REPORT on the proposal for a regulation of the European Parliament and of the Council laying down certain transitional provisions on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) and amending Regulation (EU) No [RD] as regards resources and their distribution in respect of the year 2014 and amending Council Regulation (EC) No 73/2009 and Regulations (EU) No [DP], (EU) No [HZ] and (EU) No [sCMO] as regards their application in the year 2014

9.10.2013 - (COM(2013)0226 – C7‑0104/2013 – 2013/0117(COD)) - ***I

Committee on Agriculture and Rural Development
Rapporteur: Albert Deß

Amendments

• 001-040 (PDF - 263 KB)
• 001-040 (DOC - 283 KB)
• 041-041 (PDF - 281 KB)
• 041-041 (DOC - 357 KB)

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the proposal for a regulation of the European Parliament and of the Council laying down certain transitional provisions on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) and amending Regulation (EU) No [RD] as regards resources and their distribution in respect of the year 2014 and amending Council Regulation (EC) No 73/2009 and Regulations (EU) No [DP], (EU) No [HZ] and (EU) No [sCMO] as regards their application in the year 2014

(COM(2013)0226 – C7‑0104/2013 – 2013/0117(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

–   having regard to the Commission proposal to Parliament and the Council (COM(2013)0226),

–   having regard to Article 294(2) and Article 43(2) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7‑0104/2013),

–   having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

–   having regard to the opinion of the European Economic and Social Committee of 19 September 2013[1],

–   having regard to Rule 55 of its Rules of Procedure,

–   having regard to the report of the Committee on Agriculture and Rural Development and the opinion of the Committee on Budgets (A7-0326/2013),

1.  Adopts its position at first reading hereinafter set out;

2.  Calls on the Commission to refer the matter to Parliament again if it intends to amend its proposal substantially or replace it with another text;

