(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 Future of Food and Farming’ of 29 November 2017 sets out the challenges, objectives and orientations for the future Common Agricultural Policy (CAP) after 2020. These objectives include, inter alia, the need for the CAP to be more result-driven, to boost modernisation and sustainability, including the economic, social, environmental and climate sustainability of the agricultural, forestry and rural areas, and to help reducing the Union legislation-related administrative burden for beneficiaries.

(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 Future of Food and Farming’ of 29 November 2017 sets out the challenges, objectives and orientations for the future Common Agricultural Policy (CAP) after 2020. These objectives include, inter alia, the need for the CAP to be more result-driven, market-oriented, to boost modernisation and sustainability, including the economic, social, demographic, environmental and climate sustainability of the agricultural, forestry and rural areas, and to help reducing the Union legislation-related administrative burden for beneficiaries. The new policy should also represent a simplification for beneficiaries who should receive a fair income. In order for the CAP to achieve those objectives, it is of utmost importance to keep the same level of financing in the 2021-2027 Multiannual Financial Framework as during the 2014-2020 period.

(1a)

The CAP continues to play a key role in the development of the Union’s rural areas. It is therefore necessary to attempt to slow down the gradual abandonment of agricultural activity by keeping a CAP that is strong, with adequate resources, to mitigate the depopulation of rural areas and to continue meeting consumer expectations in terms of the environment, food safety and animal welfare. In view of the challenges faced by Union producers in responding to new regulatory requirements and a higher level of environmental ambition, against a background of price volatility and Union borders that are more open to imports from third countries, the CAP budget should be kept at least at the same level as during the 2014-2020 period.

(1b)

In order to address the global dimension and implications of the CAP, the Commission should ensure coherence and continuity with the other Union external policies and instruments, in particular in development cooperation and trade. The Union’s commitment to policy coherence for development requires the taking into account of development objectives and principles when designing policies.

(2)

Since the CAP needs to sharpen its responses to the challenges and opportunities as they manifest themselves at Union, international, national, regional, local and farm levels, it is necessary to streamline the governance of the CAP and improve its delivery on the Union objectives and to significantly decrease the administrative burden. In the CAP based on delivery of performance (‘delivery model’), the Union should set the basic policy parameters, such as objectives of the CAP and basic requirements, while Member States should bear greater responsibility as to how they meet the objectives and achieve targets. Enhanced subsidiarity makes it possible to better take into account local conditions and needs, tailoring the support to maximise the contribution to Union objectives.

(2)

Since the CAP needs to sharpen its responses to the challenges and opportunities as they manifest themselves at Union, international, national, regional, local and farm levels, it is necessary to streamline the governance of the CAP and improve its delivery on the Union objectives and to significantly decrease the administrative burden , in particular to the final beneficiaries . In the CAP based on delivery of performance (‘delivery model’), the Union should set the basic policy parameters, such as objectives of the CAP and  basic requirements, while Member States should bear greater responsibility as to how they meet the objectives and achieve targets , whilst ensuring policy certainty and financial security for the sector . Enhanced subsidiarity makes it possible to better take into account local conditions and needs, tailoring the support to maximise the contribution to Union objectives. Nevertheless, in order to ensure that such subsidiarity does not represent a ‘renationalisation’ of the CAP, this Regulation should include a strong body of Union provisions designed to prevent the distortion of competition and to ensure non-discriminatory treatment for all Union farmers throughout the territory of the Union.

(3)

The use of common definitions entirely set at Union level has caused certain difficulties for Member States to cater their own specificities at national, regional, and local level. Member States should therefore be given the flexibility to specify certain definitions in their CAP Strategic Plan. In order to ensure a common level playing field, a certain framework has, however, to be set at Union level constituting the necessary essential elements to be included in those definitions (‘framework definitions’).

(3)

Member States should be given the flexibility to specify certain definitions in their CAP Strategic Plan. In order to ensure a common level playing field, a certain framework has, however, to be set at Union level constituting the necessary common elements to be included in those definitions (‘framework definitions’).

(4)

In order to ensure that the Union can respect its international obligations on domestic support as set out in the WTO Agreement on Agriculture, and in particular that the basic income support for sustainability and related types of interventions continue to be notified as ‘Green Box’ support which has no, or at most minimal, trade-distorting effects or effects on production, the framework definition for ‘agricultural activity’ should provide for both the production of agricultural products or the maintenance of the agricultural area. In light of adjusting to local conditions, Member States should lay down the actual definition of agricultural activity in their CAP Strategic Plans.

(4)

In order to ensure that the Union can respect its international obligations on domestic support as set out in the WTO Agreement on Agriculture, and in particular that the basic income support for sustainability and related types of interventions continue to be notified as ‘Green Box’ support which has no, or at most minimal, trade-distorting effects or effects on production, the framework definition for ‘agricultural activity’ should provide for both the production of agricultural products or the maintenance of the agricultural area. In light of adjusting to local conditions, Member States should lay down the definition of agricultural activity in their CAP Strategic Plans , complying with the common elements of the Union framework definition .

(5)

In order to retain the essential Union-wide elements to ensure comparability between Member State decisions, without however limiting Member States in reaching Union objectives, a framework definition for ‘agricultural area’ should be set out. The related framework definitions for ‘arable land’, ‘permanent crops’ and ‘permanent grassland’ should be set out in a broad way to allow Member States to further specify definitions according to their local conditions. The framework definition for ‘arable land’ should be laid down in a way that allows Member States to cover different production forms, including system such as agroforestry and arable areas with shrubs and trees and that requires the inclusion of fallow land areas in order to ensure the decoupled nature of the interventions. The framework definition of ‘permanent crops’ should include both areas actually used for production and not, as well as nurseries and short rotation coppice to be defined by Member States. The framework definition of ‘permanent grassland’ should be set in a way that allows Member States to specify further criteria and allows them to include species other than grasses or other herbaceous forage that can be grazed or that may produce animal feed, whether used for actual production or not.

(5)

In order to retain common essential Union-wide elements to ensure comparability between Member State decisions and equal treatment between Union farmers , without however limiting Member States in reaching Union objectives, a framework definition for ‘agricultural area’ should be set out. The related framework definitions for ‘arable land’, ‘permanent crops’ and ‘permanent grassland’ should be set out in a broad way to allow Member States to further specify definitions according to their local conditions and traditional practices . The framework definition for ‘arable land’ should be laid down in a way that allows Member States to cover different production forms, including system such as agroforestry and arable areas with shrubs and trees and that requires the inclusion of fallow land areas in order to ensure the decoupled nature of the interventions. The framework definition of ‘permanent crops’ should include both areas actually used for production and not, as well as nurseries and short rotation coppice to be defined by Member States. The framework definition of ‘permanent grassland’ should be set in a way that allows Member States to specify further criteria and allows them to include species other than grasses or other herbaceous forage that can be grazed , whether exclusively or not, or that may produce animal feed, whether used for actual production or not.

(5a)

The focus in the future of farming should be on producing high-quality food, as that is where the Union’s competitive advantage lies. Union standards should be maintained and strengthened where feasible, and measures should be provided for to further increase the long-term productivity and competitiveness of the food production sector, and to introduce new technologies and a more efficient use of resources, thereby strengthening the Union’s role as a world leader.

(8)

As regards the areas used for the production of hemp, in order to preserve public health and to ensure the coherence with other bodies of legislation, the use of hemp seeds varieties with tetrahydrocannabinol content below 0,2  % should be part of the definition of eligible hectare.

(8)

As regards the areas used for the production of hemp, in order to preserve public health and to ensure the coherence with other bodies of legislation, the use of hemp seeds varieties with tetrahydrocannabinol content below 0,3  % should be part of the definition of eligible hectare.

(9)

In view of further improving the performance of the CAP, income support should be targeted to genuine farmers. In order to ensure a common approach at Union level for such a targeting of support, a framework definition for ‘ genuine farmer’ displaying the essential elements should be set out. On the basis of this framework, Member States should define in their CAP Strategic Plans which farmers are not considered genuine farmers based on conditions such as income tests, labour inputs on the farm, company object and inclusion in registers. It should also not result in precluding support to pluri-active farmers, who are actively farming but who are also engaged in non-agricultural activities outside their farm, as their multiple activities often strengthen the socio-economic fabric of rural areas.

(9)

In view of further improving the performance of the CAP, income support should be targeted to active farmers. In order to ensure a common approach at Union level for such a targeting of support, a framework definition for ‘ active farmer’ displaying the common elements should be set out. Support to pluri-active farmers, who are actively farming but who are also engaged in non-agricultural activities outside their farm, should not be precluded, as their multiple activities often strengthen the socio-economic fabric of rural areas. That framework definition should, in any event, help to preserve the model of family farming that exists in the Union.

(9a)

Equality between women and men is a core principle of the Union and gender mainstreaming is an important tool in the integration of that principle into to the CAP. There should therefore be a particular focus on promoting the participation of women in the socio-economic development of rural areas. The size of female-operated farms tends to be smaller and the work performed by women, as farmers’ spouses, is not always recognised and visible, which has an impact on their economic independence. This Regulation should help to ensure that the work that women do is more visible, better appreciated and taken into account within the specific objectives to be proposed by the Member States in their strategic plans. Gender equality as well as non-discrimination principles should be an integral part of the preparation, implementation and evaluation of CAP interventions. Member States shall also strengthen their capacity in gender mainstreaming and in the collection of sex-disaggregated data.

(10)

In order to ensure consistency between the direct payments types of interventions and rural development types of interventions when addressing the objective of generational renewal, a framework definition for ‘young farmer’ with the essential elements should be set out at Union level.

(10)

In order to ensure consistency between the direct payments types of interventions and rural development types of interventions when addressing the objective of generational renewal, a framework definition for ‘young farmer’ with common elements should be set out at Union level.

(10a)

In order to ensure consistency between the direct payments types of interventions and rural development types of interventions when addressing the objective of facilitating business development in rural areas, a framework definition for ‘new farmer’ with common elements should be set out at Union level.

(11)

In order to give substance to the objectives of the CAP as established by Article 39 of the Treaty on the Functioning of the European Union (TFEU), as well as to ensure that the Union adequately addresses its most recent challenges, it is appropriate to provide for a set of general objectives reflecting the orientations given in the Communication on ‘The Future of Food and Farming’. A set of specific objectives should be further defined at Union level and applied by the Member States in their CAP Strategic Plans. While striking a balance across the dimensions of sustainable development, in line with the impact assessment, these specific objectives should translate the general objectives of the CAP into more concrete priorities and take into account relevant Union legislation, particularly with regard to climate, energy and environment .

(11)

In order to pursue the objectives of the CAP as established by Article 39 of the Treaty on the Functioning of the European Union (TFEU), as well as to ensure that the Union adequately addresses its most recent challenges, it is appropriate to provide for a set of general objectives reflecting the orientations given in the Communication on ‘The Future of Food and Farming’. A set of specific objectives should be further defined at Union level and pursued by the Member States in their CAP Strategic Plans. While striking a balance across the dimensions of sustainable development, in line with the impact assessment, these specific objectives should translate the general objectives of the CAP into more concrete priorities in the economic, environmental and social spheres .

(13)

While under the CAP delivery model the Union should set the Union objectives and define the types of interventions as well as the basic Union requirements applicable to Member States, the latter should be in charge of translating that Union framework into support arrangements applicable to beneficiaries. In that context, Member States should act in line with the Charter of Fundamental Rights, general principles of Union law and ensure that the legal framework for the granting of Union support to beneficiaries be based on their CAP Strategic plans and be in line with the principles and requirements set out under this Regulation and the [Horizontal Regulation].

