Regulation (EU) No 1305/2013 of the European Parliament and of the Council

of 17 December 2013

on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) and repealing Council Regulation (EC) No 1698/2005_cross-notes

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 42 and Article 43(2) 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 Court of Auditors,

Having regard to the opinion of the European Economic and Social Committee,

Having regard to the opinion of the Committee of the Regions,

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 CAP towards 2020: Meeting the food, natural resources and territorial challenges of the future" set out the potential challenges, objectives and orientations for the common agricultural policy ("the CAP") after 2013. In the light of the debate on that Communication, the CAP should be reformed with effect from 1 January 2014. That reform should cover all the main instruments of the CAP, including Council Regulation (EC) No 1698/2005(1). In view of the scope of the reform, it is appropriate to repeal Regulation (EC) No 1698/2005 and to replace it with a new text.

(2) A rural development policy should be established to accompany and complement direct payments and market measures of the CAP and thereby to contribute to that policy's objectives as laid down in the Treaty on the Functioning of the European Union ("TFEU"). Such rural development policy should also integrate the major policy objectives set out in the Communication from the Commission of 3 March 2010 entitled "Europe 2020 - A strategy for smart, sustainable and inclusive growth" ("the Europe 2020 Strategy") and should be coherent with the general objectives for the economic and social cohesion policy, as set out in the TFEU.

(3) Since the objective of this Regulation, namely rural development, cannot be sufficiently achieved by the Member States, given the links between rural development and the other instruments of the CAP, the extent of the disparities that exist between the various rural areas and the limits on the financial resources of the Member States in an enlarged Union but can rather, by reason of the multi-annual guarantee of Union finance and by concentrating on its priorities, be better achieved at Union level. the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union ("TEU"). In accordance with the principle of proportionality as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve that objective.

(4) To ensure the sustainable development of rural areas, it is necessary to focus on a limited number of core priorities relating to knowledge transfer and innovation in agriculture, forestry and rural areas, to farm viability, to the competitiveness of all types of agriculture in all regions and promoting innovative farm technologies and the sustainable management of forests, to the organisation of the food chain, including the processing and marketing of agricultural products, to animal welfare, to risk management in agriculture, restoring, preserving and enhancing ecosystems that are related to agriculture and forestry, to the promotion of resource efficiency and the shift towards a low carbon economy in the agricultural, food and forestry sectors, and to promoting social inclusion, poverty reduction in and the economic development of rural areas. In doing so, account should be taken of the diversity of the situations that affect rural areas with different characteristics or different categories of potential beneficiaries and of the cross-cutting objectives of innovation, environment and climate change mitigation and adaptation. Mitigation action should relate both to limiting emissions in agriculture and forestry from key activities such as livestock production, fertilizer use and to preserving carbon sinks and enhancing carbon sequestration with regard to land use, land use change and the forestry sector. The Union priority for rural development relating to knowledge transfer and innovation in agriculture, forestry and rural areas should apply horizontally in relation to the other Union priorities for rural development.

(5) The Union's priorities for rural development should be pursued in the framework of sustainable development and the Union's promotion of the aim of protecting and improving the environment, as set out in Article 11 TFEU, taking into account the polluter pays principle. The Member States should, provide information on the support for climate change objectives in line with the ambition to devote at least 20 % of the Union budget to this end using a methodology adopted by the Commission.

(6) The activities of the European Agricultural Fund for Rural Development ("the EAFRD") and the operations to which it contributes should be consistent and compatible with support from other instruments of the CAP.

(7) In order to ensure the immediate start and efficient implementation of rural development programmes, support from the EAFRD should be based on the existence of administrative framework conditions that are sound. Member States should therefore assess the applicability and fulfilment of certain ex ante conditionalities. Each Member State should prepare either a national rural development programme for its entire territory or a set of regional programmes or both a national programme and a set of regional programmes. Each programme should identify a strategy for meeting targets in relation to the Union priorities for rural development and a selection of measures. Programming should comply with Union priorities for rural development, whilst at the same time adapting to national contexts and complementing the other Union policies, in particular the agricultural market policy, the cohesion policy and the common fisheries policy. Member States which opt for preparing a set of regional programmes should also be able to prepare a national framework, without a separate budgetary allocation, in order to facilitate co-ordination among the regions in addressing nation-wide challenges.

(8) Member States should be able to include in their rural development programmes thematic sub-programmes to address specific needs in areas of particular importance to them. Thematic sub-programmes should concern, among others, young farmers, small farms, mountain areas, the creation of short supply chains, women in rural areas and climate change mitigation and adaptation and biodiversity. Thematic sub-programmes should also be used to provide for the possibility to contribute to the restructuring of agricultural sectors which have a strong impact on the development of rural areas. As a means of increasing the efficient intervention of certain thematic sub-programmes Member States should be allowed to provide for higher support rates for certain operations covered by those thematic sub-programmes.

(9) Rural development programmes should identify the needs of the area covered and describe a coherent strategy to meet them in the light of the Union priorities for rural development. That strategy should be based on the setting of targets. The links between the needs identified, the targets set and the choice of measures selected to meet them should be established. Rural development programmes should also contain all the information required to assess their conformity with the requirements of this Regulation.

(10) Targets are to be established in rural development programmes against a common set of target indicators for all Member States and where necessary, against programme specific indicators. In order to facilitate this exercise the areas covered by these indicators should be defined, in line with the Union priorities for rural development. Given the horizontal application of the Union priority for rural development relating to knowledge transfer in agriculture and forestry, interventions under this priority are to be considered as instrumental to the target indicators defined for the remaining Union priorities.

(11) It is necessary to establish certain rules for programming and revising rural development programmes. A simplified procedure should be provided for revisions that do not affect the strategy of the programmes or the respective Union financial contributions.

(12) The evolution and specialisation of agriculture and forestry and the particular challenges faced by micro and small and medium-sized enterprises ("SMEs") in rural areas require an appropriate level of technical and economic training as well as an increased capacity to access and exchange knowledge and information including through the diffusion of best agricultural and forestry production practices. Knowledge transfer and information actions should not only take the form of traditional training courses but should also be adapted to the needs of rural actors. Workshops, coaching, demonstration activities, information actions and also short-term farm and forest-exchange schemes and visits should therefore also be supported. The knowledge and information acquired should enable farmers, forest holders, persons engaged in the food sector and rural SMEs to, in particular, enhance their competitiveness and resource efficiency and improve their environmental performance while at the same time contributing to the sustainability of the rural economy. When providing support to SMEs, Member States have the possibility to give priority to SMEs linked to the agriculture and forestry sectors. In order to ensure that knowledge transfer and information actions are effective in delivering these results it should be required that the providers of knowledge transfer services have all the appropriate capabilities.

(13) Farm advisory services help farmers, young farmers, forest holders, other land managers and SMEs in rural areas to improve the sustainable management and overall performance of their holding or business. Therefore both the setting up of such services and the use of advice by farmers, young farmers, forest holders, other land managers and SMEs should be encouraged. In order to enhance the quality and effectiveness of the advice offered, provision should be made for the minimum qualifications and regular training of advisors. As provided for in Regulation (EU) No 1306/2013 of the European Parliament and of the Council(2) farm advisory services should help farmers to assess the performance of their agricultural holding and to identify the necessary improvements as regards the statutory management requirements, good agricultural and environmental conditions, agricultural practices beneficial to the climate and the environment set out in Regulation (EU) No 1307/2013 of the European Parliament and of the Council(3) and measures at farm level provided for in the rural development programmes aiming at farm modernisation, competitiveness building, sectoral integration, innovation, market orientation as well as the promotion of entrepreneurship. Farm advisory services should also help farmers to identify the necessary improvements as regards requirements laid down for the implementation of Article 11(3) of Directive 2000/60/EC of the European Parliament and of the Council(4) ("the Water Framework Directive"), as well as requirements for the implementation of Article 55 of Regulation (EC) No 1107/2009 of the European Parliament and of the Council(5) and Article 14 of Directive 2009/128/EC of the European Parliament and of the Council(6), in particular in relation to the compliance with the general principles of integrated pest management. Where relevant, advice should also cover occupational or safety standards linked to the farm as well as specific advice for farmers setting up for the first time. It should also be possible for advice to cover the setting up by young farmers, the sustainable development of the economic activities of the holding and local processing and marketing issues, linked to the economic, agricultural and environmental performance of the holding or enterprise. Specific advice may also be provided on climate change mitigation and adaptation, biodiversity, the protection of water, the development of short supply chains, organic farming and health aspects of animal husbandry. When providing support to SMEs, Member States have the possibility to give priority to SMEs linked to the agriculture and forestry sectors. Farm management and farm relief services should help farmers improve and facilitate management of their holding.

(14) Union or national quality schemes, including farm certification schemes for agricultural products and food, provide consumers with assurances on the quality and characteristics of the product or the production process used as a result of the participation of farmers in such schemes, achieve added value for the products concerned and enhance their market opportunities. Farmers and groups of farmers should therefore be encouraged to participate in those schemes. In order to ensure the effective use of EAFRD resources, support should be limited to active farmers within the meaning of Article 9 of Regulation (EU) No 1307/2013. As it is at the moment of entering into such schemes and in the early years of participation that additional costs and obligations imposed on farmers as a result of their participation are not fully remunerated by the market, support should be provided for new participation and should cover a period of no more than five years. Given the special characteristics of cotton as a farm product, quality schemes for cotton should also be covered. Support should also be made available for information and promotion activities concerning products covered by the quality and certification schemes receiving support pursuant to this Regulation.

(15) In order to improve the economic and environmental performance of agricultural holdings and rural enterprises, to improve the efficiency of the agricultural products marketing and processing sector, including the setting up of small scale processing and marketing facilities in the context of short supply chains and local markets, to provide infrastructure needed for the development of agriculture and forestry and to support non-remunerative investments necessary to achieve environmental aims, support should be provided for physical investments contributing to these aims. During the 2007-2013 programming period a variety of measures covered different areas of intervention. In the interest of simplification, but also of allowing beneficiaries to design and realise integrated projects with increased added value, a single measure should cover most types of physical investments. Member States should direct the support to farms eligible for aid for investments related to supporting farm viability based on the results of the strengths, weaknesses, opportunities and threats ("SWOT") analysis as a means of better targeting that aid. In order to facilitate the setting up by young farmers for the first time an additional period of eligibility for investments to comply with Union standards can be granted. In order to foster the implementation of new Union standards, investments related to compliance with those standards should be eligible for an additional period after they have become mandatory for the agricultural holding.

(16) The agricultural sector, more than other sectors, is subject to damage to its productive potential caused by natural disasters, adverse climatic events and catastrophic events. In order to help farm viability and competitiveness in the face of such disasters or events, support should be provided to help farmers restore agricultural potential which has been damaged. Member States should also ensure that no overcompensation of damages occurs as a result of the combination of Union (in particular the risk management measure under this Regulation), national and private compensation schemes.

(17) For the development of rural areas, the creation and development of new economic activity in the form of new farms, the diversification into non-agricultural activities including the provision of services to agriculture and forestry, activities related to health care, social integration and tourist activities are essential. It is also possible for diversification into non-agricultural activities to address the sustainable management of cynegetic resources. A farm and business development measure should facilitate the initial establishment of young farmers and the structural adjustment of their agricultural holding after the initial setting up. Furthermore, diversification of farmers into non-agricultural activities and the setting up and development of non-agricultural SMEs in rural areas should be promoted. That measure should also encourage entrepreneurship of women in rural areas. The development of small farms, which are potentially economically viable should also be encouraged. In order to ensure the viability of new economic activities supported under that measure, support should be made conditional on the submission of a business plan. Support for a business start up should cover only the initial period of the life of such a business and should not become an operating aid. Therefore, where Member States opt to grant aid in instalments, such instalments should be made over a period of no more than five years. In addition, in order to encourage the restructuring of the agricultural sector, support, in the form of annual or one-off payments, should be provided for farmers eligible for the small farmers scheme established by Title V of Regulation (EU) No 1307/2013 ("the small farmer's scheme") who commit to transfer their entire holding and the corresponding payment entitlements to another farmer. In order to address problems of young farmers related to access to land Member States are also able to offer this support in combination with other forms of support, for example, through the use of financial instruments.

(18) SMEs are the backbone of the rural economy of the Union. Farm and non-agricultural business development should be aimed at employment promotion and the setting up of quality jobs in rural areas, the maintenance of existing jobs, the reduction of seasonality fluctuations in employment, the development of non-agricultural sectors outside agriculture and agricultural and food processing. At the same time it should foster business integration and local inter-sectoral links. Projects that bring together agriculture and, rural tourism through the promotion of sustainable and responsible tourism in rural areas, and natural and cultural heritage should be encouraged as well as renewable energy investments.

(19) The development of local infrastructure and local basic services in rural areas, including leisure and culture services, the renewal of villages and activities aimed at the restoration and upgrading of the cultural and natural heritage of villages and rural landscapes is an essential element of any effort to realise the growth potential and to promote the sustainability of rural areas. Support should therefore be granted to operations with that aim, including access to Information and Communication Technologies and the development of fast and ultra-fast broadband. In line with those objectives, the development of services and infrastructure leading to social inclusion and reversing trends of social and economic decline and depopulation of rural areas should be encouraged. In order to achieve the maximum effectiveness of such support, covered operations should be implemented in accordance with plans for the development of municipalities and their basic services, where such plans exist, elaborated by one or more rural communes. In order to create synergies and to improve co-operation, operations should also, where relevant, promote rural-urban links. Member States have the possibility to give priority to investments by community-led local development partnerships, and to projects managed by local community organisations.

(20) Forestry is an integral part of rural development and support for sustainable and climate friendly land use should include forest area development and sustainable management of forests. During the 2007-2013 programming period, a variety of measures covered different types of support for forestry investments and management. In the interests of simplification and of allowing beneficiaries to design and realise integrated projects with increased added value, a single measure should cover all types of support for forestry investments and management. [^X1That measure should cover the extension and improvement of forest resources through the afforestation of land and the creation of agroforestry systems combining extensive agriculture with forestry systems. It should also cover the restoration of forests damaged by fire or other natural disasters and catastrophic events and relevant prevention measures; investments in forestry technologies and in the processing; the mobilising and marketing of forest products aimed at improving the economic and environmental performance of forest holdings;^X1] and non- remunerative investments which improve ecosystem and climate resilience and environmental value of forest ecosystems. Support should not distort competition and should be market neutral. As a result, limitations relating to the size and legal status of beneficiaries should be imposed. Preventive actions against fires should be undertaken in areas classified by Member States as medium or high fire risk. All preventive actions should be part of a forest protection plan. In the case of an action undertaken for the restoration of damaged forest potential, the occurrence of a natural disaster should be subject to formal recognition by a scientific public organisation. The forestry measure should be adopted in the light of undertakings given by the Union and Member States at international level, and should be based on Member States' national or sub-national forest plans or equivalent instruments which should take into account the commitments made in the Ministerial Conferences on the Protection of Forests in Europe. It should contribute to the implementation of the Union Forest Strategy in line with the Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions entitled "A new EU Forest Strategy: for forests and the forest-based sector".

(21) Producer groups and organisations help farmers to face together the challenges posed by increased competition and consolidation of downstream markets in relation to the marketing of their products including in local markets. The setting up of producer groups and organisations should therefore be encouraged. In order to ensure the best use of limited financial resources only producer groups and organisations that qualify as SMEs should benefit from support. Member States have the possibility to give priority to producer groups and organisations of quality products covered by the measure on quality schemes for agricultural products and foodstuffs in this Regulation. In order to ensure that the producer group or organisation becomes a viable entity, a business plan should be submitted to the Member States, as a condition for granting support to a producer group or organisation. In order to avoid providing operating aid and in order to maintain the incentive role of the support, the maximum duration of the support should be limited to five years from the date of recognition of the producer group or organisation on the basis of its business plan.

(22) Agri-environment-climate payments should continue to play a prominent role in supporting the sustainable development of rural areas and in responding to society's increasing demands for environmental services. They should further encourage farmers and other land managers to serve society as a whole by introducing or continuing to apply agricultural practices that contribute to climate change mitigation and adaptation and that are compatible with the protection and improvement of the environment, the landscape and its features, natural resources, and the soil and genetic diversity. In that context the conservation of genetic resources in agriculture and the additional needs of farming systems that are of high nature value should be given specific attention. Payments should contribute to covering additional costs and income foregone resulting from the commitments undertaken and should only cover commitments going beyond relevant mandatory standards and requirements, in accordance with the "polluter pays principle". Member States should also ensure that payments to farmers do not lead to double funding under this Regulation and Regulation (EU) No 1307/2013. In many situations the synergies resulting from commitments undertaken jointly by a group of farmers multiply the environmental and climate benefit. However, joint actions involve additional transaction costs which should be compensated adequately. In addition, in order to ensure that farmers and other land managers are in a position to correctly implement the commitments they have undertaken, Member States should endeavour to provide them with the required skills and knowledge. Member States should maintain the level of efforts made during the 2007-2013 programming period and should be required to spend a minimum of 30 % of the total contribution from the EAFRD to each rural development programme on climate change mitigation and adaptation as well as environmental issues. Such spending should be made through agri-environment-climate and organic farming payments and payments to areas facing natural or other specific constraints, through payments for forestry, payments for Natura 2000 areas and climate and environment-related investment support.

(23) Payments to farmers for the converting to, or maintaining, organic farming should encourage them to participate in such schemes thereby responding to the increasing demand of society for the use of environmentally friendly farm practices and for high standards of animal welfare. In order to increase synergy in biodiversity, benefits delivered by the organic farming measure, collective contracts or co-operation between farmers should be encouraged to cover larger, adjacent areas. In order to avoid a large-scale return by farmers to conventional farming support should be given to both conversion and maintenance measures. Payments should contribute to covering additional costs incurred and income foregone as a result of the commitment and should cover only commitments that go beyond relevant mandatory standards and requirements. [^X1Member States should also ensure that payments to farmers do not lead to double funding under this Regulation and Regulation (EU) No 1307/2013.^X1] In order to ensure the effective use of EAFRD resources, support should be limited to active farmers within the meaning of Article 9 of Regulation (EU) No 1307/2013.

(24) Support should continue to be granted to farmers and forest holders to help address specific disadvantages in the areas concerned resulting from the implementation of Directive 2009/147/EC of the European Parliament and of the Council(7) and Council Directive 92/43/EEC(8) and in order to contribute to the effective management of Natura 2000 sites. Support should also be made available to farmers to help address disadvantages in river basin areas resulting from the implementation of the Water Framework Directive. Support should be linked to specific requirements described in the rural development programme that go beyond relevant mandatory standards and requirements. Member States should also ensure that payments to farmers do not lead to double funding under this Regulation and Regulation (EU) No 1307/2013. Furthermore, the specific needs of Natura 2000 areas should be taken into account by Member States in the overall design of their rural development programmes.

(25) Payments to farmers in mountain areas or in other areas facing natural or other specific constraints should, by encouraging continued use of agricultural land, contribute to maintaining the countryside as well as to maintaining and promoting sustainable farming systems. In order to ensure the efficiency of such support, payments should compensate farmers for income foregone and additional costs linked to the disadvantage of the area concerned. In order to ensure the effective use of EAFRD resources, support should be limited to active farmers within the meaning of Article 9 of Regulation (EU) No 1307/2013.

(26) In order to ensure the efficient use of Union funds and equal treatment for farmers across the Union, mountain areas and areas facing natural or other specific constraints should be defined in accordance with objective criteria. In the case of areas facing natural constraints, those criteria should be bio-physical and underpinned by robust scientific evidence. Transitional arrangements should be adopted in order to facilitate the phasing-out of payments in areas that, as a result of the application of these criteria, will no longer be considered to be areas facing natural constraints.

(27) Farmers should continue to be encouraged to adopt high standards of animal welfare by providing support for farmers who undertake to adopt standards of animal husbandry, which go beyond the relevant mandatory standards. In order to ensure the effective use of EAFRD resources, support should be limited to active farmers within the meaning of Article 9 of Regulation (EU) 1307/2013.

(28) Payments should continue to be granted to forest holders who provide environment-friendly or climate-friendly forest conservation services by undertaking commitments to enhance biodiversity, preserve high-value forest ecosystems, improve their climate change mitigation and adaptation potential, and reinforce the protective value of forests with respect to soil erosion, maintenance of water resources and natural hazards. In that context, specific attention should be paid to the conservation and promotion of forest genetic resources. Payments should be granted for forest environmental commitments going beyond relevant mandatory standards established by national law.

