Explanatory Memorandum to COM(2019)581 - Transitional provisions for the support by the European Agricultural Fund for Rural Development (EAFRD) and by the European Agricultural Guarantee Fund (EAGF) in the year 2021

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dossier COM(2019)581 - Transitional provisions for the support by the European Agricultural Fund for Rural Development (EAFRD) and by the European ...
source COM(2019)581 EN
date 31-10-2019


1. CONTEXTOFTHE PROPOSAL

• Reasons for and objectives of the proposal

(a) Extension of the applicability of the existing regulations

The Commission’s reform proposals1 on the common agricultural policy (CAP) beyond 2020 provide that the Member States start to implement their Strategic Plans as from 1 January 2021. This would imply that Member States submit their Strategic Plans at the latest by 1 January 2020 and that the Commission approves these plans in the course of the year. In view of the present state of play in both the Parliament and the Council, it is clear that the basic acts and the ensuing delegated and implementing acts will not be formally adopted by January 2020 and that, therefore, it will be necessary to plan for a transitional period.

This transitional period will require the extension of the applicability of the existing legal framework and adaptations of certain rules to ensure the continuity of the CAP until the new system is in place.

Regulations (EU) No 1305/2013, 1306/2013, 1307/2013 and 1308/2013 are formally not limited in time and, therefore, will continue to apply until they are repealed. Regulation (EU) No 1305/2013 will continue to apply to the support approved by the Commission under Regulation 1305/2013.

However, the Direct Payments Regulation (EU) No 1307/2013 and the Rural Development Regulation (EU) No 1305/2013 do not contain the amount of Union support or national ceilings for the years after 2020. This is also true for Regulation (EU) No 228/2013 on specific measures for agriculture in the outermost regions of the Union and Regulation (EU) No 229/2013 on specific measures for agriculture in favour of the smaller Aegean islands. These Regulations will therefore become in practice inapplicable as of 2021. Therefore, they need to be amended to include the relevant amounts/ceilings, when they are decided for the new MFF 2021-2027. Furthermore, in the Direct Payments Regulation (EU) No 1307/2013 certain rules were limited to the period until 2019. Regulation (EU) 2019/288 amending the Direct Payments Regulation provides for rules for calendar year 2020. These rules will need to be extended another time for the transitional period. For the sake of clarity and legal certainty, certain rules also need to be added or certain existing rules need to be amended to ensure continuity.

2.

Regulation (EU) No 1303/2013 provides rules in relation to the 2014-2020 programming. As the current programming period in rural development will have to be extended beyond this


1 Proposal for a Regulation of the European Parliament and of the Council establishing rules on support

for strategic plans to be drawn up by Member States under the Common agricultural policy (CAP Strategic Plans) and financed by the European Agricultural Guarantee Fund (EAGF) and by the European Agricultural Fund for Rural Development (EAFRD) and repealing Regulation (EU) No 1305/2013 of the European Parliament and of the Council and Regulation (EU) No 1307/2013 of the European Parliament and of the Council, COM(2018)392 final - 2018/0216 (COD); 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, COM(2018)393 final - 2018/0217 (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 COM(2018)394 final/2.

period, certain regulatory deadlines defined in that regulation will need to be adjusted accordingly.

The provisions on the financing, management and monitoring of the CAP laid down in Regulation (EU) No 1306/2013 continue to apply, but certain modifications should be made to ensure continuity in the transitional period.

This proposal aims at providing certainty and continuity in the granting of support to European farmers and ensuring the continuity of support for rural development in the transitional period for those Member States that have used their 2014-2010 EAFRD allocations by extending the current legal framework until the new CAP becomes applicable. In order to allow Member States to make the necessary adaptations at national level, these changes would need to be adopted by the Council and the European Parliament by mid-2020.

(b) Transition to the next CAP period

The new CAP comes with significant changes. Transitional rules are needed to ensure a smooth transition from the current to the next CAP period.

As for the second pillar, the definition of transitional rules between the two programming periods represents a standard practice. Transitional rules are generally needed to bridge two consecutive programming periods. In view of the significant changes that come with the Commission’s reform proposals, there is all the more the need for transitional arrangements, in particular concerning the continuation of multiannual commitments undertaken in the current and previous programming periods.

The Single CMO Regulation (EU) No 1308/2013 lays down rules for the common organisation of agricultural markets, including aid schemes for specific sectors. It sets out the parameters for intervening on agricultural markets and providing sector-specific support. To ensure coherence, most interventions of the new CAP will be part of one strategic CAP support plan per Member State, including several sectorial interventions that have previously been set out in Regulation (EU) No 1308/2013. Under the current rules, the different sectoral programmes follow different time frames. To ensure coherence, continuity and a smooth transition between the aid schemes under Regulation (EU) No 1308/2013 and the sectoral types of interventions under the new CAP it is necessary to set rules regarding the duration of each of these aid schemes with respect to the entry into application of the Member States’ CAP Strategic Plans. For aid schemes in the fruit and vegetables sector and in the olive oil and table olives sector, it is necessary to regulate the continuation and modification of operational programmes and work programmes.

