality schemes for agricultural
products and foodstuffs, (EU) No 251/2014 on the definition, description,
presentation, labelling and the protection of geographical indications of
aromatised wine products, (EU) No 228/2013 laying down specific measures for
agriculture in the outermost regions of the Union and (EU) No 229/2013 laying
down specific measures for agriculture in favour of the smaller Aegean islands.
(hereinafter: Amending Regulation)

These regulations combined adjust the CAP by aligning its objectives to the Juncker priorities
and the SDGs while at the same time simplifying the policy implementation. The CAP will
become more adjusted to local circumstance by the removal of eligibility condition for

7 Interinstitutional Agreement between the European Parliament, the Council of the European Union and
the European Commission on Better Law-Making of 13 April 2016; OJ L 123, 12.5.2016, p. 1–14.

# EN 10 EN

support at EU level. Member States will be able to define most eligibility conditions at
national level to make them appropriate for their specific circumstances. At the same time, the
administrative burden linked to controls will be reduced by limiting the direct link between
EU level eligibility conditions and the final beneficiaries.

With the aim of further improving the sustainable development of farming, food and rural
areas, the CAP general objectives focus on the economic viability, the resilience and income
of farms, on an enhanced environmental and climate performance, and on the strengthened
socio-economic fabric of rural areas. Moreover, fostering knowledge, innovation and
digitalisation in agriculture and rural areas is a cross-cutting objective.

The new CAP will pursue the following specific objectives:

(a) Support viable farm income and resilience across the EU territory to enhance food
security;

(b) enhance market orientation and increase competitiveness including greater focus on
research, technology and digitalisation ;

(c) Improve farmers' position in the value chain;

(d) Contribute to climate change mitigation and adaptation, as well as sustainable

energy;

(e) Foster sustainable development and efficient management of natural resources such
as water, soil and air;

(f) Contribute to the protection of biodiversity, enhance ecosystem services and preserve
habitats and landscapes;

(g) Attract young farmers and facilitate business development in rural areas;

(h) Promote employment, growth, social inclusion and local development in rural areas,
including bio-economy and sustainable forestry;

(i) Improve the response of EU agriculture to societal demands on food and health,
including safe, nutritious and sustainable food, as well as animal welfare.

To deliver on these objectives Member States shall ensure simplification and performance of
CAP support. They will design interventions that are appropriate in their circumstances based
on the types of interventions mentioned in the regulation. The Member States will have to pay
particular attention to the environmental and climate specific objectives, to generational
renewal, and to the modernisation of the policy implementation by focusing on a better use of
knowledge and advice and new (digital) technologies.

The Member States will present their proposed interventions to achieve the EU specific
objectives in a CAP Strategic Plan. The legislation lays down rules on the content of such a
CAP Strategic Plan and the Commission will check the plans and approve them. The CAP
Strategic Plans will combine most CAP Support instruments financed under the EAGF
(including the sectoral programmes that until now have been established under the CMO
regulation) and EAFRD. In this way a single coherent intervention strategy per Member State
will be designed though Member States. In the CAP Strategic Plans Member States will set
targets on what they want to achieve in the programming period using commonly defined
result indicators.

Once the CAP Strategic Plans are established Member States will annually report on the
progress made in the implementation using a system of common indicators. The Member

# EN 11 EN

States and Commission will monitor progress and evaluate the effectiveness of the
interventions.

The section below provides information on the specific content of the three regulations.

**CAP Strategic Plan Regulation**

Title I provides for the scope of the regulation as well as definitions.

Tittle II presents the CAP general and specific objectives that have to be pursued through the
interventions designed by the Member States in their CAP Strategic Plans. Title III introduces
a number of common requirements for the CAP strategic Plans, as well as elements which
apply to several interventions. The common requirements concern compliance with general
principles and fundamental rights such as the avoidance of distortion of competition, respect
for the internal market and non-discrimination as well as the respect of the rules of WTO
domestic support. They also include requirements as regards specific elements to be defined
in the CAP plans, such as what is an agricultural area, an agricultural activity, a genuine
farmer, a young farmer. This section describes, the obligations under 'conditionality' (the
requirements any beneficiary of area-based payments has to comply with concerning good
agricultural practices but also obligations stemming from EU legislation, and the need to have
well-functioning farm advisory services.

Finally this Title presents the types of interventions that the Member States may use to
implement their CAP Strategic Plans. Types of interventions are the broad categories of
interventions that Member States my use in their CAP Strategic Plans.

Title IV provides financial provisions. It includes in particular financial allocations per
Member State and per Fund and defines the flexibility for transferring allocations between
funds. It provides the contribution rates for EAFRD in relation to public expenditure in the
Member States and sets out some minimum or maximum financial allocations for specific

purposes.

Title V presents the rules on the CAP Strategic Plans. It mentions what elements Member
States have to take into account when drafting a CAP Strategic Plan and what shall be its
minimum content including targets and financial planning. This title also explains what rules
apply for the approval of the CAP Strategic Plans by the Commission and how such plans can
be amended.

Title VI provides the necessary elements on coordination and governance. It attributes
responsibilities to Member States' authorities for specific tasks related to the CAP Strategic
Plans. It establishes a monitoring committee to involve all stakeholders. It also establishes
networks that have to facilitate the successful implementation of the CAP Strategic Plans.
These networks will be established both at national and at EU level. Finally, this title
establishes the European Innovation Partnership in order to stimulate the exchange of
knowledge and innovation.

Title VII introduces the performance monitoring and evaluation framework laying down rules
on what and when Member States have to report progress on their CAP Strategic Plans and
rules on how this progress will be monitored and evaluated. This title in particular contains
the rules on a performance bonus for good environmental and climate performance.

# EN 12 EN

Finally, Titles VIII and IX concern the competition rules, which explain how in particular
State aid rules have to be applied, and the final provisions that explain what regulations are
repealed and when the regulation becomes applicable.

**CAP Horizontal Regulation**

It is proposed to maintain the current structure of the CAP in two pillars with annual measures
of general application in Pillar I complemented by measures reflecting the national and
regional specificities under a multi-annual programming approach in Pillar II. However, the
new design of the CAP for post 2020 will point to an increased subsidiarity so that Member
States can better tailor implementing measures under both Pillars to their realities and farmers'
concrete circumstances. More subsidiarity means rebalancing the responsibilities in the
management of the CAP and looking for a new relationship between the European Union, the
Member States and the farmers.

On this basis, the current CAP Horizontal Regulation is adapted to the new delivery model
and reflects more flexibility for Member States in implementing the policy (in line with their
local needs), less bureaucracy for beneficiaries and shift to a performance-based policy.

The move at EU level from an emphasis on compliance to performance requires a clear
identification of the objectives which the policy has to achieve: again, these objectives will be
established at EU level. In order to advance towards a more result-driven policy mechanism,
there will be a shift from assurance on legality and regularity of the underlying transactions to
assurance on performance and the respect of EU basic requirements, like the Integrated
Administration and Control System (IACS) or the governance bodies (paying agencies,
coordinating bodies, competent authorities and certification bodies). The robust and reliable
governance structures which characterise the CAP will be maintained.

In addition to financing provisions, the CAP Horizontal Regulation continues to have
provisions on general principles for checks and penalties, checks for conditionality and IACS.
As a result, the regulation lays down rules on financing, management and control systems,
clearance processes (annual financial clearance and annual performance clearance) and
conformity procedure.

This regulation includes various simplification elements. First of all, the new annual
performance clearance reflects the shift from compliance by the individual beneficiary to
performance of the policy in the Member States.

Furthermore, it foresees reducing the number of paying agencies and reinforcing the role of
the coordinating body and certification body in line with the new delivery model. This will
render the system more transparent and less burdensome for both national administrations and
the Commission. The concept of the single audit approach is introduced, in line with the
Financial Regulation and the number of Commission audits can be reduced.

**Amending Regulation**

The Communication on the Future of Food and Farming confirms market orientation as a key
element of the CAP, but also highlights challenges related to environmental sustainability and
climate change. Moreover, it places the agricultural sector squarely in the debate about food
and citizens' concerns in that regard, recalling that "the most important role for the policy is to
help farmers anticipate developments in dietary habits and adjust their production according
to market signals and consumers' demands". As detailed rules that may prevent the necessary
adjustments are laid down at EU level, the reform presents an opportunity to make necessary

# EN 13 EN

changes. The CAP should furthermore address citizens' concerns regarding sustainable
agriculture production.

It is therefore foreseen to maintain the architecture and main features of Regulation (EU)
1308/2013, while amending a limited number of provisions in view of economic,
environmental and societal evolutions experienced since its entry into force in 2014.

Firstly, it is foreseen to delete provisions related to sectorial interventions that have previously
been laid down in Regulation (EU) No 1308/2013, as these interventions of the future CAP
will be regulated under the CAP Strategic Plan Regulation and be part of Member States'
strategic plans, to ensure a better coherence of CAP interventions.

Secondly, while the successive 2008 and 2013 reforms of the wine policy have overall
reached their objectives, resulting in economically vibrant wine sector, new economic,
environmental and climatic challenges have appeared. Therefore, the regulation foresees a
number of specific amendments to existing rules to cope with these challenges.

Thirdly, the Communication on the Future of Food and Farming called for geographical
indications (GIs) to be made more attractive to farmers and consumers, and render the system
easier to manage. It is therefore proposed to amend current rules on GIs, spread over four
basic Acts, aiming at a simpler GI system, faster registration of geographical indications and
more efficient approval of amendments to product specifications. These changes aim to a
simplified GI system that would be more understandable to consumers, easier to promote and
would reduce administrative costs of managing the system.

On rules for wine GIs, limiting the EU scrutiny of applications to checking them against
manifest errors, separating intellectual property rules from other requirements laid down in
the product specification as well as habilitating Member States to decide on amendments that
do not have impacts at EU level, would streamline approvals, shorten timelines, and
rationalise resources, in line with the twin principles of subsidiarity and proportionality. In the
same vein, simplification of some specific procedures, for example the opposition procedure,
is envisaged to make the approval process more efficient.

Clarification of the definition of 'Protected Designation of Origin' for wines will enable
producer groups to use new varietals, also needed in response to climate change, and allow
proper justifications of applications in line with viticulture and oenological realities.
Strengthening protection of GIs against counterfeiting of GIs on the interned and on goods in
transit is also proposed.

The simplification proposed for wine GIs has to be applied also to agricultural products and
foodstuffs: to ensure reasonable level of coherence between the schemes and bring the above
benefits to producers of GIs in this sector, too. The aromatised wines GI scheme that only has
5 out of 3350 GIs, cannot be operational and should be merged into another scheme – the
agricultural products and foodstuffs scheme is appropriate as already covers other alcoholic
beverages.

Furthermore, the regulation foresees provisions that merely translate into internal legislation
commitments taken by the EU and its Member States in the context of recent World Trade
Organization Ministerial Decisions, notably on export subsidies.

# EN 14 EN

Finally, it is proposed to delete a number of obsolete provisions, _inter alia_ the system of
production regulation and requirements applying to the sugar sector that expired at the end of
the 2016/2017 marketing year.

# EN 15 EN

2018/0218 (COD)

Proposal for a

**REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL**

**amending Regulations (EU) No 1308/2013 establishing a common organisation of the**
**markets in agricultural products, (EU) No 1151/2012 on quality schemes for agricultural**
**products and foodstuffs, (EU) No 251/2014 on the definition, description, presentation,**
**labelling and the protection of geographical indications of aromatised wine products,**
**(EU) No 228/2013 laying down specific measures for agriculture in the outermost**
**regions of the Union and (EU) No 229/2013 laying down specific measures for**
**agriculture in favour of the smaller Aegean islands**

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular
Article 43(2), Article 114, the first paragraph of Article 118 and Article 349 thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Economic and Social Committee [8] _,_

Having regard to the opinion of the Committee of the Regions [9],

Having regard to the opinion of the Court of Auditors,

Acting in accordance with the ordinary legislative procedure,

Whereas:

(1) The Communication from the Commission to the European Parliament, the Council,
the European Economic and Social Committee and the Committee of the Regions
entitled ‘The Future of Food and Farming’ of 29 November 2017 sets out the
challenges, objectives and orientations for the future Common Agricultural Policy
(CAP) after 2020. These objectives include, _inter alia,_ the need for the CAP to be
more result-driven, to boost modernisation and sustainability, including the economic,
social, environmental and climate sustainability of the agricultural, forestry and rural
areas, and to help reducing the Union legislation-related administrative burden for
beneficiaries.