3.  Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Amendment  1 Proposal for a regulation Recital -1 (new)
Text proposed by the Commission	Amendment
	(-1) It is important to ensure that administrative burden in the agricultural sector is regularly monitored and reduced.The Commission, in its Communication of 12 December 2012 on EU regulatory fitness, undertook to keep up its efforts to remove all unnecessary regulatory burdens.. The European Parliament and the Council should be informed about progress in this area;
Amendment  2 Proposal for a regulation Recital 3
Text proposed by the Commission	Amendment
(3) To ensure legal certainty in the transition it should be provided that expenditure undertaken pursuant to Regulation (EC) No 1698/2005 under area and animal related measures should be eligible for an EAFRD contribution in the new programming period when there are still payments to be made. In the interest of sound financial management and effective programme implementation, such expenditure should be clearly identified in the rural development programmes and throughout the management and control systems of the Member States. In order to avoid unnecessary complexity in the financial management of rural development programmes in the new programming period, it should be provided that the co-financing rates of the new programming period shall apply to transitional expenditure.	(3) To ensure legal certainty in the transition, provision should be made for all measures in the programming period 2007-2013 undertaken pursuant to Regulation (EC) No 1698/2005 to be eligible for an EAFRD contribution in the new programming period when there are still payments to be made. In the interest of sound financial management and effective programme implementation, such expenditure should be clearly identified in the rural development programmes and throughout the management and control systems of the Member States. In order to avoid unnecessary complexity in the financial management of rural development programmes in the new programming period, it should be provided that the co-financing rates of the new programming period shall apply to transitional expenditure.
Justification
In the interest of the programme’s coherence, all ongoing rural development measures should be continued in the transition year, in accordance with the ‘new money for old measures’ principle.
Amendment  3 Proposal for a regulation Recital 3 a (new)
Text proposed by the Commission	Amendment
	(3a) In view of the serious difficulties that a number of Member States still face with respect to their financial stability, and in order to limit, during the transition from the current to the forthcoming programming period, the negative effects resulting therefrom by allowing for maximum utilisation of the EAFRD funds available, it is necessary to extend the duration of the derogation increasing the maximum EAFRD contribution rates provided for in Article 70(4c) of Council Regulation (EC) No 1698/2005 until the final date of eligibility of expenditure for the 2007-2013 programming period, on 31 December 2015.
Amendment  4 Proposal for a regulation Recital 11
Text proposed by the Commission	Amendment
(11) With a view to allowing Member States to address the needs of their agricultural sectors or to strengthen their rural development policy in a more flexible way, they should be given the possibility to transfer funds from their direct payments ceilings to their support assigned for rural development and from the support assigned for rural development to their direct payments ceilings. At the same time, Member States where the level of direct support remains lower than 90 % of the Union average level of support should be given the possibility to transfer additional funds from their support assigned for rural development to their direct payments ceilings. Such choices should be made, within certain limits, once and for the whole period of financial years 2015-2020.	(11) With a view to allowing Member States to address the needs of their agricultural sectors or to strengthen their rural development policy in a more flexible way, they should be given the possibility to transfer funds from their direct payments ceilings to their support assigned for rural development and from the support assigned for rural development to their direct payments ceilings. At the same time, Member States where the level of direct support remains lower than 90 % of the Union average level of support should be given the possibility to transfer additional funds from their support assigned for rural development to their direct payments ceilings. Such choices should be made, within certain limits, for the whole period of financial years 2015-2020, with the possibility of a review in 2017.
(The passage “and from the support assigned for rural development to their direct payments ceilings” had been deleted in the AM 3 in the draft report but has to be re-inserted.)
Amendment  5 Proposal for a regulation Recital 13 a (new)
Text proposed by the Commission	Amendment
	(13a) Finland has been authorised to pay national support to certain agricultural sectors in southern Finland in accordance with Article 141 of its Accession Treaty. Taking into account the timing of the CAP reform and due to the fact that the economic situation of agriculture in southern Finland is difficult and the producers are, therefore, still in need of specific support, it is appropriate to provide for integration measures whereby Finland may, in accordance with Article 42 of the Treaty, be authorised by the Commission to make national payments for certain production sectors in southern Finland. These payments should be decreased gradually over the period 2014 to 2020.
Amendment  6 Proposal for a regulation Article -1 (new)
Text proposed by the Commission	Amendment
	Article -1
	Reducing the administrative burden
	The Commission shall avoid imposing any additional, unnecessary and disproportionate administrative burden when implementing this Regulation and Regulations (EU) No [DP], (EU) No [HZ] and (EU) No [sCMO]. The Commission shall submit to the European Parliament and the Council at regular intervals a report on the efforts made in this respect.
Amendment  7 Proposal for a regulation Article 1 – paragraph 1
Text proposed by the Commission	Amendment
1. By way of derogation from Article 94 of Regulation (EU) No […] [RD], for the measures of Article 36(a)(i) to (v) and (b)(iv) and (v) of Regulation (EC) No 1698/2005, Member States may continue to undertake new legal commitments to beneficiaries in 2014 pursuant to the rural development programmes adopted on the basis of Regulation (EC) No 1698/2005 even after the financial resources of the 2007-2013 programming period have been used up, until the adoption of the respective rural development programme for the 2014-2020 programming period. The expenditure incurred on the basis of these commitments shall be eligible in accordance with Article 3 of this Regulation.	1. By way of derogation from Article 94 of Regulation (EU) No […] [RD], for all measures of the programming period 2007-2013 of Regulation (EC) No 1698/2005, Member States may continue to undertake new legal commitments to beneficiaries in 2014 pursuant to the rural development programmes adopted on the basis of Regulation (EC) No 1698/2005 even after the financial resources of the 2007-2013 programming period have been used up, until the adoption of the respective rural development programme for the 2014-2020 programming period, or until the end of 2014. The expenditure incurred on the basis of these commitments shall be eligible in accordance with Article 3 of this Regulation.
Amendment  8 Proposal for a regulation Article 3 – paragraph 1 – introductory part
Text proposed by the Commission	Amendment
1. By way of derogation from Article 7(1) of Regulation (EU) No […] [RD], expenditure relating to legal commitments to beneficiaries, undertaken under the measures of Article 36(a)(i) to (v) and (b)(iv) and (v) of Regulation (EC) No 1698/2005 and of Article 36(b)(i) and (iii) of that Regulation in relation to the annual premium, shall be eligible for an EAFRD contribution in the 2014-2020 programming period in the following cases:	1. By way of derogation from Article 7(1) of Regulation (EU) No [...] [RD], expenditure relating to legal commitments to beneficiaries, undertaken under all measures referred to in Articles 20, 36, 52 and 63 of Regulation (EC) No 1698/2005, shall be eligible for an EAFRD contribution in the 2014-2020 programming period in the following cases:
Amendment  9 Proposal for a regulation Article 3 – paragraph 1 – point b
Text proposed by the Commission	Amendment
(b) for payments to be made after 31 December 2015.	(b) for payments to be made after 31 December 2015 for all commitments undertaken pursuant to Article 36.
Amendment  10 Proposal for a regulation Article 3 – paragraph 2a (new)
Text proposed by the Commission	Amendment
	2a. Where there are no longer sufficient funds in previous rural development programmes to cover the expenditure referred to in paragraph 1, such expenditure may be declared to the Commission for reimbursement in reference periods starting from the first month after the end of the first reference period. .
Justification
It is important to provide continuity of support for broader scope of commitments for 2007-2013 measures than proposed by the Commission.
Amendment  11 Proposal for a regulation Article 5 – paragraph 1 – point 2 Regulation (EC) No 73/2009 Article 40 – paragraph 2
Text proposed by the Commission Amendment 2. Where necessary, a Member State shall make a linear reduction/increase in the value of all payment entitlements and/or the amount of the national reserve as referred to in Article 41 in order to ensure compliance with the ceiling determined in Annex VIII. 2. Where necessary, a Member State shall make a linear reduction in the value of payment entitlements above EUR 2 000 and/or the amount of the national reserve as referred to in Article 41 in order to ensure compliance with the ceiling determined in Annex VIII.
Amendment  12 Proposal for a regulation Article 5 – paragraph 1 – point 2 Regulation (EC) No 73/2009 Article 40 – paragraph 2 - subparagraph 1a (new)
Text proposed by the Commission Amendment   1a. By way of derogation from paragraphs 1 and 2, Member States may decide to retain the value that payment entitlements had on 31 December 2013.
Justification
In 2015 the value of payment entitlements will be recalculated as a result of the agricultural policy reform and in particular of internal convergence and greening. An adjustment of payments rather than the values of entitlements for the transition year 2014 would simplify matters.
Amendment  13 Proposal for a regulation Article 5 – paragraph 1 – point 2 Regulation (EC) No 73/2009 Article 40 – paragraph 2a (new)
