Annexes to COM(2016)605-1 - Financial rules applicable to the general budget of the Union amending a number of regulations

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dossier COM(2016)605-1 - Financial rules applicable to the general budget of the Union amending a number of regulations.
document COM(2016)605 EN
date December 13, 2017
ANNEX I

Annex II to Regulation (EU) No 1305/2013 is amended as follows:

(1)in the line concerning Article 17(3), Subject: Investment in physical assets, Agricultural sector, Maximum amount in EUR or rate: 40 %, the fourth column, the introductory part and the first indent is replaced by the following:

‘Of the amount of eligible investment in other regions

The above rates may be increased by an additional 20 percentage points, provided that maximum combined support does not exceed 90 %, for:

—Young farmers for a maximum of five years from the date of setting up as set out in the rural development programme, or until the actions defined in the business plan referred to in Article 19(4) are completed;’;

(2)in the line concerning Article 17(3), Subject: Investments in physical assets, Processing and marketing of products listed in Annex I to the TFEU, Maximum amount in EUR or rate: 40 %, the fourth column is replaced by the following:

‘Of the amount of eligible investment in other regions

The above rates may be increased by an additional 20 percentage points, provided that maximum combined support does not exceed 90 %, for operations supported in the framework of the EIP, for collective investments and integrated projects or operations linked to a merger of producer organisations’;

(3)the lines concerning Article 37(5), Article 38(5) and Article 39(5) are replaced by the following:

‘37(5)Crop, animal and plant insurance70 %Of the insurance premium due
38(5)Mutual funds for adverse climatic events, animal and plant diseases, pest infestations and environmental incidents70 %Of the eligible costs
39(5)Income stabilisation tool70 %Of the eligible costs’


ANNEX II

In Annex X to Regulation (EU) No 1307/2013, the table ‘Conversion and weighting factors referred to in Article 46(3)’ is amended as follows:

(1)the line ‘Areas with short rotation coppice’ is replaced by the following:

‘Areas with short rotation coppice (per 1 m2)n.a.0,50,5 m2’

(2)the line ‘Areas with nitrogen fixing crops’ is replaced by the following:

‘Areas with nitrogen fixing crops (per 1 m2)n.a.11 m2’

(3)the following lines are added:

‘Areas with Miscanthusn.a.0,70,7 m2
Areas with Silphium perfoliatumn.a.0,70,7 m2
Land lying fallow for melliferous plants (pollen and nectar rich species)n.a.1,51,5 m2’


ANNEX III

Annexes VII and VIII to Regulation (EU) No 1308/2013 are amended as follows:

(1)in point 1(c) of Part II of Annex VII, the second indent is replaced by the following:

‘—the upper limit for the total alcoholic strength may exceed 15 % volume for wines with a protected designation of origin which have been produced without enrichment, or enriched only by partial concentration processes listed in point 1 of Section B of Part I of Annex VIII, provided that the product specification in the technical file of the protected designation of origin concerned allows for that possibility;’;

(2)in Section A of Part I of Annex VIII, point 3 is replaced by the following:

‘3.In years when climatic conditions have been exceptionally unfavourable, the limit(s) laid down in point 2 may be raised by 0,5 % by the Member States as an exception for the regions concerned. Member States shall notify the Commission of any such increase.’.


Commission statements

Ad Article 1 - Rural development

—   Extension of the duration of rural development programmes

Expenditure relating to the 2014-2020 rural development programmes approved in accordance with Article 10(2) of Regulation (EU) No 1305/2013 will continue to be eligible for EAFRD contribution if paid to the beneficiaries by latest 31 December 2023. The Commission will address the continuation of support for rural development after 2020 in the context of its proposal for the next MFF.

—   Risk management

The Commission confirms its intention to review the functioning and efficiency of the risk management tools which are currently included in Regulation (EU) No 1305/2013 in the context of its proposal on the modernisation and simplification of the Common Agricultural Policy.

—   Penalties for Leader

The Commission confirms its intention to review the effectiveness and proportionality of the penalties for LEADER included in Commission Implementing Regulation (EU) 809/2014.

Ad Article 2 - Horizontal Regulation

—   Crisis reserve

The Commission confirms that the operation of the reserve for crises in the agricultural sector and the reimbursement of appropriations related to financial discipline as provided for in Articles 25 and 26(5) of Regulation (EU) No 1306/2013 will be reviewed in the context of the preparations for the next MFF with a view to allowing an efficient and timely intervention in times of market crisis.