(29) During the 2007-2013 programming period the only type of co-operation which was explicitly supported under rural development policy was co-operation for the development of new products, processes and technologies in the agriculture and food sector and the forestry sector. Support for that type of co-operation is still necessary but should be adapted in order to better meet the requirements of the knowledge economy. In that context, there should be the possibility for projects by a single operator to be financed under that measure, on condition that the results obtained are disseminated, thus achieving the aim of diffusing new practices, processes or products. In addition, it has become clear that supporting a much broader range of types of co-operation, with a wider range of beneficiaries, from smaller operators to larger ones, can contribute to achieving the objectives of rural development policy by helping operators in rural areas overcome the economic, environmental and other disadvantages of fragmentation. Therefore, that measure should be widened. Support to small operators for organising joint work processes and sharing facilities and resources should help them to be economically viable despite their small scale. Support for horizontal and vertical co-operation among actors in the supply chain, as well as for promotion activities in a local context, should catalyse the economically rational development of short supply chains, local markets and local food chains. Support for joint approaches to environmental projects and practices should help to produce greater and more consistent environmental and climate benefits than those which can be delivered by individual operators acting without reference to others (for example, through practices applied on larger, unbroken areas of land). Support should be provided in various forms. Clusters and networks are particularly relevant to the sharing of expertise as well as the development of new and specialised expertise, services and products. Pilot projects are important tools for testing the commercial applicability of technologies, techniques and practices in different contexts, and adapting them where necessary. Operational groups are a pivotal element of the European Innovation Partnership ("EIP") for agricultural productivity and sustainability. Another important tool lies in local development strategies operating outside the framework of LEADER local development – between public and private actors from rural and urban areas. Unlike under the LEADER approach, it is possible for such partnerships and strategies to be limited to one sector or to relatively specific development aims, including those mentioned above. Member States have the possibility to give priority to co-operation among entities involving primary producers. Inter-branch organisations should also be eligible for support under this measure. Such support should be limited to a period of seven years except for collective environmental and climate action in duly justified cases.

(30) Nowadays, farmers are exposed to increasing economic and environmental risks as a consequence of climate change and increased price volatility. In this context, the effective management of risks has an increased importance for farmers. Consequently, a risk management measure should be set up to assist farmers in addressing the most common risks faced by them. That measure should therefore help farmers to cover the premiums they pay for crop, animal and plant insurance as well as help with the setting up of mutual funds and the compensation paid by such funds to farmers for losses suffered as a result of adverse climatic events, the outbreak of animal or plant diseases, pest infestation or environmental incidents. It should also include an income stabilisation tool in the form of a mutual fund to support farmers facing a severe drop in their incomes. In order to ensure that farmers receive equal treatment across the Union, that competition is not distorted and that the international obligations of the Union are respected, specific conditions should be provided for the granting of support under these measures. In order to ensure the effective use of EAFRD resources, support should be limited to active farmers within the meaning of Article 9 of Regulation (EU) No 1307/2013.

(31) The LEADER approach for local development has, over a number of years, proven its effectiveness in promoting the development of rural areas by fully taking into account the multi-sectoral needs for endogenous rural development through its bottom-up approach. LEADER should therefore be continued in the future and its application should remain compulsory for rural development programmes at national and/or regional level.

(32) Support for LEADER local development from the EAFRD should also cover inter-territorial co-operation projects between groups within a Member State or transnational co-operation projects between groups in several Member States or co-operation projects between groups in Member States and in third countries.

(33) In order to enable partners in rural areas who do not yet apply LEADER to test and prepare for the design and implementation of a local development strategy, a "LEADER start-up kit" should also be financed. Support should not be conditional on the submission of a local development strategy.

(34) Investments are common to many of the rural development measures under this Regulation and may relate to operations of a very diverse nature. In order to ensure clarity in the implementation of those operations certain common rules for all investments should be laid down. Those common rules should define the types of expenditure that may be considered to be investment expenditure and should ensure that only such investments that create new value in agriculture receive support. In order to facilitate the implementation of investment projects Member States should have the possibility to pay advances. To ensure the effectiveness, fairness and sustainable impact of EAFRD assistance, rules should be laid down to ensure that investments related to operations are durable and that EAFRD support is not used to distort competition.

(35) It should be possible for the EAFRD to support investments in irrigation to provide economic and environmental benefits, provided that the sustainability of the irrigation concerned is ensured. Consequently, in every case, support should be granted only if a river basin management plan is in place in the area concerned as required by the Water Framework Directive, and if there is already water metering in place at the level of the investment or it is put in place as part of the investment. Investments in improvements to existing irrigation infrastructure or equipment should lead to a minimum gain in terms of water efficiency, expressed as a potential water saving. If the water body affected by the investment is under stress for reasons related to water quantity as set out in the analytical framework established by the Water Framework Directive, half of the gain in terms of water efficiency should be translated into a real reduction in water use at the level of the supported investment, in order to reduce the stress on the water body concerned. Certain cases should be set out in which it is not possible or necessary for the requirements of potential or effective water savings to apply, including those concerning investments in recycling or re-using water. In addition to supporting investments in improvements to existing equipment provision should be made for the EAFRD to support investments in new irrigation subject to the findings of an environmental analysis. With certain exceptions, support should, however, not be granted for new irrigation where the affected water body is already under stress, in view of the very high risk that granting support in such circumstances would worsen existing environmental problems.

(36) Certain area-related measures under this Regulation require beneficiaries to undertake commitments for at least five years. During that period, it is possible that changes occur to the situation of either the holding or of the beneficiary. Rules should therefore be laid down in order to determine what should happen in such cases.

(37) Certain measures under this Regulation make support conditional upon beneficiaries undertake commitments that go beyond a relevant baseline defined in terms of mandatory standards or requirements. In view of possible changes to the law during the period of the commitments resulting in the modification of the baseline, provision should be made the contracts concerned to be revised in order to ensure continued compliance with that condition.

(38) In order to ensure that financial resources for rural development are used in the best possible way and to target measures under rural development programmes in accordance with the Union priorities for rural development and in order to guarantee equal treatment of applicants, Member States should establish selection criteria for the selection of projects. Exception to this rule should be made only for payments under agri-environmental-climate, organic farming, Natura 2000 and the Water Framework Directive, areas facing natural or other specific constraints, animal welfare, forest-environmental and climate services and risk management related measures. When applying the selection criteria the size of the operation should be taken into account in accordance with the principle of proportionality.

(39) The EAFRD should support, through technical assistance, actions relating to the implementation of rural development programmes, including the costs related to the protection of symbols and abbreviations relating to Union quality schemes for participation in which support may be granted under this Regulation and costs of the Member States for the delimitation of areas facing natural constraints.

(40) The networking of national networks, organisations and administrations involved in the various stages of programme implementation, organised in the context of the European network for rural development, has proven that it can play a very important role in improving the quality of rural development programmes by increasing the involvement of stakeholders in the governance of rural development as well as in informing the broader public of its benefits. It should, therefore, be financed as part of technical assistance at Union level. To take account of the specific needs of evaluation, a European evaluation capacity for rural development should be set up as part of the European network for rural development in order to bring together all actors involved and thereby to facilitate the exchange of expertise in the field.

(41) The EIP for agricultural productivity and sustainability should contribute to the achievement of the Europe 2020 objectives of smart, sustainable and inclusive growth. It is important that it brings together all relevant actors at Union, national and regional levels, presenting new ideas to Member States on how to streamline, simplify and better coordinate existing instruments and initiatives and complement them with new actions where necessary.

(42) In order to contribute to the achievement of the aims of the EIP for agricultural productivity and sustainability a EIP network should be set up in order to network operational groups, advisory services and researchers involved in the implementation of actions targeting innovation in agriculture. It should be financed as part of technical assistance at Union level.

(43) Member States should reserve a portion of the total amount of each rural development programme devoted to technical assistance in order to finance the setting up and operation of a national rural network that brings together organisations and administrations involved in rural development, including the EIP, with the aim of increasing their involvement in the implementation of the programme and improving the quality of rural development programmes. To this end, national rural networks should prepare and implement an action plan.

(44) Rural development programmes should provide for innovative actions promoting a resource-efficient, productive and low-emission agricultural sector, with the support of the EIP for agricultural productivity and sustainability. The EIP should aim to promote a faster and wider transposition of innovative solutions into practice. The EIP should create added value by enhancing the uptake and effectiveness of innovation-related instruments and enhancing synergies between them. The EIP should fill gaps by better linking research and practical farming.

[^X1(45) The implementation of innovative projects in the context of the EIP for agricultural productivity and sustainability should be undertaken by operational groups that bring together farmers, forest managers, rural communities, researchers, NGOs, advisors, businesses and other actors concerned by innovation in the agricultural sector. In order to ensure that the results of such projects benefit the sector as a whole, those results in the field of innovation and knowledge exchanges within the Union and with third countries should be disseminated.^X1]

(46) Provision should be made for the determination of the total amount of Union support for rural development under this Regulation for the period from 1 January 2014 to 31 December 2020, in accordance with the Multi-annual Financial Framework for the period 2014 to 2020. The appropriations available should be indexed on a flat-rate basis for programming.

(47) In order to facilitate the management of EAFRD funds, a single contribution rate for support from the EAFRD to rural development programming should be set in relation to public expenditure in the Member States. In order to take account of their particular importance or nature, specific contribution rates should be set in relation to certain types of operations. In order to mitigate the specific constraints resulting from the level of development the remoteness and insularity, an appropriate EAFRD contribution rate should be set for less developed regions, the outermost regions referred to in the TFEU and the smaller Aegean islands, as well as transition regions.

(48) Member States should take all steps necessary to ensure that their rural development measures are verifiable and controllable, including putting in place adequate provisions. To that end, the Managing Authority and Paying Agency should provide an ex ante assessment and undertake to assess measures throughout the implementation of the programme. Measures that do not comply with that condition should be adjusted.

(49) The Commission and Member States should take all steps necessary to ensure the sound management of rural development programmes. In this context the Commission should carry out adequate measures and controls and the Member States should take measures to guarantee the sound functioning of their management systems.

(50) A single Managing Authority should be responsible for the management and implementation of each rural development programme. Its duties should be specified in this Regulation. The Managing Authority should be able to delegate part of its duties whilst retaining responsibility for the efficiency and correctness of management. Where a rural development programme contains thematic sub-programmes the Managing Authority should be able to designate another body to carry out the management and implementation of that sub-programme in relation to the financial allocations that have been identified for it in the programme whilst ensuring sound financial management of those sub-programmes. Where a Member State has more than one programme to manage, a coordination body can be set up to ensure consistency.

(51) Each rural development programme should be subject to regular monitoring of the implementation of the programme and of progress towards the established targets of the programme. Since demonstrating and improving the impact and effectiveness of actions under the EAFRD also depends on appropriate evaluation during the preparation and implementation of a programme and its completion, a monitoring and evaluation system should be set up jointly by the Commission and the Member States with the purpose of demonstrating the progress and assessing the impact and efficiency of rural development policy implementation.

(52) In order to ensure that information can be aggregated at Union level, a set of common indicators should form part of that monitoring and evaluation system. Key information on the implementation of rural development programmes should be recorded and maintained electronically as a means to facilitate data aggregation. Beneficiaries should therefore be required to provide the minimum necessary information that is needed for monitoring and evaluation.

(53) The responsibility for monitoring the programme should be shared between the Managing Authority and a Monitoring Committee set up for that purpose. The Monitoring Committee should be responsible for the monitoring of the effectiveness of the implementation of the programme. To that end, its responsibilities should be specified.

(54) The monitoring of the programme should involve the drawing up of an annual implementation report to be sent to the Commission.

(55) In order to improve its quality and demonstrate its achievements, each rural development programme should be subject to evaluation.

(56) Articles 107, 108 and 109 TFEU should apply to the support for the rural development measures under this Regulation. Nevertheless, given the specific characteristics of the agricultural sector, those TFEU provisions should not apply to rural development measures concerning operations falling within the scope of Article 42 TFEU, that are carried out under and in conformity with this Regulation or to payments made by Member States, intended to provide additional national financing for rural development operations for which Union support is granted and which fall within the scope of Article 42 TFEU.

(57) Moreover, with a view to ensuring consistency with the rural development measures eligible for Union support and in order to simplify procedures, payments made by the Member States, intended to provide additional national financing for rural development operations for which Union support is granted and which fall within the scope of Article 42 TFEU, should be included in the rural development programme for assessment and approval in accordance with the provisions of this Regulation. In order to ensure that additional national financing is not implemented unless it has been authorised by the Commission, the Member State concerned should be precluded from putting its proposed additional financing for rural development into effect until it has been approved. Payments made by Member States intended to provide additional national financing for rural development operations for which Union support is granted and which fall outside the scope of Article 42 TFEU should be notified to the Commission pursuant to Article 108(3) TFEU, unless they fall under a regulation, adopted pursuant to Council Regulation 994/98(9), and Member States should be precluded from putting them into effect until that notification procedure has resulted in a final approval by the Commission.

(58) In order to provide an efficient and secure exchange of data of common interest as well as to record, maintain and manage key information and report on monitoring and evaluation, an electronic information system should be established.

(59) Union law on the protection of individuals with regard to the processing of personal data and on the free movement of such data, in particular Directive 95/46/EC of the European Parliament and of the Council(10) and Regulation (EC) No 45/2001 of the European Parliament and of the Council(11) should apply.

(60) In order to supplement or amend certain non-essential elements of this Regulation, the power to adopt delegated acts in accordance with Article 290 TFEU 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. 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.

(61) That empowerment should cover: the conditions under which a legal person is considered to be a young farmer and the setting of a period of grace for the acquisition of skills; the duration and content of farm and forest exchange schemes and farm and forest visits. [^X1It should also cover: the specific Union schemes under Article 16(1)(a) and the characteristics of groups of producers and types of actions that may receive support under paragraph 2 of Article 16, as well as the setting of conditions to prevent distortion of competition to prevent discrimination against products and to exclude commercial brands from support.^X1]

(62) In addition, that empowerment should cover: the minimum content of business plans and the criteria to be used by Member states for setting the thresholds referred to in Article 19(4); the definition and the minimum environmental requirements for afforestation and the creation of woodland; the conditions applicable to agri-environment-climate commitments to extensify livestock farming, rear local breeds in danger of being lost to farming or preserve plant genetic resources under threat of genetic erosion, as well as the definition of eligible operations for the conservation and for the sustainable use and development of genetic resources. It should also cover: the calculation method to be used in order to avoid double funding of the practices referred to in Article 43 of Regulation (EU) No 1307/2013 for the agri-environment-climate, organic farming, measures under Natura 2000 and measures under the Water Framework Directive; the definition of the areas in which animal welfare commitments shall provide upgraded standards of production methods; the type of operations eligible for support under the conservation and promotion of forest genetic resources; the specification of the characteristics of pilot projects, clusters, networks, short supply chains and local markets that will be eligible for support under the co-operation measure, as well as the conditions for granting aid to the types of operation listed under that measure.

(63) Furthermore, that empowerment should cover: the minimum and maximum duration of commercial loans to mutual funds under the risk management measure under this Regulation; the conditions under which costs related to leasing contracts or second hand equipment may be considered as eligible investment expenditure, as well as the definition of types of renewable energy infrastructure eligible for investment; the conditions applicable to conversion or adjustment of commitments under the measures referred to in Articles 28, 29, 33 and 34, as well as the definition of other situations in which reimbursement of the aid shall not be required. It should also cover: the review of the ceilings set out in Annex I; the conditions under which support approved by the Commission under Regulation (EC) No 1698/2005 may be integrated into support provided for under this Regulation, including for technical assistance and for the ex-post evaluations, in order to facilitate a smooth transition from the system established by Regulation (EC) No 1698/2005 to the system established by this Regulation. In order to take account of the Treaty of Accession of the Republic of Croatia those delegated acts should also cover, for Croatia, the transition from support for rural development under Council Regulation (EC) No 1085/2006(12), where necessary.

(64) In order to ensure uniform conditions for the implementation of this Regulation, implementing powers should be conferred on the Commission, in relation to the content of rural development programmes and national frameworks, the approval of programmes and of modifications thereto, the procedures and timetables for approval of programmes, the procedures and timetables for the approval of modifications to programmes and to national frameworks, including their entry in to force and frequency of submission, the rules on payment methods for participants' costs for knowledge transfer and information actions, specific conditions for the implementation of rural development measures, the structure and operation of networks set up by this Regulation, the information and publicity requirements, the adoption of the monitoring and evaluation system and the rules for the operation of the information system, and the rules concerning the presentation of the annual implementation reports. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and the Council(13).

(65) The European Data Protection Supervisor was consulted and adopted an opinion on 14 December 2011(14).

(66) Due to the urgency of preparing the smooth implementation of the measures envisaged, this Regulation should enter into force on the day of its publication in the Official Journal of the European Union.

(67) The new support scheme provided for by this Regulation replaces the support scheme set up by Regulation (EC) No 1698/2005. Regulation (EC) No 1698/2005 should therefore be repealed,

HAVE ADOPTED THIS REGULATION:

TITLE I OBJECTIVES AND STRATEGY

CHAPTER I Subject matter and Definitions

Article 1 Subject matter

[^F1 1.This Regulation lays down general rules governing support for rural development. It sets out the objectives to which rural development policy is to contribute and the relevant priorities for rural development. It outlines the strategic context for rural development policy and defines the measures to be adopted in order to implement rural development policy. [^F2 In addition, it lays down rules on programming, networking, management, monitoring and evaluation.^F2^,^F1]]

2.This Regulation complements the provisions of Part Two of Regulation (EU) No 1303/2013 of the European Parliament and the Council(15).

Article 2 Definitions

1. For the purposes of this Regulation, the definitions of "programme", "operation", "beneficiary", "community-led local development strategy", [^F3 "public expenditure", "SMEs", ^F3] "completed operation" and "financial instruments" as laid down or referred to in Article 2 and of [^F4 "less developed regions" and ^F4] "transition regions" as laid down in [^F5 points (a) and (b) ^F5][^F5 point (b) ^F5] in Article 90(2) of Regulation (EU) No 1303/2013 [^F6 as it had effect immediately before IP completion day ^F6] apply.

In addition, the following definitions shall apply:

(a) "programming": means the process of organisation, decision making and allocation of financial resources in several stages, with the involvement of partners, intended to implement, on a multi-annual basis, [^F7 action to achieve the priorities for rural development ^F7] .

(b) "region" means a territorial unit corresponding to level 1 or 2 of the Nomenclature of territorial units for statistics (NUTS level 1 and 2) within the meaning of Regulation (EC) No 1059/2003 of the European Parliament and of the Council ( 16 ) [^F8 as it had effect immediately before IP completion day ^F8] ;

(d) "support rate" means the rate of public contribution to an operation;

(e) "transaction cost" means an additional cost linked to fulfilling a commitment, but not directly attributable to its implementation or not included in the costs or income foregone that are compensated directly; and which can be calculated on a standard cost basis;

(f) "agricultural area" means any area taken up by arable land, permanent grassland and [^F10 permanent pasture or ^F10] permanent crops as defined in [^F11 Article 4 of Regulation (EU) No 1307/2013 ^F11][^F11 Article 2(1) of Regulation (EU) No 1306/2013 ^F11] ;

(g) "economic losses" means any additional cost incurred by a farmer as a result of exceptional measures taken by the farmer with the objective of reducing supply on the market concerned or any substantial loss of production;

(h) "adverse climatic event" means weather conditions, such as frost, storms and hail, ice, heavy rain or severe drought, which can be assimilated to a natural disaster;

(i) "animal diseases" means diseases mentioned in the list of animal diseases established by the World Organisation for Animal Health or in [^F12 Annex II of Regulation (EU) No 652/2014 ^F12] ;

(j) "environmental incident" means a specific occurrence of pollution, contamination or degradation in the quality of the environment which is related to a specific event and is of limited geographical scope; but does not cover general environmental risks not connected with a specific event, such as climate change or atmospheric pollution;

(k) "natural disaster": means a naturally occurring event of a biotic or abiotic nature that leads to important disturbances in agricultural production systems or forest structures, eventually causing important economic damage to the farming or forestry sectors;

(l) "catastrophic event": means an unforeseen event of a biotic or abiotic nature caused by human action that leads to important disturbances in agricultural production systems or forest structures, eventually causing important economic damage to the farming or forestry sectors;

(m) "short supply chain": means a supply chain involving a limited number of economic operators, committed to co-operation, local economic development, and close geographical and social relations between producers, processors and consumers;

[^F13 (n) "young farmer" means a person who is no more than 40 years of age at the moment of submitting the application, possesses adequate occupational skills and competence and is setting up for the first time in an agricultural holding as head of that holding; the setting up may be done solely or jointly with other farmers, irrespective of its legal form; ^F13]

[^F14 (o) "thematic objectives": means the thematic objectives defined in Article 9 of Regulation (EU) No 1303/2013 ; ^F14]

[^F15 (p) "Common Strategic Framework" ("CSF")": means the Common Strategic Framework referred to in Article 10 of Regulation (EU) No 1303/2013 ; ^F15]

(q) "cluster" means a grouping of independent undertakings, including start-ups, small, medium and large undertakings as well as advisory bodies and/or research organisations - designed to stimulate economic/ innovative activity by promoting intensive interactions, the sharing of facilities and the exchange of knowledge and expertise, as well as contributing effectively to knowledge transfer, networking and information dissemination among the undertakings in the cluster;

(r) "forest" means an area of land spanning more than 0,5 hectares with trees higher than 5 meters and a canopy cover of more than 10 percent, or trees able to reach these thresholds in situ; and does not include land that is predominantly under agricultural or urban land use, subject to paragraph 2 [^F13 ; ^F13]

[^F16 (s) "date of setting up" means the date when the applicant performs or completes (an) action(s) related to the setting up referred to in point (n); ^F16]

[^F17 (t) “ Directive 2000/29 ” means Directive 2000/29/EC of 8 May 2000 on protective measures against the introduction into the Community of organisms harmful to plants or plant products and against their spread within the Community;

(u) “ Directive 2009/147 ” means Directive 2009/147/EC of the European Parliament and of the Council on the conservation of wild birds; ^F17]

[^F18 (v) [^F19 ‘appropriate authority’ means—

(i)the relevant authority for the constituent nation in which the regulations apply, or

(ii)the Secretary of State:

(aa)in relation to regulations applying in Scotland, if consent is given by the Scottish Ministers;

(bb)in relation to regulations applying in Northern Ireland, if consent is given by the Department of Agriculture, Environment and Rural Affairs.^F19]

[^F19 “appropriate authority” means the relevant authority for the constituent nation in which the regulations apply. ^F19^,^F18]]

2.[^F20 The relevant authority^F20] or region may choose to apply a forest definition, other than the one in point (r) of paragraph 1, based on existing national law or inventory system. The [^F21relevant authorities^F21] or regions shall provide such definition in the rural development programme;

3.In order to ensure a coherent approach in the treatment of beneficiaries and to take into account the need for an adaptation period, as regards the definition of young farmer laid down in paragraph 1(n), the [^F22appropriate authority may make regulations^F22] concerning the conditions under which a legal person may be considered to be a 'young farmer', and the setting of a grace period for the acquisition of occupational skills .