Text proposed by the Commission Amendment   2a. By way of derogation from paragraph 2 and the final subparagraph of Article 51(2), a Member State may make a linear reduction of direct payments for 2014 in order to remain within the ceiling set out in Annex VIII. Where such a reduction is undertaken, Member States may grant an allowance of up to EUR 5 000in the event of direct payments to be granted to a farm owner as a result of an aid application submitted for 2014.
Justification
This would allow the Member States greater flexibility in remaining within the ceilings set out in Annex VIII and would also simplify matters.
Amendment  14 Proposal for a regulation Article 5 – paragraph 1 – point 2 Regulation (EC) No 73/2009 Article 40 – paragraph 3
Text proposed by the Commission Amendment 3. Without prejudice to Article 25 of Regulation (EU) No [HZ] of the European Parliament and of the Council, the amounts of direct payments which may be granted in a Member State in respect of calendar year 2014 under Articles 34, 52, 53 and 68 of this Regulation and for the aid to silkworm rearers under Article 111 of Regulation (EC) No 1234/2007 shall not be higher than the ceilings set out in Annex VIII to this Regulation for that year. Where necessary, and in order to comply with the ceilings set out in Annex VIII, Member States shall make a linear reduction in the amounts of direct payments in respect of calendar year 2014. 3. Without prejudice to Article 25 of Regulation (EU) No [HZ] of the European Parliament and of the Council, the amounts of direct payments which may be granted in a Member State in respect of calendar year 2014 under Articles 34, 52, 53 and 68 of this Regulation and for the aid to silkworm rearers under Article 111 of Regulation (EC) No 1234/2007 shall not be higher than the ceilings set out in Annex VIII to this Regulation for that year, minus the amounts resulting from the application of Article 136b for calendar year 2015 in accordance with Annex VIIIa to this Regulation. Where necessary, and in order to comply with the ceilings set out in Annex VIII, Member States shall make a linear reduction in the amounts of direct payments in respect of calendar year 2014 minus the amounts resulting from the application of Article 136b for calendar year 2015 in accordance with Annex VIIIa to this regulation.
Justification
Inclusion of a provision allowing Member States to continue to transfer unspent resources from the first pillar to the second in 2014.
Amendment  15 Proposal for a regulation Article 5 – paragraph 1 – point 3 Regulation (EC) No 73/2009 Article 51 – paragraph 2
Text proposed by the Commission Amendment In Article 51(2), the following subparagraph is added: In Article 51(2) the following subparagraphs are added: "For 2014, the ceilings for the direct payments referred to in Articles 52 and 53 shall be identical to the ceilings determined for 2013, multiplied by a coefficient to be calculated for each Member State concerned by dividing the national ceiling for 2014 set out in Annex VIII by the national ceiling for 2013. This multiplication shall only apply to Member States where the national ceiling set out in Annex VIII for 2014 is lower than the national ceiling for 2013." "For 2014, the ceilings for the direct payments referred to in Articles 52 and 53 shall be identical to the ceilings determined for 2013, multiplied by a coefficient to be calculated for each Member State concerned by dividing the national ceiling for 2014 set out in Annex VIII by the national ceiling for 2013. This multiplication shall only apply to Member States where the national ceiling set out in Annex VIII for 2014 is lower than the national ceiling for 2013.   By way of derogation from the previous paragraph, the Member States may , before ...*, decide that, for 2014, the ceilings for the direct payments referred to in Articles 52 and 53 shall be identical to the ceilings for 2013.   The Commission shall be notified of this decision on or before the date set out in the subparagraph in question.’   __________________   * OJ please insert the date seven days from the date of entry into force of this Regulation.
Justification
Amendment to avoid penalising small beef cattle breeders who receive less in aid than the EUR 5 000 exemption from the current modulation instrument, which is set to disappear. This significant reduction in aid for breeding would cause problems in the current economic situation, so that there is a need to adjust the legislation.
Amendment  16 Proposal for a regulation Article 5 – paragraph 1 – point 5 – point aa Regulation (EC) No 73/2009 Article 69 – paragraph 1
Text proposed by the Commission Amendment   (aa) The following paragraphs are inserted:   "1a. By way of derogation from paragraph 1, Member States may decide to use up to 13 % of the annual national ceiling referred to in Article 40, provided that:   (a) they applied, until 31 December 2013, the single area payment scheme as laid down in Title V of this Regulation, or financed measures under Article 111 of this Regulation, or are covered by the derogation provided for in Article 69(5), or, in the case of Malta, in Article 69(1) of this Regulation; or   (b) during at least one year in the period 2010-2013, they allocated, more than 5 % of their amount available for granting the direct payments provided for in Titles III, IV, and V of this Regulation, with the exception of Section 6 of Chapter 1 of Title IV, to financing the measures laid down in Section 2 of Chapter 2 of Title III of this Regulation, the support provided for in subpoints (i) to (iv) of point (a) and in points (b) and (e) of Article 68(1) of this Regulation, or the measures under Chapter 1, with the exception of Section 6, of Title IV of this Regulation.   1b. By way of derogation from paragraph 1a, Member States that during at least one year in the period 2010-2013 allocated more than 10 % of their amount available for granting the direct payments provided for in Titles III, IV and V of this Regulation, with the exception of Section 6 of Chapter 1 of Title IV, to financing the measures laid down in Section 2 of Chapter 2 of Title III of this Regulation, the support provided for in subpoints (i) to (iv) of point (a) and in points (b) and (e) of Article 68(1) of this Regulation, or the measures under Chapter 1, with the exception of Section 6, of Title IV of this Regulation may decide to use more than 13 % of the annual national ceiling set out in Annex VIII of this Regulation subject to approval by the Commission."
Justification
As a consequence of the MFF decisions, in 2014 the direct payment envelopes for most of the Member States will be lower than in 2013. Thus, the amount of direct payments that can be directed to coupled support will also be significantly lower in 2014 than in 2013. Therefore it is necessary to enable the use of higher rates of coupled payments provided for in Articles 39(1), 39(2) and 39(3) of the new draft Regulation on Direct Payments. These new rates should be applicable already from 1.1.2014
Amendment  17 Proposal for a regulation Article 5 – paragraph 1 – point 5 – point b a (new) Regulation (EC) No 73/2009 Article 69 – paragraph 4
Text proposed by the Commission Amendment   (ba) Paragraph 4 is amended as follows:   "4. The support provided for in points (i), (ii), (iii) and (iv) of paragraph 1(a) and paragraphs 1(b) and (e) is limited to 6.5 % of the national ceilings set out in Article 40 or, in the case of Malta, to EUR 2 million, as set out in Article 69(1) of this Regulation, which should be used particularly to finance the measures referred to in Article 68(1)(b) in the dairy sector."
Justification
The increase in the maximum authorised level of coupled voluntary aid in the reform can be introduced in 2014 by raising the proportion of specific aid currently authorised from 3.5 % to 6.5 % of national ceilings set out in Article 69 of Regulation 73/2009. Those Member States which so wish can therefore apply one section of the CAP immediately and give advance assistance to some sectors such as the breeding sector, which are in a difficult situation and suffer from revenue problems.
Amendment  18 Proposal for a regulation Article 5 – paragraph 1 – point 5 a (new) Regulation (EC) No 73/2009 Chapter 5a (new)
Text proposed by the Commission Amendment In Title III, Chapter 5a is inserted after Article 72:   “CHAPTER 5a   REDISTRIBUTIVE PAYMENT for 2014   Article 72a   General rules   1. Up to ...*, Member States may decide to grant, for the year 2014, an award to farmers who are entitled to a payment under the single payment scheme in accordance with Chapter 1 or Chapter 2, Section 1 of this Title, or both, or under the single area payment scheme under Title 5.   Member States shall notify the Commission of their decision by the date referred to in the first subparagraph.   2. Member States which have decided to apply the single payment scheme at regional level may apply the payment referred to in this Chapter at regional level.   3. Payments made in accordance with paragraph 1 shall only be made to farmers who activate payment claims or receive payments under the single area payment scheme in 2014.   4. The payment referred to in paragraph 1 shall be calculated by Member States by multiplying a figure to be set by the Member State which shall not be higher than 65 % of the national or regional average payment per hectare by the number of payment entitlements that the farmer has activated in accordance with Article 35(1), or by the number of eligible hectares declared by the farmer under the single area payment scheme. The number of such payment entitlements or hectares, shall not be greater than 30 hectares or, if that average size is greater than 30 hectares in the Member State concerned, the average size of agricultural holdings set out in Annex XIIa . " Provided that the maximum limits set out in the first subparagraph are respected, Member States may, at national level, establish a graduation in the number of hectares set in accordance with the first subparagraph, on condition that that graduation applies equally to all farmers.   The national average payment per hectare referred to in the first subparagraph shall be established by the Member States on the basis of the national ceiling set in Annex VIII for calendar year 2014 and the number of eligible hectares declared in accordance with Article 35 or under the single area payment scheme in 2014.   The regional average payment per hectare in accordance with the first subparagraph shall be determined by Member States on the basis of objective criteria.   5. Member States shall ensure that no payments are made to farmers where it has been proven that, at any point after 19 October 2011, they have divided up their land with the sole purpose of being awarded a redistributive payment. This shall also apply to farmers whose holdings result from that division.   Article 72b   Financial provisions   1. In order to finance the payment referred to in this Chapter, Member States may use up to 30 % of the national ceiling for calendar year 2014 in accordance with Annex VIII.   2. On the basis of the percentage of the national ceiling used by Member States in accordance with paragraph 1, the Commission shall adopt delegated acts, in accordance withArticle 141a, setting the respective ceilings for the payment concerned and adapt the ceilings in line with Annex VIII."   ______________   * OJ please insert date: three months after the entry into force of this Regulation.