—   Single audit

The Commission supports the single audit approach, as confirmed by its proposal for Article 123 of the new Financial Regulation. The Commission also confirms that the current legal framework for the management and control of agricultural expenditure, established by Regulation (EU) No 1306/2013, already allows for such an approach and that this has been taken up in its audit strategy for the 2014-2020 period. In particular, where the opinion of the Certification Body delivered in accordance with Article 9(1) of Regulation (EU) No 1306/2013 is considered reliable, the Commission takes this opinion into account when assessing the need for audits of the paying agency concerned.

Ad Article 3 - Direct payments

—   Protein Plan

The Commission confirms its intention to review the supply and demand situation for plant proteins in the EU and to consider the possibility of developing a ‘European plant protein strategy’ with a view to further encouraging the production of plant proteins in the EU in an economically and environmentally sound way.

Ad Article 4 - CMO

—   Voluntary production reduction

The Commission confirms that Regulation (EU) 1308/2013 establishing a common organisation of the markets in agricultural products already contains, in Articles 219 and 221, the necessary legal base allowing it, subject to the availability of budgetary resources, to address market disturbances and other specific problems, including at regional level, with the possibility of granting direct financial assistance to farmers. Moreover, the Commission's proposal to add a sector-specific income stabilisation tool to Regulation (EU) No 1305/2013 on support for rural development will allow Member States to include in their rural development programmes the possibility of compensating farmers in a specific sector in the event of a significant drop in their income.

The Commission further confirms that Article 219 allows it to introduce, in case of market disturbance or threats thereof, schemes under which Union aid is granted to producers who undertake to reduce their production on a voluntary basis, including the necessary details for the operation of such a scheme (Example: Commission Delegated Regulation (EU) 2016/1612 (OJ L 242, 9.9.2016, p. 4).

—   Recognition of transnational IBOs

The Commission recalls that rules on producer cooperation of recognising transnational producer organisations, transnational associations of producer organisations or transnational interbranch, including the necessary administrative cooperation between the Member States concerned, are currently laid down in Commission Delegated Regulation (EU) 2016/232. The operation and adequacy of these rules will be reviewed in the context of the ongoing process on the modernisation and simplification of the CAP.

—   Unfair trading practices

The Commission confirms that it has launched an initiative on the food supply chain which is now proceeding through the various stages required by the Better Regulation guidelines. It will decide on a possible legislative proposal once this procedure has been completed, if possible in the first half of 2018.

—   Producer co-operation

The Commission takes note of the agreement between Parliament and Council on the amendments to Articles 152, 209, 222 and 232. The Commission notes that the amendments agreed by Parliament and Council are substantial in nature and included without an impact assessment as required by point 15 of the Inter-Institutional Agreement on Better Law-Making. This leads to an unwelcome degree of legal and procedural uncertainty of which the impact and implications are not known.

As the changes to the Commission's original proposal taken together result in a significant change to the legal framework, the Commission notes with concern that some of the new provisions in favour of producers' organisations might have the effect of endangering the viability and wellbeing of small farmers and the interest of the consumers. The Commission confirms its commitment to maintain effective competition in the agricultural sector, and give full effect to the objectives of the CAP laid down in Article 39 of the Treaty on the Functioning of the European Union. In this context, the Commission notes that the amendments agreed by the co-legislators foresee only a very limited role for both the Commission and the national competition authorities to act to preserve effective competition.

The Commission's overall agreement on the ‘Omnibus’ proposal, including the amendments agreed by Parliament and Council, is without prejudice to any future proposals the Commission may make in these areas in the context of the reform of the common agricultural policy for the post-2020 period and other initiatives which are specifically meant to address some of the issues touched upon by the text now agreed by the European Parliament and the Council.

The Commission regrets that the issue of the very limited role for both the Commission and the National Competition authorities to act to preserve effective competition has not been addressed in a satisfactory manner by the co-legislators, and expresses concern with the possible implications of this limitation for farmers and consumers. The Commission notes that the legal text must be interpreted in a manner consistent with the Treaty, notably as regards the possibility for the Commission and national competition authorities to intervene if a producer organisation, which covers a large share of the market, seeks to restrict the freedom of action of its members. The Commission regrets that this possibility is not clearly safeguarded in the legal text.