(13)

While under the CAP delivery model the Union should set the Union objectives and define the types of interventions as well as the common Union requirements applicable to Member States, the latter should be in charge of translating that Union framework into support arrangements applicable to beneficiaries. In that context, Member States should act in line with the Charter of Fundamental Rights, general principles of Union law and ensure that the legal framework for the granting of Union support to beneficiaries be based on their CAP Strategic plans and be in line with the principles and requirements set out under this Regulation and the [Horizontal Regulation].

(13a)

The cross-cutting principles set out in Article 3 of the Treaty on European Union (TEU) and in Article 10 TFEU, including the principles of subsidiarity and proportionality as set out in Article 5 TEU, should be observed when implementing the CAP Strategic Plans. Member States and the Commission should also comply with the obligations of the United Nations Convention on the Rights of Persons with Disabilities and ensure accessibility in line with Article 9 thereof and in accordance with Union law harmonising accessibility requirements for products and services. Member States and the Commission should seek to eliminate inequalities and promote equality between men and women and gender mainstreaming, as well as to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation. The European Agricultural Guarantee Fund (EAGF) and the European Agricultural Fund for Rural Development (EAFRD) should not support actions that contribute to any form of segregation, discrimination, or exclusion. The objectives of those funds should be pursued from the perspective of sustainable development and in line with the aim, promoted under the Aarhus Convention and by the Union, of preserving, protecting, and improving the quality of the environment and combating climate change, as set out in Article 11 and Article 191(1) TFEU, while applying the ‘polluter pays’ principle.

(13b)

The delivery model should not lead to a situation in which there are 27 different national agricultural policies, thus endangering the common spirit of the CAP and creating distortions. It should leave to Member States a certain degree of flexibility within a strong common regulatory framework.

(15)

In the context of greater market-orientation of the CAP, as outlined by the Communication on ‘The Future of Food and Farming’, market exposure, climate change and associated frequency and severity of extreme weather events, as well as sanitary and phytosanitary crises, may lead to risks of price volatility and increasing pressures on incomes. Thus, although farmers are ultimately responsible for designing their on-farm strategies, a robust framework should be set up to ensure appropriate risk management. To this aim, Member States and farmers may be able to draw on a Union-level platform on risk management for capacity-building in order to provide farmers with adequate financial instruments for investments and access to working capital, training, knowledge transfer and advice.

(15)

In the context of greater market-orientation of the CAP, as outlined by the Communication on ‘The Future of Food and Farming’, market exposure, absence of reciprocity clauses in trade agreements with third countries, climate change and associated frequency and severity of extreme weather events, as well as sanitary and phytosanitary crises, may lead to risks of price volatility and increasing pressures on incomes . Inequalities in the food chain, mainly at the expense of the primary sector, which is the ‘weakest link’, also have an adverse effect on producers’ incomes . Thus, although farmers are ultimately responsible for designing their on-farm strategies and for improving the resilience of their farms , a robust framework should be set up to ensure appropriate risk management. To this aim, Member States and farmers may be able to draw on a Union-level platform on risk management for capacity-building in order to provide farmers with adequate financial instruments for investments and access to working capital, training, knowledge transfer and advice.

(16)

Bolstering environmental care and climate action and contributing to the achievement of Union environmental- and climate-related objectives is a very high priority in the future of Union agriculture and forestry. The architecture of the CAP should therefore reflect greater ambition with respect to these objectives. By virtue of the delivery model, action taken to tackle environmental degradation and climate change should be result-driven and Article 11 TFEU should, for this purpose, be considered as an obligation of result.

(16)

Supporting and improving environmental protection, biodiversity and genetic diversity in the agricultural system, as well as climate action and contributing to the achievement of Union environmental- and climate-related objectives is a very high priority in the future of Union agriculture , horticulture and forestry. The architecture of the CAP should therefore reflect greater ambition with respect to these objectives , while at the same time reflecting adequately the greater burden and requirements before the producers . By virtue of the delivery model, action taken to tackle environmental degradation and climate change should be result-driven and Article 11 TFEU should, for this purpose, be considered as an obligation of result.

(16a)

For the socio-economic sustainability of rural areas, the Commission should check that the Member States ensure in their CAP Strategic Plans that there is coherence between the application of Directive 2010/41/EU of the European Parliament and of the Council  (1a) and the long - term approach on the use of Rural Development funds.

(16b)

Agriculture can be an important engine of growth and poverty reduction, but the sector is underperforming in many countries in part because women, who greatly contribute to the rural economy, face constrains. Effective action should be taken by Member States to support women’s key role in the development and preservation of rural areas.

(17)

The CAP should keep ensuring food security, which should be understood as meaning access to sufficient, safe and nutritious food at all times. Moreover, it should help improving the response of Union agriculture to new societal demands on food and health, including sustainable agricultural production, healthier nutrition, food waste and animal welfare. The CAP should continue to promote production with specific and valuable characteristics, while at the same time helping farmers to proactively adjust their production according to market signals and consumers’ demands.

(17)

The CAP should keep ensuring food security, which should be understood as meaning access to sufficient, safe , healthy and nutritious food at all times. Moreover, it should help improving the response of Union agriculture to new societal demands on food and health, including sustainable agricultural production, healthier nutrition, high-quality production and quality differentiation, food waste and animal welfare. The CAP should continue to promote sustainable production with specific and valuable characteristics, such as High Nature Value farming systems, while at the same time helping farmers to proactively adjust their production according to market signalsand consumers’ demands.

(17a)

In line with their commitment to the 2030 Agenda and the Paris Agreement, and with the conclusions of the International Assessment of Agricultural Knowledge, Science and Technology for Development, as well as the recommendations of the United Nations Special Rapporteur on the right to food, the Union and its Member States should transition to a sustainable European food and agriculture system. The pathway for that transition should focus on promoting diversified, sustainable and resilient agricultural practices that contribute to protecting and enhancing natural resources, reinforcing ecosystems and to climate change adaptation and mitigation, through adjusting livestock production to ecological carrying capacities, minimising dependence on unsustainable inputs including fossil energies and progressively improving biodiversity and soil quality.

(17b)

While the One Health Action Plan against antimicrobial resistance (AMR) considers vaccination to be a cost-effective public health intervention to combat AMR, the relatively higher cost of diagnosis, antimicrobial alternatives and vaccination compared with conventional antibiotics are an obstacle to increasing the vaccination rate of animals.

(17c)

In order to meet the environmental objectives of the CAP but also societal requirements in terms of increased food safety, the use of fertilising products with very low levels of heavy metals should be promoted.

(19a)

In order to ensure the well-being of farmers and their families, and bearing in mind that stress is a major cause of farm accidents, Member States shall ensure the social sustainability of the policy by keeping the regulatory and administrative burden at the minimum, allowing for a healthy work-life balance for farmers, and ensuring viability of farming in the Union.

(21)

Building on the previous system of cross-compliance implemented until 2020, the system of new conditionality links full receipt of CAP support to the compliance by beneficiaries of basic standards concerning the environment, climate change, public health, animal health, plant health and animal welfare. The basic standards encompass in a streamlined form a list of statutory management requirements (SMRs) and standards of good agricultural and environmental conditions of land (GAECs). These basic standards should better take into account the environmental and climate challenges and the new environmental architecture of the CAP, thus delivering a higher level of environmental and climate ambition as the Commission announced in its Communications on the ‘Future of Food and Farming’ and the Multiannual Financial Framework (MFF). Conditionality aims to contribute to the development of sustainable agriculture through better awareness on the part of beneficiaries of the need to respect those basic standards. It also aims to make the CAP more compatible with the expectations of society through improving consistency of the policy with the environment, public health, animal health, plant health and animal welfare objectives. Conditionality should form an integral part of the environmental architecture of the CAP, as part of the baseline for more ambitious environmental and climate commitments, and should be comprehensively applied across the Union. For those farmers who do not comply with those requirements, Member States should ensure that proportionate, effective and dissuasive penalties are applied in accordance with [the HZR Regulation].

(21)

Building on the previous system of cross-compliance implemented until 2020, the system of new conditionality links full receipt of CAP support to the compliance by beneficiaries of basic standards concerning the environment, climate change, public health , applicable working and employment conditions , animal health, plant health and animal welfare. The basic standards encompass in a streamlined form a list of statutory management requirements (SMRs) and standards of good agricultural and environmental conditions of land (GAECs). These basic standards should better take into account the environmental and climate challenges and the new environmental architecture of the CAP, thus delivering a higher level of environmental and climate ambition as the Commission announced in its Communications on the ‘Future of Food and Farming’ and the Multiannual Financial Framework (MFF). Moreover it is of particular importance that Member States take relevant measures to ensure employers’ access to direct payments is conditional on the compliance with the applicable working and employment conditions and/or employer obligations resulting from all relevant collective agreements and social and labour law at national and Union levels, inter alia in the field of awareness of conditions of employment, remuneration, working time, health and safety, housing, gender equality, free movement of workers, equal treatment, posting of workers, conditions of stay of third-country nationals, temporary agency work, social protection and social security coordination among Member States.

(22)

The framework of standards of GAECs aims to contribute to the mitigation and adaptation to climate change, the tackling of water challenges, the protection and quality of soil and the protection and quality of biodiversity. The framework needs to be enhanced to take into account in particular the practices set until 2020 under the greening of direct payments, the mitigation of climate change and the need to improve farms sustainability , and in particular the nutrients management . It is acknowledged that each GAEC contributes to multiple objectives. In order to implement the framework, Member States should define a national standard for each of the standards set at Union level taking into account the specific characteristics of the area concerned, including soil and climatic conditions, existing farming conditions, land use, crop rotation, farming practices and farm structures. Member States may also define in addition other national standards related to the main objectives laid down in Annex III in order to improve the environmental and climate delivery of the GAEC framework. As part of GAEC framework, in order to support both the agronomic and the environmental performance of farms, nutrient management plans will be established with the help of a dedicated electronic Farm Sustainability Tool made available by the Member States to individual farmers. The tool should provide on-farm decision support starting from minimum nutrient management functionalities. A wide interoperability and modularity should also ensure the possibility to add other electronic on-farm and e-governance applications. In order to ensure a level playing field between farmers and across the Union, the Commission may provide support to the Member States in the design of the Tool as well as with the data storage and processing services required.

(22)

The framework of standards of GAECs aims to contribute to the mitigation and adaptation to climate change, the tackling of water challenges, the protection and quality of soil and the protection and quality of biodiversity. The framework needs to be enhanced to take into account in particular the practices set until 2020 under the greening of direct payments, the mitigation of climate change and the need to improve farms sustainability. It is acknowledged that each GAEC contributes to multiple objectives. In order to implement the framework, Member States should define a national standard for each of the standards set at Union level taking into account the specific characteristics of the area concerned, including soil and climatic conditions, existing farming conditions, the agronomic characteristics of different productions, differences between annual crops, permanent crops and other specialised production, land use, crop rotation, local and traditional farming practices and farm structures. Member States may also define equivalent practices or certification systems having a beneficial impact on the climate and the environment which is similar to or better than the impact of one or more GAEC practices.

(22a)

In order to tackle the Union-wide biodiversity decline, it is essential to ensure a minimum level of non-productive areas and features under conditionality and eco-schemes in all Member States. In that context, Member States should aim, in their Strategic Plans, to provide an area of at least 10 % of landscape elements beneficial for biodiversity. Those should include, inter alia, buffer strips, rotational or non-rotational fallow land, hedges, non-productive trees, terrace walls, and ponds, all of which contribute to enhancing carbon sequestration, preventing soil erosion and depletion, filtering air and water, and supporting climate adaptation.