Amendment  19 Proposal for a regulation Article 5 – paragraph 1 – point 6 a (new) Regulation (EC) No 73/2009 Article 111 – paragraph 5
Text proposed by the Commission Amendment   (6a) In Article 111(5), the third subparagraph is amended as follows:   "As regards holdings located throughout the territory of a Member State, if, in the Member State concerned, the cattle population has a high proportion of suckler cows, representing at least 30 % of the total number of cows, and if at least 30 % of the male bovine animals slaughtered belong to conformation classes S, E and U, the EAGF shall finance the additional premium in total. Whether these percentages have been exceeded shall be established on the basis of the average of the two years preceding that for which the premium is granted."
Justification
We must build on the transitional regulation to anticipate the entry into force of the disappearance of the national supplementary dairy cow premium (PNSVA) by introducing an adjustment (by broadening the range of young male bovine animals for slaughter which can be included under letter U) to Article 111 of current Regulation 73/2009 so that cattle breeding can be supported by the EAGF in 2014. This simple technical adjustment is a tool enabling assistance to be given rapidly to breeding areas which are in a difficult situation.
Amendment  20 Proposal for a regulation Article 5 – paragraph 1 – point 7 a (new) Regulation (EC) No 73/2009 Article 124
Text proposed by the Commission Amendment   (7a) In Article 124, paragraphs 1 and 2 are replaced by the following:   "1. The agricultural area of a new Member State other than Bulgaria and Romania under the single area payment scheme shall be the part of its utilised agricultural area which is maintained in good agricultural condition, whether or not in production, and, where appropriate, adjusted in accordance with the objective and non-discriminatory criteria to be set by that new Member State after approval by the Commission."   For the purposes of this Title, 'utilised agricultural area' shall mean the total area taken up by arable land, permanent grassland, permanent crops and kitchen gardens as established by the Commission for its statistical purposes.   For Bulgaria and Romania, the agricultural area under the single area payment scheme shall be the part of its utilised agricultural area which is maintained in good agricultural condition, whether or not in production, where appropriate adjusted in accordance with the objective and non-discriminatory criteria to be set by Bulgaria or Romania after approval by the Commission.   2. For the purpose of granting payments under the single area payment scheme, all agricultural parcels corresponding to the criteria provided for in paragraph 1, as well as agricultural parcels planted with short rotation coppice (CN code ex 0602 90 41), shall be eligible. However, for Bulgaria and Romania, all agricultural parcels corresponding to the criteria provided for in paragraph 1, as well as agricultural parcels planted with short rotation coppice (CN code ex 0602 90 41), shall be eligible.   Except in the case of force majeure or exceptional circumstances, the parcels referred to in the first subparagraph shall be at the farmer's disposal on the date fixed by the Member State which shall be no later than the date in that Member State for amendment of the aid application.   The minimum size of eligible area per holding for which payments may be requested shall be 0,3 ha. However, any new Member State may decide, on the basis of objective criteria and after approval by the Commission, to set the minimum size at a higher level on condition that it does not exceed 1 ha."
Justification
In Article 124 Regulation (EC) No. 73/2009 paragraph 1 and 2 are replaced, alignment of the text to the European Parliament's negotiation mandate for the Regulation on direct payments (Decision of 13 March 2013).
Amendment  21 Proposal for a regulation Article 5 – paragraph 1 – point 8 a (new) Regulation (EC) No 73/2009 Article 133b (new)
Text proposed by the Commission Amendment   (8a) In Title V, the following Article is added:   "Article 133b   Transitional national aid in 2014   1. The new Member States applying the single area payment according to Article 122 may decide to grant transitional national aid in 2014.   2. Bulgaria and Romania may grant aid under this Article only if they decide by [one month from the date of application of this Regulation] not to grant in 2014 any complementary national direct payments under Article 132.   3. The aid under this Article may be granted to farmers in sectors in respect of which transitional national aid according to Article 133a, or in the case of Bulgaria and Romania complementary national direct payments according to Article 132, were granted in 2013.   4. The conditions for granting the aid under this Article shall be identical to those authorised for the granting of payments pursuant to Articles 132 or 133a in respect of 2013, with exception of the reductions due to the application of Article 132(2) in conjunction with Articles 7 and 10 of this Regulation. However, Member States may modify the conditions for granting the decoupled aid after authorisation by the Commission.   5. The total amount of aid that may be granted to farmers in any of the sectors referred to in paragraph 2 shall be limited to 80 % of the sector specific financial envelopes in respect of 2013 as authorised by the Commission in accordance with Article 133a(5), or for Bulgaria and Romania as authorised in accordance with Article 132(7).   For Cyprus, the sector specific financial envelopes are set out in Annex XVIIa of this Regulation.   6. New Member States shall notify the decisions referred to in paragraphs 1 and 2 to the Commission by 31 March 2014 at the latest. The notification of the decision referred to in paragraph 1 shall include the following:   (a) the financial envelope for each sector;   (b) the maximum rate of transitional national aid, where appropriate.   7. New Member States may decide, on the basis of objective criteria and within the limits authorised by the Commission pursuant to paragraph 5, on the amounts of transitional national aid to be granted."
Justification
In Regulation (EC) No. 73/2009 Article 133b is inserted, alignment of the text to the European Parliament's negotiation mandate for the Regulation on direct payments (Decision of 13 March 2013).
Amendment  22 Proposal for a regulation Article 5 – paragraph 1 – point 9 Regulation (EC) No 73/2009 Article 136a – paragraph 1
Text proposed by the Commission Amendment 1. Before ...1, Member States may decide to make available as additional support for measures under rural development programming financed under the EAFRD as specified under Regulation (EU) No […] [RD] of the European Parliament and of the Council, up to [15] % of their annual national ceilings for calendar years 2014 to 2019 as set out in Annex VIII to this Regulation for year 2014 and in Annex II to Regulation (EU) No [DP] of the European Parliament and of the Council, for years 2015-2019. As a result, the corresponding amount shall no longer be available for granting direct payments. 1. Before ...1, Member States may decide to make available as additional support for measures under rural development programming financed under the EAFRD as specified under Regulation (EU) No […] [RD] of the European Parliament and of the Council, up to 15% of their annual national ceilings for calendar years 2014 to 2019 in Annex VIII to this Regulation for year 2014 and in Annex II to Regulation (EU) No [DP] of the European Parliament and of the Council, for years 2015-2019.. As a result, the corresponding amount shall no longer be available for granting direct payments. The decision referred to in the first subparagraph shall be notified to the Commission by the date referred to in that subparagraph. The decision referred to in the first subparagraph shall be notified to the Commission by the date referred to in that subparagraph. The percentage notified in accordance with the second subparagraph shall be the same for the years referred to in the first subparagraph. That decision shall set out the percentage as referred to in that subparagraph which may vary by calendar year.   Member States which do not make use of the first subparagraph in respect of calendar year 2014 may take the decision referred to therein, in respect of calendar years 2015 to 2019, before 1 August 2014 and shall notify it to the Commission by 1 August 2014.   Member States may decide to review the decisions referred to in this paragraph with effect from calendar year 2018. Such review shall not result in a decrease of the percentage notified to the Commission in accordance with the first, second and third sub-paragraphs. Member States shall notify the Commission of such decisions to review by 1 August 2017." ______________ ______________ 1 OJ please insert the date 7 days from the date of entry into force of this Regulation. 1 OJ please insert the date three months from the date of entry into force of this Regulation.
Justification
Compromise Amendment inserting the text agreed at the last trilogue on 24 September 2013
Amendment  23 Proposal for a regulation Article 5 – paragraph 1 – point 9 Regulation (EC) No 73/2009 Article 136a – paragraph 2
