How to improve environment protection
Following Parliament's lead, the three institutions agreed that more should be done to protect the environment. The agreement provides for 30% of the national budget for direct payments to farmers to be linked to "greening" measures. But MEPs also won Council support for 30% of rural development spending to be earmarked for environment-related actions. The option of paying farmers twice for applying the same greening measures was definitively ruled out at the insistence of MEPs.
The deal also ensures that the new environmental rules for farmers will be more flexible and linked to the size of the holding. The three key measures proposed by the Commission – crop diversification, maintaining existing permanent grassland and ecological focus areas – would remain, but certain exceptions should be made to reflect geographical conditions and size of holding, according to the political agreement.
Farmers whose holdings are certified under national or regional environmental certification schemes would be considered "green" only on condition that the measures they apply deliver at least the same benefit as the default greening ones, or go beyond them. The same applies to "equivalent practices" supported by CAP Pillar 2 (rural development) agri-environment schemes, which farmers could choose to apply instead of the three default measures.. Equivalent measures would be strictly defined by the core legislation and assessed by the Commission for equivalence to the practices listed in the annex to the regulation.
Organic farmers shall be automatically considered "green", without imposing any additional requirements.
In line with Parliament's position, farmers with holdings of 10 ha – 30 ha of arable land which is not entirely cultivated, with crops under water for a significant part of the year, should be required to plant at least two different crops. None of these crops should cover more than 75% of the arable land.
Farms of more than 30 ha of arable land should be required to cultivate three crops with the main one covering not more than 75% and two main crops together not more than 95% of the arable land. Holdings in north Scandinavia (north of the 62nd parallel) with more than 10 hectares of arable land should cultivate at least two crops on arable land with none covering more than 75% of the land.
Member states must ensure that the ratio of the land under permanent grassland does not decrease by more than 5% at national, regional or sub-regional level (to be decided by member states) compared to the situation in 2015. According to the agreement, farmers must neither convert nor plough permanent grassland on wetlands, peat and carbon-rich soils which are located in areas designated by member states as "environmentally sensitive".
Ecological focus areas
Farmers with more than 15ha of arable land would have to ensure, as soon as the new rules take effect, that 5% of their farm, excluding permanent grassland and permanent crops, is reserved for so-called "ecological focus areas" (EFAs), such as land left fallow, terraces, landscape features, buffer strips, etc. Farms which are more than 75% grassland (provided that the remaining arable area is less than 30 ha) and farms with crops under water would be exempt, the three institutions agreed.
EFAs could be weighted on the basis of their ecological significance, with the technicalities of setting the weighting and conversion factors being left to a delegated act. By the end of March 2017, the Commission would have to present an evaluation report and if necessary a legislative proposal to further increase the percentage of EFAs to 7%. This proposal would be subject to approval by both the European Parliament and the Council.
Parliament and Council backed Commission plans to make 30% of the national budget for direct payments conditional upon compliance with greening measures. Should farmers fail to apply them, they would lose the greening component of their direct payments. Furthermore, during the third year after the new CAP enters into force (2017), non-compliance could lead to further sanctions of up to 20% and from the fourth year (2018) on up to 25% of their greening payment. The additional penalty would not apply during the first two years of the new CAP, to allow farmers time to familiarise themselves with the new rules.
Budget ring-fencing for voluntary environmental measures
At Parliament's insistence that a spending must be ring-fenced for optional greening measures, the three institutions agreed that at least 30% of the total budget earmarked for rural development programmes would have to be reserved for environmental and climate expenditure.
No double funding
Parliament insisted in the negotiations that optional greening measures financed from the rural development envelope must not be subject to any other financing under the EU budget. This means that farmers would have to go beyond the mandatory greening measures in delivering environmental benefits in order to be eligible for additional funding from the rural development budget.