[^F23 4.[^F24 In these Regulations, references to Regulation (EU) No 1303/2013 are references to Regulation (EU) No 1303/2013, as amended by the European Structural and Investment Funds Common Provisions (Amendment) (EU Exit) Regulations 2019.^F24^,^F23]]

CHAPTER II Mission, objectives and priorities

[^F25Article 3 Mission _E1

Support provided through rural development programmes shall contribute to promoting sustainable rural development in a manner that complements other support provided to the agriculture and fisheries sectors [^F26 and to less developed regions^F26] . It shall contribute to the development of an agricultural sector that is more territorially and environmentally balanced, climate-friendly and resilient and competitive and innovative. It shall also contribute to the development of rural territories.^F25]

[^F387Article 3 Aim _E32

Support for rural development shall contribute to the development of rural economies and sectors that are more resilient, competitive and innovative and which support the achievement of the well-being goals as set out in section 4 of the Well-being of Future Generations (Wales) Act 2015, the sustainable management of natural resources as set out in Part 1 of the Environment (Wales) Act 2016 and climate resilience.^F387]

Article 4 Objectives _E2

Within the overall framework of [^F27agricultural support^F27] , support for rural development, including for activities in the food and non-food sector and in forestry, shall contribute to achieving the following objectives:

(a)

fostering the competitiveness of agriculture;

(b)

ensuring the sustainable management of natural resources, and climate action;

(c)

achieving a balanced territorial development of rural economies and communities including the creation and maintenance of employment.

[^F388Article 4 Objectives _E33

Support for rural development, must contribute to achieving the following objectives:

(a)fostering the competitiveness of agriculture;

(b)contributing towards the sustainable management of natural resources as set out in Part 1 of the Environment (Wales) Act 2016;

(c)ensuring climate resilience;

(d)achieving a balanced territorial development of rural economies and communities including the creation and maintenance of employment.^F388]

Article 5 Union priorities for rural development _E3

[^F28 The achievement of the objectives of rural development shall be pursued through the following six priorities for rural development, which reflect the relevant Thematic Objectives of the CSF:^F28]

(1)

fostering knowledge transfer and innovation in agriculture, forestry, and rural areas with a focus on the following areas:

(a)

fostering innovation, cooperation, and the development of the knowledge base in rural areas;

(b)

strengthening the links between agriculture, food production and forestry and research and innovation, including for the purpose of improved environmental management and performance;

(c)

fostering lifelong learning and vocational training in the agricultural and forestry sectors.

(2)

enhancing farm viability and competitiveness of all types of agriculture in all regions and promoting innovative farm technologies and the sustainable management of forests, with a focus on the following areas:

(a)

improving the economic performance of all farms and facilitating farm restructuring and modernisation, notably with a view to increasing market participation and orientation as well as agricultural diversification;

(b)

facilitating the entry of adequately skilled farmers into the agricultural sector and, in particular, generational renewal.

(3)

promoting food chain organisation, including processing and marketing of agricultural products, animal welfare and risk management in agriculture, with a focus on the following areas:

(a)

improving competitiveness of primary producers by better integrating them into the agri-food chain through quality schemes, adding value to agricultural products, promotion in local markets and short supply circuits, producer groups and organisations and inter-branch organisations;

(b)

supporting farm risk prevention and management.

(4)

restoring, preserving and enhancing ecosystems related to agriculture and forestry, with a focus on the following areas:

(a)

restoring, preserving and enhancing biodiversity, including in Natura 2000 areas, and in areas facing natural or other specific constraints, and high nature value farming, as well as the state of European landscapes;

(b)

improving water management, including fertiliser and pesticide management;

(c)

preventing soil erosion and improving soil management.

(5)

promoting resource efficiency and supporting the shift towards a low carbon and climate resilient economy in agriculture, food and forestry sectors, with a focus on the following areas:

(a)

increasing efficiency in water use by agriculture;

(b)

increasing efficiency in energy use in agriculture and food processing;

(c)

facilitating the supply and use of renewable sources of energy, of by-products, wastes and residues and of other non food raw material, for the purposes of the bio-economy;

(d)

reducing green house gas and ammonia emissions from agriculture;

(e)

fostering carbon conservation and sequestration in agriculture and forestry;

(6)

promoting social inclusion, poverty reduction and economic development in rural areas, with a focus on the following areas:

(a)

facilitating diversification, creation and development of small enterprises, as well as job creation;

(b)

fostering local development in rural areas;

(c)

enhancing the accessibility, use and quality of information and communication technologies (ICT) in rural areas.

^F29 All those priorities shall contribute to the cross-cutting objectives of innovation, environment and climate change mitigation and adaptation. Programmes may address fewer than six priorities if justified on the basis of the analysis of the situation in terms of strengths, weaknesses, opportunities and threats ("the SWOT") and the ex ante evaluation. At least four priorities shall be addressed by each programme. ....

Other focus areas may be included in programmes in order to pursue one of the priorities if justified and measurable.

[^F389Article 5 Priorities for rural development _E34

Support for rural development must support the following priorities:

1fostering knowledge transfer and innovation in agriculture, forestry, and rural areas;

2enhancing farm viability and competitiveness of all types of agriculture in all regions and promoting innovative farm technologies and the sustainable management of forests;

3promoting food chain organisation, including processing and marketing of agricultural products, animal welfare and risk management in agriculture;

4restoring, preserving and enhancing ecosystems dependent on agriculture and forestry;

5promoting resource efficiency and supporting the shift towards a low carbon and climate resilient economy in the agriculture, food and forestry sectors;

6promoting social inclusion, poverty reduction and economic development in rural areas.

Each of these priorities shall contribute to the cross-cutting objectives of innovation, environment and climate change mitigation and adaptation.^F389]

TITLE II PROGRAMMING

CHAPTER I Programming content

[^F30Article 6 Rural development programmes _E4

Support for rural development shall be provided in accordance with rural development programmes. These programmes shall implement a strategy to meet the priorities for rural development through a set of measures as defined in Title III. Support for rural development must be provided to further the objectives and the priorities of rural development.^F30]

[^F390Article 6 The rural development programme _E35

Support for rural development must be provided in accordance with the rural development programme. This programme shall implement a strategy to meet the priorities for rural development through a set of measures as defined in Title III. Support for rural development must be provided to further the objectives and the priorities of rural development.^F390]

^F31Article 7 Thematic sub-programmes

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[^F32Article 8 Content of rural development programmes _E5

1.In addition to the elements referred to in Article 27 of Regulation (EU) No 1303/2013, each rural development programme shall include:

^F33(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b)a SWOT analysis of the situation and an identification of the needs that have to be addressed in the geographical area covered by the programme.

The analysis shall be structured around the ^F34... priorities for rural development. Specific needs concerning the environment, climate change mitigation and adaptation and innovation shall be assessed across ^F34... priorities for rural development, in order to identify relevant responses in these three areas at the level of each priority;

(c)a description of the strategy which demonstrates that:

(i)

appropriate targets are set for each of the focus areas of the ^F34... priorities for rural development included in the programme, based on the common indicators referred to in Article 69 and, where necessary, on programme specific indicators;

(ii)

relevant combinations of measures are selected in relation to each of the focus areas of the ^F34... priorities for rural development included in the programme, based on a sound intervention logic ^F35... the analysis referred to in point (b);

(iii)

the allocation of financial resources to the measures of the programme is justified and adequate to achieve the targets set;

(iv)

specific needs linked with specific conditions at regional or sub-regional level are taken into account and concretely addressed through adequately designed combinations of measures ^F36...;

(v)

an appropriate approach towards innovation with a view to achieving the ^F34... priorities for rural development, including the EIP for agricultural productivity and sustainability, towards the environment, including the specific needs of Natura 2000 areas, and towards climate change mitigation and adaptation is integrated into the programme;

(vi)

measures have been taken to ensure the availability of sufficient advisory capacity on the regulatory requirements and on actions related to innovation;

(d)for each ex ante conditionality, established in accordance with Article 19, and part II of Annex XI to Regulation (EU) No 1303/2013 for the general ex ante conditionalities, and in accordance with Annex V to this Regulation, an assessment of which of the ex ante conditionalities are applicable to the programme and which of them are fulfilled at the date of submission of ^F37... the programme. Where the applicable ex ante conditionalities are not fulfilled, the programme shall contain a description of the actions to be taken, the bodies responsible and a timetable for such actions ^F38....

^F39(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(f)a description of each of the measures selected;

(g)the evaluation plan referred to in Article 56 of Regulation (EU) No 1303/2013. The [^F40 relevant authority^F40] shall provide sufficient resources to address the needs which have been identified and to ensure proper monitoring and evaluation;

(h)a financing plan comprising:

(i)

[^F41 a table setting out, in accordance with Article 58(4) and Article 58a(2) of this Regulation, the total [^F42 core^F42] contribution planned for each year. That table shall indicate separately the additional resources as referred to in Article 58a(2) of this Regulation. When applicable, that table shall also indicate separately, within the total [^F42 core^F42] contribution, the appropriations provided for the less developed regions and the funds transferred to the [^F42 support for rural development^F42] pursuant to Article 7(2) of Regulation (EU) No 1307/2013. ^F43...;^F41]

(ii)

[^F41 a table setting out, for each measure, for each type of operation with a specific [^F42 core^F42] contribution rate, for the type of operation referred to in Article 37(1) and Article 39a ^F44... and for technical assistance, the total ^F34... contribution planned and the applicable [^F42 core^F42] contribution rate. Where applicable, that table shall indicate separately the [^F42 core^F42] contribution rate for less developed regions and for other regions;^F41]

(i)an indicator plan, broken down into focus areas, comprising the targets referred to in point (i) of Article 8(1)(c) and the planned outputs and planned expenditure of each rural development measure selected in relation to a corresponding focus area;

(j)where applicable, a table on additional national financing per measure in accordance with Article 82;

(k)where applicable, the list of aid schemes falling under Article 81(1) to be used for the implementation of the programmes;

[^F45 (l)information on the complementarity with other support provided to the agricultural and fisheries sectors;^F45]

(m)programme implementing arrangements including:

(i)

the designation ^F46... of all authorities referred to in Article 65(2) and, for information, a summary description of the management and control structure;

(ii)

a description of the monitoring and evaluation procedures, as well as the composition of the Monitoring Committee;

(iii)

the provisions to ensure that the programme is publicised, including through the national rural network referred to in Article 54;

(iv)

a description of the approach laying down principles with regard to the establishment of selection criteria for operations and local development strategies that takes into account relevant targets; in this context [^F47 the relevant authority^F47] may provide for priority to be given to SMEs linked to the agriculture and forestry sector.

(v)

in relation to local development, where applicable, a description of the mechanisms to ensure coherence between activities envisaged under the local development strategies, the "Cooperation" measure referred to in Article 35, and the "Basic services and village renewal in rural areas" measure referred to in Article 20 including urban-rural links;

(n)the actions taken to involve the partners referred to in Article 5 of Regulation (EU) No 1303/2013 and a summary of the results of the consultation of the partners;

(o)where applicable, the structure of the national rural network as referred to in Article 54(3), and provisions for its management, which would constitute the basis for its annual actions plans.

^F482.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[^F49 3.The appropriate authority may make regulations laying down rules for the presentation of the elements described in paragraph 1 in rural development programmes.^F49^,^F32]]

Article 8 Content of rural development programmes _E36

1.In addition to the elements referred to in Article 27 of Regulation (EU) No 1303/2013, each rural development programme shall include:

^F391(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b)a SWOT analysis of the situation and an identification of the needs that have to be addressed in the geographical area covered by the programme.

^F392^,^F392The analysis shall be structured around the ... priorities for rural development. Specific needs concerning the environment, climate change mitigation and adaptation and innovation shall be assessed across ... priorities for rural development, in order to identify relevant responses in these three areas at the level of each priority;

(c)a description of the strategy which demonstrates that:

(i)

^F392 appropriate targets are set for each of the focus areas of the ... priorities for rural development included in the programme, based on the common indicators referred to in Article 69 and, where necessary, on programme specific indicators;

(ii)

^F392^,^F393 relevant combinations of measures are selected in relation to each of the focus areas of the ... priorities for rural development included in the programme, based on a sound intervention logic ... the analysis referred to in point (b);

(iii)

the allocation of financial resources to the measures of the programme is justified and adequate to achieve the targets set;

(iv)

^F394 specific needs linked with specific conditions at regional or sub-regional level are taken into account and concretely addressed through adequately designed combinations of measures ...;

(v)

^F392 an appropriate approach towards innovation with a view to achieving the ... priorities for rural development, including the EIP for agricultural productivity and sustainability, towards the environment, including the specific needs of Natura 2000 areas, and towards climate change mitigation and adaptation is integrated into the programme;

(vi)

measures have been taken to ensure the availability of sufficient advisory capacity on the regulatory requirements and on actions related to innovation;

(d)^F395^,^F396for each ex ante conditionality, established in accordance with Article 19, and part II of Annex XI to Regulation (EU) No 1303/2013 for the general ex ante conditionalities, and in accordance with Annex V to this Regulation, an assessment of which of the ex ante conditionalities are applicable to the programme and which of them are fulfilled at the date of submission of ... the programme. Where the applicable ex ante conditionalities are not fulfilled, the programme shall contain a description of the actions to be taken, the bodies responsible and a timetable for such actions ....

^F397(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(f)a description of each of the measures selected;

(g)the evaluation plan referred to in Article 56 of Regulation (EU) No 1303/2013. The [^F398relevant authority^F398] shall provide sufficient resources to address the needs which have been identified and to ensure proper monitoring and evaluation;

(h)a financing plan comprising:

(i)

[^F399 a table setting out the total core contribution, as determined by the Scottish Ministers in accordance with Article 58. When applicable this table shall indicate separately within the total core contribution the funds transferred to the support for rural development in application of Article 11(4A) of Regulation (EU) No 1307/2013;^F399]

(ii)

[^F41 a table setting out, for each measure, for each type of operation with a specific [^F400 core^F400] contribution rate, for the type of operation referred to in Article 37(1) and Article 39a, ^F401... and for technical assistance, the total ^F392... contribution planned and the applicable [^F400 core^F400] contribution rate. Where applicable, that table shall indicate separately the [^F400 core^F400] contribution rate for less developed regions and for other regions;^F41]

(j)^F402where applicable, a table on additional ... financing per measure in accordance with Article 82;

(k)where applicable, the list of aid schemes falling under Article 81(1) to be used for the implementation of the programmes;

[^F403 (l)information on the complementarity with other support provided to the agricultural and fisheries sectors;^F403]

(m)programme implementing arrangements including:

(i)

^F404 the designation ... of all authorities referred to in Article 65(2) and, for information, a summary description of the management and control structure;

(ii)

a description of the monitoring and evaluation procedures, as well as the composition of the Monitoring Committee;

(iii)

the provisions to ensure that the programme is publicised, including through the national rural network referred to in Article 54;

(iv)

a description of the approach laying down principles with regard to the establishment of selection criteria for operations and local development strategies that takes into account relevant targets; in this context [^F405the relevant authority^F405] may provide for priority to be given to SMEs linked to the agriculture and forestry sector.

(v)

(n)the actions taken to involve the partners referred to in Article 5 of Regulation (EU) No 1303/2013 and a summary of the results of the consultation of the partners;

(o)where applicable, the structure of the national rural network as referred to in Article 54(3), and provisions for its management, which would constitute the basis for its annual actions plans.

^F4062.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[^F407 3.The appropriate authority may make regulations laying down rules for the presentation of the elements described in paragraph 1 in rural development programmes.^F407]

Article 8 Content of rural development programmes _E37

1.In addition to the elements referred to in Article 27 of Regulation (EU) No 1303/2013, each rural development programme shall include:

^F408(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b)a SWOT analysis of the situation and an identification of the needs that have to be addressed in the geographical area covered by the programme.

^F409^,^F409The analysis shall be structured around the ... priorities for rural development. Specific needs concerning the environment, climate change mitigation and adaptation and innovation shall be assessed across ... priorities for rural development, in order to identify relevant responses in these three areas at the level of each priority;

(c)a description of the strategy which demonstrates that:

(i)

^F409 appropriate targets are set for each of the focus areas of the ... priorities for rural development included in the programme, based on the common indicators referred to in Article 69 and, where necessary, on programme specific indicators;

(ii)

^F409^,^F410 relevant combinations of measures are selected in relation to each of the focus areas of the ... priorities for rural development included in the programme, based on a sound intervention logic ... the analysis referred to in point (b);

(iii)

the allocation of financial resources to the measures of the programme is justified and adequate to achieve the targets set;

(iv)

^F411 specific needs linked with specific conditions at regional or sub-regional level are taken into account and concretely addressed through adequately designed combinations of measures ...;

(v)

^F409 an appropriate approach towards innovation with a view to achieving the ... priorities for rural development, including the EIP for agricultural productivity and sustainability, towards the environment, including the specific needs of Natura 2000 areas, and towards climate change mitigation and adaptation is integrated into the programme;

(vi)

measures have been taken to ensure the availability of sufficient advisory capacity on the regulatory requirements and on actions related to innovation;

(d)^F412^,^F413for each ex ante conditionality, established in accordance with Article 19, and part II of Annex XI to Regulation (EU) No 1303/2013 for the general ex ante conditionalities, and in accordance with Annex V to this Regulation, an assessment of which of the ex ante conditionalities are applicable to the programme and which of them are fulfilled at the date of submission of ... the programme. Where the applicable ex ante conditionalities are not fulfilled, the programme shall contain a description of the actions to be taken, the bodies responsible and a timetable for such actions ....