Text proposed by the Commission Amendment 2. [Member States] not using the possibility under paragraph 1, [may decide, before ...1, to make available as direct payments under this Regulation and Regulation (EU) No [DP] up to [15] % of the amount allocated to support for measures under rural development programming financed under the EAFRD in the period 2015-2020 as specified under Regulation (EU) No […] [RD]]. Bulgaria, Estonia, Finland, Latvia, Lithuania, Poland, Portugal, Romania, Slovakia, Spain, Sweden and the United-Kingdom may decide to make available as direct payments an [additional] [10%] of the amount allocated under rural development. As a result, the corresponding amount shall no longer be available for support measures under rural development programming. 2. Before ...1, Member States not using the possibility under paragraph 1 may decide to make available as direct payments under this Regulation and Regulation (EU) No [DP], up to 15 % or, in the case of Bulgaria, Estonia, Finland, Latvia, Lithuania, Poland, Portugal, Romania, Slovakia, Spain, Sweden and the United-Kingdom, up to 25 % of the amount allocated to support for measures under rural development programming financed under the EAFRD in the period 2015-2020 as specified under Regulation (EU) No […] [RD]. As a result, the corresponding amount shall no longer be available for support measures under rural development programming. The decision referred to in the first subparagraph shall be notified to the Commission by the date referred to in that subparagraph. The decision referred to in the first subparagraph shall be notified to the Commission by the date referred to in that subparagraph. The percentage notified in accordance with the second subparagraph shall be the same for the years referred to in the first subparagraph of paragraph 1. That decision shall set out the percentage as referred to in that subparagraph which may vary by calendar year.   Member States which do not make use of the first subparagraph for financial year 2015 may take the decision referred to in the first sub-paragraph, as regards the period 2016-2020, before 1 August 2014 and shall notify it to the Commission by 1 August 2014.   Member States may decide to review the decisions referred to in this paragraph with effect for financial years 2019 and 2020. Such review shall not result in an increase of the percentage notified to the Commission in accordance with the first, second and third sub-paragraphs. Member States shall notify the Commission of such decisions to review by 1 August 2017. ______________ ______________ OJ please insert the date 7 days from the date of entry into force of this Regulation. OJ please insert the date three months from the date of entry into force of this Regulation. (The passages “Bulgaria, Estonia, Finland, Latvia, Lithuania, Poland, Portugal, Romania, Slovakia, Spain, Sweden and the United-Kingdom” and “of the amount allocated to support for measures under rural development programming financed under the EAFRD in the period 2015-2020 as specified under Regulation (EU) No […] [RD]] have been inverted and “up to 25 %” added)
Justification
Compromise Amendment inserting the text agreed at the last trilogue on 24 September 2013
Amendment  24 Proposal for a regulation Article 5 – paragraph 1 – point 9 a (new) Regulation (EC) No 73/2009 Article 136b (new)
Text proposed by the Commission Amendment 9a. The following Article 136b shall be inserted:   “Article 136b   Member States which have decided, in accordance with Article 136, to make available from financial year 2011 an amount for Community support in the framework of rural development programming and financing under the European Agricultural Fund for Rural Development (EAFRD), shall continue to make these amounts available for Community support in the framework of rural development programming and financing under the EAFRD for financial year 2015 in accordance with Annex VIIIa."
Justification
Inclusion of a provision allowing Member States to continue to transfer unspent resources from the first pillar to the second in 2014.
Amendment  25 Proposal for a regulation Article 5 a (new) Regulation (EC) Nr. 1698/2005 Article 70 – paragraph 4c
Text proposed by the Commission Amendment   Article 5a   Amendment to Regulation (EC) No 1698/2005   Regulation (EC) No 1698/2005 is amended as follows:   1. Article 70(4c) is amended as follows:   (a) In the first subparagraph the introductory part is replaced by the following:   "By way of derogation from the ceilings set out in paragraphs 3, 4 and 5, the EAFRD contribution may be increased up to a maximum of 95 % of eligible public expenditure in the regions eligible under the Convergence Objective and the outermost regions and the smaller Aegean Islands, and 85 % of eligible public expenditure in other regions. These rates shall apply to the eligible expenditure newly declared in each certified declaration of expenditure, where after …1 a Member State complies with one of the following conditions: "   (b) the second subparagraph is replaced by the following:   "A Member State wishing to make use of the derogation provided in the first subparagraph shall submit a request to the Commission to modify its rural development programme accordingly. The derogation shall apply from the approval, by the Commission, of the modification of the programme."   ___________________   1 OJ please insert date of entry into force of this Regulation.
Justification
Commission proposal COM(2013)0521 on extending the use of increased co-financing rates by Member States threatened with serious difficulties with respect to their financial stability should be included in the legal framework.
Amendment  26 Proposal for a regulation Article 5 b(new) Regulation (EC) Nr. 1234/2007 Article 182 – Paragraph 7
Text proposed by the Commission Amendment   Article 5b   Amendment to Regulation (EC) No 1234/2007   Regulation (EC) No 1234/2007 is amended as follows:   In Article 182, paragraph 7 is replaced by the following:   "Until 31 May 2015, Member States may grant state aid of a total annual amount of up to 55 % of the ceiling set out in Article 69(4) and (5) of Regulation (EC) No 73/2009 to farmers in the dairy sector in addition to Community support granted in accordance with Article 68(1)(b) of that Regulation. However, the total amount of Community support under the measures referred to in Article 69(4) of that Regulation and State aid shall not exceed the ceiling referred to in Article 69(4) and (5)."
Justification
It should be possible, under Article 182(7) of Regulation (EC) No 1234/2007, for state aid to be paid in the transition year 2014 as well – particularly in cases of hardship – which can also be granted as specific support under Article 68(1)(b) of Regulation (EC) No 73/2009.
Amendment  27 Proposal for a regulation Article 6 – paragraph 2 Regulation (EU) No [....] [DP] Article 14
Text proposed by the Commission Amendment Flexibility between pillars deleted "1. Before ..., Member States may decide to make available as additional support for measures under rural development programming financed under the EAFRD as specified under Regulation (EU) No […] [RD], up to [15] % of their annual national ceilings for calendar years 2014 to 2019 as set out in Annex VIII to Regulation (EC) No 73/2009 for year 2014 and in Annex II to this Regulation for years 2015-2019. As a result, the corresponding amount shall no longer be available for granting direct payments.   The decision referred to in the first subparagraph shall be notified to the Commission by the date referred to in that subparagraph.   The percentage notified in accordance with the second subparagraph shall be the same for the years referred to in the first subparagraph.   2. [Member States] not using the possibility under paragraph 1, [may decide, before ... , to make available as direct payments under Regulation (EC) No 73/2009 and this Regulation up to [15] % of the amount allocated to support for measures under rural development programming financed under the EAFRD in the period 2015-2020 as specified under Regulation (EU) No […] [RD]]. Bulgaria, Estonia, Finland, Latvia, Lithuania, Poland, Portugal, Romania, Slovakia, Spain, Sweden and the United-Kingdom may decide to make available as direct payments an [additional] [10%] of the amount allocated under rural development. As a result, the corresponding amount shall no longer be available for support measures under rural development programming.   The decision referred to in the first subparagraph shall be notified to the Commission by the date referred to in that subparagraph.   The percentage notified in accordance with the second subparagraph shall be the same for the years referred to in the first subparagraph of paragraph 1."   (3) In Article 57(2), the following subparagraph is inserted after the first subparagraph:   "However, it shall continue to apply in respect of aid applications relating to claim years starting before 1 January 2015."   (4) In Article 59, the second and the third paragraphs are replaced by the following:   "It shall apply from 1 January 2015.   However, Articles 20(5), 22(6), 35(1), 37(1) and 39 shall apply from the date of entry into force of this Regulation."
Justification
Compromise Amendment reflecting the agreement found on the DP regulation at the last trilogue on 24 September 2013, a wording which should not be amended by the transitional regulation.
Amendment  28 Proposal for a regulation Article 6 – paragraph 4 Regulation (EU) No [....] [DP] Article 59
Text proposed by the Commission Amendment In Article 59, the second and the third paragraphs are replaced by the following: Article 59, the second and the third paragraphs are replaced by the following: "It shall apply from 1 January 2015. "It shall apply from 1 January 2015. However, Articles 20(5), 22(6), 35(1), 37(1) and 39 shall apply from the date of entry into force of this Regulation." However, Articles 18(2), 20(5), 22(6), 28a(1), 35(1), 37(1) and 39 shall apply from the date of entry into force of this Regulation."
Justification
This is in accordance with the political agreement of 26 June 2013 and subject to formal approval by the European Parliament and Council.
Amendment  29 Proposal for a regulation Article 7 – paragraph -1 a (new) Regulation (EU) No [...] [HZ] Article 113 – paragraph 1 – subparagraph 1a (new)
Text proposed by the Commission Amendment   In Article 113(1) of Regulation (EU) No [...][HZ], the following subparagraph is inserted after the first subparagraph:   "However, Article 44a of Regulation (EC) 1290/2005 and the relevant implementing rules shall continue to apply to payments made for the financial years 2013 and 2014."
Justification
The farmers should be informed of the publication of their personal data before they have submitted the support application concerned. There must be also enough time reserved to the authorities to be prepared to implement the publication of the data in a way which fulfils the target of better understanding of agricultural policy and the legitimacy of support for the agricultural sector. Therefore the new transparency rules should be apply from the financial year 2015.
Amendment  30 Proposal for a regulation Article 7 – paragraph -1 b (new) Regulation (EU) No [...] [HZ] Article 114a (new)
Text proposed by the Commission Amendment   The following Article 114a is inserted:   "Article 114a   Derogations   By way of derogation from Article 59(5) of Regulation (EU) No 966/2012 and Article 9(1) of this Regulation, the certification bodies' opinion shall not be required to confirm the legality and regularity of the underlying transactions for the years 2014 and 2015."
Justification
It is anything but cost-effective that the certification bodies have to perform and then re-perform on-the-spot checks, as well as learn the eligibility rules in a very short period of time and in the level of detail required before the eligibility rules change again because of the CAP. Therefore, the control of legality and regularity (Art. 59(5) of Reg. 966/2012 and Art. 9(1) of Horizontal Regulation) should apply only as from financial year 2016.