(23)

SMRs need to be fully implemented by Member States in order to become operational at farm level and ensure equal treatment of farmers. To ensure the consistency of the rules on conditionality in enhancing the sustainability of the policy, SMRs should encompass main Union legislation on environment, public health, animal health, plant health and animal welfare which implementation at national level imply precise obligations on individual farmers, including obligations under Council Directive 92/43/EEC (11) and Directive 2009/147/EC of the European Parliament and of the Council (12) or Council Directive 91/676/EEC (13). In order to follow up on the joint statement made by the European Parliament and the Council as annexed to Regulation (EU) No 1306/2013 of the European Parliament and of the Council (14), the relevant provisions of Directive 2000/60/EC of the European Parliament and of the Council (15) and Directive 2009/128/EC of the European Parliament and of the Council (16) are included as SMRs into the scope of conditionality and the list of GAEC standards is adapted accordingly.

(23)

SMRs need to be fully implemented by Member States in order to become operational at farm level and ensure equal treatment of farmers. To ensure the consistency of the rules on conditionality in enhancing the sustainability of the policy, SMRs should encompass main Union legislation on environment, public health, animal health, plant health and animal welfare which implementation at national level imply precise obligations on individual farmers, including obligations under Council Directive 92/43/EEC (11) and Directive 2009/147/EC of the European Parliament and of the Council (12) or Council Directive 91/676/EEC (13). In order to follow up on the joint statement made by the European Parliament and the Council as annexed to Regulation (EU) No 1306/2013 of the European Parliament and of the Council (14), the relevant provisions of Directive 2000/60/EC of the European Parliament and of the Council (15) (the Water Framework Directive) and Directive 2009/128/EC of the European Parliament and of the Council (16) are included as SMRs into the scope of conditionality and the list of GAEC standards is adapted accordingly.

(24)

Member States should set farm advisory services for the purpose of improving the sustainable management and overall performance of agricultural holdings and rural businesses, covering economic, environmental and social dimensions, and to identify the necessary improvements as regards all measures at farm level provided for in the CAP Strategic Plans. These farm advisory services should help farmers and other beneficiaries of CAP support to become more aware of the relationship between farm management and land management on the one hand, and certain standards, requirements and information, including environmental and climate ones, on the other hand. The list of the latter includes standards applying to or necessary for farmers and other CAP beneficiaries and set in the CAP Strategic Plan, as well as those stemming from the legislation on water, on the sustainable use of pesticides, as well as the initiatives to combat antimicrobial resistance and the management of risks. In order to enhance the quality and effectiveness of the advice, Member States should integrate advisors within the Agricultural Knowledge and Innovation Systems (AKIS), in order to be able to deliver up-to-date technological and scientific information developed by research and innovation.

(24)

Member States should provide high-quality farm advisory services for the purpose of improving the sustainable management and overall performance of agricultural holdings and rural businesses, covering economic, environmental and social dimensions, and to identify the necessary improvements as regards all measures at farm level provided for in the CAP Strategic Plans. These farm advisory services should help farmers and other beneficiaries of CAP support to become more aware of the relationship between farm management and land management on the one hand, and certain standards, requirements and information, including environmental and climate ones, on the other hand. The list of the latter includes standards applying to or necessary for farmers and other CAP beneficiaries and set in the CAP Strategic Plan, as well as those stemming from the legislation on water, on the sustainable use of pesticides, as well as the initiatives to combat antimicrobial resistance and the management of risks. In order to enhance the quality and effectiveness of the advice, Member States should integrate advisors within the Agricultural Knowledge and Innovation Systems (AKIS), in order to be able to deliver up-to-date technological and scientific information developed by research and innovation. Any Union initiatives regarding advisory services and innovation systems should be built, whenever possible, upon existing ones at Member State level.

(26)

Union legislation should provide that Member States should set requirements in terms of minimum area for receiving decoupled payments in their CAP Strategic Plan. Such requirements should relate to the need to avoid the excessive administrative burden caused by managing numerous payments of small amounts and to that of ensuring an effective contribution of the support to the objectives of the CAP to which the decoupled direct payments contribute. In order to guarantee a minimum level of agricultural income support for all genuine farmers, as well as to comply with the Treaty objective in ensuring a fair standard of living for the agricultural community, an annual area-based decoupled payment should be established as the type of intervention ‘basic income support for sustainability’. In order to enhance better targeting of this support, the payment amounts can be differentiated, by groups of territories, based on socio-economic and/or agronomic conditions. In view of avoiding disruptive effects for farmers' income, Member States may choose to implement the basic income support for sustainability based on payment entitlements. In this case, the value of payment entitlements before any further convergence should be proportional to their value as established under the basic payment schemes pursuant to Regulation (EU) No 1307/2013, taking also into account the payments for agricultural practices beneficial for the climate and the environment. Member States should also achieve further convergence in order to continue to move progressively away from historical values.

(26)

Union legislation should provide that Member States should set requirements in terms of minimum area for receiving decoupled payments in their CAP Strategic Plan. Such requirements should relate to the need to avoid the excessive administrative burden caused by managing numerous payments of small amounts and to that of ensuring an effective contribution of the support to the objectives of the CAP to which the decoupled direct payments contribute. In order to guarantee a minimum level of agricultural income support for all active farmers, as well as to comply with the Treaty objective in ensuring a fair standard of living for the agricultural community, an annual area-based decoupled payment should be established as the type of intervention ‘basic income support for sustainability’. In order to enhance better targeting of this support, the payment amounts can be differentiated, by groups of territories, based on socio-economic , environmental and/or agronomic conditions. In view of avoiding disruptive effects for farmers' income, Member States may choose to implement the basic income support for sustainability based on payment entitlements. In this case, the value of payment entitlements before any further convergence should be proportional to their value as established under the basic payment schemes pursuant to Regulation (EU) No 1307/2013, taking also into account the payments for agricultural practices beneficial for the climate and the environment. Member States should also achieve further convergence in order to move progressively to full convergence by 2026

(26a)

Income support through the CAP is a major contributor to the stability and sustainability of many small and family farms across Europe, and although expectations on farmers have increased, monetary benefits have not. The CAP's overall share of the Union’s budget is decreasing, while market crises in the sector and a falling number of active famers continue to threaten the survival of the sector. The family farm model should be protected as a general objective of the CAP and through the Member State Strategic Plans, giving proper place to the vital role this model has in contributing to the social fabric of rural life, and the provision of a way of life for many rural dwellers. Family farms contribute to sustainable food production, the preservation of natural resources, diversification needs and ad ensuring food security. The first farmers to suffer under the immense pressures of globalisation will be those that pursue the small family farm model. Such a situation would be an obvious failure to meet the objectives of the CAP and would undermine the argument for support of the CAP in future. Therefore the CAP Strategic Plans should pursue through their specific objectives keeping the protection of that farming model.

(28)

Small farms remain a cornerstone of Union agriculture as they play a vital role in supporting rural employment and contribute to territorial development. In order to promote a more balanced distribution of support and to reduce administrative burden for beneficiaries of small amounts, Member States should have the option of offering to small farmers the possibility of replacing the other direct payments by providing a round some payment for small farmers.

(28)

Small farms remain a cornerstone of Union agriculture as they play a vital role in supporting rural employment and contribute to territorial development. In order to promote a more balanced distribution of support and to reduce administrative burden for beneficiaries of small amounts, Member States should have the option of offering to small farmers the possibility of replacing direct payments by providing a round some payment for small farmers. However, with a view to further reducing the administrative burden, Member States should be authorised to automatically include certain farmers, initially, within the simplified scheme, offering them the possibility of withdrawing from it by a specific deadline. In line with the principle of proportionality, the Member States should be given the possibility of establishing a reduced system of conditionality checks for small farmers that participate in the simplified scheme .

(30a)

Organic farming is developing in many Member States and has a proven track record of delivering public goods, preserving ecosystems services and natural resources, reducing inputs, attracting young farmers and women in particular, creating jobs, experimenting with new business models, meeting societal demands, and revitalising rural areas. Yet the growth in demand for organic products continues to outpace the growth in production. Member States should ensure that their CAP Strategic Plans include objectives to increase the share of agricultural land under organic management in order to meet the increasing demand for organic products, and to develop the whole organic supply chain. Member States should be able to fund organic conversion and maintenance either through rural development measures or through eco-schemes, or through a combination of both, and should ensure that allocated budgets match the expected growth in organic production.

(31)

The CAP should ensure that Member States increase the environmental delivery by respecting local needs and farmers' actual circumstances. Member States should under direct payments in the CAP Strategic Plan set up Eco-schemes voluntary for farmers, which should be fully coordinated with the other relevant interventions. They should be defined by the Member States as a payment granted either for incentivising and remunerating the provision of public goods by agricultural practices beneficial to the environment and climate or as a compensation for the introduction of these practices. In both cases they should aim at enhancing the environmental and climate performance of the CAP and should consequently be conceived to go beyond the mandatory requirements already prescribed by the system of conditionality. Member States may decide to set up eco-schemes for agricultural practices such as the enhanced management of permanent pastures and landscape features, and organic farming. These schemes may also include ‘entry-level schemes’ which may be a condition for taking up more ambitious rural development commitments.

(31)

The CAP should ensure that Member States increase the environmental delivery by respecting local needs and farmers' actual circumstances. Member States should under direct payments in the CAP Strategic Plan set up , on the basis of a list of agricultural practices beneficial for the climate and the environment established by the Commission, eco-schemes voluntary for farmers, which should be fully coordinated with the other relevant interventions. They should be defined by the Member States as a payment granted either for incentivising and remunerating the provision of public goods by agricultural practices beneficial to the environment and climate, they should aim at enhancing the environmental and climate performance of the CAP and should consequently be conceived to go beyond the mandatory requirements already prescribed by the system of conditionality. Member States should set aside a certain percentage of their direct payments allocation for the eco-schemes. Member States may decide to set up eco-schemes to promote production models that are beneficial for the environment, particularly extensive livestock rearing, and to promote all kinds of agricultural practices such as the enhanced management of permanent pastures and permanent landscape features, and to set up environmental certification schemes , such as organic farming , integrated production, or conservation agriculture . These schemes may also include measures of a type other than rural development environmental and climate commitments, or measures of the same nature that may be classified as ‘entry-level schemes’ which may be a condition for taking up more ambitious rural development commitments.

(33)

Compliance of coupled income support with the Union's international commitments should be ensured. This includes in particular the requirements of the Memorandum of Understanding between the European Economic Community and the United States of America on oilseeds within the framework of the GATT  (17) , as applicable subsequent to changes to the EU separate base area for oilseeds following changes to the composition of the EU. The Commission should have the power to adopt implementing acts for this purpose of laying down detailed rules in this respect.

(35)

Sectoral types of interventions are needed to contribute to the CAP objectives and reinforce synergies with other CAP instruments. In line with the delivery model, minimum requirements concerning the contents and objectives for such sectoral types of interventions should be elaborated at Union level in order to ensure a level playing field in the internal market and avoid conditions of unequal and unfair competition. Member States should justify their inclusion in their CAP Strategic Plans and ensure consistency with other interventions at sectoral level. The broad types of interventions to be established at Union level should cover the sectors of fruit and vegetables, wine, apiculture products, olive oil and table olives, hops and other products to be defined, for which the establishment of sectoral programs is deemed to have beneficial effects on the achievement of some or all of the general and specific objectives of the CAP pursued by this Regulation.

(35)

Sectoral types of interventions are needed to contribute to the CAP objectives and reinforce synergies with other CAP instruments. In line with the delivery model, minimum requirements concerning the contents and objectives for such sectoral types of interventions should be elaborated at Union level in order to ensure a level playing field in the internal market and avoid conditions of unequal and unfair competition. Member States should justify their inclusion in their CAP Strategic Plans and ensure consistency with other interventions at sectoral level. The broad types of interventions to be established at Union level should cover the sectors of fruit and vegetables, wine, apiculture products, olive oil and table olives, hops and other products defined in Article 39 , for which the establishment of sectoral programs is deemed to have beneficial effects on the achievement of some or all of the general and specific objectives of the CAP pursued by this Regulation.

