New regulation on agricultural state aid is adopted
MetadataShow full item record
CTA. 2004. New regulation on agricultural state aid is adopted. Agritrade, January 2004. CTA, Wageningen, The Netherlands.
Permanent link to this item: http://hdl.handle.net/10568/52864
On December 10 th 2003 a regulation was adopted which allows EU member states...
On December 10 th 2003 a regulation was adopted which allows EU member states to grant various types of state aid without the prior clearance of the Commission. This is designed to speed up the implementation of new state aids in the agricultural sector. A Commission press release maintains that the new regulation ‘will not soften the state-aid rule' and ‘will not allow state aid in areas considered incompatible with the internal market'. The same rules will continue to apply throughout the EU. The modification will require member states to strengthen their post-fact reporting of state aid. To ensure full transparency, all exempted state aid (state aid not requiring prior Commission approval) will be published on the internet. The proposed regulation covers state aid granted to small- and medium-sized enterprises (SMEs) in the agricultural sector. Due to the definition of SMEs used – up to 250 employees, a turnover of € 40 million or a € 27 million balance sheet – the rules cover almost all farms and companies active in the agricultural sector. The press release sets out the types and levels of aid subject to the new regulation. The areas covered include: aid to on-farm investment; aid to investment in agro-processing; aid to conservation of traditional landscapes; aid to relocation of farm buildings in the public interest; aid to young farmers; aid for early retirement; aid for the establishment of producer groups; aid with insurance premiums; aid for land reparcelling; aid for the production and marketing of quality products; aid for technical support; aid to the livestock sector. The new regulation will remain in force until the end of 2006. Comment: The regulation provides an insight into the level of state aid from member states (which is in addition to EU aid), which can be allowed under EU rules. These areas of expenditure are likely to increase in importance in the coming years.