^F414(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(f)a description of each of the measures selected;

(g)the evaluation plan referred to in Article 56 of Regulation (EU) No 1303/2013. The [^F415relevant authority^F415] shall provide sufficient resources to address the needs which have been identified and to ensure proper monitoring and evaluation;

(h)a financing plan comprising:

(i)

[^F416 a table setting out, in accordance with Article 58(4) and Article 58a(2) of this Regulation, the total [^F417 core^F417] contribution planned for each year. That table shall indicate separately the additional resources as referred to in Article 58a(2) of this Regulation. When applicable, that table shall also indicate separately, within the total [^F417 core^F417] contribution, [^F418 the appropriations provided to the less developed regions^F418] ;^F416]

(ii)

[^F416 a table setting out, for each measure, for each type of operation with a specific [^F417 core^F417] contribution rate, for the type of operation referred to in Article 37(1) and Article 39a ^F419... and for technical assistance, the total ^F409... contribution planned and the applicable [^F417 core^F417] contribution rate. Where applicable, that table shall indicate separately the [^F417 core^F417] contribution rate for less developed regions and for other regions;^F416]

(j)where applicable, a table on additional national financing per measure in accordance with Article 82;

(k)where applicable, the list of aid schemes falling under Article 81(1) to be used for the implementation of the programmes;

[^F420 (l)information on the complementarity with other support provided to the agricultural and fisheries sectors;^F420]

(m)programme implementing arrangements including:

(i)

^F421 the designation ... of all authorities referred to in Article 65(2) and, for information, a summary description of the management and control structure;

(ii)

a description of the monitoring and evaluation procedures, as well as the composition of the Monitoring Committee;

(iii)

the provisions to ensure that the programme is publicised, including through the national rural network referred to in Article 54;

(iv)

a description of the approach laying down principles with regard to the establishment of selection criteria for operations and local development strategies that takes into account relevant targets; in this context [^F422the relevant authority^F422] may provide for priority to be given to SMEs linked to the agriculture and forestry sector.

(v)

(n)the actions taken to involve the partners referred to in Article 5 of Regulation (EU) No 1303/2013 and a summary of the results of the consultation of the partners;

(o)where applicable, the structure of the national rural network as referred to in Article 54(3), and provisions for its management, which would constitute the basis for its annual actions plans.

^F4232.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[^F424 3.The appropriate authority may make regulations laying down rules for the presentation of the elements described in paragraph 1 in rural development programmes.^F424]

CHAPTER II Preparation, approval and modification of rural development programmes

[^F32Article 9 Ex ante conditionalities

In addition to the general ex ante conditionalities, referred to in part II of Annex XI to Regulation (EU) No 1303/2013, the ex ante conditionalities referred to in Annex V to this Regulation shall apply to the ^F50... programming, if relevant and applicable to the specific objectives pursued within the priorities of the programme.^F32]

^F51[^F32Article 10 Approval of rural development programmes

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .^F32]

[[^F52^,^F32Article 11 Amendment of rural development programmes _E6

The appropriate authority may make regulations to supplement or amend Commission Implementing Decision C(2015) 855, Commission Implementing Decision C(2015) 3488, Commission Implementing Decision C(2015) 3489 or Commission Implementing Decision C(2015) 6018 as applicable for the purpose of amending programmes concerning one or more of the following:

(a)a change in the:

(i)programme strategy through a change of more than 50% in the quantified target linked to a focus area;

(ii)contribution rate of one or more measures;

(iii)annual distribution of the contribution at programme level;

(b)the introduction or withdrawal of measures or other types of operations;

(c)transfer of funds between measures.^F32^,^F52]]

[^F425Article 11 Amendment of rural development programmes _E38

[^F426 The Scottish Ministers may supplement or amend the rural development programme for the following purposes:^F426]

(a)a change in the:

(i)programme strategy through a change of more than 50% in the quantified target linked to a focus area;

(ii)contribution rate of one or more measures;

(iii)annual distribution of the contribution at programme level;

(b)the introduction or withdrawal of measures or other types of operations;

(c)transfer of funds between measures.^F425]

[[^F53^,^F32Article 12 Rules on amendments

The appropriate authority may make regulations setting the frequency of amendments that may be made during the programming period.^F32^,^F53]]

TITLE III RURAL DEVELOPMENT SUPPORT

CHAPTER I Measures

Article 13 Measures

^F54Each rural development measure shall be programmed to contribute specifically to the achievement of one or more ... priorities for rural development. [^F55An indicative list of measures of particular relevance to the ^F54... priorities is set out in Annex VI.^F55]

Article 14 Knowledge transfer and information actions

1.Support under this measure shall cover vocational training and skills acquisition actions, demonstration activities and information actions. Vocational training and skills acquisition actions may include training courses, workshops and coaching.

Support may also cover short-term farm and forest management exchanges as well as farm and forest visits.

2.Support under this measure shall be for the benefit of persons engaged in the agricultural, food and forestry sector, land managers and other economic actors which are SMEs operating in rural areas.

The training or other knowledge transfer and information action provider shall be the beneficiary of the support.

3.Support under this measure shall not include courses of instruction or training, which form part of normal education programmes or systems at secondary or higher levels.

Bodies providing knowledge transfer and information services shall have the appropriate capacities in the form of staff qualifications and regular training to carry out this task.

[^F13 4.Eligible costs under this measure shall be the costs of organising and delivering the knowledge transfer or information action. Infrastructure installed as a result of demonstration may be used after the operation is completed. In the case of demonstration projects, support may also cover relevant investment costs. Costs for travel, accommodation and per diem expenses of participants as well as the cost of the replacement of farmers shall also be eligible for support. All costs identified under this paragraph shall be paid to the beneficiary.^F13]

5.^F56In order to ensure that farm and forest exchange schemes and visits are clearly demarcated in relation to similar actions under other ... schemes, the [^F57appropriate authority may make regulations^F57] concerning the duration and content of farm and forest exchange schemes and farm and forest visits.

6.The [^F58appropriate authority may make regulations^F58] laying down the rules on payment modalities for participants' costs, including through the use of vouchers or other similar forms.

^F59...

Article 14 Knowledge transfer and information actions

Support may also cover short-term farm and forest management exchanges as well as farm and forest visits.

2.Support under this measure shall be for the benefit of persons engaged in the agricultural, food and forestry sector, land managers [^F427, animal health and welfare sector^F427] and other economic actors which are [^F428businesses^F428] operating in rural areas.

The training or other knowledge transfer and information action provider shall be the beneficiary of the support.

3.Support under this measure shall not include courses of instruction or training, which form part of normal education programmes or systems at secondary or higher levels.

Bodies providing knowledge transfer and information services shall have the appropriate capacities in the form of staff qualifications and regular training to carry out this task.

[^F429 4.Eligible costs under this measure shall be the costs of organising and delivering the knowledge transfer or information action. Infrastructure installed as a result of demonstration may be used after the operation is completed. In the case of demonstration projects, support may also cover relevant investment costs. Costs for travel, accommodation and per diem expenses of participants as well as the cost of the replacement of farmers shall also be eligible for support. All costs identified under this paragraph shall be paid to the beneficiary.^F429]

5.^F430In order to ensure that farm and forest exchange schemes and visits are clearly demarcated in relation to similar actions under other ... schemes, the [^F431appropriate authority may make regulations^F431] concerning the duration and content of farm and forest exchange schemes and farm and forest visits.

6.The [^F432appropriate authority may make regulations^F432] laying down the rules on payment modalities for participants' costs, including through the use of vouchers or other similar forms.

^F433...

Article 15 Advisory services, farm management and farm relief services _E7

1.Support under this measure shall be granted in order to:

(a)help farmers, young farmers as defined in this Regulation, forest holders, other land managers and SMEs in rural areas benefit from the use of advisory services for the improvement of the economic and environmental performance as well as the climate friendliness and resilience of their holding, enterprise and/or investment;

(b)promote the setting up of farm management, farm relief and farm advisory services, as well as forestry advisory services, including the Farm Advisory System referred to in Articles 12 to 14 of Regulation (EU) No 1306/2013;

(c)promote the training of advisors.

[^F13 2.The beneficiary of support provided in accordance with points (a) and (c) of paragraph 1 shall be either the provider of advice or training or the Managing Authority. Where the Managing Authority is the beneficiary, the provider of advice or training shall be selected by a body that is functionally independent from the Managing Authority. Support under point (b) of paragraph 1 shall be granted to the authority or body selected to set up the farm management, farm relief, farm advisory or forestry advisory service.^F13]

[^F13 3.The authorities or bodies selected to provide advice shall have appropriate resources in the form of regularly trained and qualified staff and advisory experience and reliability with respect to the fields in which they advise. The providers under this measure shall be chosen through a selection procedure open to both public and private bodies. That selection procedure shall be objective and shall exclude candidates with conflicts of interest.^F13]

When providing advice, advisory services shall respect the non-disclosure obligations referred to in Article 13(2) of Regulation (EU) No 1306/2013.

[^F16 3a.For the purpose of this Article, [^F60 the relevant authority^F60] shall, in accordance with Article 65(1), carry out all checks at the level of the provider of advice or training.^F16]

4.^F61Advice to the individual farmers, young farmers as defined in this Regulation and other land managers shall be linked to at least one ... priority for rural development and shall cover as a minimum one of the following elements:

(a)obligations at farm level deriving from the statutory management requirements and/or standards for good agricultural and environmental conditions provided for in Chapter I of Title VI of Regulation (EU) No 1306/2013;

(b)where applicable, the agricultural practices beneficial for the climate and the environment as laid down in Chapter 3 of Title III of Regulation (EU) No 1307/2013 and the maintenance of the agricultural area as referred to in point (c) of Article 4(1) of Regulation (EU) No 1307/2013;

(c)measures at farm level provided for in rural development programmes aiming at farm modernisation, competitiveness building, sectoral integration, innovation and market orientation, as well as the promotion of entrepreneurship;

[^F62 (d) requirements arising from any programme of measures for river basin districts which has been implemented in consequence of Article 11(3) of Directive 2000 /60/EC establishing a framework for Community action in the field of water policy (‘the Water Framework Directive’), which is to be construed as if references to “Community legislation” were references to “the law as it applies in the constituent nation” and references to “Member States” were references to “The competent authority”;

(e) requirements which apply by virtue of Article 55 of Regulation (EC) No 1107/2009 , in particular any requirement which applies as a consequence of the implementation of Articles 14(1), (2), (4) and (5) of Directive 2009/128/EC of the European Parliament and of the Council establishing a framework for Community action to achieve the sustainable use of pesticides, which are to be construed as if references to “Member States” were references to “the competent authority” ^F62] ; or

(f)where relevant, occupational safety standards or safety standards linked to the farm;

(g)specific advice for farmers setting up for the first time.

[^X1 Advice may also cover other issues and in particular the information related to climate change mitigation and adaptation, biodiversity and the protection of water as laid down in Annex I to Regulation (EU) No 1306/2013 or issues linked to the economic and environmental performance of the agricultural holding, including competitiveness aspects.^X1] This may include advice for the development of short supply chains, organic farming and health aspects of animal husbandry.

5.[^F63 Advice to forest holders shall cover, as a minimum, the relevant requirements which have been implemented as a consequence of Directives 92/43, 2009/147 and 2000/60.^F63] It may also cover issues linked to the economic and environmental performance of the forest holding.

6.Advice to SMEs may cover issues linked to the economic and environmental performance of the enterprise.

7.Where duly justified and appropriate, advice may be provided partly in a group, while taking into account the situations of the individual user of advisory services.

8.Support under points (a) and (c) of paragraph 1 shall be limited to the maximum amounts laid down in Annex II. Support under point (b) of paragraph 1 shall be degressive over a maximum period of five years from setting up.

Article 15 Advisory services, farm management and farm relief services _E39

1.Support under this measure shall be granted in order to:

(a)help farmers, young farmers as defined in this Regulation, forest holders, other land managers and [^F434businesses^F434] in rural areas benefit from the use of advisory services for the improvement of the economic and environmental performance as well as the climate friendliness and resilience of their holding, enterprise and/or investment;

(b)promote the setting up of farm management, farm relief and farm advisory services, as well as forestry advisory services, including the Farm Advisory System referred to in [^F435Article 12^F435] of Regulation (EU) No 1306/2013;

(c)promote the training of advisors.

[^F436 2.The beneficiary of support provided in accordance with points (a) and (c) of paragraph 1 shall be either the provider of advice or training or the Managing Authority. Where the Managing Authority is the beneficiary, the provider of advice or training shall be selected by a body that is functionally independent from the Managing Authority. Support under point (b) of paragraph 1 shall be granted to the authority or body selected to set up the farm management, farm relief, farm advisory or forestry advisory service.^F436]

[^F436 3.The authorities or bodies selected to provide advice shall have appropriate resources in the form of regularly trained and qualified staff and advisory experience and reliability with respect to the fields in which they advise. The providers under this measure shall be chosen through a selection procedure open to both public and private bodies. That selection procedure shall be objective and shall exclude candidates with conflicts of interest.^F436]

^F437...

^F4383a.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4.^F439Advice to the individual farmers, young farmers as defined in this Regulation and other land managers shall be linked to at least one ... priority for rural development and shall cover as a minimum one of the following elements:

(b)^F440where applicable, ... the maintenance of the agricultural area as referred to in point (c) of Article 4(1) of Regulation (EU) No 1307/2013;

[^F441 (d) requirements arising from any programme of measures for river basin districts which has been implemented in consequence of Article 11(3) of Directive 2000 /60/EC establishing a framework for Community action in the field of water policy (‘the Water Framework Directive’), which is to be construed as if references to “Community legislation” were references to “the law as it applies in the constituent nation” and references to “Member States” were references to “The competent authority”;

(f)where relevant, occupational safety standards or safety standards linked to the farm;

(g)specific advice for farmers setting up for the first time.

[^X2 Advice may also cover other issues and in particular the information related to climate change mitigation and adaptation, biodiversity and the protection of water ^F442... or issues linked to the economic and environmental performance of the agricultural holding, including competitiveness aspects.^X2] This may include advice for the development of short supply chains, organic farming and health aspects of animal husbandry.

5.[^F443 Advice to forest holders shall cover, as a minimum, the relevant requirements which have been implemented as a consequence of Directives 92/43, 2009/147 and 2000/60.^F443] It may also cover issues linked to the economic and environmental performance of the forest holding.

6.Advice to [^F444businesses^F444] may cover issues linked to the economic and environmental performance of the enterprise.

7.Where duly justified and appropriate, advice may be provided partly in a group, while taking into account the situations of the individual user of advisory services.

8.^F445... Support under point (b) of paragraph 1 shall be degressive over a maximum period of five years from setting up.

Article 15 Advisory services, farm management and farm relief services _E40

1.Support under this measure shall be granted in order to:

(c)promote the training of advisors.

[^F446 2.The beneficiary of support provided in accordance with points (a) and (c) of paragraph 1 shall be either the provider of advice or training or the Managing Authority. Where the Managing Authority is the beneficiary, the provider of advice or training shall be selected by a body that is functionally independent from the Managing Authority. Support under point (b) of paragraph 1 shall be granted to the authority or body selected to set up the farm management, farm relief, farm advisory or forestry advisory service.^F446]

[^F446 3.The authorities or bodies selected to provide advice shall have appropriate resources in the form of regularly trained and qualified staff and advisory experience and reliability with respect to the fields in which they advise. The providers under this measure shall be chosen through a selection procedure open to both public and private bodies. That selection procedure shall be objective and shall exclude candidates with conflicts of interest.^F446]

When providing advice, advisory services shall respect the non-disclosure obligations referred to in Article 13(2) of Regulation (EU) No 1306/2013.

[^F447 3a.For the purpose of this Article, [^F448 the relevant authority^F448] shall, in accordance with Article 65(1), carry out all checks at the level of the provider of advice or training.^F447]

4.^F449Advice to the individual farmers, young farmers as defined in this Regulation and other land managers shall be linked to at least one ... priority for rural development and shall cover as a minimum one of the following elements:

^F450(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[^F451 (b)where applicable, the maintenance of the agricultural area as referred to in point (c) of Article 2(1) of Regulation (EU) No 1306/2013;^F451]

[^F452 (d) requirements arising from any programme of measures for river basin districts which has been implemented in consequence of Article 11(3) of Directive 2000 /60/EC establishing a framework for Community action in the field of water policy (‘the Water Framework Directive’), which is to be construed as if references to “Community legislation” were references to “the law as it applies in the constituent nation” and references to “Member States” were references to “The competent authority”;

(f)where relevant, occupational safety standards or safety standards linked to the farm;

(g)specific advice for farmers setting up for the first time.

[^X3 Advice may also cover other issues and in particular the information related to climate change mitigation and adaptation, biodiversity and the protection of water as laid down in Annex I to Regulation (EU) No 1306/2013 or issues linked to the economic and environmental performance of the agricultural holding, including competitiveness aspects.^X3] This may include advice for the development of short supply chains, organic farming and health aspects of animal husbandry.

5.[^F453 Advice to forest holders shall cover, as a minimum, the relevant requirements which have been implemented as a consequence of Directives 92/43, 2009/147 and 2000/60.^F453] It may also cover issues linked to the economic and environmental performance of the forest holding.

6.Advice to SMEs may cover issues linked to the economic and environmental performance of the enterprise.

7.Where duly justified and appropriate, advice may be provided partly in a group, while taking into account the situations of the individual user of advisory services.

Article 16 Quality schemes for agricultural products, and foodstuffs _E8

[^F13 1.Support under this measure shall cover new participation, or participation in the five preceding years, by farmers and groups of farmers, in:^F13]

(a)quality schemes established under the following Regulations and provisions:

(i)

Regulation (EU) 1151/2012 of the European Parliament and of the Council(17);

(ii)

Council Regulation (EC) No 834/2007(18);

(iii)

Regulation (EC) No 110/2008 of the European Parliament and of the Council(19);

(iv)

Council Regulation (EEC) No 1601/91(20);

(v)

Part II, Title II, Chapter I, Section 2 of Council Regulation (EU) No 1308/2013 as concerns wine.

(b)quality schemes, including farm certification schemes, for agricultural products, cotton or foodstuffs, recognised by the [^F64relevant authority^F64] as complying with the following criteria:

(i)

the specificity of the final product under such schemes is derived from clear obligations to guarantee any of the following:

specific product characteristics,
specific farming or production methods, or
a quality of the final product that goes significantly beyond the commercial commodity standards as regards public, animal or plant health, animal welfare or environmental protection;

(ii)

the scheme is open to all producers;

(iii)

the scheme involves binding product specifications and compliance with those specifications is verified by public authorities or by an independent inspection body;

(iv)

the scheme is transparent and assures complete traceability of products; or

(c)^F66voluntary agricultural product certification schemes recognised by the [^F65relevant authority^F65] as meeting the ... best practice guidelines for the operation of voluntary certification schemes relating to agricultural products and foodstuffs.

[^F13 2.Support under this measure may also cover costs arising from information and promotion activities implemented by groups of producers, concerning products covered by a quality scheme receiving support in accordance with paragraph 1 of this Article. ^F67...

3.Support under paragraph 1 shall be granted as an annual incentive payment, the level of which shall be determined in accordance with the level of the fixed costs arising from participation in supported schemes, for a maximum duration of five years.

In the case of initial participation prior to the application for support under paragraph 1, the maximum duration of five years shall be reduced by the number of years which have elapsed between the initial participation in a quality scheme and the time of the application for the support.

For the purposes of this paragraph, ‘fixed costs’ means the costs incurred for entering a supported quality scheme and the annual contribution for participating in that scheme, including, where necessary, expenditure on checks required to verify compliance with the specifications of the scheme.

For the purposes of this Article, ‘farmer’ means active farmer within the meaning of Article 9 of Regulation (EU) No 1307/2013 ^F68 .... ^F13]

4.Support shall be limited to the maximum support rate and amount laid down in Annex II.

5.^F73In order to take into account new [^F69statutory requirements^F69] that may affect support under this measure and in order to ensure consistency with other [^F70EU-derived domestic legislation or [^F71 assimilated direct^F71] legislation^F70] on promotion of agricultural measures and prevent distortion of competition, the [^F72appropriate authority may make regulations^F72] concerning, the specific ... schemes to be covered by point (a) of paragraph 1 and the characteristics of groups of producers and the types of actions that may receive support under paragraph 2, the setting of conditions to prevent discrimination against certain products; and the setting of conditions on the basis of which commercial brands are to be excluded from support.

Article 16 Quality schemes for agricultural products, and foodstuffs _E41

[^F454 1.Support under this measure [^F455 may^F455] cover new participation, or participation in the five preceding years, by farmers and groups of farmers [^F456 and food processors^F456] , in:^F454]

(a)quality schemes established under the following Regulations and provisions:

(i)

Regulation (EU) 1151/2012 of the European Parliament and of the Council(17);

(ii)

Council Regulation (EC) No 834/2007(18);

(iii)

Regulation (EC) No 110/2008 of the European Parliament and of the Council(19);

(iv)

Council Regulation (EEC) No 1601/91(20);

(v)

Part II, Title II, Chapter I, Section 2 of Council Regulation (EU) No 1308/2013 as concerns wine.