(2) Since the CAP needs to sharpen its responses to the challenges and opportunities as
they manifest themselves at Union, international, national, regional, local and farm
levels, it is necessary to streamline the governance of the CAP and improve its
delivery on the Union objectives and to significantly decrease the administrative
burden. In the CAP based on delivery of performance (‘delivery model’), the Union
should set the basic policy parameters, such as objectives of the CAP and basic
requirements, while Member States should bear greater responsibility as to how they
meet the objectives and achieve targets. Enhanced subsidiarity makes it possible to

8 OJ C,, p. .
9 OJ C,, p. .

# EN 16 EN

better take into account local conditions and needs, tailoring the support to maximise
the contribution to Union objectives.

(3) To ensure coherence of the CAP, all interventions of the future CAP should be part of
a strategic support plan which would include certain sectoral interventions that were
laid down in Regulation (EU) No 1308/2013 of the European Parliament and of the
Council [10] .

(4) Annex II to Regulation (EU) No 1308/2013 sets out certain definitions concerning
sectors falling within the scope of that Regulation. Definitions concerning the sugar
sector set out in Section B of Part II of that Annex should be deleted because they are
no longer applicable. In order to update definitions concerning other sectors referred to
in that Annex, in light of new scientific knowledge or market developments, the power
to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the
European Union should be delegated to the Commission in respect of the amendment
of those definitions. It is of particular importance that the Commission carry out
appropriate consultations during its preparatory work, including at expert level. The
Commission, when preparing and drawing up delegated acts, should ensure a
simultaneous, timely and appropriate transmission of relevant documents to the
European Parliament and to the Council. Consequently, the individual empowerment
delegated to the Commission in point 4 of section A of Part II of that Annex to amend
the definition of inulin syrup should be deleted.

(5) Part I of Regulation (EU) No 1308/2013 should be simplified. Redundant and obsolete
definitions and provisions empowering the Commission to adopt implementing acts
should be deleted.

(6) The limits of Union aid for the supply of fruit and vegetables and of milk and milk
products in educational establishments, set out in Article 23(a) of Regulation (EU) No
1308/2013 should be updated.

(7) Provisions concerning Aid schemes set out in Sections 2 to 6 of Chapter II of Title I of
Part II of Regulation (EU) No 1308/2013 should be deleted as all types of
interventions in these sectors will be set out in Regulation (EU)…/… of the European
Parliament and of the Council [11] ( _CAP Strategic Plan Regulation)_ .

(8) In view of the decrease in the actual area planted with vines in several Member States
in the years 2014-2017, and in view of the potential loss in production ensuing, when
establishing the area for new planting authorisations referred to in Article 63(1) of
Regulation (EU) No 1308/2013, Member States should be able to choose between the
existing basis and a percentage of the total area actually planted with vines in their
territory on 31 July 2015 increased by an area corresponding to the planting rights
under Regulation (EC) No 1234/2007 available for conversion into authorisations in
the Member State concerned on 1 January 2016.

10 Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013
establishing a common organisation of the markets in agricultural products and repealing Council
Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 (OJ L
347, 20.12.2013, p. 671).
11 Regulation (EU)…/… of the European Parliament and of the Council of …. 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 (OJ L …, ......, p…).

# EN 17 EN

(9) Rules for classifying wine grape varieties by Member States should be modified to
include the wine grape varieties _Noah, Othello, Isabelle, Jacquez, Clinton and_
_Herbemont,_ previously excluded _._ To ensure that wine production in the Union
develops a higher resistance to diseases and that it uses vine varieties better adapted to
changing climatic conditions, provision should be made allowing _Vitis Labrusca_
varieties and varieties stemming from crosses between _Vitis vinifera, Vitis Labrusca_
and other species of the genus _Vitis_ to be planted for wine production in the Union.

(10) To enable producers to use vine varieties that are better adapted to changing climatic
conditions and with higher resistance to diseases, provision should be made permitting
products using designations of origin not only from vine varieties belonging to _Vitis_
_vinifera_ but also from vine varieties stemming from a cross between _Vitis vinifera_ and
other species of the genus _Vitis_ .

(11) Provisions concerning certificates of compliance and analysis reports for imports of
wine should be applied in light of the international agreements concluded in
accordance with the Treaty on the Functioning of the European Union (‘TFEU’).

(12) The definition of a designation of origin should be aligned with the definition in the
Agreement on Trade-Related Aspects of Intellectual Property Rights [12] (‘TRIPS
Agreement’), approved by Council Decision 94/800/EC [13], in particular with Article
22(1) thereof, in that the name is to identify the product as originating in a specific
region or a specific place.

(13) To ensure coherent decision-making as regards applications for protection and
objection submitted in the preliminary national procedure referred to in Article 96 of
Regulation (EU) No 1308/2013, the Commission should be informed in a timely and
regular manner when procedures are launched before national courts or other bodies
concerning an application for protection forwarded by the Member State to the
Commission, as referred to in Article 96(5) of Regulation (EU) No 1308/2013.
Implementing powers should be conferred on the Commission in order to, in those
circumstances and where appropriate, suspend the examination of the application until
the national court or other national body has adjudicated on the challenge to the
Member State’s assessment of the application in the preliminary national procedure.

(14) Registration of geographical indications should be made simpler and faster by
separating the assessment of compliance with intellectual property rules from the
assessment of compliance of the product specifications with the requirements laid
down in the marketing standards and labelling rules.

(15) The assessment carried out by the competent authorities of Member States is an
essential step in the procedure. Member States have knowledge, expertise and access
to data and facts that make them the best placed to verify whether the information
provided in the application is correct and truthful. Therefore, Member States should
guarantee that the result of that assessment, which is to be faithfully recorded in a
single document summarising the relevant elements of the product specification, is
reliable and accurate. Having regard to the principle of subsidiarity, the Commission
should subsequently scrutinise applications to ensure that there are no manifest errors

12 Uruguay Round of Multilateral Trade Negotiations (1986- 1994) - Annex 1 - Annex 1C - Agreement on
Trade-Related Aspects of Intellectual Property Rights (WTO) (OJ L 336, 23.12.1994, p. 214).
13 Council Decision 94/800/EC of 22 December 1994 concerning the conclusion on behalf of the
European Community, as regards matters within its competence, of the agreements reached in the
Uruguay Round multilateral negotiations (1986-1994) (OJ L 336, 23.12.1994, p. 1).

# EN 18 EN

and that Union law and the interests of stakeholders outside the Member State of
application are taken into account.

(16) The period during which an objection can be made should be extended to three months
to ensure that all interested parties have sufficient time to analyse the application for
protection and the possibility to submit a statement of objection. To ensure that the
same procedure for objections is applied under Regulation (EU) No 1308/2013 and
under Regulation (EU) No 1151/2012 of the European Parliament and of the Council [14]
and thus enable Member States to forward objections stemming from natural or legal
persons residing or established in their territory to the Commission in a coordinated
and efficient manner, objections from natural or legal persons should be submitted via
the authorities of the Member State in which they reside or are established. To
simplify the objection procedure, the Commission should be empowered to reject
inadmissible statements of objection in the implementing act conferring protection.
Therefore, Article 111 of Regulation (EU) No 1308/2013 conferring implementing
powers on the Commission to reject inadmissible objections under a separate
implementing act should be deleted.

(17) To increase procedural efficiency and in order to ensure uniform conditions for the
conferral of protection on designations of origin or geographical indications _,_
implementing powers should be conferred on the Commission to adopt implementing
acts conferring protection without recourse to the examination procedure in
circumstances where no admissible statement of objections to the application for
protection has been submitted. Where an admissible statement of objection has been
submitted, implementing powers should be conferred on the Commission to adopt
implementing acts in accordance with the examination procedure either conferring
protection or rejecting the application for protection.

(18) Having due regard to the TRIPS Agreement, in particular to Articles 22 and 23
thereof, and to the General Agreement on Tariffs and Trade [15] (‘GATT Agreement’) in
particular Article V thereof on freedom of transit, both of which were approved by
Council Decision 94/800/EC and aim at strengthening the protection of designations
of origin and geographical indications, and to combat counterfeiting more effectively,
the protection conferred by Article 103(2) of Regulation (EU) No 1308/2013 should
be extended to cover goods which are in transit across the Union customs territory and
to goods which are sold over the internet or by other means of electronic commerce.

(19) It should be possible to cancel the protection of a designation of origin or geographical
indication in circumstances where they are no longer in use or where the applicant
referred to in Article 95 of Regulation (EU) No 1308/2013 no longer wishes to
maintain that protection.

(20) In view of the ever increasing consumer demand for innovative grapevine products
with a lower actual alcoholic strength than the minimum actual alcoholic strength set
out for grapevine products in Part II of Annex VII to Regulation (EU) No 1308/2013,
it should be possible to produce such innovative grapevine products also in the Union.

(21) It is necessary to provide for definitions of de-alcoholised grapevine products and
partially de-alcoholised grapevine products. These definitions should take into account
the definitions set out in the Resolutions of the International Organisation of Vine and

14 Regulation (EU) No 1151/2012 of the European Parliament and of the Council of 21 November 2012
on quality schemes for agricultural products and foodstuffs (OJ L 343, 14.12.2012, p. 1).
15 Uruguay Round of Multilateral Trade Negotiations (1986 - 1994) – Annex 1 – Annex 1A – General
Agreement on Tariffs and Trade in Goods (WTO) (OJ L 336, 23.12.1994, p. 1).

# EN 19 EN

Wine (OIV), OIV-ECO 433-2012 _Beverage Obtained By Partial Dealcoholisation of_
_Wine_ and OIV-ECO 523-2016 _Wine With An Alcohol Content Modified by_
_Dealcoholisation._

(22) In order to ensure that the rules governing labelling and presentation of products in the
wine sector also apply to de-alcoholised or partially de-alcoholised grapevine
products, to establish rules governing the dealcoholisation processes for the production
of certain de-alcoholised or partially de-alcoholised grapevine products within the
Union, and rules concerning the conditions of use of closures in the wine sector in
order to ensure that consumers are protected from misleading use of certain closures
associated with certain beverages and from hazardous closure materials that may
contaminate the beverages, the power to adopt acts in accordance with Article 290 of
the Treaty on the Functioning of the European Union should be delegated to the
Commission. It is of particular importance that the Commission carry out appropriate
consultations during its preparatory work, including at expert level and that those
consultations be conducted in accordance with the principles laid down in the
Interinstitutional Agreement of 13 April 2016 on Better Law-Making. In particular, to
ensure equal participation in the preparation of delegated acts, the European
Parliament and the Council receive all documents at the same time as Member States'
experts, and their experts systematically have access to meetings of Commission
expert groups dealing with the preparation of delegated acts.

(23) The rules on production and the requirements applying to the sugar sector expired at
the end of the 2016/2017 marketing year. Article 124 and Articles 127 to 144 of
Regulation (EU) No 1308/2013 are now obsolete and should be deleted.

(24) Measures and rules concerning imports of hemp set out in Article 189 of Regulation
(EU) No 1308/2013 are redundant and obsolete and should be deleted.

(25) Articles 192 and 193 of Regulation (EU) No 1308/2013 should be deleted as such
measures are no longer necessary in view of the end of the production regulation in the
sugar sector. In order to ensure that the Union market is adequately supplied by means
of imports from third countries, implementing powers should be conferred on the
Commission to suspend import duties for cane and beet molasses.

(26) The Ministerial Decision of 19 December 2015 on Export Competition of the 10 [th]
WTO Ministerial Conference in Nairobi [16] sets down rules on export competition
measures. As regards export subsidies, WTO members are required to eliminate their
export subsidy entitlements as of the date of that Decision. Therefore, Union
provisions on export refunds set out in Articles 196 to 204 of Regulation (EU) No
1308/2013 should be deleted.

(27) In respect of export credits, export credit guarantees and insurance programmes,
agricultural exporting state trading enterprises and international food aid, Member
States may adopt national measures respecting Union law. Since the Union and its
Member States are WTO Members, such national measures should also comply with
the rules laid down in that WTO Ministerial Decision of 19 December 2015, as a
matter of Union law and international law.

(28) Obsolete reporting obligations of the Commission regarding the milk and milk
products market, the extension of the school scheme scope and the application of
competition rules to the agriculture sector should be deleted. Reporting obligations

16 WT/MIN(15)/45, WT/L//980

# EN 20 EN

concerning the apiculture sector should be integrated in Regulation (EU) …/… ( _CAP_
_Strategic Plan Regulation)_ .