Amendment  31 Proposal for a regulation Article 7 Regulation (EU) No [...] [HZ] Article 115
Text proposed by the Commission Amendment This Regulation shall enter into force on the seventh day following that of its publication in the Official Journal of the European Union. 1. This Regulation shall enter into force on the seventh day following that of its publication in the Official Journal of the European Union. It shall apply from 1 January 2014, except as follows: It shall apply from 1 January 2014.   2. However : (a) Articles 7, 8 and 9 shall apply from 16 October 2013; (a) Articles 7, 8, 16, 24a and 25 shall apply from 16 October 2013; (b) Articles 18, 42, 43 and 45 shall apply from 16 October 2013 as regards expenditure incurred from 16 October 2013 (b) without prejudice to Article 114a, Articles 9, 18, 42 and 45 shall apply from 16 October 2013 for expenditure incurred from that date; (c) Title III, Chapter II of Title V and Title VI shall apply from 1 January 2015. " (c) Article 54, Title III, Title IV and Title V shall apply from 1 January 2015, except as regards Title V sCMO Regulation, which shall apply from 1 January 2014;   (ca) Article 110 shall apply for payments made as from financial year 2016 onwards and Articles 110a - 110d shall apply for payments made as from financial year 2015 onwards.
Justification
As regards point (c), in order to avoid misinterpretations and unnecessary administrative costs and burden, the whole of Title V should apply from 1 January 2015 except as regards the application of the sCMO Regulation. Currently, the text of Art. 115(c) provides that only Chapter II of Title V (i.e. IACS) would apply from 1 January 2015, but other provisions, such as Art. 60-67 on general principles on checks, would apply already in 2014.As regards point (d), to make it possible to compare data and results, the monitoring and evaluation of the CAP (Art. 110) should apply from 16 October 2015 (i.e. after the CAP reform).As regards the transparency provisions (Art. 110a - 110d), Art. 110c of HZ Regulation states that the farmers have to be informed about the publication of their names, municipalities, support amounts etc. Payments have been claimed for financial year 2014 already in early spring 2013, before the now-proposed timetable was in the draft regulation concerning transitional provisions. Thus, the farmers have not been informed about the publication at the stage when they claimed support for the financial year 2014. Therefore, it is not possible to publish this information about payments made for financial year 2014 (claimed in 2013). The minimum is that the publication would be made as regards payments made from financial year 2015 onwards.
Amendment  32 Proposal for a regulation Article 8 – paragraph -1 (new) Regulation (EU) No [...][sCMO], Article 149
Text proposed by the Commission Amendment   (-1) In Article 149 of Regulation (EU) No [...][sCMO], point 149a is added:   "149a. National payments for certain sectors in Finland   Subject to authorisation by the Commission, Finland may in the years 2014 to2020 make degressive national payments to the sectors referred to in Commission Decision of 27 February 2008 on a transitional national support programme for farmers in the South of Finland1 . The Commission shall adopt implementing acts authorising these payments as well as setting the more detailed conditions for granting the aid. Those implementing acts shall be adopted without using the Committee procedure referred to in [Article 162].   ____________   1 COM(2008)696 final.".
Justification
In order to maintain diverse agricultural production in Southern Finland, the Commission should be given powers to authorise national payments for certain agricultural sectors, which have, since the Finnish accession to the EU, been eligible for national support on the basis of Commission decisions.
Amendment  33 Proposal for a regulation Article 9 Regulation (EU) No [....] [RD] Article 64
Text proposed by the Commission Amendment In Article 64 of Regulation (EU) No […] [RD], paragraphs 4 and 5 are replaced by the following: deleted "4. The Commission shall, by means of an implementing act, make an annual breakdown by Member State of the amounts referred to in paragraph 1, after deduction of the amount referred to in paragraph 2 and taking into account the transfers of funds referred to in Article 136a(2) of Council Regulation (EC) No 73/2009.   In making the annual breakdown the Commission shall take into account:   (a) objective criteria linked to the objectives referred to in Article 4; and   (b) past performance.   5. In addition to the amounts referred to in paragraph 4, the implementing act referred to in that paragraph shall also include the funds transferred to the EAFRD in application of Article 136a(1) of Regulation (EC) No 73/2009 and Article 7(2) of Regulation (EU) No [DP] and the funds transferred to the EAFRD in application of Articles 10b and 136 of Regulation (EC) No 73/2009 in respect of calendar year 2013."   _______   * OJ L 30, 31.1.2009, p. 16."
Justification
Compromise Amendment reflecting the agreement found on the RD regulation at the last trilogue on 24 September 2013, a wording which should not be amended by the transitional regulation.
Amendment  34 Proposal for a regulation Annex I – Title
Text proposed by the Commission	Amendment
Correspondence of Articles in animal and area related measures under the 2007-2013 and the 2014-2020 programming periods	Correspondence of Articles in measures under the 2007-2013 and the 2014-2020 programming periods
Justification
The correlation table should also contain intervention measures.
Amendment  35 Proposal for a regulation Annex I – rows -1 (new) to -1c (new)
Amendment
Regulation (EC) No 1698/2005	Regulation (EU) No […] [RD]
Article 20(b)(i) – Modernisation of agricultural holdings	Article 18 – Investments in physical assets
Article 20(b)(iii) – Increasing the added value of agricultural and forestry products	Article 18 – Investments in physical assets and Article 27 – Investments in new forestry methods and in the processing and marketing of forestry products
Article 20(b)(iv) – Cooperation as regards the development of new products, processes and technologies in agriculture, forestry and the food industry	Article 36 – Cooperation
Article 20(b)(v) – Improving and developing infrastructure related to the development and adaptation of agriculture and forestry	Article 18 – Investments in physical assets and Article 27 – Investments in new forestry methods and in the processing and marketing of forestry products
Amendment  36 Proposal for a regulation Annex II – introductory part Regulation (EC) No 73/2009
Text proposed by the Commission Amendment Annexes II, III and VIII to Regulation (EC) No 73/2009 are amended as follows: Annexes II, III and VIII to Regulation (EC) No 73/2009 are amended as follows and new Annexes VIIIa and XIIa are inserted:
Amendment  37 Proposal for a regulation Annex II – point 1 a (new)
Text proposed by the Commission	Amendment
	(1a) In Annex II, Point B. 'Public, animal and plant health' SMR 9 is replaced by the following:
	9. Regulation (EC) No 1107/2009 of the European Parliament and of the Council of 21 October 2009 concerning the placing of plant protection products on the market and repealing Council Directives 79/117/EEC and 91/414/EEC (OJ L 309, 24.11.2009, p.1)
	Article 55, first and second sentence
Amendment  38 Proposal for a regulation Annex II – point 2 – point a
2. Annex III is amended as follows:
a) The entry for "Protection and management of water" is replaced by the following:
"Protection and management of water:	- Establishment of buffer strips along water courses (1)
	- Where use of water for irrigation is subject to authorisation, compliance with authorisation procedures
Protect water against pollution and run‑off, and manage the use of water	The measures laid down in the Appendix
(1) Note: The GAEC buffer strips must respect, both within and outside vulnerable zones designated pursuant to Article 3(2) of Directive 91/676/EEC, at least the requirements relating to the conditions for land application of fertiliser near water courses, referred to in point A.4 of Annex II to Directive 91/676/EEC to be applied in accordance with the action programmes of Member States established under Article 5(4) of Directive 91/676/EEC."
Amendment
2. Annex III is amended as follows:
a) The entry for "Protection and management of water" is replaced by the following:
"Protection and management of water:	- Establishment of buffer strips along water courses (1)
	- Where use of water for irrigation is subject to authorisation, compliance with authorisation procedures
Protect groundwater against pollution	The measures laid down in the Appendix, where these are often used in agricultural practices (2)
(1) Note: The GAEC buffer strips must respect, both within and outside vulnerable zones designated pursuant to Article 3(2) of Directive 91/676/EEC, at least the requirements relating to the conditions for land application of fertiliser near water courses, referred to in point A.4 of Annex II to Directive 91/676/EEC to be applied in accordance with the action programmes of Member States established under Article 5(4) of Directive 91/676/EEC."
(2) The GAEC Standard does not apply where fertiliser and plant protection products are used in line with the codes of good agricultural practice.
Justification
The wording of the GAEC Standard on groundwater protection is very broad in the Commission proposal and could lead to disproportionate restrictions on agricultural practices which comply with the rules. It is important, therefore, to make very clear that
- the standard relates to groundwater protection (and not surface water),
- it is only necessary to define measures which are relevant to traditional farming methods, and
- fertilisers and plant protection products may still be applied, provided this is done in accordance with the rules.
Amendment  39 Proposal for a regulation Annex II – point 3a (new) Regulation (EC) No 73/2009 Annex VIIIa (new)
Amendment (4) The following Annex VIIIa is inserted after Annex VIII: Annex VIIIa (in EUR 1 000) Member State 2014 Germany 42 600 Sweden 9 000
Justification
Inclusion of a provision allowing Member States to continue to transfer unspent resources from the first pillar to the second in 2014.
Amendment  40 Proposal for a regulation Annex II – point 3b (new) Regulation (EC) No 73/2009 Annex XIIa (new)
Amendment The following Annex XIIa is inserted after Annex XII: Annex XIIa Average size of agricultural holding for the purposes of Article 72a Member State Average size of agricultural holding (in hectares) BelgiumBulgaria Czech Republic Denmark Germany Estonia Ireland Greece Spain France Croatia Italy Cyprus Latvia Lithuania Luxembourg Hungary Malta Netherlands Austria Poland Portugal Romania Slovenia Slovakia Finland Sweden United Kingdom   296 89 60 46 39 32 5 24 52 5.9 8 4 16 12 57 7 1 25 19 6 13 3 6 28 34 43 54