• Consistency with existing policy provisions in the policy area

The proposed amendments are consistent with the existing Regulations (EU) No 1305/2013, 1307/2013 and 1308/2013, therefore the proposal is consistent with the existing policy provisions of the CAP.

• Consistency with other Union policies

The proposed amendments are consistent with the proposal for a Regulation laying down the multiannual financial framework for the years 2021 to 2027 (MFF)2 and the proposal for the

Common Provisions Regulation (CPR)3.

COM(2018) 322. COM(2018) 375.

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2. LEGALBASIS, SUBSIDIARITYAND PROPORTIONALITY

• Legal basis

Articles 43(2) and Article 349 of the Treaty on the Functioning of the European Union (TFEU).

• Subsidiarity (for non-exclusive competence)

The TFEU provides that the competence for agriculture is shared between the Union and the Member States. The Union exercises its competence through the adoption of various legislative acts, thereby defining and implementing an EU common agricultural policy as provided for in Article 38 to 44 of the Treaty on the Functioning of the European Union. The aim of this proposal is to bridge the period until the new CAP becomes applicable by extending the current legal framework and to ensure a smooth transition from the current to the next CAP period. These objectives can only be achieved through an amendment of Regulations (EU) No 1305/2013, No 1306/2013, No 1307/2013, No 1308/2013, No 228/2013 and (EU) No 229/2013 as well as by laying down certain transitional provisions.

• Proportionality

The proposal does not entail any new policy developments compared to the legislative acts it intends to amend and the legislative framework it intends to transition into. The proposal modifies the existing Regulations only to the extent necessary to achieve the objectives outlined above.

• Choice of the instrument

Since the original legislative acts are regulations of the European Parliament and the Council, the amendments must also be introduced as a European Parliament and Council regulation by means of the ordinary legislative procedure.

3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER

Contents

1.

CONSULTATIONS


ANDIMPACTASSESSMENTS

• Ex-post evaluations/fitness checks of existing legislation

Not applicable.

• Stakeholder consultations

Not applicable.

• Collection and use of expertise

Not applicable.

• Impact assessment

The proposal addresses legal needs that follow from the late application of the new CAP due to the state of play of the discussions between the Institutions regarding the CAP reform. Without such legislation, farmers and other beneficiaries of the CAP risk not receiving support in 2021. This is why Member States are requesting the Commission to propose such legislation. It also proposes transitional adjustments that are necessary due to the significant changes that come with the Commission’s reform proposals. In this context, an impact assessment is not pertinent.

• Regulatory fitness and simplification

Not applicable.

• 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. BUDGETARYIMPLICATIONS

The current Regulations (EU) No 1305/2013 on rural development and (EU) No 1307/2013 on direct payments do not lay down allocations for the transitional period (beyond calendar year 2020). Therefore, the initiative has a budgetary impact in the sense that it adds the allocations for direct payments and rural development for the relevant transitional period to ensure smooth continuity. These allocations are equal to those in the CAP Plan proposal and they are coherent with the Commission’s proposal on the MFF 2021-2027. Where Member States do not decide to prolong their current rural development programmes, the 2021 EAFRD allocations will be transferred to the 2022 – 2025 EAFRD allocations.

Similarly, for the transitional period, the allocations contained in Regulations (EU) No 1308/2013, (EU) No 228/2013 and (EU) No 229/2013 need to be adjusted to respect the overall amounts for the European Agricultural Guarantee Fund (EAGF) included in the MFF proposal.

The reserve for agricultural crises referred to in Article 25 of Regulation (EU) No 1306/2013 is proposed to be maintained throughout the transitional period to ensure continuity. It is to be financed through financial discipline applied on direct payments. As such, it does not entail any additional expenditure.

The present proposal is neutral in terms of overall budgetary commitments. The impact as regards the estimated schedule for payment appropriations will depend on Member States decisions as regards the prolongation of the current rural development programmes.

Similarly, any decision of Member States to transfer funds between direct payments and rural development will be neutral in terms of overall budgetary commitments but may have an impact in terms of timing of payments that however cannot be estimated.

Further details on the financial implications of the present proposal are provided in the financial statement attached to the proposal.