(29) In view of the repeal of Regulation (EU) No 1306/2013 of the European Parliament
and of the Council [17] by Regulation (EU)…/… ( _CAP Strategic Plan Regulation)_,
provisions concerning checks and penalties related to marketing standards and
protected designations of origin, geographical indications and traditional terms should
be integrated in Regulation (EU) No 1308/2013.

(30) Provisions concerning the reserve for crises in the agricultural sector laid down in
Chapter III of Part V of Regulation (EU) No 1308/2013 should be deleted as updated
provisions concerning the agricultural reserve are laid down in Regulation (EU) …/…
of the European Parliament and of the Council [18] ( _Horizontal Regulation)_ .

(31) In view of the limited number of registrations of geographical indications of
aromatised wines under Regulation (EU) No 251/2014 of the European Parliament and
of the Council [19] the legal framework for the protection of geographical indications for
those products should be simplified. Aromatised wines and other alcoholic beverages
with the exception of spirit drinks and of grapevine products listed in Part II of Annex
VII to Regulation (EU) No 1308/2013 should have the same legal regime and
procedures as other agricultural products and foodstuffs. The scope of
Regulation (EU) No 1151/2012 should be extended to cover those products.
Regulation (EU) No 251/2014 of the European Parliament and of the Council should
be amended to take account of this change as regards its title, scope, definitions and
provisions concerning labelling of aromatised wine products. A smooth transition for
the names protected under Regulation (EU) No 251/2014 should be ensured.

(32) Procedures related to the registration of protected designations of origin, protected
geographical indications and traditional specialities guaranteed laid down in
Regulation (EU) No 1151/2012 should be streamlined and simplified to ensure that
new names can be registered within shorter time periods. The opposition procedure
should be simplified.

(33) Provision should be made for specific derogations that permit the use of other names
alongside the registered name of a traditional speciality guaranteed. The Commission
should fix transitional periods for the use of designations that contain names of
traditional specialities guaranteed, in line with the conditions for such transitional
periods already in existence for protected designations of origin and protected
geographical indications.

(34) The procedure for approval of amendments to product specifications laid down in
Regulation (EU) No 1151/2012 should be simplified by introducing a distinction
between Union and standard amendments. In accordance with the subsidiarity
principle, Member States should be responsible for approving standard amendments

17 Regulation (EU) No 1306/2013 of the European Parliament and of the Council of 17 December 2013 on
the financing, management and monitoring of the common agricultural policy and repealing Council
Regulations (EEC) No 352/78, (EC) No 165/94, (EC) No 2799/98, (EC) No 814/2000, (EC) No
1290/2005 and (EC) No 485/2008 (OJ L 347, 20.12.2013, p. 549).
18 Regulation (EU)…/… of the European Parliament and of the Council of …. on the financing and
monitoring of the common agriculture policy and repealing Regulation (EU) No 1306/2013 (OJ L …,
......, p…).
19 Regulation (EU) No 251/2014 of the European Parliament and of the Council of 26 February 2014 on
the definition, description, presentation, labelling and the protection of geographical indications of
aromatised wine products and repealing Council Regulation (EEC) No 1601/91 (OJ L 84, 20.3.2014, p.
14).

# EN 21 EN

and the Commission should retain responsibility for approving Union amendments to
product specifications.

(35) The amounts of financial resources available to finance measures under Regulations
(EU) No 228/2013 [20] and (EU) No 229/2013 of the European Parliament and of the
Council [21] should be updated.

(36) Regulations (EU) No 1308/2013, (EU) No 1151/2012, (EU) No 251/2014, (EU) No
228/2013 and (EU) No 229/2013 should therefore be amended accordingly.

(37) Transitional arrangements should be put in place for applications for protection and for
the registration of protected designations of origin, geographical indications and
traditional specialities guaranteed that have been submitted before the date of entry
into force of this Regulation and for the expenditure incurred before 1 January 2021
under the aid schemes for olive oil and table olives, fruit and vegetables, wine,
apiculture and hops established in Articles 29 to 60 of Regulation (EU) No 1308/2013.

(38) In order to ensure a smooth transition to the new legal framework laid down in
Regulation (EU) …/… ( _CAP Strategic Plan Regulation),_ the provisions concerning
amendments to Regulation (EU) No 1308/2013 as regards certain aid schemes and the
reserve for crisis in the agricultural sectors and the provisions concerning amendments
to Regulations (EU) No 228/2013 and (EU) No 229/2013 should apply from 1 January
2021,

HAVE ADOPTED THIS REGULATION:

_Article 1_

**Article Amendments to Regulation (EU) No 1308/2013**

Regulation (EU) No 1308/2013 is amended as follows:

(1) Article 3 is amended as follows:

(a) paragraph 2 is deleted;

(b) paragraphs 3 and 4 are replaced by the following:

'3. The definitions set out in Regulation (EU) …/… of the European
Parliament and of the Council* _[Horizontal Regulation]_ and Regulation
(EU) …/… of the European Parliament and of the Council** _[ CAP_
_Strategic Plan Regulation]_ shall apply for the purposes of this
Regulation, save as otherwise provided for in this Regulation.

4. The Commission shall be empowered to adopt delegated acts in
accordance with Article 227 amending the definitions concerning the
sectors set out in Annex II to the extent necessary to update the
definitions in light of market developments.

---------------------------

20 Regulation (EU) No 228/2013 of the European Parliament and of the Council of 13 March 2013 laying
down specific measures for agriculture in the outermost regions of the Union and repealing Council
Regulation (EC) No 247/2006 (OJ 78, 20.3.2013, p. 23).
21 Regulation (EU) No 229/2013 of the European Parliament and of the Council of 13 March 2013 laying
down specific measures for agriculture in favour of the smaller Aegean islands and repealing Council
Regulation (EC) No 1405/2006 (OJ L 78, 20.3.2013, p. 41).

# EN 22 EN

***** **Regulation (EU) …/… of the European Parliament and of the Council of …. on the financing**
**and monitoring of the common agriculture policy and repealing Regulation (EU) No**
**1306/2013 (OJ L …, ......, p…).**

****** **Regulation (EU) …/… of the European Parliament and of the Council of …. 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**
**(OJ L …, ......, p…).';**

(2) Article 5 is replaced by the following:

_'Article 5_

**Article Conversion rates for rice**

The Commission may adopt implementing acts fixing the conversion rates for rice at
various stages of processing.

Those implementing acts shall be adopted in accordance with the examination
procedure referred to in Article 229(2).';

(3) Article 6 is deleted;

(4) Chapter II of Title I of Part II is amended as follows:

(a) the title is replaced by:

_'CHAPTER II_

_Aid for the supply of fruit and vegetables and of milk and milk products in_
_educational establishments';_

(b) the heading 'Section 1' and its title are deleted;

(c) Article 23a is amended as follows:

(i) paragraph 1 is replaced by the following:

'1. Without prejudice to paragraph 4, the aid under the school
scheme allocated for the distribution of products, the
accompanying educational measures and the related costs
referred to in Article 23(1) shall not exceed
EUR 220 804 135 per school year.

Within that overall limit, the aid shall not exceed:

(a) for school fruit and vegetables: EUR 130 608 466 per
school year;

(b) for school milk: EUR 90 195 669 per school year.';

(ii) in the third subparagraph of paragraph 2, the last sentence is deleted;

(iii) paragraph 4 is replaced by the following:

'4. Without exceeding the overall limit of EUR 220 804 135 laid
down in paragraph 1, any Member State may transfer once
per school year up to 20% of either one or the other of its
indicative allocations.';

(d) Sections 2 to 6 covering Articles 29 to 60 are deleted;

# EN 23 EN

(5) in Article 63, paragraph 1 is replaced by the following:

'1. Member States shall make available each year authorisations for new plantings
corresponding to either:

(a) 1% of the total area actually planted with vines in their territory, as
measured on 31 July of the previous year; or

(b) 1% of an area comprising the area actually planted with vines in their
territory, as measured on 31 July 2015, and the area covered by planting
rights granted to producers in their territory in accordance with Article
85h, Article 85i or Article 85k of Regulation (EC) No 1234/2007 and
available for conversion into authorisations on 1 January 2016, as
referred to in Article 68 of this Regulation.';

(6) in Article 81, paragraph 2 is replaced by the following:

'2. Subject to paragraph 3, Member States shall classify which wine grape
varieties may be planted, replanted or grafted in their territories for the purpose
of wine production.

Member States may classify wine grape varieties where:

(a) the variety concerned belongs to the species _Vitis vinifera_ or _Vitis_
_Labrusca;_ or

(b) the variety concerned comes from a cross between the species _Vitis_
_vinifera, Vitis Labrusca_ and other species of the genus _Vitis._

Where a wine grape variety is deleted from the classification referred to in the
first subparagraph, grubbing up of this variety shall take place within 15 years
of its deletion _._ ';

(7) in Article 90, paragraph 3 is replaced by the following:

'3. Save as otherwise provided for in international agreements concluded in
accordance with the TFEU, the import of the products referred to in paragraph
1 shall be subject to the presentation of:

(a) a certificate evidencing compliance with the provisions referred to in
paragraphs 1 and 2, drawn up by a competent body, included on a list to be
made public by the Commission, in the product's country of origin;

(b) an analysis report drawn up by a body or department designated by the
product's country of origin, if the product is intended for direct human
consumption.';

(8) in Section 1 of Chapter 1 of Title II of Part II, the following Subsection 4a is
inserted:

'Subsection 4a

**Checks and penalties**

_Article 90a_

**Checks and penalties related to marketing rules**

1. Without prejudice to acts concerning the wine sector that have been adopted
pursuant to Article 57 of Regulation (EU) […/…] ( _Horizontal Regulation)_, in
the event of infringement of Union rules in the wine sector, Member States

# EN 24 EN

shall apply proportionate, effective and dissuasive administrative penalties in
accordance with Title IV, Chapter I of that Regulation ( _Horizontal Regulation_ ).

2. In order to protect Union funds and to protect the identity, provenance and
quality of Union wine, the Commission shall be empowered to adopt delegated
acts in accordance with Article 227 relating to:

(a) the establishment of an analytical databank of isotopic data to help detect
fraud to be constructed on the basis of samples collected by Member
States;

(b) rules governing control bodies and the mutual assistance between them;

(c) rules governing the common use of the findings of Member States.

3. The Commission may adopt implementing acts laying down all measures
necessary for establishing:

(a) the procedures relating to Member States' own databanks and to the
analytical databank of isotopic data that will help detect fraud;

(b) the procedures relating to cooperation and assistance between control
authorities and bodies;

(c) as regards the obligation referred to in paragraph 3, rules for performing
checks on compliance with marketing standards, rules governing the
authorities responsible for performing the checks, as well as on the
content, the frequency and the marketing stage to which those checks are
to apply.

Those implementing acts shall be adopted in accordance with the examination
procedure referred to in Article 229(2).';

(9) Article 93 is amended as follows:

(a) in paragraph 1, point (a) is replaced by the following:

'(a) 'a designation of origin' means a name which identifies a product,
referred to in Article 92(1):

(i) whose quality or characteristics are essentially or exclusively due
to a particular geographical environment, with its inherent natural
factors and, where relevant, human factors;

(ii) as originating in a specific place, region or, in exceptional cases, a
country;

(iii) produced from grapes which originate exclusively from that
geographical area;

(iv) the production of which takes place in that geographical area; and

(v) which is obtained from vine varieties belonging to _Vitis vinifera_ or
a cross between the _Vitis vinifera_ species and other species of the
genus _Vitis._ ';

(b) in paragraph 2, point (c) is replaced by the following:

'(c) fulfil the requirements referred to in points (a)(i) to (v) of paragraph 1;
and';

(c) paragraph 4 is replaced by the following:

# EN 25 EN

'4. Production, as referred to in points (a)(iv) and (b)(iii) of paragraph 1,
shall cover all the operations involved, from the harvesting of the grapes
to the completion of the wine-making processes, with the exception of
any post-production processes.';

(10) in Article 94(1), the introductory sentence is replaced by the following:

'Applications for protection of names as designations of origin or geographical
indications shall include:'

(11) in Article 96, the following paragraphs 6 and 7 are added:

'6. The Member State shall inform the Commission without delay if any procedure
is initiated before a national court or other national body concerning an
application for protection that the Member State has forwarded to the
Commission, in accordance with paragraph 5.

7. Where appropriate, the Commission may adopt implementing acts to suspend
the examination of the application referred to in Article 97(2) until a national
court or other national body has adjudicated on a challenge to an application
for protection where the Member State has considered that the requirements are
fulfilled in a preliminary national procedure in accordance with paragraph 5.