• [1]     Not yet published in the Official Journal.

EXPLANATORY STATEMENT

The European Parliament, together with the other EU institutions, endeavours to make possible the entry into force of the reformed CAP on 1 January 2014. In order for this to be possible, however, an agreement between the institutions must be reached on the Multiannual Financial Framework 2014-2020 and the reform of the Common Agricultural Policy (CAP) by autumn 2013 to enable the legal bases of the reformed CAP to enter into force on 1 January 2014.

It appears improbable, however, that all aspects of the reformed CAP will be able to be implemented by 1 January 2014. Transitional rules are therefore needed to define technical arrangements which will permit a smooth transition to the new regime, while at the same time ensuring continuity of the different forms of support under the CAP. As regards direct payments, sufficient time must be available to allow Member States, paying agencies and farmers to be well prepared and to learn about the new rules sufficiently in advance of their application. The main aspects of the current rules will therefore be extended to claim year 2014 and/or adjusted by means of transitional provisions. Subject to consent to the MFF by the European Parliament, the transitional provisions will incorporate the procedure on external convergence and flexibility between the two pillars of the CAP. The introduction of transitional measures means that some of the dates included in the Commission proposal on direct support beyond 2013 will have to be adapted accordingly in order to ensure consistency with this proposal for a Regulation.

As regards rural development, it is common practice to establish transitional rules for the transition period between the two programming periods but also to determine how current measures can be continued, with funding from the new financial envelope. A bridge between the two consecutive programming periods must be established. Given that the countryside is currently facing new challenges, some specific transitional arrangements are required, notably to deal with the implications of the delay to the new direct payment regime for certain rural development measures, especially as regards the baseline for agri‑environment and climate measures and the application of the rules on cross compliance. Transitional arrangements are also needed to ensure that Member States can continue to undertake new commitments in 2014 even if the resources for the current period have been exhausted. These new commitments and corresponding ongoing commitments can receive support from the new financial envelopes of the next programming period's rural development programmes.

These transitional provisions include a flexibility mechanism, under which Member States can transfer funds from one CAP pillar to the other. It is proposed to limit the amount of funds transferred to 15 % for transfers from the first to the second pillar, and to 10 % for transfers from the second to the first pillar. The latter should, however, only be available to those Member States whose average direct payments amount to less than 90 % of the EU average. In order not to anticipate a final decision taken on this specific element, the parts of the article included in the transitional measures that differ from Article 14 of the Commission proposal on direct payments beyond 2013 have been placed between square brackets.

In the light of the above, specific transitional rules need to be adopted by the European Parliament and the Council before the end of the year and, where necessary, amendments to the basic acts of the CAP currently in force need to be made.

OPINION of the Committee on Budgets (27.9.2013)

for the Committee on Agriculture and Rural Development

on the proposal for a regulation of the European Parliament and of the Council laying down certain transitional provisions on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) and amending Regulation (EU) No [RD] as regards resources and their distribution in respect of the year 2014 and amending Council Regulation (EC) No 73/2009 and Regulations (EU) No [DP], (EU) No [HZ] and (EU) No [sCMO] as regards their application in the year 2014
(COM(2013)0226 – C7‑0104/2013 – 2013/0117(COD))

Rapporteur: Giovanni La Via

SHORT JUSTIFICATION

The European Parliament is working intensively, in line with the other EU institutions, to allow the reform of the Common Agricultural Policy (CAP) to enter into force on 1 January 2014. This requires, however, that an agreement between the institutions on the Multiannual Financial Framework (MFF) 2014-2020, as well as on the reform fn the CAP is achieved in the autumn of 2013 so that the legal bases for the reformed CAP come into force on January 1, 2014.

It seems however unlikely, that all aspects of the CAP can be implemented on January 1, 2014. Hence, transition rules are needed to determine the technical modalities enabling a smooth adaptation to the new conditions, and at the same time ensuring a continuity of the various funding opportunities within the framework of the CAP. For direct payments the Member States, the paying agents and farmers must have sufficient time, to prepare well and to be informed early enough on the details of the reform. The main elements of the existing regulations are therefore be extended or adapted for the application year 2014 by the transitional regime. Subject to the consent of the European Parliament to the MFF, the transitional rules include a procedure of the external convergence and flexibility mechanism between the two pillars. The introduction of transitional measures implies that some of the data contained in the Commission's proposal for direct payments after 2013 must be adjusted accordingly, to ensure coherence with the present draft of the regulation.

Concerning Rural Development transition rules are a common practice, to lay down rules for the transition between the two programming periods, but also to determine how the activities continue in the new programming period, including their funding with a new budget. It is necessary to establish a link between two successive programming periods. Because rural areas facing new challenges some special transitional arrangements are required. In particular, to respond to the effect a delay of the new direct payment system will bring for certain support measures for rural areas with regard to the reference values for agri-environment and climate response measures and the application of the cross compliance rules. Transitional provisions are also necessary to ensure that Member States can enter new commitments in 2014, despite the appropriation for the current period is exhausted. These new obligations, as well as ongoing obligations can be funded out of the new budget for support for rural areas for the next programming period.

These transitional rules include a flexibility mechanism, whereby Member States can transfer funds between the two pillars. It is proposed, to limit these transfers to 15% for transfers from the first to the second pillar, as well as to 10% for transfers from the second to the first pillar, while the latter should only be allowed for those Member States with average direct payments below 90% of the EU average. In order not to prejudice a final decision on this specific point, the parts contained in the transitional measures laid down in the Articles, which deviate from Article 14 of the Commission proposal for direct payments after 2013, are enclosed in square brackets.

In the light of the above observations, the Council and the European Parliament must adopt before the end of the year the specific transitional rules and, if necessary, to change the current basic legal acts of the CAP.