(35a)

In view of the increase in the allocation provided for the apiculture sector and in recognition of the important role it plays in preserving biodiversity and food production, it is appropriate to also increase the Union co-financing ceiling and to add new eligible measures designed to promote the sector’s development.

(37)

For interventions for rural development, principles are defined at Union level, particularly with regard to the basic requirements for the Member States to apply selection criteria. However, Member States should have ample discretion to define specific conditions according to their needs. Types of interventions for rural development include payments for environmental, climate and other management commitments that Member States should support throughout their territories, in accordance with their national, regional or local specific needs. Member States should grant payments to farmers and other land managers who undertake, on a voluntary basis, management commitments that contribute to climate change mitigation and adaptation and to the protection and improvement of the environment including water quality and quantity, air quality, soil, biodiversity and ecosystem services including voluntary commitments in Natura 2000 and support for genetic diversity. Support under payments for management commitments may also be granted in the form of locally-led, integrated or cooperative approaches and result-based interventions.

(37)

For interventions for rural development, principles are defined at Union level, particularly with regard to the basic requirements for the Member States to apply selection criteria. However, Member States should have ample discretion to define specific conditions according to their needs. Types of interventions for rural development include payments for environmental, climate and other management commitments that Member States should support throughout their territories, in accordance with their national, regional or local specific needs. Member States should grant payments to farmers, groups of farmers and other land managers who undertake, on a voluntary basis, management commitments that contribute to climate change mitigation and adaptation and to the protection and improvement of the environment including water quality and quantity, air quality, soil, biodiversity and ecosystem services including voluntary commitments in Natura 2000 , and in High Nature Value Areas and support for genetic diversity. Support under payments for management commitments may also be granted in the form of locally-led, integrated , collective or cooperative approaches and result-based interventions.

(37a)

In view of ensuring the resilience of the Union's ecosystems and promoting biodiversity, Member States should be allowed to grant payments to agri-environmental sustainable practices, for climate mitigation and adaptation and for the protection and improvement of genetic resources, in particular through traditional breeding methods.

(38)

Support for management commitments may include organic farming premia for the maintenance of and the conversion to organic land; payments for other types of interventions supporting environmentally friendly production systems such as agro-ecology, conservation agriculture and integrated production; forest environmental and climate services and forest conservation; premia for forests and establishment of agroforestry systems; animal welfare; conservation, sustainable use and development of genetic resources. Member States may develop other schemes under this type of interventions on the basis of their needs. This type of payments should cover additional costs and income foregone only resulting from commitments going beyond the baseline of mandatory standards and requirements established in Union and national law, as well as conditionality, as laid down in the CAP Strategic Plan. Commitments related to this type of interventions may be undertaken for a pre-established annual or pluri-annual period and might go beyond seven years where duly justified.

(38)

Support for management commitments shall include organic farming premia for the conversion to organic land and may include those for the maintenance of organic land; payments for other types of interventions supporting environmentally friendly production systems such as High Nature Value farming , agro-ecology, and integrated production; forest environmental and climate services and forest conservation; premia for forests and establishment of agroforestry systems; the protection of traditional agricultural landscapes, animal welfare and animal health ; conservation, sustainable use and development of genetic resources and biodiversity . Member States may develop other schemes under this type of interventions on the basis of their needs and they may strengthen the agri-environmental measures specific to the beekeeping sector which already exist in certain regions of the Union, and develop further measures. This type of payments should cover additional costs , financial incentives and income foregone only resulting from commitments going beyond the baseline of mandatory standards and requirements established in Union and national law, as well as conditionality, as laid down in the CAP Strategic Plan . Member States should also provide financial incentives to beneficiaries. Commitments related to this type of interventions may be undertaken for a pre-established annual or pluri-annual period and might go beyond seven years where duly justified.

(39)

Forestry measures should contribute to the implementation of the Union Forest Strategy, and be based on Member States' national or sub-national forest programs or equivalent instruments, which should build on the commitments stemming from the Regulation on the inclusion of greenhouse gas emission and removals from land use, land use energy and forestry [LULUCF Regulation] and those made in the Ministerial Conferences on the Protection of Forests in Europe. Interventions should be based on forest management plans or equivalent instruments and may comprise forest area development and sustainable management of forests, including the afforestation of land and the creation and regeneration of agroforestry systems; the protection, restoration and improvement of forest resources, taking into account adaptation needs; investments to guarantee and enhance forest conservation and resilience, and the provision of forest ecosystem and climate services; and measures and investments in support of the renewable energy and bio-economy.

(39)

Forestry measures should contribute to widening the use of agroforestry systems and to the implementation of the Union Forest Strategy, and be based on Member States' national or sub-national forest programs or equivalent instruments, which should build on the commitments stemming from Regulation (EU) 2018/841 of the European Parliament and of the Council  (1a) and those made by the Ministerial Conferences on the Protection of Forests in Europe. Interventions should be based on sustainable forest management plans or equivalent instruments delivering effective carbon sequestration from the atmosphere while enhancing biodiversity and may comprise forest area development and sustainable management of forests, including the afforestation of land , fire prevention and the creation and regeneration of agroforestry systems; the protection, restoration and improvement of forest resources, taking into account adaptation needs; investments to guarantee and enhance forest conservation and resilience, and the provision of forest ecosystem and climate services; and measures and investments in support of the renewable energy and bio-economy.

(40)

In order to ensure a fair income and a resilient agricultural sector across the Union territory, Member States may grant support to farmers in areas facing natural and other area-specific constraints. As regards payments for ANC, the designation of the 2014-2020 Rural Development policy should continue to apply. For the CAP to deliver enhanced Union added on the environment and reinforce its synergies with the financing of investments in nature and biodiversity, it is necessary to keep a separate measure aiming at compensating beneficiaries for disadvantages related to the implementation of Natura 2000 and Water Framework Directives . Support should therefore continue to be granted to farmers and forest holders to help address specific disadvantages resulting from the implementation of Directive 2009/147/EC and Directive 92/43/EEC 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 CAP Strategic Plans that go beyond relevant mandatory standards and requirements. Member States should also ensure that payments to farmers do not lead to double funding with eco schemes. Furthermore, the specific needs of Natura 2000 areas should be taken into account by Member States in the overall design of their CAP Strategic Plans.

(40)

In order to ensure a fair income and a resilient agricultural sector across the Union territory, Member States may grant support to farmers in areas facing natural and other area-specific constraints, including mountain areas and island regions. As regards payments for ANC, the designation of the 2014-2020 Rural Development policy should continue to apply. For the CAP to deliver enhanced Union added on the environment and reinforce its synergies with the financing of investments in nature and biodiversity, it is necessary to keep a separate measure aiming at compensating beneficiaries for disadvantages related to the implementation of Natura 2000 established by Council Directive 92/43/EEC  (1a) and of the Water Framework Directive . Support should therefore continue to be granted to farmers and forest holders to help address specific disadvantages resulting from the implementation of Directive 2009/147/EC and Directive 92/43/EEC 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 CAP Strategic Plans that go beyond relevant mandatory standards and requirements. Member States should also ensure that payments to farmers do not lead to double funding with eco schemes , while at the same time allowing enough flexibility in Strategic Plans to facilitate complementarity between different interventions . Furthermore, the specific needs of Natura 2000 areas should be taken into account by Member States in the overall design of their CAP Strategic Plans.

(41)

The objectives of the CAP should also be pursued through support for investments, productive as well as non-productive, on farm as well as off-farm . Such investments may concern, inter alia, infrastructures related to the development, modernisation or adaptation to climate change of agriculture and forestry, including access to farm and forest land, land consolidation and improvement, agro-forestry practices and the supply and saving of energy and water. In order to better ensure the consistency of the CAP Strategic Plans with Union objectives, as well as a level playing field between Member States, a negative list of investment topics is included in this Regulation.

(41)

The objectives of the CAP should also be pursued through support for investments, productive as well as non-productive, which aim to strengthen farms’ resilience . Such investments may concern, inter alia infrastructures related to the development, modernisation or adaptation to climate change of agriculture and forestry, including access to farm and forest land, land consolidation and improvement, agro-forestry practices, and the supply and saving of energy and water. In order to better ensure the consistency of the CAP Strategic Plans with Union objectives, as well as a level playing field between Member States, a negative list of investment topics is included in this Regulation.

(42)

In the light of the need to fill the investment gap in the Union agricultural sector and improve access to financial instruments for priority groups, notably young farmers and new entrants with higher risk profiles, use of the InvestEU guarantee and combination of grants and financial instruments should be encouraged. Since the use of financial instruments across Member States varies considerably as a result of differences in terms of access to finance, banking sector development, presence of risk capital, familiarity of public administrations and potential range of beneficiaries, Member States should establish in the CAP Strategic Plan appropriate targets, beneficiaries and preferential conditions, and other possible eligibility rules.

(42)

In the light of the need to fill the investment gap in the Union agricultural sector and improve access to financial instruments for priority groups, notably young farmers and new entrants with higher risk profiles, a combination of grants and financial instruments should be encouraged. Since the use of financial instruments across Member States varies considerably as a result of differences in terms of access to finance, banking sector development, presence of risk capital, familiarity of public administrations and potential range of beneficiaries, Member States should establish in the CAP Strategic Plan appropriate targets, beneficiaries and preferential conditions, and other possible eligibility rules.

(43)

Young farmers and new entrants still face significant barriers regarding access to land, high prices and access to credit. Their businesses are more threatened by price volatility (for both inputs and produce) and their needs in terms of training in entrepreneurial and risk management skills are high. It is therefore essential to continue the support for the setting up of new businesses and new farms. Member States should provide for a strategic approach and identify a clear and coherent set of interventions for generational renewal under the specific objective dedicated to this issue. To this aim, Member States may set in their CAP Strategic Plans preferential conditions for financial instruments for young farmers and new entrants, and should include in their CAP Strategic Plan the ring-fencing of at least an amount corresponding to 2 % of the annual direct payments' envelope. An increase of the maximum amount of aid for the installation of young farmers and rural business start-ups, up to EUR 100 000 , which can be accessed also through or in combination with financial instrument form of support, should be established.

(43)

Young farmers and new farmers still face significant barriers regarding access to land, high prices and access to credit. Their businesses are more threatened by price volatility (for both inputs and produce) and their needs in terms of training in entrepreneurial , risk prevention and management skills are high. It is therefore essential to continue the support for the setting up of new businesses and new farms. Member States should provide for a strategic approach and identify a clear and coherent set of interventions for generational renewal under the specific objective dedicated to this issue. To this aim, Member States may set in their CAP Strategic Plans preferential conditions for financial instruments for young farmers and new entrants, and should include in their CAP Strategic Plan the ring-fencing of at least an amount corresponding to 2 % of the annual direct payments’ envelope in the first pillar . An increase of the maximum amount of aid for the installation of young farmers and rural business start-ups, up to EUR 100 000 , which can be accessed also through or in combination with financial instrument form of support, should be established.

(44)

In the light of the need to ensure appropriate risk management tools, insurance premia and mutual funds should be maintained, financed by the EAFRD. The category of mutual funds encompasses both those linked to production losses, and the general and sector-specific income stabilisation tools, linked to income losses.

(44)

In the light of the need to ensure appropriate risk management tools, insurance premia and mutual funds should be maintained, financed by the EAFRD. The category of mutual funds encompasses both those linked to production losses, and the general and sector-specific income stabilisation tools, linked to income losses. In order to adapt the risk management tools to the challenges faced by farmers, including climate change, the CAP toolbox should include compensation for the costs and losses incurred by farmers in connection with measures taken to combat animal diseases and plant pests, or for the losses incurred by organic farmers as a result of an external contamination for which they are not responsible. However, the compatibility of EARDF-financed interventions with national risk management systems should be ensured.