Those implementing acts shall be adopted without applying the procedure
referred to in Article 229(2) or (3).' **;**

(12) In Article 97, paragraphs 2, 3 and 4 are replaced by the following:

'2. The Commission shall examine applications for protection that it receives in
accordance with Articles 94 and 96(5). It shall scrutinise them for manifest
errors, taking into account the outcome of the preliminary national procedure
carried out by the Member State concerned.

Scrutiny by the Commission should not exceed a period of six months from the
date of receipt of the application from the Member State. Where this period is
exceeded, the Commission shall inform the applicants in writing of the reasons
for this delay.

3. Where, on the basis of the scrutiny carried out pursuant to paragraph 2 of this
Article, the Commission considers that the conditions laid down in Articles 93,
100 and 101 are met, it shall adopt implementing acts concerning the
publication, in the _Official Journal of the European Union_, of the single
document referred to in point (d) of Article 94(1) and of the reference to the
publication of the product specification made in the course of the preliminary
national procedure.

Those implementing acts shall be adopted without applying the procedure
referred to in Article 229(2) or (3).

4. Where, on the basis of the scrutiny carried out pursuant to paragraph 2 of this
Article, the Commission considers that the conditions laid down in Articles 93,
100 and 101 are not met it shall adopt implementing acts rejecting the
application.

Those implementing acts shall be adopted in accordance with the examination
procedure referred to in Article 229(2).';

(13) Articles 98 and 99 are replaced by the following:

# EN 26 EN

_'Article 98_

**Objection procedure**

Within three months from the date of publication in the _Official Journal of the_
_European Union,_ of the single document referred to in point (d) of Article 94(1), the
authorities of a Member State or of a third country, or any natural or legal person
having a legitimate interest and resident or established in a third country, may submit
a statement of objection to the Commission opposing the proposed protection. A
statement of objection shall be duly substantiated.

Any natural or legal person having a legitimate interest and resident or established in
a Member State other than the Member State that forwarded the application for
protection may submit the statement of objection via the authorities of the Member
State in which it is resident or established within a time limit permitting a statement
of objections to be submitted lodged within the time limit referred to in the first
paragraph.

_Article 99_

**Decision on protection**

1. Where the Commission has not received an admissible statement of objection
in accordance with Article 98, it shall adopt implementing acts conferring the
protection. Those implementing acts shall be adopted without applying the
examination procedure referred to in Article 229(2) or (3).

2. Where the Commission has received an admissible statement of objection it
shall adopt implementing acts either conferring protection or rejecting the
application. Those implementing acts shall be adopted in accordance with the
examination procedure referred to in Article 229(2).

3. Protection conferred pursuant to this Article shall be without prejudice to
compliance of products concerned with other Union rules relating in particular
to the placing of products on the market, marketing and to food labelling.'

(14) in Article 103, the following paragraph 4 is added:

'4. The protection referred to in paragraph 2 shall also apply with regard to goods
entering the customs territory of the Union without being released for free
circulation within the customs territory of the Union and with regard to goods
sold through means of electronic commerce in the Union.';

(15) Article 106 is replaced by the following:

_'Article 106_

**Cancellation**

The Commission may, on its own initiative or at the duly substantiated request of a
Member State, a third country, or a natural or legal person having a legitimate
interest, adopt implementing acts cancelling the protection of a designation of origin
or a geographical indication in one or more of the following circumstances:

(a) where compliance with the corresponding product specification is no longer
guaranteed;

(b) where no product has been placed on the market bearing the designation of
origin or geographical indication for at least seven consecutive years;

# EN 27 EN

(c) where an applicant satisfying the conditions laid down in Article 95 declares
that it no longer wants to maintain the protection of a designation of origin or a
geographical indication.

Those implementing acts shall be adopted in accordance with the examination
procedure referred to in Article 229(2).';

(16) Article 111 is deleted;

(17) in Section 2 of Chapter I of Title II of Part II, the following Subsection 4 is added:

'Subsection 4

**Checks related to designations of origin, geographical indications and traditional terms**

_Article 116a_

**Checks**

1. Member States shall take the necessary steps to stop unlawful use of protected
designations of origin, protected geographical indications and protected
traditional terms referred to in this Regulation.

2. Member States shall designate the competent authority responsible for carrying
out the checks in respect of the obligations laid down in this Section. To that
end, Articles 4(2), 4(4), 5(1), 5(4) and 5(5) of Regulation (EU) 2017/625 of the
European Parliament and of the Council* shall apply.

3. Within the Union, the competent authority referred to in paragraph 2 or one or
more delegated bodies within the meaning of point (5) of Article 3 of
Regulation (EU) 2017/625 operating as a product certification body in
accordance with the criteria laid down in Chapter III of Title II of that
Regulation, shall verify annual compliance with the product specification,
during the wine production and during or after conditioning.

4. The Commission shall adopt implementing acts concerning the following:

(a) the communication to be made by the Member States to the Commission;

(b) rules governing the authority responsible for verifying compliance with
the product specification, including where the geographical area is in a
third country;

(c) the actions to be implemented by the Member States to prevent the
unlawful use of protected designations of origin, protected geographical
indications and protected traditional terms;

(d) the checks and verification to be carried out by the Member States,
including testing.

Those implementing acts shall be adopted in accordance with the examination
procedure referred to in Article 229(2).

          - **Regulation (EU) 2017/625 of the European Parliament and of the Council of 15 March 2017**
**on official controls and other official activities performed to ensure the application of food and**
**feed law, rules on animal health and welfare, plant health and plant protection products,**
**amending Regulations (EC) No 999/2001, (EC) No 396/2005, (EC) No 1069/2009, (EC)**
**No 1107/2009, (EU) No 1151/2012, (EU) No 652/2014, (EU) 2016/429 and (EU) 2016/2031 of**
**the European Parliament and of the Council, Council Regulations (EC) No 1/2005 and (EC)**
**No 1099/2009 and Council Directives 98/58/EC, 1999/74/EC, 2007/43/EC, 2008/119/EC**
**and 2008/120/EC, and repealing Regulations (EC) No 854/2004 and (EC) No 882/2004 of the**

# EN 28 EN

**European Parliament and of the Council, Council Directives 89/608/EEC, 89/662/EEC,**
**90/425/EEC,** **91/496/EEC,** **96/23/EC,** **96/93/EC** **and 97/78/EC** **and** **Council**
**Decision 92/438/EEC (Official Controls Regulation) (OJ L 95, 7.4.2017, p. 1).';**

(18) Article 119 is amended as follows:

(a) in paragraph 1, the introductory sentence is replaced by the following:

'Labelling and presentation of the products referred to in points 1 to 11, 13, 15,
16, 18 and 19 of Part II of Annex VII marketed in the Union or for export shall
contain the following compulsory particulars:';

(b) the following paragraph 4 is added:

'4 Member States shall take measures to ensure that the products referred to in
paragraph 1 which are not labelled in conformity with the provisions of this
Regulation are not placed on the market, or are withdrawn from it if already
placed on the market.'

(19) in Article 120(1), the introductory sentence is replaced by the following:

'Labelling and presentation of the products referred to in points 1 to 11, 13, 15, 16,
18 and 19 of Part II of Annex VII may, in particular, contain the following optional
particulars:';

(20) in Article 122, paragraph 1 is amended as follows:

(a) in point (b), point (ii) is deleted;

(b) in point (c), the following point (iii) is added:

'(iii) terms referring to a holding and the conditions for their use.';

(c) in point (d), point (i) is replaced by the following:

'(i) the conditions of use of certain bottle shapes and of closures, and a list of
certain specific bottle shapes;';

(21) Section 1 of Chapter II of Title II of Part II is amended as follows:

(a) Article 124 is deleted;

(b) the heading "Subsection 1" and its title are deleted;

(c) Subsections 2 and 3 covering Articles 127 to 144 are deleted;

(22) in Article 145(3), the first sentence is replaced by the following:

'Member States which provide in their CAP strategic plans for restructuring and
conversion of vineyards in accordance with point (a) of Article 52(1) of Regulation
(EU) …/…[ _CAP Strategic Plan Regulation_ ], shall on the basis of the vineyard
register submit to the Commission by 1 March each year an updated inventory of
their production potential.';

(23) Article 189 is deleted;

(24) Articles 192 and 193 are deleted;

(25) in Chapter IV, the following Article 193a is added:

# EN 29 EN

_'Article 193a_

**Suspension of import duties for molasses**

The Commission may adopt implementing acts suspending import duties in whole or
in part for molasses falling within CN Code 1703.

Those implementing acts shall be adopted without applying the procedure referred to
in Article 229(2) or (3).';

(26) In Part III Chapter VI, covering Articles 196 to 204, is deleted;

(27) In Article 225, points (a) to (d) are deleted;

(28) In Part V, Chapter III covering Article 226 is deleted.

(29) Part II of Annex II is amended as follows:

(a) in point 4 of Section A, the second sentence is deleted;

(b) Section B is deleted;

(30) Annex III is amended as follows:

(a) the title is replaced by the following:

'STANDARD QUALITY OF RICE AND SUGAR AS REFERRED TO IN
ARTICLE 1a OF REGULATION (EU) No 1370/2013*

***** **Council Regulation (EU) No 1370/2013 of 16 December 2013 determining measures on fixing**
**certain aids and refunds related to the common organisation of the markets in agricultural**
**products (OJ L 346, 20.12.2013, p. 12)';**

(b) in Part B, Section I is deleted;

(31) Annex VI is deleted;

(32) in Part II of Annex VII, the following points (18) and (19) are added:

'(18) The term 'de-alcoholised' may be used together with the name of the grapevine
products referred to in points 1 and 4 to 9, where the product:

(a) is obtained from wine as defined in point 1, sparkling wine as defined in
point 4, quality sparkling wine as defined in point 5, quality aromatic
sparkling wine as defined in point 6, aerated sparkling wine as defined in
point 7, semi-sparkling wine as defined in point 8, or from aerated semisparkling wine as defined in point 9;

(b) has undergone a dealcoholisation treatment in accordance with the
processes specified in Section E of Part I of Annex VIII; and

(c) has a total alcoholic strength of no more than 0,5% by volume.

(19) The term 'partially de-alcoholised' may be used together with the name of the
grapevine products referred to in points 1 and 4 to 9, where the product:

(a) is obtained from wine as defined in point 1, sparkling wine as defined in
point 4, quality sparkling wine as defined in point 5, quality aromatic
sparkling wine as defined in point 6, aerated sparkling wine as defined in
point 7, semi-sparkling wine as defined in point 8, or from aerated semisparkling wine as defined in point 9;

(b) has undergone a dealcoholisation treatment in accordance with the
processes specified in Section E of Part I of Annex VIII; and

# EN 30 EN

(c) has a total alcoholic strength of more than 0,5% by volume and following
the processes specified in Section E of Part I of Annex VIII its total
alcoholic strength is reduced by more than 20% by volume compared to
its initial total alcoholic strength.';

(33) in Part I of Annex VIII, the following Section E is added:

'E. Dealcoholisation processes

The following dealcoholisation processes, whether used each of its own or in
combination, shall be allowed to reduce part of or almost all the ethanol
content in grapevine products referred to in points 1 and 4 to 9 of Part II of
Annex VII:

(a) partial vacuum evaporation;

(b) membrane techniques;

(c) distillation.

The dealcoholisation processes shall not result in organoleptic defects of the
grapevine product. The elimination of ethanol in grapevine product must not be
done in conjunction with the increase of the sugar content in the grape must.'.

_Article 2_

**Amendments to Regulation (EU) No 1151/2012**

Regulation (EU) No 1151/2012 is amended as follows:

(1) in Article 2, paragraphs 2 and 3 are replaced by the following:

'2. This Regulation shall not apply to spirit drinks or grapevine products as
defined in Part II of Annex VII to Regulation (EU) No 1308/2013, with the
exception of wine-vinegars.