(b)quality schemes, including farm certification schemes, for agricultural products, cotton or foodstuffs, recognised by the [^F457relevant authority^F457] as complying with the following criteria:

(i)

the specificity of the final product under such schemes is derived from clear obligations to guarantee any of the following:

specific product characteristics,
specific farming or production methods, or
a quality of the final product that goes significantly beyond the commercial commodity standards as regards public, animal or plant health, animal welfare or environmental protection;

(ii)

the scheme is open to all producers;

(iii)

the scheme involves binding product specifications and compliance with those specifications is verified by public authorities or by an independent inspection body;

(iv)

the scheme is transparent and assures complete traceability of products; or

(c)^F459voluntary agricultural product certification schemes recognised by the [^F458relevant authority^F458] as meeting the ... best practice guidelines for the operation of voluntary certification schemes relating to agricultural products and foodstuffs.

[^F454 2.Support under this measure may also cover costs arising from information and promotion activities implemented by groups of producers, concerning products covered by a quality scheme receiving support in accordance with paragraph 1 of this Article. ^F460...

^F461... ^F454]

^F4624.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5.^F466In order to take into account new [^F463statutory requirements^F463] that may affect support under this measure and in order to ensure consistency with other [^F464EU-derived domestic legislation or [^F71 assimilated direct^F71] legislation^F464] on promotion of agricultural measures and prevent distortion of competition, the [^F465appropriate authority may make regulations^F465] concerning, the specific ... schemes to be covered by point (a) of paragraph 1 and the characteristics of groups of producers and the types of actions that may receive support under paragraph 2, the setting of conditions to prevent discrimination against certain products; and the setting of conditions on the basis of which commercial brands are to be excluded from support.

Article 16 Quality schemes for agricultural products, and foodstuffs _E42

[^F467 1.Support under this measure shall cover new participation, or participation in the five preceding years, by farmers and groups of farmers, in:^F467]

(a)quality schemes established under the following Regulations and provisions:

(i)

Regulation (EU) 1151/2012 of the European Parliament and of the Council(17);

(ii)

Council Regulation (EC) No 834/2007(18);

(iii)

Regulation (EC) No 110/2008 of the European Parliament and of the Council(19);

(iv)

Council Regulation (EEC) No 1601/91(20);

(v)

Part II, Title II, Chapter I, Section 2 of Council Regulation (EU) No 1308/2013 as concerns wine.

(b)quality schemes, including farm certification schemes, for agricultural products, cotton or foodstuffs, recognised by the [^F468relevant authority^F468] as complying with the following criteria:

(i)

the specificity of the final product under such schemes is derived from clear obligations to guarantee any of the following:

specific product characteristics,
specific farming or production methods, or
a quality of the final product that goes significantly beyond the commercial commodity standards as regards public, animal or plant health, animal welfare or environmental protection;

(ii)

the scheme is open to all producers;

(iii)

the scheme involves binding product specifications and compliance with those specifications is verified by public authorities or by an independent inspection body;

(iv)

the scheme is transparent and assures complete traceability of products; or

(c)^F470voluntary agricultural product certification schemes recognised by the [^F469relevant authority^F469] as meeting the ... best practice guidelines for the operation of voluntary certification schemes relating to agricultural products and foodstuffs.

[^F467 2.Support under this measure may also cover costs arising from information and promotion activities implemented by groups of producers, concerning products covered by a quality scheme receiving support in accordance with paragraph 1 of this Article. ^F471...

^F472...^F467]

4.Support shall be limited to the maximum support rate and amount laid down in Annex II.

5.^F476In order to take into account new [^F473statutory requirements^F473] that may affect support under this measure and in order to ensure consistency with other [^F474EU-derived domestic legislation or [^F71 assimilated direct^F71] legislation^F474] on promotion of agricultural measures and prevent distortion of competition, the [^F475appropriate authority may make regulations^F475] concerning, the specific ... schemes to be covered by point (a) of paragraph 1 and the characteristics of groups of producers and the types of actions that may receive support under paragraph 2, the setting of conditions to prevent discrimination against certain products; and the setting of conditions on the basis of which commercial brands are to be excluded from support.

Article 17 Investments in physical assets _E9

1.Support under this measure shall cover tangible and/or intangible investments which:

(a)improve the overall performance and sustainability of the agricultural holding;

[^F13 (b)concern the processing, marketing and/or development of agricultural products covered by Annex I to the TFEU or cotton, except fishery products; the output of the production process may be a product not covered by that Annex; where support is provided in the form of financial instruments, the input may also be a product not covered by that Annex on condition that the investment contributes to one or more of the ^F74... priorities for rural development;^F13]

(c)concern infrastructure related to the development, modernisation or adaptation of agriculture and forestry, including access to farm and forest land, land consolidation and improvement, and the supply and saving of energy and water; or

(d)are non -productive investments linked to the achievement of agri- environment -climate objectives as pursued under this regulation, including biodiversity conservation status of species and habitat as well as enhancing the public amenity value of a Natura 2000 area or other high nature value systems to be defined in the programme.

2.Support under point (a) of paragraph 1 shall be granted to farmers or groups of farmers.

^F74In the case of investments to support farm restructuring, [^F75the relevant authority^F75] shall target the support to farms in accordance with the SWOT analysis carried out in relation to the ... priority for rural development "enhancing farm viability and competitiveness of all types of agriculture in all regions and promoting innovative farm technologies and sustainable management of forests".

3.Support under points (a) and (b) of paragraph 1 shall be limited to the maximum support rates laid down in Annex II. Those maximum rates may be increased for young farmers, for collective investments, including those linked to a merger of Producer Organisations, and for integrated projects involving support under more than one measure, for investments in areas facing natural and other specific constraints as referred to in Article 32, for investments linked to operations under Articles 28 and 29 and for operations supported in the framework of the EIP for agricultural productivity and sustainability in accordance with the support rates laid down in Annex II. However, the maximum combined support rate may not exceed 90 %.

4.Support under points (c) and (d) of paragraph 1 shall be subject to the support rates laid down in Annex II.

[^F13 5.Support may be granted to young farmers setting up for the first time in an agricultural holding as head of the holding in respect of investments to comply with ^F74... standards applying to agricultural production, including occupational safety. Such support may be provided for a maximum of 24 months 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.^F13]

6.Where [^F76the law as it applies in the constituent nation^F76] imposes new requirements on farmers support may be granted for investments to comply with those requirements for a maximum of 12 months from the date on which they become mandatory for the agricultural holding.

Article 17 Investments in physical assets _E43

1.Support under this measure[^F477 may^F477] cover tangible and/or intangible investments which:

(a)improve the overall performance and sustainability of the agricultural holding [^F478, or those involved in food processing^F478] ;

[^F479 (b)concern the processing, marketing and/or development of agricultural products covered by Annex I to the TFEU or cotton, except fishery products; the output of the production process may be a product not covered by that Annex; where support is provided in the form of financial instruments, the input may also be a product not covered by that Annex on condition that the investment contributes to one or more of the ^F480... priorities for rural development;^F479]

(c)^F481concern infrastructure related to the development, modernisation or adaptation of agriculture and forestry, including access to farm and forest land, land consolidation and improvement, and the supply and saving of energy and water; ...

(e)are investments linked to activities to protect, conserve, promote and enhance the historic environment as a resource for the general well-being of present and future generations^F482] .

2.Support under point (a) of paragraph 1 shall be granted to farmers or groups of farmers [^F483or those involved in food processing^F483] .

^F480In the case of investments to support farm restructuring, [^F484the relevant authority^F484] shall target the support to farms in accordance with the SWOT analysis carried out in relation to the ... priority for rural development "enhancing farm viability and competitiveness of all types of agriculture in all regions and promoting innovative farm technologies and sustainable management of forests".

^F4853.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F4864.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[^F479 5.Support may be granted to young farmers setting up for the first time in an agricultural holding as head of the holding in respect of investments to comply with ^F480... standards applying to agricultural production, including occupational safety. Such support may be provided for a maximum of 24 months 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.^F479]

6.Where [^F487the law as it applies in the constituent nation^F487] imposes new requirements on farmers support may be granted for investments to comply with those requirements for a maximum of 12 months from the date on which they become mandatory for the agricultural holding.

Article 18 Restoring agricultural production potential damaged by natural disasters and catastrophic events and introduction of appropriate prevention actions

1.Support under this measure shall cover:

(a)investments in preventive actions aimed at reducing the consequences of probable natural disasters, adverse climatic events and catastrophic events;

(b)investments for the restoration of agricultural land and production potential damaged by natural disasters, adverse climatic events and catastrophic events.

2.Support shall be granted to farmers or groups of farmers. Support may also be granted to public entities where a link between the investment undertaken by such entities and agricultural production potential is established.

[^X1 3.Support under point (b) of paragraph 1 shall be subject to the formal recognition by the competent public authorities ^F77... that a natural disaster has occurred and that this disaster or [^F78 requirements which apply by virtue of Council Directive 2000/29/EC^F78] (21) to eradicate or contain a plant disease or pest have caused the destruction of at least 30 % of the relevant agricultural potential.^X1]

4.No support under this measure shall be granted for loss of income resulting from the natural disaster or catastrophic event.

[^F79 The relevant authority^F79] shall ensure that overcompensation as a result of the combination of this measure and [^F80support under Regulation 508/2014 [^F81 or direct payment support^F81^,^F80]] or private insurance schemes is avoided.

[^F82 5.Support under point (a) of paragraph 1 shall be limited to the maximum support rates laid down in Annex II.^F82]

Article 19 Farm and business development _E10

1.Support under this measure shall cover:

(a)business start-up aid for:

(i)

young farmers;

(ii)

non-agricultural activities in rural areas;

(iii)

the development of small farms;

(b)investments in creation and development of non-agricultural activities;

(c) annual payments or one-off payments for farmers eligible for the small farmers scheme established by Title V of Regulation (EU) No 1307/2013 ("the small farmers scheme") who permanently transfer their holding to another farmer;

2.Support under point (a)(i) of paragraph 1 shall be granted to young farmers.

Support under point (a)(ii) of paragraph 1 shall be granted to farmers or members of a farm household who diversify into non-agricultural activities and to micro- and small- enterprises and natural persons in rural areas.

Support under point (a)(iii) of paragraph 1 shall be granted to small farms as defined by [^F83the relevant authority^F83] .

Support under point (b) of paragraph 1 shall be granted to micro- and small enterprises and natural persons in rural areas, as well as to farmers or members of a farm household.

Support under point (c) of paragraph 1 shall be granted to farmers eligible to participate in the small farmers scheme who, at the time of submitting their application for support, have been so eligible for at least one year and who undertake to permanently transfer their entire holding and the corresponding payment entitlements to another farmer. Support shall be paid from the date of the transfer until 31 December 2020 or calculated in respect of that period and paid in the form of a one-off payment.

3.Any natural or legal person or a group of natural or legal persons, whatever legal status is granted to the group and its members by national law, may be considered to be a member of a farm household, with the exception of farm workers. Where a legal person or a group of legal persons is considered to be a member of the farm household, that member must exercise an agricultural activity on the farm at the time of the support application.

[^F13 4.The application for support under point (a)(i) of paragraph 1 shall be submitted at the latest 24 months after the date of setting up.

Support under point (a) of paragraph 1 shall be conditional on the submission of a business plan. Implementation of the business plan shall start at the latest within nine months from the date of the decision granting the aid. The business plan shall have a maximum duration of five years.

The business plan shall provide that the young farmer is to comply with Article 9 of Regulation (EU) No 1307/2013, as applicable in the [^F84 relevant authority^F84] concerned, within 18 months from the date of the decision granting the aid.

[^F85 The relevant authority^F85] shall define the action(s) referred to in point (s) of Article 2(1) in the rural development programmes.

[^F85 The relevant authority^F85] shall define upper and lower thresholds per beneficiary or holding for allowing access to support under points (a)(i) and (a)(iii) of paragraph 1. The lower threshold for support under point (a)(i) of paragraph 1 shall be higher than the upper threshold for support under point (a)(iii) of paragraph 1. Support shall be limited to holdings falling within the definition of micro and small enterprises.^F13]

[^F16 4a.By way of derogation from Article 37(1) of Regulation (EU) No 1303/2013, support under point (a)(i) of paragraph 1 of this Article may also be provided in the form of financial instruments, or as a combination of grants and financial instruments.^F16]

[^F13 5.Support under point (a) of paragraph 1 shall be paid in at least two instalments. Instalments may be degressive. The payment of the last instalment under points (a)(i) and (a)(ii) of paragraph 1 shall be conditional upon the correct implementation of the business plan.^F13]

6.The maximum amount of support under point (a) of paragraph 1 is laid down in Annex II. [^F85The relevant authority^F85] shall define the amount of support under points (a)(i) and (a)(ii) of paragraph 1 also taking into account the socio-economic situation of the programme area.

7.Support under point (c) of paragraph 1 shall be equal to 120 % of the annual payment that the beneficiary is eligible to receive under the small farmers scheme.

8.^F88In order to ensure the efficient and effective use of [^F86support for rural development^F86] , the [^F87appropriate authority may make regulations^F87] laying down the minimum content of business plans and the criteria to be used ... for setting the thresholds referred to in paragraph 4 of this Article.

Article 19 Farm and business development _E44

1.Support under this measure shall cover:

(a)business start-up aid for:

(i)

young farmers;

(ii)

non-agricultural activities in rural areas;

(iii)

the development of small farms;

(b)investments in creation and development of non-agricultural activities;

^F488(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2.Support under point (a)(i) of paragraph 1 shall be granted to young farmers.

Support under point (a)(iii) of paragraph 1 shall be granted to small farms as defined by [^F489the relevant authority^F489] .

Support under point (b) of paragraph 1 shall be granted to micro- and small enterprises and natural persons in rural areas, as well as to farmers or members of a farm household.

^F490...

[^F491 4.The application for support under point (a)(i) of paragraph 1 shall be submitted at the latest 24 months after the date of setting up.

The business plan shall provide that the young farmer is to comply with Article 9 of Regulation (EU) No 1307/2013^F492... within 18 months from the date of the decision granting the aid.

[^F493 The relevant authority^F493] shall define the action(s) referred to in point (s) of Article 2(1) in the rural development programmes.

[^F493 The relevant authority^F493] shall define upper and lower thresholds per beneficiary or holding for allowing access to support under points (a)(i) and (a)(iii) of paragraph 1. The lower threshold for support under point (a)(i) of paragraph 1 shall be higher than the upper threshold for support under point (a)(iii) of paragraph 1. Support shall be limited to holdings falling within the definition of micro and small enterprises.^F491]

[^F494 4a.By way of derogation from Article 37(1) of Regulation (EU) No 1303/2013, support under point (a)(i) of paragraph 1 of this Article may also be provided in the form of financial instruments, or as a combination of grants and financial instruments.^F494]

[^F491 5.Support under point (a) of paragraph 1 shall be paid in at least two instalments. Instalments may be degressive. The payment of the last instalment under points (a)(i) and (a)(ii) of paragraph 1 shall be conditional upon the correct implementation of the business plan.^F491]

6.^F495... [^F493The relevant authority^F493] shall define the amount of support under points (a)(i) and (a)(ii) of paragraph 1 also taking into account the socio-economic situation of the programme area.

^F4967.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8.^F499In order to ensure the efficient and effective use of [^F497support for rural development^F497] , the [^F498appropriate authority may make regulations^F498] laying down the minimum content of business plans and the criteria to be used ... for setting the thresholds referred to in paragraph 4 of this Article.

Article 19 Farm and business development _E45

1.Support under this measure shall cover:

(a)business start-up aid for:

(i)

young farmers;

(ii)

non-agricultural activities in rural areas;

(iii)

the development of small farms;

(b)investments in creation and development of non-agricultural activities;

^F500(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2.Support under point (a)(i) of paragraph 1 shall be granted to young farmers.

Support under point (a)(iii) of paragraph 1 shall be granted to small farms as defined by [^F501the relevant authority^F501] .

Support under point (b) of paragraph 1 shall be granted to micro- and small enterprises and natural persons in rural areas, as well as to farmers or members of a farm household.

^F502...

[^F503 4.The application for support under point (a)(i) of paragraph 1 shall be submitted at the latest 24 months after the date of setting up.

^F504...

[^F505 The relevant authority^F505] shall define the action(s) referred to in point (s) of Article 2(1) in the rural development programmes.

[^F505 The relevant authority^F505] shall define upper and lower thresholds per beneficiary or holding for allowing access to support under points (a)(i) and (a)(iii) of paragraph 1. The lower threshold for support under point (a)(i) of paragraph 1 shall be higher than the upper threshold for support under point (a)(iii) of paragraph 1. Support shall be limited to holdings falling within the definition of micro and small enterprises.^F503]

[^F506 4a.By way of derogation from Article 37(1) of Regulation (EU) No 1303/2013, support under point (a)(i) of paragraph 1 of this Article may also be provided in the form of financial instruments, or as a combination of grants and financial instruments.^F506]

[^F503 5.Support under point (a) of paragraph 1 shall be paid in at least two instalments. Instalments may be degressive. The payment of the last instalment under points (a)(i) and (a)(ii) of paragraph 1 shall be conditional upon the correct implementation of the business plan.^F503]

6.The maximum amount of support under point (a) of paragraph 1 is laid down in Annex II. [^F505The relevant authority^F505] shall define the amount of support under points (a)(i) and (a)(ii) of paragraph 1 also taking into account the socio-economic situation of the programme area.

^F5077.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8.^F510In order to ensure the efficient and effective use of [^F508support for rural development^F508] , the [^F509appropriate authority may make regulations^F509] laying down the minimum content of business plans and the criteria to be used ... for setting the thresholds referred to in paragraph 4 of this Article.

Article 20 Basic services and village renewal in rural areas _E11

1.Support under this measure shall cover, in particular:

(a)the drawing up and updating of plans for the development of municipalities and villages in rural areas and their basic services and of protection and management plans relating to Natura 2000 sites and other areas of high nature value;

(b)investments in the creation, improvement or expansion of all types of small scale infrastructure, including investments in renewable energy and energy saving;

(c)broadband infrastructure, including its creation, improvement and expansion, passive broadband infrastructure and provision of access to broadband and public e-government solutions;

(d)investments in the setting up, improvement or expansion of local basic services for the rural population, including leisure and culture, and the related infrastructure;

(e)investments for public use in recreational infrastructure, tourist information and small scale tourism infrastructure;

(f)studies and investments associated with the maintenance, restoration and upgrading of the cultural and natural heritage of villages, rural landscapes and high nature value sites, including related socio-economic aspects, as well as environmental awareness actions;

(g)investments targeting the relocation of activities and conversion of buildings or other facilities located within or close to rural settlements, with a view to improving the quality of life or increasing the environmental performance of the settlement.

2.Support under this measure shall only concern small-scale infrastructure, as defined by each [^F89relevant authority^F89] in the programme. However, rural development programmes may provide for specific derogations from this rule for investments in broadband and renewable energy. In this case, clear criteria ensuring complementarity with support under other [^F90support under Regulation 508/2014 or direct payment support^F90] shall be provided.

3.Investments under paragraph 1 shall be eligible for support where the relevant operations are implemented in accordance with plans for the development of municipalities and villages in rural areas and their basic services, where such plans exist and shall be consistent with any relevant local development strategy.

[^F16 4.Paragraphs 2 and 3 shall not apply where support is provided in the form of financial instruments.^F16]

Article 20 Basic services and village renewal in rural areas _E46

1.Support under this measure shall cover, in particular:

(b)investments in the creation, improvement or expansion of all types of small scale infrastructure, including investments in renewable energy and energy saving;

(c)broadband infrastructure, including its creation, improvement and expansion, passive broadband infrastructure and provision of access to broadband and public e-government solutions;

(d)investments in the setting up, improvement or expansion of local basic services for the rural population, including leisure and culture, and the related infrastructure;

(e)investments for public use in recreational infrastructure, tourist information and small scale tourism infrastructure;

(g)investments targeting the relocation of activities and conversion [^F511and adaptive reuse^F511] of buildings or other facilities located within or close to rural settlements, with a view to improving the quality of life or increasing the environmental performance of the settlement;

[^F512 (h)investments in infrastructure or activities to protect, conserve, promote and enhance the historic environment as a resource for the general well-being of present and future generations.^F512]

[^F513 2.Support under this measure shall only concern small-scale infrastructure and services, as defined by each relevant authority. However, the rural development programme may provide for specific derogations from this rule for investments in broadband and renewable energy.^F513]

[^F514 4.Paragraphs 2 and 3 shall not apply where support is provided in the form of financial instruments.^F514]

Article 20 Basic services and village renewal in rural areas _E47

1.Support under this measure shall cover, in particular:

(b)investments in the creation, improvement or expansion of all types of small scale infrastructure, including investments in renewable energy and energy saving;

(c)broadband infrastructure, including its creation, improvement and expansion, passive broadband infrastructure and provision of access to broadband and public e-government solutions;

(d)investments in the setting up, improvement or expansion of local basic services for the rural population, including leisure and culture, and the related infrastructure;

(e)investments for public use in recreational infrastructure, tourist information and small scale tourism infrastructure;

2.Support under this measure shall only concern small-scale infrastructure, as defined by each [^F515relevant authority^F515] in the programme. However, rural development programmes may provide for specific derogations from this rule for investments in broadband and renewable energy. In this case, clear criteria ensuring complementarity with [^F516support under Regulation 508/2014^F516] shall be provided.