(45)

Support should enable the establishment and implementation of cooperation between at least two entities in view of achieving CAP objectives. Support can entail all aspects of such cooperation, such as the setting up of quality schemes; collective environmental and climate action; the promotion of short supply chain and local markets; pilot projects; Operational Group projects within the EIP for agricultural productivity and sustainability local development projects, Smart Villages, buyers' clubs and machinery rings; farm partnerships; forest management plans; networks and clusters; social farming; community supported agriculture; actions within the scope of LEADER; and the setting up of producer groups and producer organisations, as well as other forms of cooperation deemed necessary to achieve the specific objectives of the CAP.

(45)

Support should enable the establishment and implementation of cooperation between at least two entities in view of achieving CAP objectives. Support can entail all aspects of such cooperation, such as the setting up, certification costs, promotion and maintenance of quality schemes; collective environmental and climate action; the promotion of short supply chain and local markets; pilot projects; Operational Group projects within the EIP for agricultural productivity and sustainability local development projects, Smart Villages, buyers' clubs and machinery rings; farm partnerships; forest management plans , including agroforestry ; networks and clusters; social farming; community supported agriculture; actions within the scope of LEADER; and the setting up of producer groups and producer organisations, including producer groups recognised under Regulation (EU) No 1151/2012 of the European Parliament and of the Council  (1a), as well as other forms of cooperation deemed necessary to achieve the specific objectives of the CAP. As a way of promoting intergenerational renewal, consideration should be given to granting specific support to farmers who wish to stop farming before reaching the statutory retirement age and intend to hand over their farm to a cooperating younger farmer.

(47)

The EAGF should continue financing types of interventions in the form of direct payments and sectoral types of interventions, whereas the EAFRD should continue financing types of interventions for rural development as described in this Regulation. The rules for the financial management of the CAP should be laid down separately for the two funds and for the activities supported by each of them, taking into account that the new delivery model gives more flexibility and subsidiarity for Member States to reach their objectives. Types of interventions under this Regulation should cover the period from 1 January 2021 to 31 December 2027.

(47)

The EAGF should continue financing types of interventions in the form of direct payments and sectoral types of interventions, whereas the EAFRD should continue financing types of interventions for rural development as described in this Regulation. The rules for the financial management of the CAP should be laid down separately for the two funds and for the activities supported by each of them, taking into account that the new delivery model gives more flexibility and subsidiarity for Member States to reach their objectives. Types of interventions under this Regulation should cover the period from 1 January 2022 to 31 December 2027.

(48)

Support for direct payments under the CAP Strategic Plans should be granted within national allocations to be fixed by this Regulation. These national allocations should reflect a continuation of the changes whereby the allocations to Member States with the lowest support level per hectare are gradually increased to close 50 % of the gap towards 90 % of the Union average. In order to take into account the reduction of payments' mechanism and the use of its product in the Member State, the total indicative financial allocations per year in the CAP Strategic Plan of a Member State should be allowed to exceed the national allocation.

(48)

The EAGF should not provide support to activities that would harm the environment, or which are not consistent with climate and environmental objectives in line with sustainable agricultural management principles. Support for direct payments under the CAP Strategic Plans should be granted within national allocations to be fixed by this Regulation. These national allocations should reflect a continuation of the changes whereby the allocations to Member States with the lowest support level per hectare are gradually increased to close 50 % of the gap towards 90 % of the Union average. In order to take into account the reduction of payments' mechanism and the use of its product in the Member State, the total indicative financial allocations per year in the CAP Strategic Plan of a Member State should be allowed to exceed the national allocation.

(49)

In order to facilitate the management of EAFRD funds, a  single contribution rate for support from the EAFRD 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 Article 349 TFEU and the smaller Aegean islands .

(49)

In order to facilitate the management of EAFRD funds, a  general contribution rate for support from the EAFRD 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 of the outermost regions referred to in Article 349 TFEU and the smaller Aegean islands as defined in Article  1(2) of Regulation (EU) No 229/2013 of the European Parliament and of the Council  (1a) , a higher EAFRD contribution rate should be set for those regions .

(49a)

Objective criteria should be established for categorising regions and areas at Union level for support from the EAFRD. To that end, the identification of the regions and areas at Union level should be based on the common system of classification of the regions established by Regulation (EC) No 1059/2003 of the European Parliament and the Council  (1a) . The latest classifications and data should be used to ensure adequate support, in particular for addressing lagging behind regions and interregional disparities inside a Member State.

(50)

EAFRD should not provide support to investments that would harm the environment. Hence it is necessary to provide in this Regulation a number of exclusion rules, as well as the possibility to further develop these guarantees in delegated acts. Notably, the EAFRD should not finance investments in irrigation which do not contribute towards the achievement, or the preservation, of good status of the associated water body or bodies and investments in afforestation which are not consistent with climate and environmental objectives in line with sustainable forest management principles.

(50)

The EAFRD should give priority support to investments generating both economic and environmental benefits while not supporting investments that would harm the environment or which are not consistent with climate, environment, animal welfare and biodiversity objectives. Investments that generate both economic and environmental benefits should be emphasised . Hence it is necessary to provide in this Regulation a number of more specific exclusion rules, as well as the possibility to further develop these guarantees in delegated acts. Notably, the EAFRD should not finance investments in afforestation which are not consistent with climate and environmental objectives in line with sustainable forest management principles. Furthermore, the EAFRD should not cover investments in irrigation which do not contribute towards the achievement, or the preservation, of good status of the associated water body or bodies. Member States should ensure that authorities play an active role on ecology and management of forest fires in any afforestation or reforestation action and strengthen the role of soft preventive measures and land use management.

(51a)

In order to enable the Union to be independent of vegetable protein imports, the CAP aims to promote, in line with Directive 2009/28/EC of the European Parliament and of the Council  (1a) (Renewable Energy Directive), the use of biofuels obtained from the oilseed by-products of protein crops.

(51b)

The EAGF and the EAFRD should not provide support to farmers whose activities include breeding of bulls for bullfighting. Such funding is a clear violation of the European Convention for the Protection of Animals Kept for Farming Purposes.

(52)

Reflecting the importance of tackling climate change in line with the Union's commitments to implement the Paris Agreement and the United Nations Sustainable Development Goals, this Program will contribute to mainstream climate action in the Union's policies and to the achievement of an overall target of 25 % of the EU budget expenditures supporting climate objectives. Actions under the CAP are expected to contribute 40 % of the overall financial envelope of the CAP to climate objectives. Relevant actions will be identified during the Program's preparation and implementation, and reassessed in the context of the relevant evaluations and review processes.

(52)

Reflecting the importance of tackling climate change in line with the Union's commitments to implement the Paris Agreement and the United Nations Sustainable Development Goals, this Program will contribute to mainstream climate action and phase out environmentally harmful subsidies in the Union's policies and to the achievement of an overall target of at least 30 % of the EU budget expenditures supporting climate objectives. Actions under the CAP should contribute at least 40 % of the overall financial envelope of the CAP to climate objectives. Relevant actions will be identified during the Program's preparation and implementation, and reassessed in the context of the relevant evaluations and review processes.

(54)

To enhance the Union added value and to preserve a functioning agricultural internal market, as well as to pursue the above-mentioned general and specific objectives, Member States should not take decisions according to this Regulation in isolation but in the framework of a structured process that should materialise in a CAP Strategic Plan. Union top-down rules should lay down the specific EU -wide objectives of the CAP, the main types of interventions, the performance framework and the governance structure. Such a distribution of tasks is aimed at ensuring full correspondence between financial resources invested and results achieved.

(54)

To enhance the Union added value and to preserve a functioning agricultural internal market, as well as to pursue the above-mentioned general and specific objectives, Member States should not take decisions according to this Regulation in isolation but in the framework of a structured process that should materialise in a CAP Strategic Plan. Union top-down rules should lay down the specific Union -wide objectives of the CAP, the main types of interventions, the performance framework and the governance structure. Such a distribution of tasks is aimed at ensuring full correspondence between financial resources invested and results achieved.

(55)

In order to ensure a clear strategic nature of these CAP Strategic Plans, and to facilitate the links with other Union policies, and notably with established long-term national targets deriving from Union legislation or international agreements such as those related to climate change, forests, biodiversity, and water, it is appropriate that there should be one single CAP Strategic Plan per Member State.

(55)

In order to ensure a clear strategic nature of these CAP Strategic Plans, and to facilitate the links with other Union policies, and notably with established long-term national targets deriving from Union legislation or international agreements such as those related to climate change, forests, biodiversity, and water, it is appropriate that there should be one single CAP Strategic Plan per Member State. Taking due account of the administrative structure of the Member States, the Strategic Plan should, where appropriate, include regionalised interventions for rural development.

(55a)

It is imperative that the CAP Strategic Plans have a clear, simple and unambiguous framework in order to avoid ‘gold plating’ of policy at the national, regional or local level.

(55b)

The new delivery model should not call into question the integrity of the internal market or the historically European nature of the CAP, which should remain a truly common policy, ensuring a Union approach and a level playing field.

(55c)

In accordance with Article 208 TFEU, the Union and Member States should ensure that development cooperation objectives are taken into account in all CAP interventions, and respect the right to food as well as the right to development. Member States should also ensure that CAP Strategic Plans contribute to the maximum extent possible to the timely achievement of the goals set in the 2030 Agenda for Sustainable Development and in the Paris Agreement, as well as of the objectives of the European Green Deal, the Union's environmental and climate commitments and applicable legislation adopted by the European Parliament and the Council on the basis of the Farm to Fork Strategy and the Biodiversity Strategy.

(56)

In the process of development of their CAP Strategic Plans, Member States should analyse their specific situation and needs, set targets linked to the achievement of the objectives of the CAP and design the interventions which will allow reaching these targets, while being adapted to the national and specific regional contexts, including the outermost regions pursuant to Article 349 TFEU. Such process should promote more subsidiarity within a common Union framework, while compliance with the general principles of Union law and the objectives of the CAP should be ensured. It is therefore appropriate to set rules on the structure and content of the CAP Strategic Plans.

(56)

In the process of development of their CAP Strategic Plans, Member States should analyse their specific situation and needs, set targets that are realistic, linked to the achievement of the objectives of the CAP and design the interventions which will allow reaching these targets while providing certainty for the final beneficiaries, while being adapted to the national and specific regional contexts, including the outermost regions pursuant to Article 349 TFEU. Such process should promote more subsidiarity within a common Union framework, while compliance with the general principles of Union law and the objectives of the CAP should be ensured. It is therefore appropriate to set rules on the structure and content of the CAP Strategic Plans. In order to ensure that the setting of targets by Member States and that the design of interventions is appropriate and maximises the contribution to the objectives of the CAP, and while the commonality of the policy is secured, it is necessary to base the strategy of the CAP Strategic Plans on a prior analysis of the local contexts and an assessment of needs in relation to the objectives of the CAP. In proceeding with CAP Strategic Plans, it is necessary to ensure the involvement of farmers and farmers' organisations.

(57)

In order to ensure that the setting of targets by Member States and that the design of interventions is appropriate and maximises the contribution to the objectives of the CAP, it is necessary to base the strategy of the CAP Strategic Plans on a prior analysis of the local contexts and an assessment of needs in relation to the objectives of the CAP.

(57)

It is also important that the CAP strategic plans can adequately reflect changes in Member States’ conditions, structures (both internal and external) and market situations and that they can, therefore, be adjusted over time to reflect them.

(58)

The CAP Strategic Plans should aim to ensure enhanced coherence across the multiple tools of the CAP, since it should cover types of interventions in the form of direct payments, sectoral types of interventions and types of interventions for rural development. They should also ensure and demonstrate the alignment and appropriateness of the choices made by Member States to the Union priorities and objectives. It is therefore appropriate that they contain a result-oriented intervention strategy structured around the specific objectives of the CAP, including quantified targets in relation to these objectives. In order to allow their monitoring on an annual basis, it is appropriate that these targets are based on result indicators.