3. This Regulation, and in particular the registrations made pursuant to Article 52,
shall be without prejudice to compliance of products concerned with other
Union rules relating in particular to the placing of products on the market,
marketing and to food labelling.;

(2) in paragraph 1 of Article 5, point (b) is replaced by the following:

'(b) whose quality or characteristics are essentially or exclusively due to a
particular geographical environment, with its inherent natural factors and
where relevant human factors;';

(3) in paragraph 1 of Article 7, point (d) is deleted;

(4) in paragraph 1 of Article 10, the introductory sentence is replaced by the following:

' A reasoned statement of opposition as referred to in Article 51(1) shall be
admissible only if it is received by the Commission within the time limit set out
in that paragraph and if it:';

(5) in Article 13, the following paragraph 4 is added:

'4. The protection referred to in paragraph 1 shall also apply with regard to goods
entering the customs territory of the Union without being released for free
circulation within the customs territory of the Union and with regard to goods
sold through means of electronic commerce.';

# EN 31 EN

(6) Article 15 is amended as follows:

(a) in paragraph 1, the second subparagraph is replaced by the following:

'Those implementing acts shall be adopted without applying the
examination procedure referred to in Article 57(2).';

(b) in paragraph 2, the introductory sentence is replaced by the following:

'Without prejudice to Article 14, the Commission may adopt implementing acts
extending the transitional period mentioned in paragraph 1 of this Article in
justified cases where it is shown that:';

(7) the following Article 16a is inserted:

_'Article 16a_

**Existing geographical indications for aromatised wine products**

Names entered in the register established pursuant to Article 21 of Regulation (EU)
No 251/2014 **of the European Parliament and of the Council*** shall automatically
be entered in the register referred to in Article 11 of this Regulation. The
corresponding specifications shall be deemed to be the specifications for the
purposes of Article 7 of this Regulation.

          - **Regulation (EU) No 251/2014 of the European Parliament and of the Council of 26 February**
**2014 on the definition, description, presentation, labelling and the protection of geographical**
**indications of aromatised wine products and repealing Council Regulation (EEC) No 1601/91**
**(OJ L 84, 20.3.2014, p. 14).';**

(8) in paragraph 1 of Article 21, the introductory sentence is replaced by the following:

'A reasoned statement of opposition as referred to in Article 51(1) shall be admissible
only if it is received by the Commission before expiry of the time limit and if it:';

(9) the following Article 24a is inserted:

_'Article 24a_

**Transitional periods for use of traditional specialities guaranteed**

The Commission may adopt implementing acts granting a transitional period of up to
five years to enable products the designation of which consists of or contains a name
that contravenes Article 24(1) to continue to use the designation under which they
were marketed on condition that an admissible statement of opposition under Article
49(3) or Article 51 shows that such name has been legally used on the Union market
for at least five years preceding the date of the publication provided for in point (a)
of Article 50(2).

Those implementing acts shall be adopted without applying the examination
procedure referred to in Article 57(2).';

(10) in Article 49, the following paragraphs 8 and 9 are added:

'8. The Member State shall inform the Commission without delay if any procedure
is initiated before a national court or other national body concerning an
application lodged with the Commission, in accordance with paragraph 4.

9. Where appropriate, the Commission may adopt implementing acts to suspend
the scrutiny of the application for registration referred to in Article 50 until a
national court or other national body has adjudicated on a challenge to an

# EN 32 EN

application for registration where the Member State has taken a favourable
decision in a national procedure in accordance with paragraph 4.

Those implementing acts shall be adopted without applying the examination
procedure referred to in Article 57(2).';

(11) Article 50 is replaced by the following:

_'Article 50_

**Scrutiny by the Commission and publication for opposition**

1. The Commission shall examine applications for registration that it
receives in accordance with Article 49(4) and (5). The Commission shall
review the applications for manifest errors, taking into account the
outcome of the scrutiny and opposition procedure carried out by the
Member State concerned.

Scrutiny by the Commission should not exceed a period of six months
from the date of receipt of the application from the Member State. Where
this period is exceeded, the Commission shall inform the applicant in
writing of the reasons for the delay.

The Commission shall, at least each month, publish the list of names for
which applications for registration have been submitted to it, as well as
the date of their submission.

2. Where, based on the scrutiny carried out pursuant to paragraph 1, the
Commission considers that the conditions laid down in Articles 5 and 6
are fulfilled as regards registration applications under the scheme set out
in Title II, or that the conditions laid down in Article 18(1) and (2) are
fulfilled as regards applications under the scheme set out in Title III, it
shall publish in the _Official Journal of the European Union_ :

(a) for applications under the scheme set out in Title II, the single
document and the reference to the publication of the product
specification;

(b) for applications under the scheme set out in Title III, the
specification.';

(12) Article 51 is amended as follows:

(a) paragraph 1 is replaced by the following:

'1. Within three months from the date of publication in the _Official Journal_
_of the European Union_, the authorities of a Member State or of a third
country, or a natural or a legal person having a legitimate interest and
established in a third country may lodge a reasoned statement of
opposition with the Commission.

A natural or a legal person having a legitimate interest, established or
resident in a Member State other than that from which the application
was submitted, may lodge a reasoned statement of opposition with the
Member State in which it is resident or established within a time limit
permitting an opposition to be lodged pursuant to the first subparagraph.';

(b) paragraph 2 is replaced by the following:

# EN 33 EN

'2. The Commission shall examine the admissibility of the reasoned
statement of opposition based in particular on grounds of opposition laid
down in Article 10 as regards protected designations of origin and
protected geographical indications and based in particular on the grounds
for opposition laid down in Article 21 as regards traditional specialities
guaranteed.';

(c) paragraph 3 is replaced by the following:

'3. If the Commission considers that the reasoned statement of opposition is
admissible it shall, within five months from the date of publication of the
application in the _Official Journal of the European Union_, invite the
authority or person that lodged the reasoned statement of opposition and
the authority or body that lodged the application with the Commission to
engage in appropriate consultations for a reasonable period that shall not
exceed three months.

The authority or person that lodged the reasoned statement of opposition
and the authority or body that lodged the application shall start such
appropriate consultations without undue delay. They shall provide each
other with the relevant information to assess whether the application for
registration complies with the conditions laid down in this Regulation. If
no agreement is reached, this information shall be provided to the
Commission.

At any time within the period of consultations, the Commission may, at
the request of the applicant extend the deadline for the consultations by a
maximum of three months.';

(d) paragraph 5 is replaced by the following:

'5. The reasoned statement of opposition and other documents which are
sent to the Commission in accordance with paragraphs 1, 2 and 3 shall be
in one of the official languages of the Union.';

(13) in Article 52, paragraph 2 is replaced by the following:

'2. If the Commission receives no admissible reasoned statement of opposition
under Article 51, it shall adopt implementing acts, without applying the
examination procedure referred to in Article 57(2), registering the name.';

(14) in Article 53, paragraphs 2 and 3 are replaced by the following:

'2. Amendments to a product specification are classified into two categories as
regards their importance: Union amendments, requiring an opposition
procedure at the Union level and standard amendments to be dealt with at
Member State or third country level.

An amendment is considered to be a Union amendment where:

(a) it includes a change in the name of the protected designation of origin,
protected geographical indication or traditional speciality guaranteed;

(b) it risks to void the links referred to in point (b) of Article 5(1) for
protected designations of origin and of Article 5(2) for protected
geographical indications;

# EN 34 EN

(c) it introduces changes to the production method or to the use of raw
materials and ingredients that deviate from the traditional practice and
uses for traditional specialities guaranteed;

(d) it entails new restrictions on the marketing of the product.

All other amendments to product specifications are considered standard
amendments. A temporary amendment that concerns a temporary change in the
product specification resulting from the imposition of obligatory sanitary and
phytosanitary measures by the public authorities or a temporary amendment
necessary because of a natural disaster or adverse weather conditions formally
recognised by the competent authorities are also considered to be standard
amendments.

Union amendments shall be approved by the Commission. The approval
procedure shall follow, _mutatis mutandis_, the procedure laid down in
Articles 49 to 52.

Standard amendments shall be approved by the Member State in whose
territory the geographical area of the product concerned is located and notified
to the Commission. Third countries shall approve standard amendments in
accordance with the law applicable in the third country concerned and notify
them to the Commission.

Amendments shall be scrutinised taking into account other elements of the
product specifications. Where appropriate, the Commission or the Member
State concerned may invite the applicant to modify other elements of the
product specifications.

3. In order to facilitate the administrative process of Union and standard
amendments to product specification, including where the amendment does not
involve any change to the single document, the Commission shall be
empowered to adopt delegated acts, in accordance with Article 56,
complementing the rules of the amendment application process.

The Commission may adopt implementing acts laying down detailed rules on
procedures, form and presentation of an amendment application and
notification of standard amendments to the Commission. Those implementing
acts shall be adopted in accordance with the examination procedure referred to
in Article 57(2).';

(15) in Point I of Annex I, the following indents are added:

'- aromatised wines as defined in Article 3(2) of Regulation (EU) No 251/2014;

            - other alcoholic beverages, except for spirit drinks and grapevine products as
defined in Part II of Annex VII to Regulation (EU) No 1308/2013.'.

_Article 3_

**Amendments to Regulation (EU) No 251/2014**

(1) the title is replaced by the following:

**'Regulation (EU) No 251/2014 of the European Parliament and of the Council of**
**26 February 2014 on the definition, description, presentation and labelling of**
**aromatised wine products and repealing Council Regulation (EEC) No 1601/91'**

(2) in Article 1, paragraph 1 is replaced by the following:

# EN 35 EN

'1. This Regulation lays down rules on the definition, description, presentation and
labelling of aromatised wine products.';

(3) in Article 2, point 3 is deleted;

(4) in Article 5, paragraph 4 is replaced by the following:

'4. Sales denominations may be supplemented or replaced by a geographical
indication of aromatised wine product protected under Regulation (EU) No
1151/2012.

(5) in Article 8, paragraph 2 is replaced by the following:

'2. The name of the geographical indication of aromatised wine product protected
under Regulation (EU) No 1151/2012 shall appear on the label in the language
or languages in which it is registered, even where the geographical indication
replaces the sales denomination in accordance with Article 5(4) of this
Regulation.

Where the name of a geographical indication of aromatised wine product
protected under Regulation (EU) No 1151/2012 is written in a non-Latin
alphabet, it may also appear in one or more of the official languages of the
Union.';

(6) Article 9 is deleted;

(7) Chapter III is deleted.

_Article 4_

**Amendment to Regulation (EU) No 228/2013**

In Article 30, paragraphs 2 and 3 are replaced by the following:

'2. In respect of each financial year, the Union shall finance the measures provided
for in Chapters III and IV, up to a maximum annual sum of:

            - in the French overseas departments: EUR 267 580 000

            - Azores and Madeira: EUR 102 080 000

            - Canary Islands: EUR 257 970 000

3. The sums for each financial year to finance the measures provided for in
Chapter III may not exceed the following amounts:

            - in the French overseas departments: EUR 25 900 000

            - Azores and Madeira: EUR 20 400 000

            - Canary Islands: EUR 69 900 000

The Commission shall adopt implementing acts establishing the requirements in
accordance with which Member States may amend the allocation of resources
allocated every year to the various products benefiting from the supply arrangements.
Those implementing acts shall be adopted in accordance with the examination
procedure referred to in Article 34(2).'.

_Article 5_

**Amendment to Regulation (EU) No 229/2013**

In Article 18, paragraphs 2 and 3 are replaced by the following:

# EN 36 EN

'2. The Union shall finance the measures provided for in Chapters III and IV up to a
maximum amount of EUR 23 000 000.

3. The amount allocated to finance the specific supply arrangements referred to in
Chapter III shall not exceed EUR 6 830 000.'

_Article 6_

**Transitional provisions**

1. The rules applicable before the date of entry into force of this Regulation shall
continue to apply to applications for protection of designations of origin or
geographical indications received by the Commission pursuant to Regulation (EU)
No 1308/2013 before the date of entry into force of this Regulation and to
applications for registration of protected designations of origin, protected
geographical indications or traditional specialities guaranteed received by the
Commission pursuant to Regulation (EU) No 1151/2012 before the date of entry into
force of this Regulation.

2. The rules applicable before the date of entry into force of this Regulation shall
continue to apply to applications for protection of names of aromatised wines as
geographical indication received by the Commission pursuant to Regulation (EU) No
251/2014 before the date of entry into force of this Regulation. However, the
decision on registration shall be adopted pursuant to Article 52 of Regulation (EU)
No 1151/2012 as amended by point (13) of Article 2 of this Regulation.

3. Articles 29 to 60 of Regulation (EU) No 1308/2013 shall continue to apply after 1
January 2021 as regards expenditure incurred before 1 January 2021 within the aid
schemes referred to in those Articles.

_Article 7_

**Entry into force and application**

This Regulation shall enter into force on the [X] day following that of its publication in the
_Official Journal of the European Union_ .

