Negotiators from the EU Council, the European Parliament and the European Commission reached a political agreement on the main elements of the revised Common Agricultural Policy on Friday 25 June. The new CAP will enter into force on 1 January 2023.
The Agriculture Council on 28 and 29 June will still have to validate the compromises reached after 2 days of super trilogue.
A fairer CAP. For the first time, the CAP will include social conditionality, which means that CAP beneficiaries will have to respect elements of EU social and labour law in order to receive CAP funds.
National authorities will carry out the checks, with the risk of a reduction in payments in the event of infringement. This social dimension will be voluntary from 2023 and mandatory from 2025.
Member States will be required to allocate at least 10% of their national envelope of direct payments to a redistributive payment for small and medium-sized farmers.
National capitals could also use other means to distribute EU funds fairly. They could put in place a mechanism to reduce annual direct payments to farmers above €60,000 by up to 85% and to cap them at €100,000.
Support for young farmers will have a mandatory minimum level of 3% of the EU countries’ direct payment envelope.
With regard to the internal convergence of support, national governments will have to ensure that all direct payments per hectare on their territory reach at least 85% of the average direct subsidy by 2026.
A greener CAP. “The new CAP will support the transition to a more sustainable agriculture, with increased ambitions for climate, environment and animal welfare”, the Commission welcomed.
The new CAP will fully integrate EU environmental and climate legislation. The CAP plans will contribute to the objectives of the Farm to Fork and Biodiversity strategies and will be updated to take account of changes in legislation introduced by the European Green Deal.
Conditionality. The minimum requirements that CAP beneficiaries must meet in order to receive support are now more ambitious. New rules will require farmers to set aside at least 4% of their arable land for non-productive areas. If they want to include catch crops and nitrogen-fixing crops, the share would have to rise to at least 7%, with 3% of the land devoted to non-productive elements or left fallow; pesticides would be banned from being used on this land.
While MEPs wanted to require farmers to follow a classic annual crop rotation to preserve biodiversity, States will in the end be able to authorise “other practices” such as diversification (different crops grown simultaneously on the same farm) and the introduction of legumes in the rotation.
The eco-regimes will be mandatory for Member States. This new instrument will reward farmers for implementing climate and environment friendly practices (organic farming, agro-ecology, integrated pest management, etc.) as well as for improving animal welfare. Member States will have to allocate at least 25% of their income support budget to eco-regimes, i.e. a total of €48 billion of the direct payments budget, with the option of allocating only 20% in 2023 and 2024.
During this transition, States will be free to reallocate unused funds beyond 20% as they see fit, but it “must be compensated for by the end of the period” through further strengthening of eco-regimes or investment in other environmental measures.
In addition, at least 35% of rural development funds (second pillar) will be allocated to agro-environmental commitments, which promote environmental, climate and animal welfare practices.
A stronger crisis reserve. The negotiators agreed that the agricultural crisis reserve will operate with an annual budget of €450 million (in current prices). If this is not enough, the ‘financial discipline’ mechanism - which reduces direct payments to farmers - should be activated, but only as a last resort and excluding the first €2,000 of payments.
Common Market Organisation. “We, the European Parliament, wanted to see a ban on imported products containing pesticides not tolerated in Europe in the new CAP. The EU Council has always refused such a ban”, noted rapporteur Eric Andrieu (S&D, France).
He welcomed the fact that he had obtained a commitment from the European Commission to put in place specific legislation on the issue as soon as possible, “and therefore that pesticide residues banned in Europe in imported products would no longer be tolerated”.
For the wine sector, an extension of vineyard planting authorisations until 2045 was planned. Two categories of wines with a lower concentration of alcohol will be recognised. Finally, the energy value of wines will be specified on the label, and the list of ingredients will be made more widely known to consumers.
Producers of wines, hams and cheeses with a protected designation of origin now have the opportunity to collectively control the volume they market in order to stabilise their income. This option will be extended to all products with a geographical indication.
After the political agreement, the texts still need to be finalised at the technical and legal level. To enter into force, they will then have to be adopted by the Parliament, first in the Agriculture Committee and then in plenary session, and by the Council of the EU. The new CAP rules should apply from 1 January 2023.
Link to the compromise package: https://bit.ly/3gZuKyI (Original version in French by Lionel Changeur)