(58)

The CAP Strategic Plans should aim to ensure enhanced coherence across the multiple tools of the CAP, since it should cover types of interventions in the form of direct payments, sectoral types of interventions and types of interventions for rural development. They should also ensure and demonstrate the alignment and appropriateness of the choices made by Member States to the Union priorities and objectives. It is therefore appropriate that they contain a result-oriented intervention strategy structured around the specific objectives of the CAP, including quantified targets in relation to these objectives. In order to allow their monitoring it is appropriate that these targets are based on result indicators.

(58a)

The existing knowledge base, in terms of the quantity and quality of available information, varies considerably for the purposes of monitoring the specific objectives set out in Article 6 of this Regulation. For some specific objectives, in particular for monitoring biodiversity, the knowledge base is currently weak or insufficiently adapted for the purposes of creating robust impact indicators, such as for pollinators and crop biodiversity. Specific objectives and indicators set for the Union as a whole in Article 6 and Annex I respectively should be based on a shared or comparable knowledge base and methodologies in all Member States. The Commission should identify areas where knowledge gaps exist or where the knowledge base is insufficiently adapted for the purposes of monitoring the impact of the CAP. It should use the Union budget to provide a common response to knowledge-related and monitoring obstacles related to all Article 6 specific objectives and indicators. It should draw up a report on this issue and make its findings public.

(59)

The strategy should also highlight complementarity both between CAP tools and with the other Union policies. In particular, each CAP Strategic Plan should take account of environmental and climate legislation where appropriate , and national plans emanating from this legislation should be described as part of the analysis of the current situation (‘SWOT analysis’). It is appropriate to list the legislative instruments which should specifically be referred to in the CAP Strategic Plan.

(59)

The strategy should also highlight complementarity both between CAP tools and with other Union policies including cohesion . In particular, each CAP Strategic Plan should take account of environmental and climate legislation , the Union’s commitments to Policy Coherence for Development , and national plans emanating from this legislation should be described as part of the analysis of the current situation (‘SWOT analysis’). It is appropriate to list the legislative instruments which should specifically be referred to in the CAP Strategic Plan.

(59a)

Since the income support scheme plays a major role in guaranteeing the economic viability of farms, it is appropriate to take into account the social impacts, which the CAP has on providing jobs in rural areas. For that reason the Member States should also take into account in the planning of their Strategic Plans the employment impact which an establishment will have on a specific area. Measures and activities which create more employment opportunities should be given priority when drafting and implementing the respective policy tools.

(60)

Considering that flexibility should be accorded to Member States as regards the choice of delegating part of the implementation of the CAP Strategic Plan at regional level on the basis of a national framework, in order to facilitate co-ordination among the regions in addressing nation-wide challenges, it is appropriate that the CAP Strategic Plans provide a description of the interplay between national and regional interventions.

(60)

Considering that flexibility should be accorded to Member States as regards the choice of delegating part of the design and implementation of the CAP Strategic Plan at regional level through rural development intervention programmes in line with the national framework, in order to facilitate co-ordination among the regions in addressing nation-wide challenges, it is appropriate that the CAP Strategic Plans provide a description of the interplay between national and regional interventions.

(68a)

Water is an essential production factor for agriculture. Water management is therefore a fundamental issue, and better forms of water management are required. In addition, climate change will have a significant impact on water resources, with more frequent and intense periods of drought as well as periods of heavy precipitation. Storing water during autumn and winter is a common-sense solution. In addition, bodies of water help to create favourable environments for rich biodiversity. They also make it possible to maintain living soils and sufficient flow in waterways, thus encouraging aquatic life.

(69)

A Managing Authority should be responsible for the management and implementation of each CAP Strategic Plan. Its duties should be specified in this Regulation. The Managing Authority should be able to delegate part of its duties while retaining responsibility for the efficiency and correctness of management. Member States should ensure that in the Management and Implementation of CAP Strategic Plans, the financial interests of the Union are protected, in accordance with [Regulation (EU, Euratom) X] of the European Parliament and the Council [the new Financial Regulation] and Regulation (EU) X of the European Parliament and the Council [the new Horizontal Regulation].

(69)

A Managing Authority should be responsible for the management and implementation of each CAP Strategic Plan . However, where elements relating to rural development policy are dealt with on a regional basis, Member States should be able to establish regional managing authorities . Their duties should be specified in this Regulation. The managing authorities should be able to delegate part of its duties while retaining responsibility for the efficiency and correctness of management. Member States should ensure that in the Management and Implementation of CAP Strategic Plans, the financial interests of the Union are protected, in accordance with [Regulation (EU, Euratom) X] of the European Parliament and the Council [the new Financial Regulation] and Regulation (EU) X of the European Parliament and the Council [the new Horizontal Regulation].

(70)

In accordance with the principle of shared management, the Commission is assisted by committees formed by Member States representatives in the implementation of the CAP. With a view to simplifying the system and streamlining the position of Member States, only one Monitoring Committee is established for the implementation of this Regulation, merging the ‘Rural Development’ Committee and the ‘Direct Payments’ Committee, which were established under the 2014-2020 programming period. The responsibility to assist Member States in the implementation of the CAP Strategic Plans is shared between the Managing Authority and this Monitoring Committee. The Commission should also be assisted by the ‘Common Agricultural Policy’ Committee, in accordance with the provisions laid down by this Regulation.

(70)

In accordance with the principle of shared management, the Commission is assisted by committees formed by Member States representatives in the implementation of the CAP. With a view to simplifying the system and streamlining the position of Member States, only one Monitoring Committee is established for the implementation of this Regulation, merging the ‘Rural Development’ Committee and the ‘Direct Payments’ Committee, which were established under the 2014-2020 programming period. The responsibility to assist Member States in the implementation of the CAP Strategic Plans is shared between the Managing Authority and this Monitoring Committee. However, where elements relating to rural development policy are dealt with on a regional basis, Member States should be able to establish regional monitoring committees. The Commission should also be assisted by the ‘Common Agricultural Policy’ Committee, in accordance with the provisions laid down by this Regulation.

(71)

The EAFRD should support through technical assistance, at the initiative of the Commission, actions relating to the fulfilment of the tasks referred to in [Article 7 HzR]. Technical assistance may also be provided, at the initiative of Member States, for the purpose of the fulfilment of the tasks necessary for the effective administration and implementation of support in relation to the CAP Strategic Plan. An increase of the technical assistance at the initiative of Member States is only available for Malta.

(71)

The EAFRD should support through technical assistance, at the initiative of the Commission, actions relating to the fulfilment of the tasks referred to in [Article 7 HzR]. Technical assistance may also be provided, at the initiative of Member States, for the purpose of the fulfilment of the tasks necessary for the effective administration and implementation of support in relation to the CAP Strategic Plan. An increase of the technical assistance at the initiative of Member States is only available for Luxembourg and Malta.

(74)

The result-orientation triggered by the delivery model requires a strong performance framework, particularly since CAP Strategic Plans would contribute to broad general objectives for other shared managed policies. A performance-based policy implies annual and multi-annual assessment on the basis of selected outputs, result and impact indicators, as defined in the performance monitoring and evaluation framework. To this end, a limited and targeted set of indicators should be selected in a way which reflects as closely as possible whether the supported intervention contributes to achieving the envisaged objectives. Result and output indicators relating to climate- and environment-related objectives may include interventions set out in national environmental and climate-planning instruments emanating from Union legislation.

(74)

The result-orientation triggered by the delivery model requires a strong performance framework, particularly since CAP Strategic Plans would contribute to broad general objectives for other shared managed policies. A performance-based policy implies assessments on the basis of selected outputs, result and impact indicators, as defined in the performance monitoring and evaluation framework. To this end, a limited and targeted set of indicators should be selected in a way which reflects as closely as possible whether the supported intervention contributes to achieving the envisaged objectives. Result and output indicators relating to climate- and environment-related objectives , such as water quality and quantity, should include interventions set out in national environmental and climate-planning instruments emanating from Union legislation.

(75)

As part of the performance, monitor and evaluation framework, Member States should monitor and report annually to the Commission on the progress made. The information provided by the Member States are the basis on which the Commission should report on the progress towards the achievement of specific objectives over the whole programming period using for this purpose a core set of indicators.

(75)

As part of the performance, monitor and evaluation framework, Member States should monitor and report on the progress made. The information provided by the Member States are the basis on which the Commission should report on the progress towards the achievement of specific objectives over the whole programming period using for this purpose a core set of indicators.

(76)

Mechanisms should be in place to take action to protect the Union’s financial interests in case the CAP Strategic Plan implementation deviates significantly from the targets set. Member States may thus be asked to submit action plans in case of significant and non-justified underperformance. This could lead to suspensions and, in the end, reductions of the Union funds if the planned results are not achieved. Moreover, an overall performance bonus is established as part of the incentive mechanism based on allocating the performance bonus, in view of encouraging good environmental and climate performances.

(76)

Mechanisms should be in place to take action to protect the Union’s financial interests in case the CAP Strategic Plan implementation deviates significantly from the targets set. Member States may thus be asked to submit action plans in case of significant and non-justified underperformance. This could lead to suspensions and, in the end, reductions of the Union funds if the planned results are not achieved.

(78a)

The assessment described in Article 106 should be undertaken on the basis of the quantified targets of the Farm to Fork Strategy and the Biodiversity Strategy.

(80a)

Trade agreements signed with third countries relating to the agricultural sector should provide for arrangements and contain safeguard clauses to ensure a level playing field between Union and non-Union farmers and to protect consumers.

(81)

Personal data collected for the purposes of the application of any provision enshrined in this Regulation should be processed in a way that is compatible with those purposes. It should also be made anonymous, be aggregated when processed for monitoring or evaluation purposes, and be protected in accordance with Union law concerning the protection of individuals with regard to the processing of personal data and on the free movement of such data, in particular Regulation (EC) No 45/2001 of the European Parliament and of the Council (19) and Regulation (EU) 2016/679 of the European Parliament and of the Council (20). Data subjects should be informed of such processing and of their data protection rights.

(81)

Personal data collected for the purposes of the application of any provision enshrined in this Regulation should be processed in a way that is compatible with those purposes. It should also be made anonymous, be aggregated when processed for monitoring or evaluation purposes, and be protected in accordance with Union law concerning the protection of individuals with regard to the processing of personal data and on the free movement of such data, in particular Regulation (EU) 2018/1725 of the European Parliament and of the Council (19) and Regulation (EU) 2016/679 of the European Parliament and of the Council (20). Data subjects should be informed of such processing and of their data protection rights.

(83)

In order to ensure legal certainty, protect the rights of farmers and guarantee a smooth, coherent and efficient functioning of types of interventions in the form of direct payments, the power to adopt certain acts should be delegated to the Commission in respect of rules making the granting of payments conditional upon the use of certified seeds of certain hemp varieties and the procedure for the determination of hemp varieties and the verification of their tetrahydrocannabinol content; rules for good agricultural and environmental condition and certain related elements in respect of the eligibility requirements; and on the content of the declaration and the requirements for the activation of payment entitlements; further rules on eco-schemes; measures to avoid that beneficiaries of coupled income support suffering from structural market imbalances in a sector, including the decision that such support may continue to be paid until 2027 on the basis of the production units for which it was granted in a past reference period; rules and conditions for the authorisation of land and varieties for the purposes of the crop-specific payment for cotton and rules on the conditions for the granting of that payment.