Points (1)(b), (4), (8), (17), (22), (27), (28) and (31) of Article 1 and Articles 4 and 5 shall
apply from 1 January 2021.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

_For the European Parliament_ _For the Council_
_The President_ _The President_

# EN 37 EN

**LEGISLATIVE FINANCIAL STATEMENT**

**1.** **FRAMEWORK** **OF** **THE** **PROPOSAL/INITIATIVE**

1.1. Title of the proposal/initiative

1.2. Policy area(s) concerned in the ABM/ABB structure

1.3. Nature of the proposal/initiative

1.4. Grounds for the proposal/initiative

1.5. Duration and financial impact

1.6. Management mode(s) planned

**2.** **MANAGEMENT** **MEASURES**

2.1. Monitoring and reporting rules

2.2. Management and control system

2.3. Measures to prevent fraud and irregularities

**3.** **ESTIMATED** **FINANCIAL** **IMPACT** **OF** **THE** **PROPOSAL/INITIATIVE**

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

3.2. Estimated impact on expenditure

_3.2.1. Summary of estimated impact on expenditure_

_3.2.2. Estimated impact on appropriations of an administrative nature_

_3.2.3. Third-party contributions_

3.3. Estimated impact on revenue

# EN 1 EN

**1.** **FRAMEWORK** **OF** **THE** **PROPOSAL**

**1.1.** **Title of the proposal**

a) Proposal for a Regulation of the European Parliament and of the Council on the financing,
management and monitoring of the common agricultural policy and repealing Regulation
(EU) No 1306/2013;

b) 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;

c) Proposal for a Regulation of the European Parliament and of the Council amending
Regulations (EU) No 1308/2013 establishing a common organisation of the markets in
agricultural products, (EU) No 1151/2012 on quality schemes for agricultural products and
foodstuffs, (EU) No 251/2014 on the definition, description, presentation, labelling and the
protection of geographical indications of aromatised wine products, (EU) No 228/2013 laying
down specific measures for agriculture in the outermost regions of the Union and (EU) No
229/2013 laying down specific measures for agriculture in favour of the smaller Aegean
islands.

**1.2.** **Policy area(s) concerned** _**(Programme cluster)**_

Programme cluster 8 - Agriculture & Maritime Policy under Heading 3 of the
Multiannual Financial Framework (MFF) 2021-2027 – Natural Resources and
Environment

**1.3.** **The proposal/initiative relates to:**

 **a new action following a pilot project/preparatory action** **[22]**

 **the extension of an existing action**

 **a merger or redirection of one or more actions towards another/a new action**

**1.4.** **Grounds for the proposal/initiative**

_1.4.1._ _Requirement(s) to be met in the short or long term including a detailed timeline for_
_roll-out of the implementation of the initiative_

The objectives of the Common Agricultural Policy (CAP), set out in Article 39 of the
Treaty on the Functioning of the European Union, aim at:
(a) increasing agricultural productivity (including through technical progress and
optimum usage of the factors of production);
(b) thus ensuring a fair standard of living for the agricultural community (including
by increasing earnings);
(c) stabilising markets;
(d) ensuring the availability of supplies; and
(e) ensuring that supplies reach consumers at reasonable prices.

22 As referred to in Article 58(2)(a) or (b) of the Financial Regulation.

# EN 2 EN

Those are adjusted and articulated to the challenges mentioned in section 1.4.2 below
in order to put the emphasis on the 10 Commission priorities for 2015-2019 and UN
Sustainable Development Goals and in order to fulfil the above the proposals aiming
to lay down the legislative framework for the Common Agricultural Policy for the
period 2021-2027 – A simpler, smarter, modern and more sustainable CAP.

_1.4.2._ _Added value of Union involvement (it may result from different factors, e.g._
_coordination gains, legal certainty, greater effectiveness or complementarities). For_
_the purposes of this point 'added value of Union involvement' is the value resulting_
_from Union intervention which is additional to the value that would have been_
_otherwise created by Member States alone._

The cross-border and global nature of key challenges faced by EU agriculture and
rural areas require a common policy at EU level. The CAP addresses those
challenges by:

         - securing a single market and level playing field via a common income safety net

system of support that underpins food security and avoids potential distortions of
competition;

         - shoring up EU farming sector resilience necessary to harness globalisation and

         - delivering on key dimensions of sustainability challenges like climate change,

water use, air quality and biodiversity via the CAP environmental architecture.

In other areas, a strong EU-wide dimension needs to be combined with more
subsidiarity. These areas include food safety (e.g. harmonisation of standards), rural
area challenges (with big gaps in rural unemployment existing between Member
States), poor rural infrastructure and services, weaknesses in research and innovation,
and problems related to food quality, public health and nutrition. An appropriate EUlevel response to these challenges allows more effective and efficient action when
combined with more flexibility at Member State level.

_1.4.3._ _Lessons learned from similar experiences in the past_

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

_1.4.4._ _Compatibility and possible synergy with other appropriate instruments_

Predominantly as regards the CAP, significant synergies and simplification effects
will be obtained by including under one strategic framework of the CAP Strategic
Plan the implementation of interventions financed by the EAGF and EAFRD. The
structures already in place in the Member States shall be sustained while
management and control rules simplified and tailored to specific interventions
implemented by the Member States.

The CAP maintains strong synergies with climate and environment policies, food
safety and health-related issues, digital agenda in rural areas and bioeconomy,
knowledge and innovation enlargement and neighbourhood policy, trade and
development policies, Erasmus+.

The CAP will work in synergy and complementarity with other EU policies and
funds such as actions implemented under the European Structural and Investment

# EN 3 EN

Funds, the InvestEU fund, the ninth Framework Programme for Research as well as
environmental and climate-related policies. Where appropriate, common rules will be
established in view of maximising consistency and complementarity between funds,
while making sure that specificities of these policies are respected.

Synergies with the Research Framework Programme (FP) will be secured in the FP9
cluster on “Food and Natural Resources” whose objective is to make agriculture and
food systems fully safe, sustainable, resilient, circular, diverse and innovative. The
CAP will forge even stronger links to EU Research and Innovation policy by
introducing bioeconomy as a priority for the CAP. Under the cluster on “Food and
Natural Resources”, emphasis is also given to reaping the benefits of the digital
revolution, so Research and Innovation activities will contribute to the digital
transformation of agriculture and rural areas.

The legislative proposals concerned by this financial statement should be seen in the
broader context of the proposal for the Common Provisions Regulation laying down
a single framework of common rules for funds such as the EAFRD, the European
Regional Development Fund, the European Social Fund, the Cohesion Fund, the
European Maritime and Fisheries Fund and others. That framework regulation will
make an important contribution to reducing administrative burden, to spending EU
funds in an effective way, and to put simplification into practice.

**1.5.** **Duration and financial impact**

 **limited duration**

–  in effect from 01/01/2021 to 31/12/2027

–  Financial impact from 2021 to 2027 for commitment appropriations and from
2021 to beyond 2027 for payment appropriations.

 **unlimited duration** for Proposal for a Regulation of the European Parliament and
of the Council amending Regulations (EU) No 1308/2013 establishing a common
organisation of the markets in agricultural products, (EU) No 1151/2012 on quality
schemes for agricultural products and foodstuffs, (EU) No 251/2014 on the
definition, description, presentation, labelling and the protection of geographical
indications of aromatised wine products, (EU) No 228/2013 laying down specific
measures for agriculture in the outermost regions of the Union and (EU) No
229/2013 laying down specific measures for agriculture in favour of the smaller
Aegean islands

–
Implementation as from 2021 (budget year).

**1.6.** **Management mode(s) planned** **[23 ]**

 **Direct management** by the Commission

–  by its departments, including by its staff in the Union delegations;

–  by the executive agencies

 **Shared management** with the Member States

 **Indirect management** by entrusting budget implementation tasks to:

23 Details of management modes and references to the Financial Regulation may be found on the
BudgWeb site:
[https://myintracomm.ec.europa.eu/budgweb/EN/man/budgmanag/Pages/budgmanag.aspx](https://myintracomm.ec.europa.eu/budgweb/EN/man/budgmanag/Pages/budgmanag.aspx)

# EN 4 EN

–  third countries or the bodies they have designated;

–  international organisations and their agencies (to be specified);

–  the EIB and the European Investment Fund;

–  bodies referred to in Articles 70 and 71 of the Financial Regulation;

–  public law bodies;

–  bodies governed by private law with a public service mission to the extent that
they provide adequate financial guarantees;

–  bodies governed by the private law of a Member State that are entrusted with
the implementation of a public-private partnership and that provide adequate
financial guarantees;

–  persons entrusted with the implementation of specific actions in the CFSP
pursuant to Title V of the TEU, and identified in the relevant basic act.

–
_If more than one management mode is indicated, please provide details in the ‘Comments’ section._

Comments

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

# EN 5 EN

**2.** **MANAGEMENT** **MEASURES**

**2.1.** **Monitoring and reporting rules**

_Specify frequency and conditions._

A performance, monitoring and evaluation framework shall be established with a
view to:

(a) assess the impact, effectiveness, efficiency, relevance, coherence and EU
added value of the CAP;

(b) set milestones and targets for CAP Strategic Plans specific objectives;

(c) monitor progress made towards achieving the CAP Strategic Plan targets;

(d) assess the impact, effectiveness, efficiency, relevance and coherence of the
CAP Strategic Plans interventions;

(e) support a common learning process related to monitoring and evaluation.

The Managing Authority and the Monitoring Committee will monitor the
implementation of the CAP Strategic Plan and progress made towards achieving
CAP Strategic Plan targets.

**Annual performance reports**

By 15 February 2023 and 15 February of each subsequent year until and including
2030, Member States shall submit to the Commission annual performance reports on
the implementation of the CAP Strategic Plan in the previous financial year. These
reports shall set out key qualitative and quantitative information on implementation
of the CAP Strategic Plan by reference to financial data, output and result indicators.
They shall also include information about realised outputs, realised expenditure,
realised results and distance to respective targets.

The data transmitted shall relate to achieved values for indicators for partial and fully
implemented interventions. They shall also set out a synthesis of the state of
implementation of the CAP Strategic Plan realised during the previous financial year,
any issues which affect the performance of the CAP Strategic Plan, in particular as
regards deviations from milestones, underlining reasons and, where relevant, the
measures taken.

The Commission shall carry out an Annual Performance Review and an Annual
Performance Clearance based on the information provided in the Annual
Performance reports.

**CAP strategic Plan evaluation**

Member States shall carry out ex ante evaluations, including an analysis of the
strength, weaknesses, opportunities and threats relevant for the CAP Strategic Plan
concerned in order to identify the needs to be addressed by the CAP Strategic Plan.

Evaluations of CAP Strategic Plans shall be carried out by the Member States to
improve the quality of the design and implementation of plans, as well as to assess
their effectiveness, efficiency, relevance, coherence, EU added value and impact in
relation to their contribution to the CAP general and specific objectives.

# EN 6 EN

**Performance assessment by the Commission**

The Commission shall establish a multiannual evaluation plan of the CAP to be
carried out under the responsibility of the Commission.

The Commission shall carry out an interim evaluationto examine the effectiveness,
efficiency, relevance, coherence and EU added value of the Funds taking into
account the indicators set out in Annex VII. The Commission may make use of all
relevant information already available in accordance with Article 128 of Financial
Regulation.

The Commission shall carry out a retrospective evaluation to examine the
effectiveness, efficiency, relevance, coherence and EU added value of the Funds.

Based on evidence provided in evaluations on the CAP, including evaluations on
CAP Strategic Plans, as well as other relevant information sources, the Commission
shall present an initial report on the implementation of this Article, including first
results on the performance of the CAP, to the European Parliament and the Council
by 31 December 2025. A second report including an assessment of the performance
of the CAP shall be presented by 31 December 2031.

**Reporting based on a core set of indicators**

The information provided by the Member States is the basis on which the
Commission shall report on the progress towards the achievement of specific
objectives over the whole programming period using for this purpose a core set of
indicators.

In compliance with its reporting requirement pursuant to Article 38(3)(e)(i) of the
Financial Regulation, the Commission shall present to the European Parliament and
the Council the performance information referred to in that Article measured by the
core set of indicators.

**2.2.** **Management and control system(s)**

_2.2.1._ _Justification of the management mode(s), the funding implementation mechanism(s),_
_the payment modalities and the control strategy proposed_

The CAP is primarily implemented in shared management with the Member States.
The existing governance bodies set up in the Member States, notably the paying
agencies and certification bodies, have shown their effectiveness in protecting the
EU budget and ensuring sound financial management. The steady low error rate
levels under the CAP in the most recent years show that the management and control
systems set up by the Member States function properly and provide reasonable

assurance.

The new delivery model under the CAP acknowledges this situation by conferring
more subsidiarity on Member States in deciding and managing the control systems in
place within a more general set of rules at the level of the Union. Moreover,
following the strategy on budgeting focused on results and performance oriented
payments, the CAP will link the eligibility of the payments to the actual delivery on
the ground. Performance is therefore at the heart of the financial management and
assurance model in the legislative proposals for the CAP post 2020.