[^F517 4.Paragraphs 2 and 3 shall not apply where support is provided in the form of financial instruments.^F517]

Article 21 Investments in forest area development and improvement of the viability of forests _E12

1.Support under this measure shall concern:

(a)afforestation and creation of woodland;

(b)establishment of agroforestry systems;

(c)prevention and restoration of damage to forests from forest fires, natural disasters and catastrophic events, including pest and disease outbreaks, and climate related threats;

(d)investments improving the resilience and environmental value as well as the mitigation potential of forest ecosystems;

(e)investments in forestry technologies and in the processing, the mobilising and the marketing of forest products.

2.^F91...

For holdings above a certain size, to be determined by the [^F92relevant authority^F92] in the programme, support shall be conditional on the presentation of the relevant information from a forest management plan or equivalent instrument in line with sustainable forest management as defined by the Ministerial Conference on the Protection of Forests in Europe of 1993.

Article 21 Investments in forest area development and improvement of the viability of forests _E48

1.Support under this measure shall concern:

(a)afforestation and creation of woodland;

(b)establishment of agroforestry systems;

(c)prevention and restoration of damage to forests from forest fires, natural disasters and catastrophic events, including pest and disease outbreaks, and climate related threats;

[^F518 (d)investments in the sustainable management of woodlands;^F518]

[^F519 (e)investments which contribute to the development of a National Forest in Wales;

(f)investments improving the resilience and environmental value as well as the mitigation potential of forest ecosystems;

(g)investments in forestry technologies and in the processing, the mobility and marketing of forest products;

(h)investments to protect, conserve, promote and enhance the historic environment within forest areas.^F519]

2.^F520...

For holdings above a certain size, to be determined by the [^F521relevant authority^F521] in the programme, support shall be conditional on the presentation of the relevant information from a forest management plan or equivalent instrument in line with sustainable forest management as defined by the Ministerial Conference on the Protection of Forests in Europe of 1993.

Article 22 Afforestation and creation of woodland _E13

1.Support under point (a) of Article 21(1) shall be granted to public and private land-holders-and their associations and shall cover the costs of establishment and an annual premium per hectare to cover the costs of agricultural income foregone and maintenance, including early and late cleanings, for a maximum period of twelve years. In the case of state-owned land, support may only be granted if the body managing such land is a private body or a municipality.

Support for afforestation of land owned by public authorities or for fast growing trees shall cover only the costs of establishment.

2.Both agricultural and non-agricultural land shall be eligible. Species planted shall be adapted to the environmental and climatic conditions of the area and shall comply with minimum environmental requirements. No support shall be granted for the planting of trees for short rotation coppicing, Christmas trees or fast growing trees for energy production. In areas where afforestation is made difficult by severe pedo-climatic conditions support may be provided for planting other perennial woody species such as shrubs or bushes suitable to the local conditions.

3.In order to ensure that afforestation of agricultural land is in line with the aims of environmental policy, the [^F93appropriate authority may make regulations^F93] concerning the definition of the minimum environmental requirements referred to in paragraph 2 of this Article.

Article 22 Afforestation and creation of woodland _E49

[^F522 1.Support under point (a) of Article 21(1) shall be granted to public and private land-holders and their associations and may cover the costs of establishments (including planning costs) and an annual premium per hectare to cover the costs of agricultural income foregone and maintenance, including early and late cleanings and/or payments for the public benefits derived from woodlands for a maximum period of twelve years. In the case of state owned land, support may only be granted if the body managing such land is a private body or municipality.^F522]

3.In order to ensure that afforestation of agricultural land is in line with the aims of environmental policy, the [^F523appropriate authority may make regulations^F523] concerning the definition of the minimum environmental requirements referred to in paragraph 2 of this Article.

[^F13Article 23^F13] Establishment, regeneration or renovation of agroforestry systems _E14

[^F13 1.Support under point (b) of Article 21(1) shall be granted to private land-holders, municipalities and their associations and shall cover the costs of establishment, regeneration and/or renovation and an annual premium per hectare to cover the costs of maintenance for a maximum period of five years.^F13]

2.For the purposes of this Article, agroforestry systems means land use systems in which trees are grown in combination with agriculture on the same land. The minimum and maximum number of trees per hectare shall be determined by the [^F94relevant authority^F94] taking account of local pedo-climatic and environmental conditions, forestry species and the need to ensure sustainable agricultural use of the land.

3.Support shall be limited to the maximum support rate laid down in Annex II.

[^F524Article 23^F524] Establishment, regeneration or renovation of agroforestry systems _E50

[^F524 1.Support under point (b) of Article 21(1) shall be granted to private land-holders, municipalities and their associations and [^F525 may^F525] cover the costs of establishment, regeneration and/or renovation and an annual premium per hectare to cover the costs of maintenance [^F526 and/or payments for the public benefits derived from the woodlands^F526] .^F524]

2.For the purposes of this Article, agroforestry systems means land use systems in which trees are grown in combination with agriculture on the same land. The minimum and maximum number of trees per hectare shall be determined by the [^F527relevant authority^F527] taking account of local pedo-climatic and environmental conditions, forestry species and the need to ensure sustainable agricultural use of the land.

^F5283.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 24 Prevention and restoration of damage to forests from forest fires and natural disasters and catastrophic events

1.Support under point (c) Article 21(1) shall be granted to private and public forest- holders and other private law and public bodies and their associations and shall cover the costs for:

(a)the establishment of protective infrastructure. In the case of firebreaks, support may also cover aid contributing to maintenance costs. No support shall be granted to agricultural related activities in areas covered by agri-environment commitments;

(b)local, small scale prevention activities against fire or other natural hazards; including the use of grazing animals;

(c)establishing and improving forest fire, pest and diseases monitoring facilities and communication equipment; and

(d)restoring forest potential damaged from fires and other natural disasters including pests, diseases as well as catastrophic events and climate change related events.

2.In the case of preventive actions concerning pests and diseases, the risk of a relevant disaster occurrence must be supported by scientific evidence and acknowledged by scientific public organisations. Where relevant, the list of species of organisms harmful to plants which may cause a disaster must be provided in the programme.

Eligible operations shall be consistent with the forest protection plan established by the [^F95relevant authority^F95] . For holdings above a certain size, to be determined by the [^F95relevant authority^F95] in the programme, support shall be conditional on the presentation of the relevant information from a forest management plan or equivalent instrument in line with sustainable forest management as defined by the Ministerial Conference on the Protection of Forests in Europe of 1993 detailing the preventive objectives.

Forest areas classified as medium to high forest fire risk according to the forest protection plan established by the [^F95relevant authority^F95] shall be eligible for support relating to forest fire prevention.

3.Support under point (d) of paragraph 1 shall be subject to the formal recognition by the competent public authorities of [^F96the relevant authority^F96] that a natural disaster has occurred and that that disaster, or [^F97requirements which apply as a consequence of the implementation of Council Directive 2000/29/EC^F97] to eradicate or contain a plant disease or pest has caused the destruction of at least 20 % of the relevant forest potential.

4.No support under this measure shall be granted for loss of income resulting from the natural disaster.

^F99[^F98 The relevant authority^F98] shall ensure that overcompensation as a result of the combination of this measure and other ... support instruments or private insurance schemes is avoided.

Article 25 Investments improving the resilience and environmental value of forest ecosystems _E15

1.Support under point (d) of Article 21(1) shall be granted to natural persons, private and public forest-holders, and other private law and public bodies and their associations.

2.Investments shall be aimed at the achievement of commitments for environmental aims, for the provision of ecosystem services and/or for the enhancement of the public amenity value of forest and wooded land in the area concerned or the improvement of the climate change mitigation potential of ecosystems, without excluding economic benefits in the long term.

Article 25 Investments improving the resilience and environmental value of forest ecosystems _E51

1.Support under point (d) of Article 21(1) shall be granted to natural persons, private and public forest-holders, and other private law and public bodies and their associations.

2.Investments shall be aimed at the achievement of commitments for environmental aims, for the provision of ecosystem services and/or for the enhancement of the [^F529historic environment and the^F529] historic environment and the public amenity value of forest and wooded land in the area concerned or the improvement of the climate change mitigation potential of ecosystems, without excluding economic benefits in the long term.

Article 26 Investments in forestry technologies and in processing, in mobilising and in the marketing of forest products _E16

[^X1 1.Support under point (e) of Article 21(1) shall be granted to private forest- holders, municipalities and their associations and to SMEs for investments enhancing forestry potential or relating to processing, mobilising and marketing adding value to forest products. ^F100...^X1]

2.Investments related to the improvement of the economic value of forests shall be justified in relation to expected improvements to forests on one or more holdings and may include investments for soil-friendly and resource -friendly harvesting machinery and practices.

3.Investments related to the use of wood as a raw material or energy source shall be limited to all working operations prior to industrial processing.

4.Support shall be limited to the maximum support rates laid down in Annex II.

Article 26 Investments in forestry technologies and in processing, in mobilising and in the marketing of forest products _E52

[^X4 1.Support under point (e) of Article 21(1) shall be granted to private forest- holders, municipalities and their associations ^F530... for investments enhancing forestry potential or relating to processing, mobilising and marketing adding value to forest products. ^F531...^X4]

^F5323.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F5334.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 27 Setting -up of producer groups and organisations _E17

1.Support under this measure shall be granted in order to facilitate the setting up of producer groups and organisations in the agriculture and forestry sectors for the purpose of:

(a)adapting the production and output of producers who are members of such groups or organisations to market requirements;

(b)jointly placing goods on the market, including preparation for sale, centralisation of sales and supply to bulk buyers;

(c)establishing common rules on production information, with particular regard to harvesting and availability; and

(d)other activities that may be carried out by producer groups and organisations, such as the development of business and marketing skills and the organisation and facilitation of the innovation processes.

2.Support shall be granted to producer groups and organisations which are officially recognised by [^F101the^F101] competent authority on the basis of a business plan. It shall be limited to producer groups and organisations that are SMEs.

[^F102 The relevant authority^F102] shall verify that the objectives of the business plan have been reached within five years after recognition of the producer group or organisation.

3.The support shall be paid on the basis of a business plan as a flat rate aid in annual instalments for no more than five years following the date on which the producer group or organisation was recognised, and shall be degressive. It shall be calculated on the basis of the annual marketed production of the group or organisation. [^F103The relevant authority^F103] shall pay the last instalment only after having verified the correct implementation of the business plan.

In the first year [^F103the relevant authority^F103] may pay support to the producer group or organisation calculated on the basis of the average annual value of the marketed production of its members over the three years before they entered the group or organisation. In the case of producer groups and organisations in the forestry sector, support shall be calculated on the basis of the average marketed production of the members of the group or organisation over the last five years before the recognition, excluding the highest and the lowest value.

4.Support shall be limited to the maximum rates and amounts laid down in Annex II.

5.[^F104 The relevant authority^F104] may continue support for setting up of producer groups even after they have been recognised as producer organisations under the conditions of Regulation (EU) No 1308/2013(22).

Article 27 Setting -up of producer groups and organisations _E53

1.Support under this measure[^F534 may^F534] be granted in order to facilitate the setting up of producer groups and organisations in the agriculture [^F535, food processing^F535] and forestry sectors for the purpose of:

(a)adapting the production and output of producers who are members of such groups or organisations to market requirements;

(b)jointly placing goods on the market, including preparation for sale, centralisation of sales and supply to bulk buyers;

(c)establishing common rules on production information, with particular regard to harvesting and availability; and

2.^F537Support shall be granted to producer groups and organisations which are officially recognised by [^F536the^F536] competent authority on the basis of a business plan. ...

[^F538 The relevant authority^F538] shall verify that the objectives of the business plan have been reached within five years after recognition of the producer group or organisation.

3.The support shall be paid on the basis of a business plan as a flat rate aid in annual instalments for no more than five years following the date on which the producer group or organisation was recognised, and shall be degressive. It shall be calculated on the basis of the annual marketed production of the group or organisation. [^F539The relevant authority^F539] shall pay the last instalment only after having verified the correct implementation of the business plan.

In the first year [^F539the relevant authority^F539] may pay support to the producer group or organisation calculated on the basis of the average annual value of the marketed production of its members over the three years before they entered the group or organisation. In the case of producer groups and organisations in the forestry sector, support shall be calculated on the basis of the average marketed production of the members of the group or organisation over the last five years before the recognition, excluding the highest and the lowest value.

^F5404.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5.[^F541 The relevant authority^F541] may continue support for setting up of producer groups even after they have been recognised as producer organisations under the conditions of Regulation (EU) No 1308/2013(22).

Article 28 Agri-environment-climate _E18

1.[^F105 The relevant authority^F105] shall make support under this measure available throughout their territories, in accordance with their national, regional or local specific needs and priorities. This measure shall aim to preserve and promote the necessary changes to agricultural practices that make a positive contribution to the environment and climate. Its inclusion in rural development programmes shall be compulsory at national and/or regional level.

2.Agri-environment-climate payments shall be granted to farmers, groups of farmers or groups of farmers and other land-managers who undertake, on a voluntary basis, to carry out operations consisting of one or more agri-environment-climate commitments on agricultural land to be defined by [^F106the relevant authority^F106] , including but not limited to the agricultural area defined under Article 2 of this Regulation. Where duly justified to achieve environmental objectives, agri-environment-climate payments may be granted to other land-managers or groups of other land-managers.

3.^F107Agri-environment-climate payments cover only those commitments going beyond ... the relevant criteria and minimum activities as established pursuant to [^F108points (b)(ii) and (b)(iii) of Article 2(1) of Regulation (EU) 1306/2013^F108] , and relevant minimum requirements for fertiliser and plant protection products use as well as other relevant mandatory requirements established by national law. All such mandatory requirements shall be identified in the programme.

4.[^F109 The relevant authority^F109] shall endeavour to ensure that persons undertaking to carry out operations under this measure are provided with the knowledge and information required to implement such operations. They may do so through, inter alia, commitment-related expert advice and/or by making support under this measure conditional on obtaining relevant training.

5.Commitments under this measure shall be [^F110ordinarily undertaken for at least three years. However, a commitment for a shorter period may be permitted where this is necessary and justified, and commitments may be extended after the termination of the period^F110] .

6.Payments shall be granted annually and shall compensate beneficiaries for all or part of the additional costs and income foregone resulting from the commitments made. Where necessary, they may also cover transaction costs up to a value of 20 % of the premium paid for the agri-environment-climate commitments. Where commitments are undertaken by groups of farmers or groups of farmers and other land managers, the maximum level shall be 30 %.

^F111...

In duly justified cases for operations concerning environmental conservation, support may be granted at a flat-rate or as a one-off payment per unit for commitments to renounce commercial use of areas, calculated on the basis of additional costs incurred and income foregone.

7.Where required in order to ensure the efficient application of the measure, [^F106the relevant authority^F106] may use the procedure referred to in Article 49(3) for the selection of beneficiaries.

8.Support shall be limited to the maximum amounts laid down in Annex II.

No support under this measure may be granted for commitments that are covered under the organic farming measure.

[^F13 9.Support may be provided for the conservation and for the sustainable use and development of genetic resources in agriculture, including non-indigenous resources, for operations not covered by the provisions under paragraphs 1 to 8. Such commitments may be carried out by beneficiaries other than those referred to in paragraph 2.^F13]

10.^F112In order to ensure that agri-environment-climate commitments are defined in accordance with the ... priorities for rural development, the [^F113appropriate authority may make regulations^F113] concerning the following:

(a)the conditions applicable to commitments to extensify livestock farming;

(b)the conditions applicable to commitments to rear local breeds that are in danger of being lost to farming or to preserve plant genetic resources that are under threat of genetic erosion, and

(c)the definition of eligible operations under paragraph 9.

^F11411.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 28 Agri-environment-climate _E54

1.^F544^,^F546[^F542 The relevant authority^F542] shall make support under this measure available throughout [^F543Wales^F543] , in accordance with ... national, regional or local specific needs and priorities. This measure shall aim to preserve and promote the necessary changes to agricultural practices that make a positive contribution to the environment and climate. Its inclusion in [^F545the rural development programme^F545] shall be compulsory ....

2.Agri-environment-climate payments shall be granted to farmers, groups of farmers or groups of farmers and other land-managers who undertake, on a voluntary basis, to carry out operations consisting of one or more agri-environment-climate commitments on agricultural land to be defined by [^F547the relevant authority^F547] , including but not limited to the agricultural area defined under Article 2 of this Regulation. Where duly justified to achieve environmental objectives, agri-environment-climate payments may be granted to other land-managers or groups of other land-managers.

3.Agri-environment-climate payments cover only those commitments going beyond the relevant mandatory standards established pursuant to Chapter I of Title VI of Regulation (EU) No 1306/2013, the relevant criteria and minimum activities as established pursuant to points (c)(ii) and (c)(iii) of Article 4(1) of Regulation (EU) No 1307/2013, and relevant minimum requirements for fertiliser and plant protection products use as well as other relevant mandatory requirements established by national law. All such mandatory requirements shall be identified in the programme.

4.[^F548 The relevant authority^F548] shall endeavour to ensure that persons undertaking to carry out operations under this measure are provided with the knowledge and information required to implement such operations. They may do so through, inter alia, commitment-related expert advice and/or by making support under this measure conditional on obtaining relevant training.

5.Commitments under this measure shall be undertaken for a period of five to seven years. However, where necessary in order to achieve or maintain the environmental benefits sought, [^F547the relevant authority^F547] may determine a longer period in [^F549the rural development programme^F549] for particular types of commitments, including by means of providing for their annual extension after the termination of the initial period. For new commitments directly following the commitment performed in the initial period, [^F547the relevant authority^F547] may determine a shorter period in [^F549the rural development programme^F549] .

^F550...

^F551...

7.Where required in order to ensure the efficient application of the measure, [^F547the relevant authority^F547] may use the procedure referred to in Article 49(3) for the selection of beneficiaries.

8.^F552...

No support under this measure may be granted for commitments that are covered under the organic farming measure.

[^F553 9.Support may be provided for the conservation and for the sustainable use and development of genetic resources in agriculture, including non-indigenous resources, for operations not covered by the provisions under paragraphs 1 to 8. Such commitments may be carried out by beneficiaries other than those referred to in paragraph 2.^F553]

10.^F554In order to ensure that agri-environment-climate commitments are defined in accordance with the ... priorities for rural development, the [^F555appropriate authority may make regulations^F555] concerning the following:

(a)the conditions applicable to commitments to extensify livestock farming;

(b)the conditions applicable to commitments to rear local breeds that are in danger of being lost to farming or to preserve plant genetic resources that are under threat of genetic erosion, and

(c)the definition of eligible operations under paragraph 9.

^F55611.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 28 Agri-environment-climate _E55

1.[^F557 The relevant authority^F557] shall make support under this measure available throughout their territories, in accordance with their national, regional or local specific needs and priorities. This measure shall aim to preserve and promote the necessary changes to agricultural practices that make a positive contribution to the environment and climate. Its inclusion in rural development programmes shall be compulsory at national and/or regional level.

2.Agri-environment-climate payments shall be granted to farmers, groups of farmers or groups of farmers and other land-managers who undertake, on a voluntary basis, to carry out operations consisting of one or more agri-environment-climate commitments on agricultural land to be defined by [^F558the relevant authority^F558] , including but not limited to the agricultural area defined under Article 2 of this Regulation. Where duly justified to achieve environmental objectives, agri-environment-climate payments may be granted to other land-managers or groups of other land-managers.

4.[^F559 The relevant authority^F559] shall endeavour to ensure that persons undertaking to carry out operations under this measure are provided with the knowledge and information required to implement such operations. They may do so through, inter alia, commitment-related expert advice and/or by making support under this measure conditional on obtaining relevant training.

[^F560 5.Commitments under this measure shall be undertaken for a period of [^F561 one^F561] to seven years. However, where necessary in order to achieve or maintain the environmental benefits sought, [^F558 the relevant authority^F558] may determine a longer period in their rural development programmes for particular types of commitments, including by means of providing for their annual extension after the termination of the initial period. For new commitments directly following the commitment performed in the initial period, [^F558 the relevant authority^F558] may determine a shorter period in their rural development programmes.