(83)

In order to ensure legal certainty, protect the rights of farmers and guarantee a smooth, coherent and efficient functioning of types of interventions in the form of direct payments, the power to adopt certain acts should be delegated to the Commission in respect of rules making the granting of payments conditional upon the use of certified seeds of certain hemp varieties and the procedure for the determination of hemp varieties and the verification of their tetrahydrocannabinol content; rules for good agricultural and environmental condition and certain related elements in respect of the eligibility requirements establishment of criteria for the determination of equivalent measures and the appropriate requirements applicable to the national or regional certification schemes; establishment of a catalogue of examples of agricultural practices beneficial for the climate, the environment and animal welfare; measures to avoid that beneficiaries of coupled income support suffering from structural market imbalances in a sector, including the decision that such support may continue to be paid until 2027 on the basis of the production units for which it was granted in a past reference period; rules and conditions for the authorisation of land and varieties for the purposes of the crop-specific payment for cotton and rules on the conditions for the granting of that payment.

(84)

In order to ensure that sectoral types of interventions contribute to the CAP objectives and reinforce synergies with other CAP instruments and in order to ensure a level playing field in the internal market and avoid unequal or unfair competition, the power to adopt certain acts should be delegated to the Commission in respect of criteria for the approval of inter-branch organisations and rules governing the situation where the approved inter-branch organisation does not satisfy such criteria and obligations for producers; rules for the proper functioning of sectoral types of interventions, the basis for the calculation of Union financial assistance, including the reference periods and the calculation of the value of marketed production, and the maximum level of Union financial assistance for market withdrawals; rules for the fixing of a ceiling for expenditure on the replanting of vineyards; and rules under which producers are to withdraw the by-products of winemaking, and on exceptions to that obligation in order to avoid additional administrative burden and rules for the voluntary certification of distillers. In particular, in order to ensure the effective and efficient use of Union funds for interventions in the apiculture sector, the power to adopt certain acts should be delegated to the Commission in respect of additional requirements concerning the notification obligation and the establishment of a minimum Union contribution to the expenditure to implement those types of interventions.

(84)

In order to ensure that sectoral types of interventions contribute to the CAP objectives and reinforce synergies with other CAP instruments and in order to ensure a level playing field in the internal market and avoid unequal or unfair competition, the power to adopt certain acts should be delegated to the Commission in respect of criteria for the approval of inter-branch organisations and rules governing the situation where the approved inter-branch organisation does not satisfy such criteria and obligations for producers; rules for the proper functioning of sectoral types of interventions the basis for the calculation of Union financial assistance, including the reference periods and the calculation of the value of marketed production, and the maximum level of Union financial assistance for market withdrawals; rules for the fixing of a ceiling for expenditure on the replanting of vineyards; rules under which producers are to withdraw the by-products of winemaking, and on exceptions to that obligation in order to avoid additional administrative burden and rules for the voluntary certification of distillers and rules relating to the performance, monitoring and evaluation framework. The Commission should be empowered to adopt delegated acts regarding temporary derogations on conditionality rules during very adverse conditions such as catastrophic events or epidemics. The Commission should also be empowered to determine equivalent practices to agricultural and environmental practices and national or regional environmental certification schemes . In particular, in order to ensure the effective and efficient use of Union funds for interventions in the apiculture sector, the power to adopt certain acts should be delegated to the Commission in respect of additional requirements concerning the notification obligation and the establishment of a minimum Union contribution to the expenditure to implement those types of interventions. With a view to drawing up the CAP strategic plans, the power to adopt certain acts should be delegated to the Commission to set out a code of conduct in the organisation of a partnership between the Member State and the competent regional and local authorities as well as other partners.

(85)

In order to ensure legal certainty and to guarantee that interventions for rural development achieve their objectives, the power to adopt certain acts should be delegated to the Commission in respect of support for management commitments, for investments and for cooperation.

(85)

In order to ensure legal certainty and to guarantee that interventions for rural development achieve their objectives, the power to adopt certain acts should be delegated to the Commission in respect of supplementing the minimum and maximum amounts of support for certain types of interventions.

(86)

In order to amend certain non-essential elements of this Regulation, the power to adopt acts in accordance with Article 290 TFEU should be delegated to the Commission in respect of the Member States’ allocations for types of interventions in the form of direct payments and rules on the content of the CAP Strategic Plan .

(86)

In order to amend certain non-essential elements of this Regulation, the power to adopt acts in accordance with Article 290 TFEU should be delegated to the Commission in respect of the Member States’ allocations for types of interventions in the form of direct payments.

(87)

In order to ensure uniform conditions for the implementation of this Regulation and to avoid unfair competition or discrimination between farmers, implementing powers should be conferred on the Commission as regards the fixing of reference areas for the support for oilseeds, rules for the authorisation of land and varieties for the purposes of the crop-specific payment for cotton and related notifications, the calculation of the reduction where the eligible area of cotton exceeds the base area, the Union financial assistance for distillation of by-products of wine-making, the annual breakdown by Member State of the total amount of Union support for types of interventions for rural development, rules on the presentation of the elements to be included in the CAP Strategic Plan, rules on the procedure and time limits for the approval of CAP Strategic Plans and the submission and approval of requests for amendment of CAP Strategic Plans, uniform conditions for the application of the information and publicity requirements relating to the possibilities offered by the CAP Strategic Plans, rules relating to the performance, monitoring and evaluation framework, rules for the presentation of the content of the annual performance report, rules on the information to be sent by the Member States for the performance assessment by the Commission and rules on the data needs and synergies between potential data sources, and arrangements to ensure a consistent approach for determining the attribution of the performance bonus to Member States. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council. (22).

(87)

In order to ensure uniform conditions for the implementation of this Regulation and to avoid unfair competition or discrimination between farmers, implementing powers should be conferred on the Commission as regards the fixing of reference areas for the support for oilseeds, rules for the authorisation of land and varieties for the purposes of the crop-specific payment for cotton and related notifications, the calculation of the reduction where the eligible area of cotton exceeds the base area, the Union financial assistance for distillation of by-products of wine-making, the annual breakdown by Member State of the total amount of Union support for types of interventions for rural development, standardised form of the CAP strategic plans, rules on the procedure and time limits for the approval of CAP Strategic Plans and the submission and approval of requests for amendment of CAP Strategic Plans, uniform conditions for the application of the information and publicity requirements relating to the possibilities offered by the CAP Strategic Plans, rules for the presentation of the content of the annual performance report. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council (22).

(92a)

The Union’s island regions face specific difficulties in carrying out agricultural activities and developing rural areas. An assessment of the impact of the CAP should be carried out in those regions and the idea of extending the measures laid down in Regulation (EU) No 229/2013 of the European Parliament and of the Council to all the island regions in the Union should be explored.

(93)

In order to ensure legal certainty and continuity, the special provisions for Croatia concerning the gradual introduction of direct payments and complementary national direct payments in the framework of the phasing-in mechanism should continue to apply until 1 January 2021 .

(93)

In order to ensure legal certainty and continuity, the special provisions for Croatia concerning the gradual introduction of direct payments and complementary national direct payments in the framework of the phasing-in mechanism should continue to apply . Croatia will be entitled to an amount in accordance with the Accession Treaty in 2022, including an additional envelope for the national reserve for demined land in Croatia, and that right should be included in the calculation of the national envelope for 2022 .

(b)

types of interventions and common requirements for Member States to pursue these objectives as well as the related financial arrangements;

(b)

types of interventions and common requirements for Member States to pursue these objectives by ensuring a level playing field as well as the related financial arrangements;

(c)

CAP Strategic Plans to be drawn up by Member States, setting targets, defining interventions and allocating financial resources, in line with the specific objectives and identified needs;

(c)

CAP Strategic Plans to be drawn up by Member States , and, where appropriate, in collaboration with their regions , setting targets, defining interventions and allocating financial resources, in line with the specific objectives and identified needs and in accordance with the internal market ;

(a)

‘farmer’ means a natural or legal person, or a group of natural or legal persons, regardless of the legal status granted to such group and its members by national law, whose holding is situated within the territorial scope of the Treaties, as defined in Article 52 of the Treaty on European Union (TEU) in conjunction with Articles 349 and 355 of the Treaty on the Functioning of the European Union (TFEU), and who exercises an agricultural activity as defined by Member States;

(a)

‘farmer’ means a natural or legal person, or a group of natural or legal persons, regardless of the legal status granted to such group and its members by national law, whose holding is situated within the territorial scope of the Treaties, as defined in Article 52 of the Treaty on European Union (TEU) in conjunction with Articles 349 and 355 of the Treaty on the Functioning of the European Union (TFEU), and who exercises an agricultural activity in accordance with good farming practice as defined by Member States;

(ba)

‘public goods’ means goods or services that are not remunerated by the market and deliver environmental and societal outcomes above the statutory environmental, climate, and animal welfare legislation;

(bb)

‘ European public goods’ means public goods or services that can only be provided effectively at Union level through intervention to ensure coordination between Member States and level playing field on the Union agricultural market. European public goods include in particular water conservation, biodiversity protection, soil fertility protection, protection of pollinators, and animal welfare;

(e)

‘mutual fund’ means a scheme accredited by the Member State in accordance with its national law for affiliated farmers to insure themselves, whereby compensation payments are made to affiliated farmers who experience economic losses.

(e)

‘mutual fund’ means a scheme accredited by the Member State in accordance with its national law for affiliated farmers to make provision against risks and to receive compensation payments in the event of economic losses or a fall in income;

(i)

a project, contract, action or group of projects selected under the programs concerned;

(i)

a project, contract, action or group of projects selected under the strategic plan concerned;

(ii)

in the context of financial instruments, a  program contribution to a financial instrument and the subsequent financial support provided to final recipients by that financial instrument;

(ii)

in the context of financial instruments, a  strategic plan contribution to a financial instrument and the subsequent financial support provided to final recipients by that financial instrument;

(i)

a public or private law body, an entity with or without legal personality or a natural person, responsible for initiating or both initiating and implementing operations;

(i)

a public or private law body, an entity with or without legal personality, a natural person or a group of natural or legal persons , responsible for initiating or both initiating and implementing operations;

(ii)

in the context of State aid schemes, the body which receives the aid;

(ii)

in the context of state aid schemes, the entity which receives the aid;

(i)

‘targets’ means pre-agreed values to be achieved at the end of the period in relation to the result indicators included under a specific objective;

(i)

‘targets’ means pre-agreed values to be achieved by the end of the period of the CAP Strategic Plan in relation to the result indicators included under a specific objective;

(j)

‘milestones’ means intermediate targets to be achieved at a given point in time during the CAP Strategic Plan period in relation to the indicators included under a specific objective.

(j)

‘milestones’ means intermediate targets to be achieved by a Member State at a given point in time during the CAP Strategic Plan period to ensure timely progress in relation to the results indicators included under a specific objective.