The control strategy for the new period will be fully in line with the single audit
approach, ensuring that accredited paying agencies and certification bodies provide
the necessary assurance. The Commission will pay particular attention to the

# EN 7 EN

effective functioning of the governance systems in place and the reliability of the
performance reporting. As currently, there will be an audit strategy drafted at the
beginning of the period and a multi-annual working programme.

To summarize, the Commission will ensure that the governance systems set up in the
Member States are functioning effectively, will reimburse the payments incurred by
the accredited paying agencies and will carry out annual performance clearance
assessing the achieved outputs reported by the Member States.

_2.2.2._ _Information concerning the risks identified and the internal control system(s) set up_
_to mitigate them_

There are more than seven million beneficiaries of the CAP, receiving support under
a large variety of different aid schemes. The downward trend in the reduction of the
error rate in the domain of the CAP shows robust and reliable management and
control systems in the paying agencies.

The CAP has been implemented so far through detailed eligibility rules at the level
of the beneficiary which added complexity, administrative burden and risk of error.
The costs of the management and control system, in order to mitigate this risk, have
been considered as somewhat disproportionate.

The legislative package for the CAP post 2020 reduces substantially the compliance
element, increasing the focus on performance. Obligations stemming from EU rules
are to be fulfilled by Member States who then should put in place the appropriate
management and control system. Member States will have more flexibility to design
the schemes and measures that better fit their concrete realities. Therefore, the CAP
funding will be conditioned to a strategic delivery of the policy towards common
objectives defined at EU level. The CAP Plan will be the agreement between the
Member States and the Commission whereby the strategy for 7 years, targets,
interventions and planned expenditure are laid down and approved.

The proposal for the regulation on the financing, management and monitoring of the
common agricultural policy adapts the current set up to this new delivery model,
while maintaining the well-functioning governance bodies (paying agencies and
certification bodies). As in the current situation, every year the head of each paying
agency is required to provide a management declaration which covers the
completeness, accuracy and veracity of the accounts, the proper functioning of the
governance structures, including fulfilment of EU basic requirements, and the
reliability of the performance reporting. An independent audit body (Certification
Body) is required to provide an opinion on these elements.

Expenditure will be reduced if the Member State has not delivered outputs to the
agreed standards. Compliance audits will still be carried out to assess the functioning
of the governance structures. The Commission will continue to audit agricultural
expenditure, using a risk-based approach in order to ensure that its audits are targeted
to the areas of highest risk, in accordance with the single audit principle.
Furthermore, there are clear mechanisms for suspensions of payments for cases of
serious deficiencies in the governance structures or significant underperformance
trends.

The main risk envisaged for the new period is that the alleviation of concrete and
detailed rules on how the management and control system in the Member State
should be established at the level of the paying agencies may have a reputational

# EN 8 EN

impact for the Commission in cases where eligibility rules established by the
Member States are not respected. It should be stressed that the Commission will
ensure that governance systems are in place and outputs and results are being
achieved. In the spirit of budgeting focused on results, the Commission will put the
focus to what the policy delivers.

_2.2.3._ _Estimation and justification of the cost-effectiveness of the controls (ratio of "control_
_costs ÷ value of the related funds managed"), and assessment of the expected levels_
_of risk of error (at payment & at closure)_

The new delivery model for the CAP is expected to significantly reduce the cost of
controls, both for Member States and beneficiaries.

The EU level requirements have been significantly reduced and they have been set at
the level of the Member States, who should use this opportunity to adapt the
obligations to be fulfilled by beneficiaries to the concrete national or regional
circumstances.

Member States will define the management and control system within the simplified
EU framework defined in the legislative proposals. The Integrated Administration
and Control System (IACS), accountable for roughly 88% of the CAP payments, is
maintained although specific elements, so far defined at EU level, will be left to
Member States. Therefore, intensity and scope of controls which is the main cost
driver is no longer defined at EU level.

The focus on performance requires a robust and reliable reporting system, which as
mentioned in previous sections, will be subjet to independent audits. It is not
expected though that this has a significant impact on the administrative burden of the
Member States, since most of the output indicators are already available in the
accredited paying agencies.

The Member States have the potential to simplify and reduce the administrative
burden linked to the management and control of the CAP, since they will be able to
tailor eligibility rules at beneficiary level and decide most suitable way to control (no
one-size-fits-all). As stated in the Impact Assessment accompanying the CAP
legislative proposals, chapter on simplification, the delivery costs for the new CAP
are not expected to be higher (currently at 3.6%), even when taking into account the
enhanced focus on performance reporting.

As regards the expected level of errors, according to the new delivery model, the
eligibility of the expenditure is assessed in terms of outputs achieved. Therefore,
errors would not be calculated in respect to legality and regularity of individual
transactions but on the level of outputs achieved in relationship with the expenditure
reimbursed. The expenditure which has not a corresponding output will be reduced in
the framewok of the annual performance clearance, so the EU budget remains
protected.

**2.3.** **Measures to prevent fraud and irregularities**

_Specify existing or envisaged prevention and protection measures, e.g. from the Anti-Fraud Strategy._

The legislative package envisages that Member States shall ensure effective
prevention against fraud, especially in the areas with a higher level of risk,
preventing, detecting and correcting irregularities and fraud. Member States must

# EN 9 EN

impose effective, dissuasive and proportionate penalties as laid down in Union
legislation or national law, and recover any irregular payments plus interests.

These EU basic requirements are part of the governance structures that will be
audited by the Certification Bodies and on a risk-based approach, also by the
Commission following the single audit principle.

Details will be addressed, as appropriate, in a revised AGRI Anti-fraud Strategy. It is
however not expected that the typology of fraud and other serious irregularities will
substantially change in the future compared to the status quo.

The current approach of delivering targeted training to Member States on the
prevention, detection and correction of fraud and other serious irregularities is likely
to be extended onto the future CAP. The same applies to thematic guidance notes for
Member States on specific areas of high risk.

# EN 10 EN

**3.** **ESTIMATED** **FINANCIAL** **IMPACT** **OF** **THE** **PROPOSAL**

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

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

As regards the market-related expenditure, it should be underlined that the amounts
taken into account for market-related expenditure are based on the assumption of no
public intervention buying-in and other measures related to a crisis situation in any

sectors.

A new agricultural reserve will be established in the EAGF, to provide additional
support for the agricultural sector for the purpose of safety-net measures in the
context of market management or stabilisation and/or in case of crises affecting the
agricultural production or distribution. The amount of the reserve will be at least
EUR 400 million at the beginning of each financial year. The unused amounts of the
agricultural crisis reserve in financial year 2020 will be carried forward to financial
year 2021 to set up the reserve; an annual roll-over of the unused amounts will apply
in the period 2021-2027. In case the reserve is used, it will be re-filled using existing
budgetary availabilities or by fresh appropriations. In case the specific EAGF subceiling fixed in the MFF 2021-2027 is overshoot, the financial discipline will apply
to cover all needs above the sub-ceiling, including those for refilling the reserve.
Therefore, the repeated application of financial discipline for the purpose of setting
up the reserve is not foreseen in the period 2021-2027. The financial discipline
mechanism will remain for the purpose of ensuring the respect of the EAGF subceiling.

As concerns direct payments types of interventions, the net ceilings for financial year
2021 (calendar year 2020) set by Regulation (EU) No 1307/2013 of the European
Parliament and of the Council, are higher than the amounts allocated to direct
payments types of interventions indicated in the accompanying tables, consequently
they will need to be adjusted in line with the final agreement on the CAP financal
envelope within the deadlines needed for timely implementation in the Member
States.

The proposal includes a continuation of the process of external convergence of direct
payments: Member States with an average support level below 90% of the EU
average will close 50% of the gap to 90% of the EU average in 6 gradual steps
starting in 2022. All Member States will contribute to financing this convergence. It
is reflected in the Member States allocations for direct payments in Annex IV to the
CAP Strategic Plans Regulation.

The impact of the reduction of payments inf direct support to farmers is budgetary
neutral for the direct payments allocation, as the product of the reduction of
payments will be used to finance redistributive payment within the same Member
State. In case the product of the reduction of payments cannot be accomodated in the
financing of direct payments types of interventions, it will be transferred to the
EAFRD allocation of the Member State concerned. The amounts of such possible
transfer cannot be quantified at this stage.

As regards the revenue assigned to the EAGF, the estimate reflects the effect of
granted deferrals and instalments on the past clearance decisions that will be cashed

# EN 11 EN

in after 2020, and the estimated assigned revenue from clearance and irregularities to
be collected. The latter is assumed to decrease compared to current levels following
the introduction of the new delivery model.

As regards the EAFRD, the proposal foresees a decrease in EU co-financing rates
similarly to the other European Structural and Investment Funds. This together with
the allocation for the EAFRD types of interventions will allow keeping public
support to European rural areas largely unchanged. The allocation between Member
States is based on objective criteria and past performance.

The reform proposals contain provisions giving Member States a degree of flexibility
in relation to their allocation for direct payments types of interventions and for rural
development types of interventions, as well as between the allocation for direct
payments types of interventions and for certain sectorial types of interventions. In
case Member States decide to use that flexibility, this will have financial
consequences within the given financial amounts, which cannot be quantified at this
stage.

**3.1.** **Heading of the multiannual financial framework and preliminary list of new**

|3.1.|Heading of the multiannual financia expenditure budget lines proposed24|al framewo|ork and preliminary list of new|Col5|Col6|Col7|
|---|---|---|---|---|---|---|
|Heading of<br>multiannual<br>financial<br>framework|Budget line|Type of <br>expenditure|Contribution|Contribution|Contribution|Contribution|
|Heading of<br>multiannual<br>financial<br>framework|Heading 3:<br>Natural Resources and Environment|Diff./Non-<br>diff.25|from<br>EFTA<br>countries<br>26 <br>|from<br>candidate<br>countries27 <br>|from third<br>countries|within the<br>meaning of<br>Article [21(2)(b)]<br>of the Financial<br>Regulation|
|3|[08.01.YY] EAGF Non-operational<br>technical assistance|Non-diff|NO|NO|NO|NO|
|3|[08.01.YY] EAFRD Non-operational<br>technical assistance|Non-dif|NO|NO|NO|NO|
|3|[08.01.YY] Executive agencies|Non-diff|NO|NO|NO|NO|
|3|[08.02.YY] Agricultural reserve|Non-diff|NO|NO|NO|NO|
|3|[08.02.YY] Sectorial types of<br>interventions under the CAP plan|Non-diff|NO|NO|NO|NO|
|3|[08.02.YY] Market related<br>expenditure outside the CAP plan|Diff and<br>non-diff|NO|NO|NO|NO|
|3|[08.02.YY] Direct payments types of<br>interventions under the CAP plan|Non-diff|NO|NO|NO|NO|

24 A number of the existing budgetary lines is to be maintained and the numbering is to be adapted to the
new budgetary nomenclature (e.g. current chapters 05 07 and 05 08). Following the development of the
CAP proposal the nomenclature could be adjusted.
25 Diff. = Differentiated appropriations / Non-diff. = Non-differentiated appropriations.
26 EFTA: European Free Trade Association.
27 Candidate countries and, where applicable, potential candidates from the Western Balkans

# EN 12 EN

|Heading of<br>multiannual<br>financial<br>framework|Budget line|Type of<br>expenditure|Contribution|Col5|Col6|Col7|
|---|---|---|---|---|---|---|
|Heading of<br>multiannual<br>financial<br>framework|Heading 3:<br>Natural Resources and Environment|Diff./Non-<br>diff.25|from<br>EFTA<br>countries<br>26 <br>|from<br>candidate<br>countries27 <br>|from third<br>countries|within the<br>meaning of<br>Article [21(2)(b)]<br>of the Financial<br>Regulation|
|3|[08.02.YY] Direct payments outside<br>the CAP plan|Non-diff|NO|NO|NO|NO|
|3|[08.02.YY] EAGF Operational<br>technical assistance|Diff and<br>non-diff|NO|NO|NO|NO|
|3|[08.03.YY] 2021-2027 rural<br>development types of interventions<br>under the CAP plan|Diff|NO|NO|NO|NO|
|3|[08.03.YY] EAFRD Operational<br>technical assistance|Diff|NO|NO|NO|NO|
|7|[08.01.YY] Expenditure related to<br>official and temporary agents in the<br>‘Agriculture and rural development’<br>policy area|Non-diff|NO|NO|NO|NO|
|7|[08.01.YY] External personnel and<br>other management expenditure in<br>support of the 'Agricultural and Rural<br>Development' policy area|Non-diff|NO|NO|NO|NO|
|7|[08.01.YY] Expenditure related to<br>information and communication<br>technology equipment and services of<br>the 'Agricultural and Rural<br>Development'  policy area|Non-diff|NO|NO|NO|NO|

The list of budget items in the table above is preliminary and does not prejudge the concrete
budget nomenclature that the Commission will propose in the context of the annual budgetary
procedure.