^F562...^F560]

[^F560 5.Commitments under this measure shall be for up to seven years.^F560]

[^F563 When calculating the payments referred to in the first subparagraph, [^F558 the relevant authority^F558] shall deduct the amount necessary in order to exclude double funding of the practices referred to in Article 43 of Regulation (EU) No 1307/2013. [^F564 The relevant authority^F564] may calculate the deduction as a fixed, average amount applied to all beneficiaries concerned carrying out the type of operation concerned.^F563]

7.Where required in order to ensure the efficient application of the measure, [^F558the relevant authority^F558] may use the procedure referred to in Article 49(3) for the selection of beneficiaries.

8.Support shall be limited to the maximum amounts laid down in Annex II.

No support under this measure may be granted for commitments that are covered under the organic farming measure.

[^F563 9.Support may be provided for the conservation and for the sustainable use and development of genetic resources in agriculture, including non-indigenous resources, for operations not covered by the provisions under paragraphs 1 to 8. Such commitments may be carried out by beneficiaries other than those referred to in paragraph 2.^F563]

[^F565 10.In order to ensure that agri-environment-climate commitments are defined in accordance with the ^F566... priorities for rural development, the [^F567 appropriate authority may make regulations^F567] concerning the following:

(a)the conditions applicable to commitments to extensify livestock farming;

(b)the conditions applicable to commitments to rear local breeds that are in danger of being lost to farming or to preserve plant genetic resources that are under threat of genetic erosion, and

(c)the definition of eligible operations under paragraph 9.^F565]

[^F565 10. (1) The appropriate authority may make regulations to provide support in accordance with paragraph 1.

(2)The appropriate authority, in order to ensure that agri-environment-climate commitments are defined in accordance with the priorities for rural development, may make regulations concerning the following:

(a)the conditions applicable to commitments to extensify livestock farming;

(b)the conditions applicable to commitments to rear local breeds that are in danger of being lost to farming or to preserve plant genetic resources that are under threat of genetic erosion;

(c)the definition of eligible operations under paragraph 9; and

(d)the conditions applicable to commitments to make a positive contribution to the sustainability of the environment.^F565]

[^X5 11.In order to ensure that double funding, as referred to in the second subparagraph of paragraph 6 is excluded, the [^F568 appropriate authority may make regulations^F568] laying down the calculation method to be used, including in the case of equivalent measures under Article 43 of Regulation (EU) No 1307/2013.^X5]

Article 29 Organic farming _E19

[^F13 1.Support under this measure shall be granted, per hectare of agricultural area, to farmers or groups of farmers who undertake, on a voluntary basis, to convert to or maintain organic farming practices and methods as defined in Regulation (EC) No 834/2007 and who are active farmers within the meaning of Article 9 of Regulation (EU) No 1307/2013, as applicable in the [^F115 relevant authority^F115] concerned.^F13]

[^X1 2.Support shall only be granted for commitments going beyond the relevant mandatory standards established pursuant to Chapter I of Title VI of Regulation (EU) No 1306/2013, the relevant criteria and minimum activities as established pursuant to points (c)(ii) and (c)(iii) of Article 4(1) of Regulation (EU) No 1307/2013, relevant minimum requirements for fertiliser and plant protection products use as well as other relevant mandatory requirements established by national law. All such requirements shall be identified in the programme.^X1]

3.Commitments under this measure shall be made for a period of [^F116five^F116][^F116 one^F116] to seven years. Where support is granted for conversion to organic farming [^F117the relevant authority^F117] may determine a shorter initial period corresponding to the period of conversion. Where support is granted for the maintenance of organic farming, [^F117the relevant authority^F117] may provide in their rural development programmes for annual extension after the termination of the initial period. For new commitments concerning maintenance that directly follow the commitment performed in the initial period, [^F117the relevant authority^F117] may determine a shorter period in their rural development programmes.

^F118...

4.Payments shall be granted annually and shall compensate beneficiaries for all or part of the additional costs and income foregone resulting from the commitments made. Where necessary they may also cover transaction costs to a value of up to 20 % of the premium paid for the commitments. Where commitments are undertaken by groups of farmers, the maximum level shall be 30 %.

[^F13 When calculating the payments referred to in the first subparagraph of this paragraph, [^F117 the relevant authority^F117] shall deduct the amount necessary in order to exclude double funding of the practices referred to in Article 43 of Regulation (EU) No 1307/2013. [^F119 The relevant authority^F119] may calculate the deduction as a fixed, average amount applied to all beneficiaries concerned carrying out the sub-measures concerned.^F13]

5.Support shall be limited to the maximum amounts laid down in Annex II.

6.In order to ensure that double funding, as referred to in the second subparagraph of paragraph 4 is excluded, the [^F120appropriate authority may make regulations^F120] laying down the calculation method to be used.

Article 29 Organic farming _E56

[^F569 1.Support under this measure shall be granted, per hectare of agricultural area, to farmers or groups of farmers who undertake, on a voluntary basis, to convert to or maintain organic farming practices and methods as defined in Regulation (EC) No 834/2007 ^F570....^F569]

[^X6 2.Support shall only be granted for commitments going beyond the relevant mandatory standards established pursuant to Chapter I of Title VI of Regulation (EU) No 1306/2013, the relevant criteria and minimum activities as established pursuant to points (c)(ii) and (c)(iii) of Article 4(1) of Regulation (EU) No 1307/2013, relevant minimum requirements for fertiliser and plant protection products use as well as other relevant mandatory requirements established by national law. All such requirements shall be identified in the programme.^X6]

3.Commitments under this measure shall be made for a period of five to seven years. Where support is granted for conversion to organic farming [^F571the relevant authority^F571] may determine a shorter initial period corresponding to the period of conversion. Where support is granted for the maintenance of organic farming, [^F571the relevant authority^F571] may provide in [^F572the rural development programme^F572] for annual extension after the termination of the initial period. For new commitments concerning maintenance that directly follow the commitment performed in the initial period, [^F571the relevant authority^F571] may determine a shorter period in [^F572the rural development programme^F572] .

[^F573 For new commitments to be undertaken from 2021, [^F571 the relevant authority^F571] shall determine a shorter period of one to three years in [^F572 the rural development programme^F572] .

If [^F571 the relevant authority^F571] provide for an annual extension for the maintenance of organic farming after the termination of the initial period in accordance with the first subparagraph, from 2022 the extension shall not go beyond one year.

By way of derogation from the second subparagraph, for new commitments to be undertaken in 2021 and 2022, where support is granted for conversion to organic farming, [^F571 the relevant authority^F571] may determine a period of longer than three years in [^F572 the rural development programme^F572] .^F573]

^F574...

^F5755.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F5766.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 29 Organic farming _E57

[^F577 1.Support under this measure shall be granted, per hectare of agricultural area, to farmers or groups of farmers who undertake, on a voluntary basis, to convert to or maintain organic farming practices and methods as defined in Regulation (EC) No 834/2007 ^F578....^F577]

[^X7 2.Support shall only be granted for commitments going beyond ^F579... the relevant criteria and minimum activities as established pursuant to [^F580 points (b)(ii) and (b)(iii) of Article 2(1) of Regulation (EU) 1306/2013^F580] , relevant minimum requirements for fertiliser and plant protection products use as well as other relevant mandatory requirements established by national law. All such requirements shall be identified in the programme.^X7]

3.^F583^,^F583Commitments under this measure shall [^F581ordinarily be made for at least three years. However, a commitment for a shorter period may be permitted where this is necessary and justified^F581] . Where support is granted for conversion to organic farming [^F582the relevant authority^F582] may determine a shorter initial period corresponding to the period of conversion. Where support is granted for the maintenance of organic farming, [^F582the relevant authority^F582] may provide ... for [^F584their^F584] extension after the termination of the initial period. For new commitments concerning maintenance that directly follow the commitment performed in the initial period, [^F582the relevant authority^F582] may determine a shorter period ....

^F585...

^F586...

5.Support shall be limited to the maximum amounts laid down in Annex II.

^F5876.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 30 Natura 2000 and Water Framework Directive payments _E20

1.Support under this measure shall be granted annually per hectare of agricultural area or per hectare of forest in order to compensate beneficiaries for additional costs and income foregone resulting from disadvantages in the areas concerned, related to [^F121requirements on beneficiaries which apply as a consequence of the implementation of Directives 92/43/EEC and 2009/147/EC and the Water Framework Directive^F121] .

[^F13 When calculating the payments related to the support referred to in the first subparagraph, [^F122 the relevant authority^F122] shall deduct the amount necessary in order to exclude double funding of the practices referred to in Article 43 of Regulation (EU) No 1307/2013. [^F123 The relevant authority^F123] may calculate the deduction as a fixed, average amount applied to all beneficiaries concerned carrying out the sub-measures concerned.^F13]

2.Support shall be granted to farmers and to private forest holders and associations of private forest holders. In duly justified cases it may also be granted to other land managers.

[^X1 3.Support to farmers, linked to Directives 92/43/EEC and 2009/147/EC shall only be granted in relation to disadvantages resulting from requirements that go beyond the good agricultural and environmental condition provided for in Article 94 and Annex II of Council Regulation (EU) No 1306/2013 and the relevant criteria and minimum activities established pursuant to points (c)(ii) and (c)(iii) of Article 4(1) of Regulation (EU) No 1307/2013.^X1]

4.Support to farmers, linked to the Water Framework Directive shall only be granted in relation to specific requirements that:

(a)were introduced by the Water Framework Directive, are in accordance with the programmes of measures of the river basin management plans for the purpose of achieving the environmental objectives of that Directive and go beyond the measures required to implement other [^F124law as it applies in the constituent nation^F124] for the protection of water;

(b)go beyond the statutory management requirements and the good agricultural and environmental condition provided for in Chapter I of Title VI of Regulation (EU) No 1306/2013 and the relevant criteria and minimum activities as established pursuant to points (c)(ii) and (c)(iii) of Article 4(1) of Regulation (EU) No 1307/2013;

(c)^F126go beyond the level of protection of the [^F125law as it applied in the constituent nation^F125] existing at the time the Water Framework Directive was adopted ... ; and

(d)impose major changes in type of land use, and/or major restrictions in farming practice resulting in a significant loss of income.

5.The requirements referred to in paragraphs 3 and 4 shall be identified in the programme.

6.The following areas shall be eligible for payments:

(a)Natura 2000 agricultural and forest areas designated pursuant to Directives 92/43/EEC and 2009/147/EC;

(b)other delimited nature protection areas with environmental restrictions applicable to farming or forests which contribute to the implementation of Article 10 of Directive 92/43/EEC, provided that, per rural development programme, those areas do not exceed 5 % of the designated Natura 2000 areas covered by its territorial scope;

(c)agricultural areas included in river basin management plans according to the Water Framework Directive.

7.Support shall be limited to the maximum amounts laid down in Annex II.

8.In order to ensure that double funding, as referred to in the second subparagraph of paragraph 1 is excluded, the [^F127appropriate authority may make regulations^F127] laying down the calculation method to be used.

Article 30 Natura 2000 and Water Framework Directive payments _E58

1.Support under this measure shall be granted annually per hectare of agricultural area or per hectare of forest in order to compensate beneficiaries for additional costs and income foregone resulting from disadvantages in the areas concerned, related to [^F588requirements on beneficiaries which apply as a consequence of the implementation of Directives 92/43/EEC and 2009/147/EC and the Water Framework Directive^F588] .

^F589...

2.Support shall be granted to farmers and to private forest holders and associations of private forest holders. In duly justified cases it may also be granted to other land managers.

[^X8 3.Support to farmers, linked to Directives 92/43/EEC and 2009/147/EC shall only be granted in relation to disadvantages resulting from requirements that go beyond the good agricultural and environmental condition provided for in Article 94 and Annex II of Council Regulation (EU) No 1306/2013 and the relevant criteria and minimum activities established pursuant to points (c)(ii) and (c)(iii) of Article 4(1) of Regulation (EU) No 1307/2013.^X8]

4.Support to farmers, linked to the Water Framework Directive shall only be granted in relation to specific requirements that:

(c)^F593^,^F594go beyond the level of protection of the [^F592law^F592] ... at the time the Water Framework Directive was adopted ... ; and

(d)impose major changes in type of land use, and/or major restrictions in farming practice resulting in a significant loss of income.

5.The requirements referred to in paragraphs 3 and 4 shall be identified in the programme.

6.The following areas shall be eligible for payments:

(a)Natura 2000 agricultural and forest areas designated pursuant to Directives 92/43/EEC and 2009/147/EC;

(c)agricultural areas included in river basin management plans according to the Water Framework Directive.

^F5957.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F5968.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 30 Natura 2000 and Water Framework Directive payments _E59

1.Support under this measure shall be granted annually per hectare of agricultural area or per hectare of forest in order to compensate beneficiaries for additional costs and income foregone resulting from disadvantages in the areas concerned, related to [^F597requirements on beneficiaries which apply as a consequence of the implementation of Directives 92/43/EEC and 2009/147/EC and the Water Framework Directive^F597] .

^F598...

2.Support shall be granted to farmers and to private forest holders and associations of private forest holders. In duly justified cases it may also be granted to other land managers.

[^X9 3.Support to farmers, linked to Directives 92/43/EEC and 2009/147/EC shall only be granted in relation to disadvantages resulting from requirements that go beyond the good agricultural and environmental condition provided for in Article 94 and Annex II of Council Regulation (EU) No 1306/2013 and the relevant criteria and minimum activities established pursuant to [^F599 points (b)(ii) and (b)(iii) of Article 2(1) of Regulation (EU) 1306/2013^F599] .^X9]

4.Support to farmers, linked to the Water Framework Directive shall only be granted in relation to specific requirements that:

(a)were introduced by the Water Framework Directive, are in accordance with the programmes of measures of the river basin management plans for the purpose of achieving the environmental objectives of that Directive and go beyond the measures required to implement other [^F600law as it applies in the constituent nation^F600] for the protection of water;

(b)^F601go beyond ... the relevant criteria and minimum activities as established pursuant to [^F602points (b)(ii) and (b)(iii) of Article 2(1) of Regulation (EU) 1306/2013^F602] ;

(c)^F604go beyond the level of protection of the [^F603law as it applied in the constituent nation^F603] existing at the time the Water Framework Directive was adopted ... ; and

(d)impose major changes in type of land use, and/or major restrictions in farming practice resulting in a significant loss of income.

5.The requirements referred to in paragraphs 3 and 4 shall be identified in the programme.

6.The following areas shall be eligible for payments:

(a)Natura 2000 agricultural and forest areas designated pursuant to Directives 92/43/EEC and 2009/147/EC;

(c)agricultural areas included in river basin management plans according to the Water Framework Directive.

7.Support shall be limited to the maximum amounts laid down in Annex II.

8.In order to ensure that double funding, as referred to in the second subparagraph of paragraph 1 is excluded, the [^F605appropriate authority may make regulations^F605] laying down the calculation method to be used.

Article 31 Payments to areas facing natural or other specific constraints _E21

1.Payments to farmers in mountain areas and other areas facing natural or other specific constraints shall be granted annually per hectare of agricultural area in order to compensate farmers for all or part of the additional costs and income foregone related to the constraints for agricultural production in the area concerned.

[^X1 Additional costs and income foregone shall be calculated in comparison to areas which are not affected by natural or other specific constraints^F128....^X1]

When calculating additional costs and income foregone, [^F129the relevant authority^F129] may, where duly justified, differentiate the level of payment taking into account:

the severity of the identified permanent constraint affecting farming activities;
the farming system.

[^F13 2.Payments shall be granted to farmers who undertake to pursue their farming activity in the areas designated pursuant to Article 32 ^F130... .^F13]

3.Payments shall be fixed between the minimum and maximum amount laid down in Annex II. These payments may be increased in duly substantiated cases taking into account specific circumstances to be justified in the rural development programmes.

4.[^F131 The relevant authority^F131] shall provide for degressivity of payments above a threshold level of area per holding, to be defined in the programme, except if the grant covers only the minimum payment per hectare per year as laid down in Annex II.

In the case of a legal person, or a group of natural or legal persons, [^F132the relevant authority^F132] may apply the degressivity of payments at the level of the members of these legal persons or groups on condition that:

(a)[^F133 the law as it applies in the constituent nation^F133] provides for the individual members to assume rights and obligations comparable to those of individual farmers who have the status of head of holding, in particular as regards their economic, social and tax status; and

(b)those individual members have contributed to strengthening the agricultural structures of the legal persons or groups concerned.

[^F13 5.In addition to the payments provided for in paragraph 2, [^F134 the relevant authority^F134] may grant payments under this measure between 2014 and 2020 to beneficiaries in areas which were eligible under Article 36(a)(ii) of Regulation (EC) No 1698/2005 during the 2007-2013 programming period. For beneficiaries in areas that are no longer eligible following the new delimitation referred to in Article 32(3), those payments shall be degressive over a maximum period of four years. That period shall start on the date that the delimitation in accordance with Article 32(3) is completed and at the latest in 2019. Those payments shall start at no more than 80 % of the average payment fixed in the programme for the programming period 2007-2013 in accordance with Article 36(a)(ii) of Regulation (EC) No 1698/2005, and shall end in 2020 at the latest at no more than 20 %. When the application of degressivity results in the level of the payment reaching EUR 25, the [^F135 relevant authority^F135] can continue payments at this level until the phasing out period is completed.^F13]

[^F136 By way of derogation from the first subparagraph, where degressive payments start only in the year 2019, those payments shall start at no more than 80% of the average payment fixed in the 2014-2020 programming period. The payment level shall be established in such a way that the end-level in 2020 is half the starting level.^F136]

Following completion of the delimitation, beneficiaries in the areas that remain eligible shall receive full payment under this measure.

^F1376.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 31 Payments to areas facing natural or other specific constraints _E60

[^X10 Additional costs and income foregone shall be calculated in comparison to areas which are not affected by natural or other specific constraints, taking into account payments pursuant to Chapter 4 of Title III of Regulation (EU) No 1307/2013.^X10]

When calculating additional costs and income foregone, [^F606the relevant authority^F606] may, where duly justified, differentiate the level of payment taking into account:

the severity of the identified permanent constraint affecting farming activities;
the farming system.

[^F607 2.Payments shall be granted to farmers who undertake to pursue their farming activity in the areas designated pursuant to Article 32 and are active farmers within the meaning of Article 9 of Regulation (EU) No 1307/2013 ^F608... .^F607]

4.[^F609 The relevant authority^F609] shall provide for degressivity of payments above a threshold level of area per holding, to be defined in the programme, except if the grant covers only the minimum payment per hectare per year as laid down in Annex II.

In the case of a legal person, or a group of natural or legal persons, [^F610the relevant authority^F610] may apply the degressivity of payments at the level of the members of these legal persons or groups on condition that:

(a)[^F611 the law as it applies in the constituent nation^F611] provides for the individual members to assume rights and obligations comparable to those of individual farmers who have the status of head of holding, in particular as regards their economic, social and tax status; and

(b)those individual members have contributed to strengthening the agricultural structures of the legal persons or groups concerned.

[^F612 5.In addition to the payments provided for in paragraph 2, the relevant authority may grant payments under this measure between 2014 and [^F613 2030^F613] to beneficiaries in areas which were eligible under Article 36(a)(ii) of Regulation (EC) No 1698/2005 during the 2007-2013 programming period.^F612]

^F6146.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 31 Payments to areas facing natural or other specific constraints _E61

[^X11 Additional costs and income foregone shall be calculated in comparison to areas which are not affected by natural or other specific constraints^F615....^X11]

When calculating additional costs and income foregone, [^F616the relevant authority^F616] may, where duly justified, differentiate the level of payment taking into account:

the severity of the identified permanent constraint affecting farming activities;
the farming system.

[^F617 2.Payments shall be granted to farmers who undertake to pursue their farming activity in the areas designated pursuant to Article 32 ^F618...^F619... .^F617]

^F6203.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4.^F622[^F621 The relevant authority^F621] shall provide for degressivity of payments above a threshold level of area per holding, to be defined in the programme....

In the case of a legal person, or a group of natural or legal persons, [^F623the relevant authority^F623] may apply the degressivity of payments at the level of the members of these legal persons or groups on condition that:

(a)[^F624 the law ^F625...^F624] provides for the individual members to assume rights and obligations comparable to those of individual farmers who have the status of head of holding, in particular as regards their economic, social and tax status; and

(b)those individual members have contributed to strengthening the agricultural structures of the legal persons or groups concerned.

^F6265.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

^F6276.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 31 Payments to areas facing natural or other specific constraints _E62

[^X12 Additional costs and income foregone shall be calculated in comparison to areas which are not affected by natural or other specific constraints, taking into account payments pursuant to Chapter 4 of Title III of Regulation (EU) No 1307/2013.^X12]

When calculating additional costs and income foregone, [^F628the relevant authority^F628] may, where duly justified, differentiate the level of payment taking into account:

the severity of the identified permanent constraint affecting farming activities;
the farming system.