(a)

‘agricultural activity’ shall be defined in a way that it includes both the production of agricultural products listed in Annex I to the TFEU, including cotton and short rotation coppice, and maintenance of the agricultural area in a state which makes it suitable for grazing or cultivation, without preparatory action going beyond usual agricultural methods and machineries;

(a)

‘agricultural activity’ shall be defined in a way that it includes both the production of agricultural products listed in Annex I to the TFEU, including cotton and short rotation coppice and paludiculture , and maintenance of the agricultural area in a state which makes it suitable for grazing or cultivation, without preparatory action going beyond usual agricultural methods and machineries , including in agroforestry ;

(b)

‘agricultural area’ shall be defined in a way that it is composed of arable land, permanent crops and permanent grassland. The terms ‘arable land’, ‘permanent crops’ and ‘permanent grassland’ shall be further specified by Member States within the following framework:

(b)

‘agricultural area’ shall be defined in a way that it is composed of arable land, permanent crops and permanent grassland and agroforestry systems. Landscape features shall be included as components of the agricultural area . The terms ‘arable land’, ‘permanent crops’ and ‘permanent grassland ’ and ‘agroforestry systems ’ shall be further specified by Member States within the following framework:

(i)

‘arable land’ shall be land cultivated for crop production or areas available for crop production but lying fallow, and include areas set aside in accordance with Articles 22, 23 and 24 of Council Regulation (EC) No 1257/1999 (28), with Article 39 of Council Regulation (EC) No 1698/2005 (29), with Article 28 of Regulation (EU) No 1305/2013 or with Article 65 of this Regulation;

(i)

‘arable land’ shall be land cultivated for crop production or areas available for crop production but lying fallow , and it may include a combination of crops with trees/ and/or shrubs to form silvoarable agroforestry systems , and include areas set aside in accordance with Articles 22, 23 and 24 of Council Regulation (EC) No 1257/1999 (28), with Article 39 of Council Regulation (EC) No 1698/2005 (29), with Article 28 of Regulation (EU) No 1305/2013 or with Article 65 of this Regulation;

(ii)

‘permanent crops’ shall be non-rotational crops other than permanent grassland and permanent pasture that occupy the land for five years or more, which yield repeated harvests, including nurseries and short rotation coppice;

(ii)

‘permanent crops’ shall be non-rotational crops other than permanent grassland and permanent pasture that occupy the land for five years or more, which yield repeated harvests, including nurseries , including those in planters lined with plastic (if the Member State makes provision for this), and short rotation coppice;

(iii)

‘permanent grassland and permanent pasture’ (together referred to as ‘permanent grassland’) shall be land not included in the crop rotation of the holding for five years or more, used to grow grasses or other herbaceous forage naturally (self-seeded) or through cultivation (sown). It may include other species such as shrubs and/or trees which can be grazed or produce animal feed;

(iii)

‘permanent grassland and permanent pasture’ (together referred to as ‘permanent grassland’) means land used to grow grasses or other herbaceous forage naturally (self-seeded) or through cultivation (sown) and that has not been included in the crop rotation of the holding for five years or more, as well as, where Member States so decide, that has not been ploughed up for five years or more; it may include other species such as shrubs and/or trees which can be grazed or and, where Member States so decide, other species such as shrubs and/or trees which produce animal feed , provided that the grasses and other herbaceous forage remain predominant. If Member States so decide, a crop rotation shall also be the change of the species of green fodder if the new sowing consists of a different mixture of species compared to the previous sowing.

(iiia)

‘agroforestry systems’ means land use systems in which trees are grown on the same land as where agricultural practices are carried out;

(iiib)

‘temporary grassland’ shall be defined as grass or herbaceous species grown on arable land (i.e. in rotation) for less than five consecutive years, or beyond five years where ploughing and reseeding occur.

(c)

for the purpose of types of interventions in the form of direct payments, ‘eligible hectare’ shall be defined in a way that it includes any agricultural area of the holding:

(c)

for the purpose of types of interventions in the form of direct payments, ‘eligible hectare’ shall be defined in a way that it includes any agricultural area of the holding , including mobile or stationary temporary technical installations, in particular internal farm tracks and water troughs, as well as silage bales and rewetted areas used for paludiculture :

(i)

that, during the year for which support is requested, is used for an agricultural activity or, where the area is also used for non-agricultural activities, is predominantly used for agricultural activities, and which is at the farmer's disposal. Where duly justified for environmental reasons, eligible hectares may also include certain areas used for agricultural activities only every second year.

(i)

that, during the year for which support is requested, is used for an agricultural activity or, where the area is also used for non-agricultural activities, is predominantly used for agricultural activities, and which is at the farmer's disposal. Where duly justified for environmental , biodiversity and climate related reasons, eligible hectares may also include certain areas used for agricultural activities only every third year;

(ia)

that, if Member States so decide, may contain landscape features and elements including biotopes such as trees, bushes, field copses and wet areas, provided that they do not cover more than one third of the area of each agricultural parcel as defined in Article 63(4) of Regulation EU …/… [Horizontal Regulation];

(ii)

that gave a right to payments under Subsection 2 of Section 2 of Chapter II of Title III of this Regulation or under the basic payment scheme or the single area payment scheme laid down in Title III of Regulation (EU) No 1307/2013, and which:

(ii)

any area of the holding that gave a right to payments under Subsection 2 of Section 2 of Chapter II of Title III of this Regulation or under the basic payment scheme or the single area payment scheme laid down in Title III of Regulation (EU) No 1307/2013, and which:

(d)

‘ genuine farmers’ shall be defined in a way to ensure that no support is granted to those whose agricultural activity forms only an insignificant part of their overall economic activities or whose principal business activity is not agricultural , while not precluding from support pluri-active farmers. The definition shall allow to determine which farmers are not considered genuine farmers , based on conditions such as income tests, labour inputs on the farm, company object and/or inclusion in registers .

(d)

‘active farmers’ shall be defined in such a way as to ensure that support is granted only to natural or legal persons, or to groups of natural or legal persons, engaging in at least a minimum level of agricultural activity and providing public goods in accordance with the objectives of the CAP Strategic Plan , while not precluding from support pluri-active farmers particularly part-time farmers, semi-subsistence farmers and high nature value farming.

The definition shall , in any event, preserve the family farming model of the Union of an individual or group nature, irrespective of its size, and may take into account, if necessary, the special features of the regions defined in Article 349 TFEU. The definition shall ensure that no support is granted to natural or legal persons, or groups of natural or legal persons, who operate airports, railway services, waterworks, real estate services, permanent sport and recreational grounds. Member States may decide to add to this list other similar non-agricultural businesses or activities, or to withdraw such additions and may exclude from this definition individuals or companies carrying out large-scale processing of agricultural products, with the exception of groups of farmers, involved in such processing.

(e)

‘young farmer’ shall be defined in a way that it includes:

(e)

‘young farmer’ shall be defined in a way that it includes an age limit of 40 years old and :

(i)

a maximum age limit that may not exceed 40 years;

(iii)

the appropriate training and/or skills required .

(iii)

the appropriate training and/or skills.

(ea)

‘new farmer’ shall be defined in such a way that it includes:

(a)

to foster a  smart , resilient and diversified agricultural sector ensuring food security;

(a)

to foster a  modern, competitive , resilient and diversified agricultural sector ensuring long-term food security while safeguarding the family farm model ;

(b)

to bolster environmental care and climate action and to contribute to the environmental- and climate-related objectives of the Union;

(b)

to support and improve environmental protection, biodiversity and climate action and to deliver on the environmental- and climate-related objectives of the Union;

(c)

to strengthen the socio-economic fabric of rural areas.

(c)

to strengthen the socio-economic fabric of rural areas , in order to contribute to the creation and maintenance of employment, by guaranteeing a viable income for farmers, pursuing a fair standard of living for the entire agricultural population and tackling rural depopulation, with a particular focus on the less populated and the less developed regions, and balanced territorial development .

(a)

support viable farm income and resilience across the Union to enhance food security;

(a)

ensure viable farm income and resilience of the agricultural sector across the Union to enhance long-term food security and agricultural diversity, while providing safe and high quality food at fair prices with the aim of reversing the decline in the number of farmers and ensuring the economic sustainability of agricultural production in the Union ;

(b)

enhance market orientation and increase competitiveness, including greater focus on research, technology and digitalisation;

(b)

enhance market orientation , in local, national, Union as well as international markets, as well as market stabilisation, risk and crisis management, and increase long term farm competitiveness, processing and marketing capabilities of agricultural products, with greater focus on quality differentiation, research , innovation , technology , knowledge transfer and exchange and digitalisation , and facilitating the access of farmers to circular economy dynamics ;

(c)

improve the farmers' position in the value chain ;

(c)

improve the farmers' bargaining position in the value chains by encouraging associative forms, producer organisations and collective negotiations, as well as promoting short supply chains and improving market transparency ;

(d)

contribute to climate change mitigation and adaptation, as well as sustainable energy;

(d)

contribute to climate change mitigation and adaptation, by reducing greenhouse gas emissions, including by enhancing carbon sinks, carbon sequestration and storage in the agriculture and food sector, as well as incorporating sustainable energy , while ensuring food security, and sustainable management and protection of forests, in line with the Paris Agreement ;

(e)

foster sustainable development and efficient management of natural resources such as water, soil and air;

(e)

foster sustainable development and efficient management of natural resources, such as water, soil and air , while reducing chemical dependency with the aim of reaching the goals provided for in the relevant legislative instruments and rewarding farming practices and systems that deliver multiple environmental benefits including the halting of desertification ;

(f)

contribute to the protection of biodiversity, enhance ecosystem services and preserve habitats and landscapes;

(f)

enhance ecosystem services , and contribute to halting and reversing biodiversity loss, including by protecting beneficial flora, fauna and pollinator species, by supporting agrobiodiversity, nature conservation and agroforestry, as well as contributing to greater natural resilience, restoring and preserving soils, water bodies, habitats and landscapes , and supporting High Nature Value (HNV) farming systems ;

(g)

attract young farmers and facilitate business development in rural areas;

(g)

attract and support young farmers , new farmers, and promoting the participation of women in the agricultural sector, particularly in the most depopulated areas and areas with natural constrains; facilitate training and experience across the Union, sustainable business development and job creation in rural areas;

(h)

promote employment, growth, social inclusion and local development in rural areas , including bio-economy and sustainable forestry ;

(h)

promote social and territorial cohesion in rural areas including through employment creation , growth and investment , social inclusion , combatting rural poverty and through local development , including high quality local services for rural communities, focusing in particular on areas with natural constraints; promoting decent living, working and economic conditions; diversification of activities and income, including agri-tourism, sustainable bio-economy, circular economy, sustainable management and protection of forests, while ensuring gender equality; promoting equal opportunities in rural areas through specific support measures, and recognition of women's work in agriculture, crafts, tourism and local services ;

(i)

improve the response of EU agriculture to societal demands on food and health, including safe, nutritious and sustainable food, food waste, as well as animal welfare .

(i)

improve the response of Union agriculture to societal demands on food and health, including safe, nutritious , high quality and sustainable food, low input farming, organic agriculture, the reduction of food waste , combatting antimicrobial resistance and improving animal health and welfare , as well as increasing social awareness of the importance of farmers and rural areas, while contributing to the implementation of the 2030 Agenda for Sustainable Development .

(b)

result indicators relating to the specific objectives concerned and used for the establishment of quantified milestones and targets in relation to those specific objectives in the CAP Strategic Plans and assessing progress towards the targets. The indicators relating to environment- and climate-specific objectives may cover interventions included in relevant national environmental and climate-planning instruments emanating from the Union legislation listed in Annex XI;

(b)

result indicators relating to the specific objectives concerned and used for the establishment of quantified milestones and targets in relation to those specific objectives in the CAP Strategic Plans and assessing progress towards the targets. The indicators relating to environment- and climate-specific objectives may cover interventions which contribute to the commitments emanating from the Union legislation listed in Annex XI;

(c)

impact indicators related to the objectives set out in Articles 5 and 6(1) and used in the context of the CAP Strategic Plans and of the CAP.

(c)

impact indicators related to the objectives set out in Articles 5 and 6(1) and used in the context of the Strategic Plans of CAP , taking into account external factors beyond the CAP.

(i)

contribute to developing diversified and sustainable agriculture and resilient agro-ecological practices both in the Union and in partner countries;

(ii)

contribute to maintaining the genetic diversity of seeds, cultivated plants, farmed and domesticated animals and their related wild species, in the Union and in partner countries;

(iii)

fully integrate climate change mitigation and adaptation measures.

(a)

the climate and the environment;

(a)

the climate and the environment , including water, air, soil, biodiversity and ecosystem services ;

(a)

all requirements, conditions and management commitments applying to farmers and other beneficiaries set in the CAP Strategic Plan, including requirements and standards under conditionality and conditions for support schemes as well as information on financial instruments and business plans established under the CAP Strategic Plan;