# EN 13 EN

**3.2.** **Estimated impact on expenditure**

_3.2.1._ _Summary of estimated impact on expenditure_

EUR million (with three decimal places)

**Heading of multiannual financial**

**3** Natural Resources and Environment
**framework**

|Col1|Col2|Col3|2021|2022|2023|2024|2025|2026|2027|Post<br>2027|TOTAL|
|---|---|---|---|---|---|---|---|---|---|---|---|
|08 02 YY – Agricultual reserve|Commitments =<br>Payments|(1)|p.m.|p.m.|p.m.|p.m.|p.m.|p.m.|p.m.||**p.m.**|
|08 02 YY – Sectoral types of<br>interventionsunder the CAP plan 28|Commitments =<br>Payments|(2)|2,044.116|2,066.584|2,091.060|2,115.010|2,139.737|2,165.443|2,192.347||**14,814.294**|
|08 02 YY - Market related expenditure<br>outside the CAP plan|Commitments|(3)|638.309|638.309|638.309|638.309|638.309|638.309|638.309||**4,468.163**|
|08 02 YY - Market related expenditure<br>outside the CAP plan|Payments|(4)|605.136|611.601|623.808|627.643|629.770|630.334|630.314|109.558|**4,468.164**|
|08 02 YY – Direct payments types of<br>interventions|Commitments =<br>Payments|(5)|37,392.689|37,547.129|37,686.679|37,802.859|37,919.038|38,035.217|38,151.396||**264,535.007**|
|08 02 YY – Direct payments outside the<br>CAP plan|Commitments =<br>Payments|(6)|421.321|421.321|421.321|421.321|421.321|421.321|421.321||**2,949.249**|
|08 02 YY – EAGF operational technical<br>assistance29|Commitments =<br>Payments30|(7)|71.000|71.000|71.000|71.000|71.000|71.000|71.000||**497.000**|

28 An increase in the Sectorial types of interventions under the CAP plan is explained by the allocation proposed for the support to the apiculture sector amounting to
EUR 60 million, as well as the evolution of the expenditure in fruit and vegetables sector, which is not limited by an EU level envelope, following the observed past
level of execution.
29 Including also the amounts financed currently under chapters 05 07 (Audit of agricultural expenditure) and 05 08 (Policy strategy and coordination of the Agriculture
and rural development policy area).
30 For simplification, the appropriations for EAGF technical assistance are here considered as non-differenciated. The amount of RAL tends to be insignificant
compared to the total amounts concerned by this financial statement.

# EN 14 EN

|08 01 YY - Appropriations of an<br>administrative nature financed from the<br>EAGF31|Commitments =<br>Payments|(8)|13.000|13.000|13.000|13.000|13.000|13.000|13.000|Col11|91.000|
|---|---|---|---|---|---|---|---|---|---|---|---|
|~~67 01 & 67 02 – Revenue assigned to~~<br>the EAGF|Commitments =<br>Payments|(9)|280.000|230.000|130.000|130.000|130.000|130.000|130.000||**1,160.000**|
|**SUBTOTAL – EAGF**|Commitments|(10)=(1<br>+2+3+5<br>+6+7+8<br>-9)|**40,300.435**|**40,527.343**|**40,791.369**|**40,931.499**|**41,072.405**|**41,214.290**|**41,357.373**||**286,194.715**|
|**SUBTOTAL – EAGF**|Payments|11)=(1+<br>2+4+5+<br>6+7+8-<br>9)|**40,267.262**|**40,500.635**|**40,776.868**|**40,920.833**|**41,063.866**|**41,206.315**|**41,349.378**|**109.558**|**286,194.715**|

|08 03 YY – Rural development types of<br>interventions|Commitments|(12)|11,230.561|11,230.561|11,230.561|11,230.561|11,230.561|11,230.561|11,230.561|Col11|78,613.927|
|---|---|---|---|---|---|---|---|---|---|---|---|
|08 03 YY – Rural development types of<br>interventions <br>|Payments|(13)|786.139|3,703.699|6,314.312|7,860.977|9,356.414|10,331.700|11,025.236|29,235.450|**78,613.927**|
|08 03 YY – EAFRD operational<br>technical assistance EU|Commitments =<br>Payments32|(14)|22.147|22.147|22.147|22.147|22.147|22.147|22.147||**155.029**|
|08 01 YY - Appropriations of an<br>administrative nature financed from the<br>EAFRD|Commitments =<br>Payments|(15)|6.000|6.000|6.000|6.000|6.000|6.000|6.000||**42.000**|
|**SUBTOTAL – EAFRD**|Commitments|(16)=(1<br>2+14+1<br>5)|11,258.708|11,258.708|11,258.708|11,258.708|11,258.708|11,258.708|11,258.708||**78,810.955**|
|**SUBTOTAL – EAFRD**|Payments|(17)=(1<br>3+14+1<br>5)|814.286|3,731.846|6,342.459|7,889.124|9,384.561|10,359.847|11,053.383|29,235.450|**78,810.955**|
|**TOTAL appropriations for the**|Commitments|=10+16|**51,559.143**|**51,786.051**|**52,050.077**|**52,190.207**|**52,331.113**|**52,472.998**|**52,616.081**||**365,005.670**|

31 Including the amounts financed currently under item 05 01 04 01 - Support expenditure for European Agricultural Guarantee Fund (EAGF) - Non-operational
technical assistance and 05 01 06 01 - Consumer, Health, Agriculture and Food Executive Agency - Contribution from the agricultural promotion programme
32 For simplification, the appropriations for EAFRD technical assistance are here considered as non-differenciated. The amount of RAL tends to be insignificant
compared to the total amounts concerned by this financial statement.

# EN 15 EN

**CAP**
Payments =11+17 **41,081.548** **44,232.481** **47,119.327** **48,809.957** **50,448.427** **51,566.162** **52,402.761** **29,345.008** **365,005.670**

Totals do not tally due to rounding.

# EN 16 EN

**Heading of multiannual financial**

7 ‘Administrative expenditure’
**framework**

EUR million (with three decimal places)

|Col1|Col2|2021|2022|2023|2024|2025|2026|2027|Post<br>2027|TOTAL|
|---|---|---|---|---|---|---|---|---|---|---|
|Human resources|Human resources|125.678|125.678|125.678|125.678|125.678|125.678|125.678||**879.746**|
|Other administrative expenditure|Other administrative expenditure|6.008|6.008|6.008|6.008|6.008|6.008|6.008||**42.056**|
|**TOTAL appropriations under HEADING**<br>**7 of the multiannual financial framework**|Commitments =<br>Payments|**131.686**|**131.686**|**131.686**|**131.686**|**131.686**|**131.686**|**131.686**||**921.802**|

|Col1|Col2|2021|2022|2023|2024|2025|2026|2027|Post<br>2027|TOTAL|
|---|---|---|---|---|---|---|---|---|---|---|
|**TOTAL appropriations** <br>**across HEADINGS** <br>of the multiannual financial framework|Commitments|**51,690.829**|**51,917.737**|**52,181.763**|**52,321.893**|**52,462.799**|**52,604.684**|**52,747.767**||**365,927.472**|
|**TOTAL appropriations** <br>**across HEADINGS** <br>of the multiannual financial framework|Payments|**41,213.234**|**44,364.167**|**47,251.013**|**48,941.643**|**50,580.113**|**51,697.848**|**52,534.447**|**29,345.008**|**365,927.472**|

Totals do not tally due to rounding.

EUR million (with three decimal places)

# EN 17 EN

_3.2.2._ _Summary of estimated impact on appropriations of an administrative nature_

–  The proposal/initiative does not require the use of appropriations of an
administrative nature

–  The proposal/initiative requires the use of appropriations of an administrative
nature, as explained below:

EUR million (to three decimal places)

|HEADING 7<br>of the multiannual<br>financial framework|Col2|Col3|Col4|Col5|Col6|Col7|Col8|Col9|
|---|---|---|---|---|---|---|---|---|
|Human resources|125.678|125.678|125.678|125.678|125.678|125.678|125.678|**879.746**|
|Other administrative<br>expenditure|6.008|6.008|6.008|6.008|6.008|6.008|6.008|**42.056**|
|**Subtotal HEADING 7** <br>**of the multiannual**<br>**financial framework**|**131.686**|**131.686**|**131.686**|**131.686**|**131.686**|**131.686**|**131.686**|**921.802**|

|Outside HEADING 733<br>of the multiannual<br>financial framework|Col2|Col3|Col4|Col5|Col6|Col7|Col8|Col9|
|---|---|---|---|---|---|---|---|---|
|Human resources|1.850|1.850|1.850|1.850|1.850|1.850|1.850|12.950|
|Other expenditure <br>of an administrative<br>nature|17.150|17.150|17.150|17.150|17.150|17.150|17.150|120.050|
|**Subtotal** <br>**outside HEADING 7** <br>**of the multiannual**<br>**financial framework**|**19.000**|**19.000**|**19.000**|**19.000**|**19.000**|**19.000**|**19.000**|**133.000**|

Totals do not tally due to rounding.

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

33 Technical and/or administrative assistance and expenditure in support of the implementation of
EU programmes and/or actions (former ‘BA’ lines), indirect research, direct research.

# EN 18 EN

3.2.2.1. Estimated requirements of human resources

–  The proposal/initiative does not require the use of human resources.

–  The proposal/initiative requires the use of human resources, as explained
below:

_Estimate to be expressed in full time equivalent units_

|Years|Col2|2021|2022|2023|2024|2025|2026|2027|
|---|---|---|---|---|---|---|---|---|
|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|
|Headquarters and Commission’s<br>Representation Offices|Headquarters and Commission’s<br>Representation Offices|845|845|845|845|845|845|845|
|Delegations|Delegations|3|3|3|3|3|3|3|
|Research|Research||||||||
|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 34 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 34 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 34 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 34 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 34 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 34 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 34 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 34 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 34 <br>Heading 7|
|Financed from<br>HEADING 7 of<br>the multiannual<br>financial<br>framework|- at Headquarters|57.75|57.75|57.75|57.75|57.75|57.75|57.75|
|Financed from<br>HEADING 7 of<br>the multiannual<br>financial<br>framework|- in Delegations|1|1|1|1|1|1|1|
|Financed from the<br>envelope of the<br>programme **35 **|- at Headquarters|29|29|29|29|29|29|29|
|Financed from the<br>envelope of the<br>programme **35 **|- in Delegations||||||||
|Research|Research||||||||
|Other (specify)|Other (specify)||||||||
|**TOTAL**|**TOTAL**|**935.75**|**935.75**|**935.75**|**935.75**|**935.75**|**935.75**|**935.75**|

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

34 AC= Contract Staff; AL = Local Staff; END = Seconded National Expert; INT = agency staff;
JPD= Junior Professionals in Delegations.
35 Sub-ceiling for external staff covered by operational appropriations (former ‘BA’ lines).

# EN 19 EN

_3.2.3._ _Third-party contributions_

The proposal/initiative:

–  does not provide for co-financing by third parties

–  provides for the co-financing by third parties estimated below:

Appropriations in EUR million (to three decimal places)

|Years|2021|2022|2023|2024|2025|2026|2027|TOTAL|
|---|---|---|---|---|---|---|---|---|
|Specify the co-financing<br>body|||||||||
|TOTAL appropriations<br>co-financed|||||||||

**3.3.** **Estimated impact on revenue**

–  The proposal/initiative has no financial impact on revenue.

–  The proposal/initiative has the following financial impact:

–  on own resources

–  on other revenue

please indicate, if the revenue is assigned to expenditure lines 

EUR million (to three decimal places)

|Budget revenue line:|Impact of the proposal|Col3|Col4|Col5|Col6|Col7|Col8|
|---|---|---|---|---|---|---|---|
|Budget revenue line:|**2021**|**2022**|**2023**|**2024**|**2025**|**2026**|**2027**|
|67 01 & 67 02|280|230|130|130|130|130|130|

For assigned revenue, specify the budget expenditure line(s) affected.

08 02 YY – Sectoral types of interventions

08 02 YY – Direct payments types of interventions

Other remarks (e.g. method/formula used for calculating the impact on revenue or any other information).

Please refer to comments under point 3

# EN 20 EN