Brussels, 10/10/2007 (Agence Europe) - On Wednesday 10 October, the European Commission wrote to Romania to inform it that it faces a provisional 25% cut in European Union farm payments (direct aid and rural development funds) unless it can reverse serious shortcomings in its administration and financial control system. The Commission is happy with the payment system set up by Bulgaria and will therefore not be withholding farm aid from Bulgaria.
Commission Regulation 1423/2006, building on Article 37 of the Accession Treaties for Romania and Bulgaria, provides for the reduction of payments by 25% if the systems set up to ensure the correct payment of farm aid are so seriously deficient that they affect the proper functioning of the overall system. Romania can prevent this happening by providing proof within the next 30 days that it has installed two software modules which are indispensable elements in the Integrated Administration and Control System (IACS). It must wait until the required controls have been completed before making payments to farmers. Romania risks losing 25% of the €443m in direct farm aid earmarked for 2008, and 25% of a share (3.3%) of its rural development funds (€832bn in total over 2007-2013).
If Romania does not make the required improvements by 9 November, the European Commission will almost immediately decide to cut aid payments. If Romania makes the required improvements, the European Commission will not be organising any further checks to monitor progress.
The situation in Bulgaria. Investigations in June and September 2007 showed that the IACS has been introduced in Bulgaria and is operational. A few shortcomings detected in the system for identifying plots of land will be remedied before any payments are made to farmers. (lc)