EUROPEAN COMMISSION DIRECTORATE-GENERAL FOR AGRICULTURE AND RURAL DEVELOPMENT

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1 EUROPEAN COMMISSION DIRECTORATE-GENERAL FOR AGRICULTURE AND RURAL DEVELOPMENT Directorate D. Direct support Director Ref. Ares(06) /07/06 Brussels, DDG./D/D(06) 9485 Subject: Summary Minutes of the 9 th Expert group for direct payments and Workshop on Exchange of Member States' experiences on Circumvention and Force majeure in the Direct payments support schemes - 9 June 06 Chairman: Owen Jones, Marie Bourjou All Member States except the UK were present.. CIRCUMVENTION AND FORCE MAJEURE EXCHANGE OF MEMBER STATES' EXPERIENCES OF IMPLEMENTATION AND CONTROL In the framework of the exchange of experiences by the Member States (MS) on the implementation and control aspects of direct payments, a workshop on the 'circumvention and force majeure in the direct payments' was organised on 9 June 06 in Brussels. More particularly, the workshop focussed on the concepts of force majeure/exceptional circumstances and circumvention in the European agricultural law and the applicable EU legislation in force. During the morning session, the Commission presented an overview of the regulatory provisions on force majeure/exceptional circumstances and circumvention with examples regarding the creation of artificial funding conditions (circumvention) in Pillar and of the CAP. Afterwards, two MS/regions (Belgium-Flanders and The Netherlands) gave presentations on their implementation experience related to the issue of circumvention in the area of direct payments. Each presentation was followed by a short questions & answers session. The potential circumvention practices focused the attention of the participants, while the force majeure/exceptional circumstances cases were not discussed in such details. Some questions were related to: How to deal with the issue of potential circumvention - mainly related to Small farmer (SFS), Young farmer (YFS) and Active farmer scheme. The possible warnings/red flags that can be observed in cases of potential circumvention. During the late morning and afternoon session the experts were split into three working groups (all groups worked on both subjects force majeure and circumvention). The following observations and conclusions were drawn: Commission européenne/europese Commissie, 049 Bruxelles/Brussel, BELGIQUE/BELGIË - Tel. + 99

2 The concept of force majeure/exceptional circumstances poses difficulties to some administrations in terms of establishing the starting point and the duration of the event. It was concluded that in relation to the Direct payments schemes mainly two types of cases could be distinguished due to personal circumstances (death, sickness, animal diseases etc.) and due to natural disasters. Each type posed different challenges on the national administrations as for example: - What if it is not the farmer but a member of his/her family who dies? Is the case still considered exceptional circumstance? - For how long can a farmer claim he is in force majeure/exceptional circumstances in cases of animal diseases? - In cases of natural disasters/severe climate conditions, what the impact of the event should be in order to "qualify" for force majeure/exceptional circumstance 5, 0 or 50% of the crops should be destroyed for example? Is meteorological data sufficient evidence in such cases or the farmers must provide additional data? Moreover, a question was raised whether indeed a case by case assessment is to be applied also in cases of general natural disaster affecting a region. Other similar situational questions coming from the discussion in the working groups were also raised in the wrap up session by the moderators. The opportunity for the experts to discuss between themselves in the working groups was reported as extremely valuable for exchange of good practices on the above subjects. Some experts raised willingness to further develop their capacity to exchange experience in relation with force majeure/exceptional circumstances cases national administrations are treating, so they can learn from each other. The initiative was encouraged by the Commission. Many MSs have established administrative procedures for treating both cases of force majeure and cases of potential circumvention. In relation to the potential circumvention cases, most MSs have put in place systems/alerts for identifying potential cases. Experts shared their experience regarding difficulties proving circumvention in practice as well as the excessive workload and administrative burden related to such files. The Greening, Small farmer, Young farmer and Active farmer schemes where identified as potentially vulnerable to circumvention. Experts showed awareness of this situation and stated to be doing controls in this relation.. SIMPLIFICATION YOUNG FARMER SCHEME, VOLUNTARY COUPLED SUPPORT AND SINGLE AREA PAYMENT Exchange of views on the draft Commission Delegated Regulation (EU) / of XXX amending Delegated Regulation (EU) No 69/04 as regards the clarification of certain provisions on the payment for young farmers and repealing certain reporting provisions related to the voluntary coupled support and the single area payment scheme The Commission made a presentation on the rationale for introducing a new paragraph to Article 49()(b) of Regulation (EU) No 69/04 to clarify the time when a young