5. OTHERELEMENTS

• Implementation plans and monitoring, evaluation and reporting arrangements

The existing system with its inherent implementation plans and monitoring, evaluation and reporting arrangements is extended.

documents

• Explanatory documents (for directives)

Not relevant.


Detailed explanation of the specific provisions of the proposal

The proposal concerns seven regulations:

• Regulation (EU) No 1303/2013 of the European Parliament and of the Council laying down common provisions on the European Regional Development Fund, the European Social Fund, the Cohesion Fund, the European Agricultural Fund for Rural Development and the European Maritime and Fisheries Fund (hereinafter: CPR)

• Regulation (EU) No 1305/2013 of the European Pa rlia ment a nd of the Council on support for rural development by the European Agricultural Fund for Rural Development (hereinafter: RD Regulation)

• Regulation (EU) No 1306/2013 of the European Pa rliame nt a nd of the Council on the financing, management and monitoring of the common agricultural policy (hereinafter: Horizontal Regulation)

• Regulation (EU) No 1307/2013 of the European Parliament and of the Council e stablishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy (hereinafter: DP Regulation)

• Regulation (EU) No 1308/2013 of the European Parliament and of the Council establishing a common organisation of the markets in agricultural products (hereinafter: CMO Regulation)

• Regulation (EU) No 228/2013 of the European Parliament and of the Council laying down specific measures for agriculture in the outermost regions of the Union and repealing Council Regulation (EC) No 247/2006

• Regulation (EU) No 229/2013 of the European Parliament and of the Council laying down specific measures for agriculture in favour of the smaller Aegean islands and repealing Council Regulation (EC) No 1405/2006

The proposal is divided in two titles.

The first title includes four chapters, covering provisions extending the current legal framework to bridge the additional period until the CAP Plan is applicable and specific transitional provisions to ensure a smooth transition from the current to the next CAP period.

The second title mainly covers provisions extending the current legal framework.

Title I sets new stand-alone provisions.

Title II amends existing provisions.

Regulation (EU) No 1303/2013 (CPR)

It is necessary that Regulation (EU) No 1303/2013, laying down common rules for several funds including the European Agricultural Fund for Rural Development (EAFRD), continues to apply to programmes supported by the EAF RD for the 2014–2020 programming period as well as to those programmes supported by the EAFRD which Member States decide to extend for the transitional period. In this regard, certain regulatory deadlines need to be adapted to cover the transitional period.

Regulation (EU) No 1305/2013

3.

The proposed amendments to Regulation (EU) No 1305/2013 concern the optional extension of the current programming period 2014-2020 for a year. They include the relevant amounts


of Union support for the extended period after 2020 in line with the Commission’s proposal on the MFF 2021-2027.

This proposal also ensures that multi-annual commitments from the current programming period (Art. 28, 29 and 33) can be continued into the new programming period. Member States will have to determine a shorter period for new commitments.

Moreover, it ensures the continued financing of commitments based on current as well as previous rules with the EAFRD financial envelopes of the next period.

Regulation (EU) No 1306/2013

The main adjustment concerns the reserve for agricultural crises referred to in Article 25 of Regulation (EU) No 1306/2013 which is proposed to be maintained throughout the transitional period to ensure continuity. The proposal also addresses certain regulatory deadlines that need to be adapted to cover the transitional period.

Regulation (EU) No 1307/2013

The Regulation currently includes national and net ceilings for direct payments up to calendar year 2020 included. Therefore, ceilings should be added for calendar year 2021 and the reference amounts for the crop-specific payment for cotton for calendar year 2021 should also be adapted. The proposal also aims to address errors made by Member States in the allocation of payment entitlements, regarding both the number and value of payment entitlements. In the interest of legal certainty, payment entitlements should be regularised from 2021.The proposal includes the possibility for Member States to continue transferring funds between pillars after calendar year 2020. It also renders the option for Member States to continue the internal convergence process after 2019, explicit. It provides for a prolongation of SAPS in the transitional period.

Regulation (EU) 1308/2013

The proposed amendments to Regulation (EU) No 1308/2013 adjust the amounts of Union support for specific aid schemes for the transitional period in line with the Commission proposal for the MFF 2021-2027. They also lay down rules on the duration of each of these aid schemes with respect to the entry into application of the Member States’ future CAP Strategic Plans and for aid schemes in certain sectors rules on the continuation and modification of operational programmes and work programmes.

Regulation (EU) No 228/2013

The proposed amendments to Regulation (EU) No 228/2013 concern the relevant amounts of Union support available for specific measures for the transitional period in line with the MFF 2021-2027.

Regulation (EU) No 229/2013

The proposed amendments to Regulation (EU) No 229/2013 concern the relevant amounts of Union support available for specific measures for the transitional period in line with the MFF 2021-2027.