[^F629 2.Payments shall be granted to farmers who undertake to pursue their farming activity in the areas designated pursuant to Article 32 and are active farmers within the meaning of Article 9 of Regulation (EU) No 1307/2013 ^F630... .^F629]

4.[^F631 The relevant authority^F631] shall provide for degressivity of payments above a threshold level of area per holding, to be defined in the programme, except if the grant covers only the minimum payment per hectare per year as laid down in Annex II.

In the case of a legal person, or a group of natural or legal persons, [^F632the relevant authority^F632] may apply the degressivity of payments at the level of the members of these legal persons or groups on condition that:

(a)[^F633 the law as it applies in the constituent nation^F633] provides for the individual members to assume rights and obligations comparable to those of individual farmers who have the status of head of holding, in particular as regards their economic, social and tax status; and

(b)those individual members have contributed to strengthening the agricultural structures of the legal persons or groups concerned.

[^F629 5.In addition to the payments provided for in paragraph 2, [^F634 the relevant authority^F634] may grant payments under this measure between 2014 and 2020 to beneficiaries in areas which were eligible under Article 36(a)(ii) of Regulation (EC) No 1698/2005 during the 2007-2013 programming period. For beneficiaries in areas that are no longer eligible following the new delimitation referred to in Article 32(3), those payments shall be degressive over a maximum period of four years. That period shall start on the date that the delimitation in accordance with Article 32(3) is completed and at the latest in 2019. Those payments shall start at no more than 80 % of the average payment fixed in the programme for the programming period 2007-2013 in accordance with Article 36(a)(ii) of Regulation (EC) No 1698/2005, and shall end in 2020 at the latest at no more than 20 %. When the application of degressivity results in the level of the payment reaching EUR 25, the [^F635 relevant authority^F635] can continue payments at this level until the phasing out period is completed.^F629]

[^F636 By way of derogation from the first subparagraph, where degressive payments start only in the year 2019, those payments shall start at no more than 80% of the average payment fixed in the 2014-2020 programming period. The payment level shall be established in such a way that the end-level in 2020 is half the starting level.^F636]

Following completion of the delimitation, beneficiaries in the areas that remain eligible shall receive full payment under this measure.

^F6376.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Article 32 Designation of areas facing natural and other specific constraints

1.[^F138 The relevant authority^F138] shall, on the basis of paragraphs 2, 3 and 4, designate areas eligible for payments provided for in Article 31 under the following categories:

(a)mountain areas;

(b)areas, other than mountain areas, facing significant natural constraints; and

(c)other areas affected by specific constraints.

2.In order to be eligible for payments under Article 31, mountain areas shall be characterized by a considerable limitation of the possibilities for using the land and by an appreciable increase in production costs due to:

(a)the existence, because of altitude, of very difficult climatic conditions, the effect of which is to substantially shorten the growing season;

(b)at a lower altitude, the presence over the greater part of the area in question of slopes too steep for the use of machinery or requiring the use of very expensive special equipment, or a combination of these two factors, where the constraints resulting from each taken separately are less acute but the combination of the two gives rise to an equivalent constraints.

^F139...

3.In order to be eligible for payments under Article 31, areas, other than mountain areas, shall be considered to be facing significant natural constraints if, at least 60 % of the agricultural area meets at least one of the criteria listed in Annex III at the threshold value indicated.

Compliance with those conditions shall be ensured at the level of local administrative units ("LAU 2" level) or at the level of a clearly delineated local unit which covers a single clear contiguous geographical area with a definable economic and administrative identity.

When delimiting the areas concerned by this paragraph, [^F140the relevant authority^F140] shall carry out a fine-tuning exercise, based on objective criteria, with the purpose of excluding areas in which significant natural constraints, referred to in the first subparagraph have been documented but have been overcome by investments or by, economic activity, or by evidence of normal land productivity, or in which production methods or farming systems have offset the income loss or added costs referred to in Article 31(1).

4.Areas other than those referred to in paragraphs 2 and 3 shall be eligible for payments under Article 31 if they are affected by specific constraints and if it is necessary for land management to be continued in order to conserve or improve the environment, to maintain the countryside, to preserve the tourist potential of the area or to protect the coastline.

Areas affected by specific constraints shall comprise farming areas within which the natural production conditions are similar and the total extent of which does not exceed 10 % of the area of the [^F141constituent nation^F141] concerned.

In addition, areas may also be eligible for payments under this paragraph, where:

at least 60 % of the agricultural area meets at least two of the criteria listed in Annex III each within a margin of not more than 20 % of the threshold value indicated, or
at least 60 % of the agricultural area is composed of areas meeting at least one of the criteria listed in Annex III at the threshold value indicated, and areas meeting at least two of the criteria listed in Annex III each within a margin of not more than 20 % of the threshold value indicated.

Compliance with those conditions shall be ensured at LAU2 level or at the level of a clearly delineated local unit which covers a single clear contiguous geographical area with a definable economic and administrative identity. When delimiting areas concerned by this subparagraph, [^F142the relevant authority^F142] shall undertake a fine-tuning exercise as described in Article 32(3). Areas considered eligible pursuant to this subparagraph, shall be taken into account for calculating the 10 % limit referred to in the second subparagraph.

[[^F143^,^X1 By way of derogation, the second subparagraph shall not apply to [^F142 constituent nations^F142] the entire territory of which was considered as an area facing specific handicaps under Regulations (EC) No 1698/2005 and (EC) No 1257/1999.^X1^,^F143]]

5.[^F144 The relevant authorities^F144] shall attach to their rural development programmes:

(a)the existing or amended delimitation pursuant to paragraphs 2 and 4;

(b)the new delimitation of the areas referred to in paragraph 3.

Article 33 Animal welfare _E22

[^F13 1.Animal welfare payments under this measure shall be granted to farmers who undertake, on a voluntary basis, to carry out operations consisting of one or more animal welfare commitments and who are active farmers within the meaning of Article 9 of Regulation (EU) No 1307/2013 ^F145....^F13]

2.Animal welfare payments cover only those commitments going beyond the relevant mandatory standards established pursuant to Chapter I of Title VI of Regulation (EU) No 1306/2013 and other relevant mandatory requirements. These relevant requirements shall be identified in the programme.

Those commitments shall be undertaken for a renewable period of one to seven years.

^F146...

3.The payments shall be granted annually and shall compensate farmers for all or part of the additional costs and income foregone resulting from the commitment made. Where necessary, they may also cover transaction costs to the value of up to 20 % of the premium paid for the animal welfare commitments.

Support shall be limited to the maximum amount laid down in Annex II.

4.^F147In order to ensure that animal welfare commitments are in accordance with the overall ... policy in this field, the [^F148appropriate authority may make regulations^F148] concerning the definition of the areas in which animal welfare commitments are to provide upgraded standards of production methods.

Article 33 [^F638Animal health and welfare^F638] _E63

[^F639 1.[^F638 Animal health and welfare^F638] payments under this measure shall be granted to farmers who undertake, on a voluntary basis, to carry out operations consisting of one or more [^F638 animal health and welfare^F638] commitments ^F640...^F641....^F639]

2.[^F638 Animal health and welfare^F638] payments cover only those commitments going beyond the relevant mandatory standards established pursuant to Chapter I of Title VI of Regulation (EU) No 1306/2013 and other relevant mandatory requirements. These relevant requirements shall be identified in the programme.

Those commitments shall be undertaken for a renewable period of one to seven years.

[^F642 For new commitments to be undertaken as from 2021, Member States shall determine a shorter period of one to three years in their rural development programmes.

If Member States provide for an annual renewal of commitments after the termination of the initial period in accordance with the second subparagraph, as from 2022 the renewal shall not go beyond one year.

By way of derogation from the third subparagraph, for new commitments to be undertaken in 2021 and 2022, Member States may determine a period of longer than three years in their rural development programmes based on the nature of the commitments and the [^F638 animal health and welfare^F638] benefits sought.^F642]

^F643...

4.^F644In order to ensure that [^F638animal health and welfare^F638] commitments are in accordance with the overall ... policy in this field, the [^F645appropriate authority may make regulations^F645] concerning the definition of the areas in which [^F638animal health and welfare^F638] commitments are to provide upgraded standards of production methods.

Article 33 Animal welfare _E64

[^F646 1.Animal welfare payments under this measure shall be granted to farmers who undertake, on a voluntary basis, to carry out operations consisting of one or more animal welfare commitments ^F647... .^F646]

2.^F648Animal welfare payments cover only those commitments going beyond the ... relevant mandatory requirements. These relevant requirements shall be identified in the programme.

Those commitments shall be undertaken for a renewable period of one to seven years.

^F649...

Support shall be limited to the maximum amount laid down in Annex II.

4.^F650In order to ensure that animal welfare commitments are in accordance with the overall ... policy in this field, the [^F651appropriate authority may make regulations^F651] concerning the definition of the areas in which animal welfare commitments are to provide upgraded standards of production methods.

Article 34 Forest-environmental and climate services and forest conservation _E23

1.Support under this measure shall be granted per hectare of forest to public and private forest-holders and other private law and public bodies and their associations who undertake, on a voluntary basis, to carry out operations consisting of one or more forest-environment and climate commitments. In the case of state owned forests, support may only be granted if the body managing such a forest is a private body or a municipality.

For forest holdings above a certain threshold to be determined by [^F149the relevant authority^F149] in their rural development programmes, support under paragraph 1 shall be conditional on the presentation of the relevant information from a forest management plan or equivalent instrument in line with sustainable forest management as defined by the Ministerial Conference on the Protection of Forests in Europe of 1993.

2.^F150Payments shall cover only those commitments going beyond the relevant mandatory requirements established by ... relevant national law. All such requirements shall be identified in the programme.

Commitments shall be undertaken for a period of between five and seven years. However, where necessary and duly justified, [^F149the relevant authority^F149] may determine a longer period in their rural development programmes for particular types of commitments.

3.Payments shall compensate beneficiaries for all or part of the additional costs and income foregone resulting from the commitments made. Where it is necessary they may also cover transaction costs to a value of up to 20 % of the premium paid for the forest-environment commitments. Support shall be limited to the maximum amount laid down in Annex II.

In duly justified cases for operations concerning environmental conservation, support may be granted as a flat-rate or one-off payment per unit for commitments to renounce commercial use of trees and forests, calculated on basis of additional costs incurred and income foregone.

4.Support may be provided to public and private entities for the conservation and promotion of forest genetic resources for operations not covered under paragraphs 1, 2 and 3.

5.In order to ensure the efficient use of [^F151support for rural development^F151] , the [^F152appropriate authority may make regulations^F152] concerning the types of operations eligible for support under paragraph 4 of this Article.

Article 34 [^F652Forest-environmental, climate commitments and forest historic environment commitments^F652] _E65

1.Support under this measure shall be granted per hectare of forest to public and private forest-holders and other private law and public bodies and their associations who undertake, on a voluntary basis, to carry out operations consisting of one or more [^F653forest-environmental, climate commitments and forest historic environment commitments^F653] . In the case of state owned forests, support may only be granted if the body managing such a forest is a private body or a municipality.

For forest holdings above a certain threshold to be determined by [^F654the relevant authority^F654] in [^F655the rural development programme^F655] , support under paragraph 1 shall be conditional on the presentation of the relevant information from a forest management plan or equivalent instrument in line with sustainable forest management as defined by the Ministerial Conference on the Protection of Forests in Europe of 1993.

2.^F656Payments shall cover only those commitments going beyond the relevant mandatory requirements established by ... relevant national law. All such requirements shall be identified in the programme.

Commitments shall be undertaken for a period of between five and seven years. However, where necessary and duly justified, [^F654the relevant authority^F654] may determine a longer period in their rural development programmes for particular types of commitments.

3.^F657Payments shall compensate beneficiaries for all or part of the additional costs and income foregone resulting from the commitments made. Where it is necessary they may also cover transaction costs to a value of up to 20 % of the premium paid for the forest-environment commitments. ...

4.Support may be provided to public and private entities for the conservation and promotion of forest genetic resources for operations not covered under paragraphs 1, 2 and 3.

5.In order to ensure the efficient use of [^F658support for rural development^F658] , the [^F659appropriate authority may make regulations^F659] concerning the types of operations eligible for support under paragraph 4 of this Article.

Article 35 Co-operation _E24

1.Support under this measure shall be granted in order to promote forms of co-operation involving at least two entities and in particular:

(a)^F153co-operation approaches among different actors in the ... agriculture sector, forestry sector and food chain and other actors that contribute to achieving the objectives and priorities of rural development policy, including producer groups, cooperatives and inter-branch organisations;

(b)the creation of clusters and networks;

(c)the establishment and operation of operational groups of the EIP for agricultural productivity and sustainability as referred to in Article 56.

2.Co-operation under paragraph 1 shall relate, in particular, to the following:

(a)pilot projects;

(b)the development of new products, practices, processes and technologies in the agriculture, food and forestry sectors;

(c)co-operation among small operators in organising joint work processes and sharing facilities and resources and for the development and/or marketing of tourism services relating to rural tourism;

(d)horizontal and vertical co-operation among supply chain actors for the establishment and the development of short supply chains and local markets;

(e)promotion activities in a local context relating to the development of short supply chains and local markets;

(f)joint action undertaken with a view to mitigating or adapting to climate change;

(g)joint approaches to environmental projects and ongoing environmental practices, including efficient water management, the use of renewable energy and the preservation of agricultural landscapes;

(h)horizontal and vertical co-operation among supply chain actors in the sustainable provision of biomass for use in food and energy production and industrial processes;

(i)^F154implementation, in particular by groups of public and private partners other than those defined in point (b) of Article 32(2) of Regulation (EU) No 1303/2013, of local development strategies other than those defined in Article 2(19) of Regulation (EU) 1303/2013 addressing one or more of the ... priorities for rural development;

(j)drawing up of forest management plans or equivalent instruments;

(k)diversification of farming activities into activities concerning health care, social integration, community-supported agriculture and education about the environment and food.

3.Support under point (b) of paragraph 1 shall be granted only to newly formed clusters and networks and those commencing an activity that is new to them.

Support for operations under points (a) and (b) of paragraph 2 may be granted also to individual actors where this possibility is provided for in the rural development programme.

4.The results of pilot projects under point (a) of paragraph 2 and operations under point (b) of paragraph 2 carried out by individual actors as provided for in paragraph 3 shall be disseminated.

5.The following costs, linked to the forms of co-operation referred to in paragraph 1 shall be eligible for support under this measure:

(a)the cost of studies of the area concerned, of feasibility studies, and of drawing up a business plan or a forest management plan or equivalent or a local development strategy other than the one referred to in Article 33 of Regulation (EU) No 1303/2013;

(b)the cost of animation of the area concerned in order to make feasible a collective territorial project or a project to be carried out by an operational group of the EIP for Agricultural Productivity and Sustainability as referred to in Article 56. In the case of clusters, animation may also concern the organisation of training, networking between members and the recruitment of new members;

(c)the running costs of the co-operation;

(d)the direct costs of specific projects linked to the implementation of a business plan an environmental plan, a forest management plan or equivalent, a local development strategy other than the one referred to in Article 33 of Regulation (EU) No 1303/2013 or direct costs of other actions targeted towards innovation, including testing;

(e)the cost of promotion activities.

6.Where a business plan or an environmental plan or a forest management plan or equivalent or a development strategy is implemented, [^F155the relevant authority^F155] may grant the aid either as a global amount covering the costs of co-operation and the costs of the projects implemented or cover only the costs of the co- operation and use funds from other measures or [^F156support under Regulation 508/2014, CMO support or direct payment support^F156] for project implementation.

Where support is paid as a global amount and the project implemented is of a type covered under another measure of this Regulation, the relevant maximum amount or rate of support shall apply.

7.^F157Co-operation among actors located in different regions ... shall also be eligible for support.

[^F158 8.Support shall be limited to a maximum period of seven years except for collective environmental action in duly justified cases.^F158]

[^F158 8.Support shall be for a minimum period of one year determined by the appropriate authority.^F158]

[^F159 9.Co-operation under this measure may be combined with projects supported by support under Regulation 508/2014 or CMO support or direct payment support. The relevant authority shall ensure that overcompensation as a result of the combination of this measure with other sources of support is avoided.^F159]

[^F160 10.In order to ensure the efficient use of [^F161 support for rural development^F161] , the [^F162 appropriate authority may make regulations^F162] , concerning the further specification of the characteristics of pilot projects, clusters, networks, short supply chains and local markets that will be eligible for support, as well as concerning the conditions for granting aid to the types of operation listed in paragraph 2 of this Article.^F160]

[^F160 10.The appropriate authority may make regulations to—

(a)promote forms of co-operation in accordance with paragraph 1;

(b)ensure the efficient use of support for rural development concerning the further specification of the characteristics of pilot projects, clusters, networks, short supply chains and local markets that will be eligible for support;

(c)make conditions for granting aid to the types of operation listed in paragraph 2.^F160]

[^F160Article 35 Co-operation _E66

1.Support under this measure shall be granted in order to promote forms of co-operation involving at least two entities and in particular:

(a)co-operation approaches among different actors in the ^F660... agriculture sector, forestry sector and food chain and other actors that contribute to achieving the objectives and priorities of rural development policy, including producer groups, cooperatives and inter-branch organisations;

(b)the creation of clusters and networks;

^F661(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2.Co-operation under paragraph 1 shall relate, in particular, to the following:

(a)pilot projects;

(b)the development of new products, practices, processes and technologies in the agriculture, food and forestry sectors;

(c)co-operation among small operators in organising joint work processes and sharing facilities and resources and for the development and/or marketing of tourism services relating to rural tourism;

(d)horizontal and vertical co-operation among supply chain actors for the establishment and the development of short supply chains and local markets;

(e)promotion activities in a local context relating to the development of short supply chains and local markets;

(f)joint action undertaken with a view to mitigating or adapting to climate change;

(g)joint approaches to environmental projects and ongoing environmental practices, including efficient water management, the use of renewable energy and the preservation of agricultural landscapes;

(h)horizontal and vertical co-operation among supply chain actors in the sustainable provision of biomass for use in food and energy production and industrial processes;

(i)implementation, in particular by groups of public and private partners other than those defined in point (b) of Article 32(2) of Regulation (EU) No 1303/2013, of local development strategies other than those defined in Article 2(19) of Regulation (EU) 1303/2013 addressing one or more of the ^F662... priorities for rural development;

(j)drawing up of forest management plans or equivalent instruments;

(k)diversification of farming activities into activities concerning health care, social integration, community-supported agriculture and education about the environment and food.

3.Support under point (b) of paragraph 1 shall be granted only to newly formed clusters and networks and those commencing an activity that is new to them.

Support for operations under points (a) and (b) of paragraph 2 may be granted also to individual actors where this possibility is provided for in the rural development programme.

4.The results of pilot projects under point (a) of paragraph 2 and operations under point (b) of paragraph 2 carried out by individual actors as provided for in paragraph 3 shall be disseminated.

5.The following costs, linked to the forms of co-operation referred to in paragraph 1 shall be eligible for support under this measure:

(b)the cost of animation of the area concerned in order to make feasible a collective territorial project ^F663.... In the case of clusters, animation may also concern the organisation of training, networking between members and the recruitment of new members;

(c)the running costs of the co-operation;

(e)the cost of promotion activities.

6.Where a business plan or an environmental plan or a forest management plan or equivalent or a development strategy is implemented, [^F664 the relevant authority^F664] may grant the aid either as a global amount covering the costs of co-operation and the costs of the projects implemented or cover only the costs of the co- operation and use funds from other measures ^F665... for project implementation.

Where support is paid as a global amount and the project implemented is of a type covered under another measure of this Regulation, the relevant maximum amount or rate of support shall apply.

7.Co-operation among actors located in different regions ^F666... shall also be eligible for support.

8.Support shall be limited to a maximum period of seven years except for collective environmental action in duly justified cases.

[^F667 9.Co-operation under this measure may be combined with projects supported by support under Regulation 508/2014 or CMO support or direct payment support. The relevant authority shall ensure that overcompensation as a result of the combination of this measure with other sources of support is avoided.^F667]

10.In order to ensure the efficient use of [^F668 support for rural development^F668] , the [^F669 appropriate authority may make regulations^F669] , concerning the further specification of the characteristics of pilot projects, clusters, networks, short supply chains and local markets that will be eligible for support, as well as concerning the conditions for granting aid to the types of operation listed in paragraph 2 of this Article.^F160]

[^F160Article 35 Co-operation _E67

1.Support under this measure shall be granted in order to promote forms of co-operation involving at least two entities and in particular:

(a)co-operation approaches among different actors in the ^F670... agriculture sector, forestry sector and food chain and other actors that contribute to achieving the objectives and priorities of rural development policy, including producer groups, cooperatives and inter-branch organisations;