3 farmer who exercises effective and long-term control over a legal person has to comply with the age limit of 40 years. The Commission was asked to explain how the new provision would apply in case of a change of legal form by an applicant: if a young farmer applies as natural person while he complies with the age criterion, but subsequently, and after the young farmer no longer complies with the age criterion, changes its legal form to legal person, or, if a young farmer applies as a legal person, but subsequently changes its form to another legal person. The Commission explained that the new sub-paragraph clarifies the application of the age criterion only with regard to the first submission. First, Member States should establish that this is the first setting up of the applicant. Subsequently, if Member States establish that there is continuity between a natural person and a legal person, then they should look at the age of the applicant when he first applied as natural person and regardless of his subsequent change of legal form to legal person. The same applies in case of continuity between legal persons. The Commission explained that notification provided in Article 64(5) refers to rather early data regarding eligible areas under the single area payment scheme and more precise information would be available via controls statistics (CATS database); therefore it is proposed to delete this notification requirement. Furthermore, the Commission presented the draft legislative changes affecting Article 67() of Regulation (EU) No 69/04. This aims at repealing the obligation of the Member States to submit an implementation report with regard to voluntary coupled support on an annual basis via ISAMM, while the same information will be available either via CATS (based upon Art. 9 of Commission Implementing Regulation (EU) No 809/04) or AGREX (based upon Art 0 of Commission Implementing Regulation (EU) No 908/04). It was also highlighted that the amending act is only foreseen to enter into force and apply following the due date of the respective voluntary coupled support and SAPS notifications in 06. Therefore, the respective notifications referring to claim year 05 and due by 5 September 06 (VCS) and referring to claim year 06 and due by September 06 (SAPS) shall still be submitted via ISAMM; in fact the data to be notified still play important role in the monitoring by the Commission of claim year 05. Accordingly, the reporting obligations with regard to voluntary coupled support and SAPS would only be repealed as from the reports due in 07. "e-signed" Pierre BASCOU Director

4 EXPERT GROUP FOR DIRECT PAYMENTS List of participants 9/06/06 Member States BE ORGANISATION Service public de Wallonie / Vlaamse overheid department landbouw en visserij Number of experts BG Ministry of Agriculture and Food State Agricultural Fund CZ Ministry of Agriculture DK Naturerhvervstyrelsen DE Bundesministerium fur Ernahrung und Landwirtschaft Observer for the German Länder Federal office for Agriculture and Food EE Ministry of Agriculture ARIB IE Department of Agriculture, Food and the Marine EL Paying Agency ES FEGA Ministerio de Agricultura, Alimentacion v Medio Ambiente FR Ministry of Agriculture HR Paying Agency IT Ministry of Agriculture CY CAPO LT Ministry of Agriculture LV Ministry of Agriculture Rural Support Service LU Paying Agency HU Ministry of Agriculture MT Paying Agency NL Ministry of Economic Affairs / Netherlands Enterprise Agency AT PL BMLFUW AMA Ministry of Agriculture and Rural Development Agency for Restructuring and Modernisation of Agriculture 4

5 PT RO SI GPP IFAP M.A.D.R. A.P.I.A. Ministry of Agriculture and Environment ARDAM SK Ministry of Agriculture and Rural Development FI Ministry of Agriculture Paying Agency SE Swedish Board of Agriculture UK Absent no represented Electronically signed on 6/07/06 09:08 (UTC+0) in accordance with article 4. (Validity of electronic documents) of Commission Decision 004/56 5