AMENDMENTS

The Committee on Budgets calls on the Committee on Agriculture and Rural Development, as the committee responsible, to incorporate the following amendments in its report:

Amendment  1 Proposal for a regulation Article 1 – paragraph 1
Text proposed by the Commission	Amendment
By way of derogation from Article 94 of Regulation (EU) No […] [RD], for the measures of Article 36(a)(i) to (v) and (b)(iv) and (v) of Regulation (EC) No 1698/2005, Member States may continue to undertake new legal commitments to beneficiaries in 2014 pursuant to the rural development programmes adopted on the basis of Regulation (EC) No 1698/2005 even after the financial resources of the 2007-2013 programming period have been used up, until the adoption of the respective rural development programme for the 2014-2020 programming period. The expenditure incurred on the basis of these commitments shall be eligible in accordance with Article 3 of this Regulation.	By way of derogation from Article 94 of Regulation (EU) No […] [RD], Member states may continue to undertake new legal commitments to beneficiaries in 2014, in relation to the measures referred to in Articles 20, 36, 52 and 63 of Regulation (EC) No 1698/2005, pursuant to the rural development programmes adopted on the basis of Regulation (EC) No 1698/2005 even after the financial resources of the 2007-2013 programming period have been used up, until the adoption of the respective rural development programme for the 2014-2020 programming period or until the end of 2014, by financing it from the funds from the 2014-2020 period. The expenditure incurred on the basis of these commitments shall be eligible in accordance with Article 3 of this Regulation.
Amendment  2 Proposal for a regulation Article 1 – paragraph 2
Text proposed by the Commission	Amendment
2. The condition of the second indent of Article 14(2) of Council Regulation (EC) No 1257/1999 shall not apply to new legal commitments undertaken by Member States under Article 36(a)(i) and (ii) of Regulation (EC) No 1698/2005 in 2014.	2. The condition set out in the second indent of Article 14(2) of Council Regulation (EC) No 1257/1999 shall not apply to new legal commitments undertaken by Member States under Article 36(a)(i) and (ii) of Regulation (EC) No 1698/2005 in 2014.
Amendment  3 Proposal for a regulation Article 3 – paragraph 1 – introductory part
Text proposed by the Commission	Amendment
1. By way of derogation from Article 7(1) of Regulation (EU) No […] [RD], expenditure relating to legal commitments to beneficiaries, undertaken under the measures of Article 36(a)(i) to (v) and (b)(iv) and (v) of Regulation (EC) No 1698/2005 and of Article 36(b)(i) and (iii) of that Regulation in relation to the annual premium, shall be eligible for an EAFRD contribution in the 2014-2020 programming period in the following cases:	1. By way of derogation from Article 7(1) of Regulation (EU) No […] [RD], expenditure relating to legal commitments to beneficiaries, undertaken under the measures referred to in Articles 20 , 36, 52 and 63 of Regulation 1698/2005, shall be eligible for an EAFRD contribution in the 2014-2020 programming period in the following cases:
Amendment  4 Proposal for a regulation Article 3 – paragraph 1 – point b
Text proposed by the Commission	Amendment
(b) for payments to be made after 31 December 2015.	(b) for payments to be made after 31 December 2015 for all commitments undertaken pursuant to Article 36 of Regulation (EU) No [...][RD].
Amendment  5 Proposal for a regulation Article 5 - paragraph 1 - subparagraph 2 - point 3 Regulation (EC) No 73/2009 Article 40 - paragraph 3
Text proposed by the Commission Amendment Without prejudice to Article 25 of Regulation (EU) No [HZ] of the European Parliament and of the Council*, the amounts of direct payments which may be granted in a Member State in respect of calendar year 2014 under Articles 34, 52, 53 and 68 of this Regulation and for the aid to silkworm rearers under Article 111 of Regulation (EC) No 1234/2007 shall not be higher than the ceilings set out in Annex VIII to this Regulation for that year. Where necessary, and in order to comply with the ceilings set out in Annex VIII, Member States shall make a linear reduction in the amounts of direct payments in respect of calendar year 2014. Without prejudice to Article 25 of Regulation (EU) No [HZ] of the European Parliament and of the Council*, the amounts of direct payments which may be granted in a Member State in respect of calendar year 2014 under Articles 34, 52, 53 and 68 of this Regulation and for the aid to silkworm rearers under Article 111 of Regulation (EC) No 1234/2007 shall not be higher than the ceilings set out in Annex VIII to this Regulation for that year reduced by the amounts resulting from the application of Article 136 for the budget year 2015. Where necessary, and in order to comply with the ceilings set out in Annex VIII, reduced by the amounts resulting from the application of Article 136 for the budget year 2015. Member States shall make a linear reduction in the amounts of direct payments in respect of calendar year 2014.

PROCEDURE

Title	Transitional provisions regarding the regulations on Direct payments, Rural development and Financing, monitoring and management of the CAP
References	COM(2013)0226 – C7-0104/2013 – 2013/0117(COD)
Committee responsible        Date announced in plenary	AGRI 21.5.2013
Opinion by        Date announced in plenary	BUDG 21.5.2013
Rapporteur        Date appointed	Giovanni La Via 7.5.2013
Date adopted	26.9.2013
Result of final vote	+: –: 0:	32 0 0
Members present for the final vote	Marta Andreasen, Zuzana Brzobohatá, Isabelle Durant, James Elles, Eider Gardiazábal Rubial, Ingeborg Gräßle, Jutta Haug, Monika Hohlmeier, Sidonia Elżbieta Jędrzejewska, Anne E. Jensen, Ivailo Kalfin, Jan Kozłowski, Alain Lamassoure, Giovanni La Via, George Lyon, Claudio Morganti, Jan Mulder, Andrej Plenković, Dominique Riquet, Oleg Valjalo, Jacek Włosowicz
Substitute(s) present for the final vote	Alexander Alvaro, Maria Da Graça Carvalho, Lidia Joanna Geringer de Oedenberg, Edit Herczog, Jürgen Klute, Peter Šťastný, Catherine Trautmann
Substitute(s) under Rule 187(2) present for the final vote	Jean-Pierre Audy, Elisabeth Jeggle, Maurice Ponga, Sabine Verheyen

PROCEDURE

Title	Transitional provisions regarding the regulations on Direct payments, Rural development and Financing, monitoring and management of the CAP
References	COM(2013)0226 – C7-0104/2013 – 2013/0117(COD)
Date submitted to Parliament	18.4.2013
Committee responsible        Date announced in plenary	AGRI 21.5.2013
Committee(s) asked for opinion(s)        Date announced in plenary	BUDG 21.5.2013	CONT 21.5.2013	ENVI 21.5.2013	REGI 21.5.2013
Not delivering opinions        Date of decision	CONT 22.5.2013	ENVI 7.5.2013	REGI 11.7.2013
Rapporteur(s)        Date appointed	Albert Deß 24.4.2013
Discussed in committee	8.7.2013	2.9.2013
Date adopted	30.9.2013
Result of final vote	+: –: 0:	35 3 0
Members present for the final vote	John Stuart Agnew, Eric Andrieu, Liam Aylward, José Bové, Luis Manuel Capoulas Santos, Vasilica Viorica Dăncilă, Michel Dantin, Paolo De Castro, Albert Deß, Herbert Dorfmann, Robert Dušek, Hynek Fajmon, Mariya Gabriel, Iratxe García Pérez, Martin Häusling, Peter Jahr, Elisabeth Jeggle, Jarosław Kalinowski, George Lyon, Mairead McGuinness, Wojciech Michał Olejniczak, Marit Paulsen, Britta Reimers, Ulrike Rodust, Alfreds Rubiks, Giancarlo Scottà, Czesław Adam Siekierski, Sergio Paolo Francesco Silvestris, Alyn Smith, Csaba Sándor Tabajdi, Marc Tarabella, Janusz Wojciechowski
Substitute(s) present for the final vote	María Auxiliadora Correa Zamora, Sandra Kalniete, Christa Klaß, Giovanni La Via, Hans-Peter Mayer, Dimitar Stoyanov
Substitute(s) under Rule 187(2) present for the final vote	María Muñiz De Urquiza
Date tabled	9.10.2013