Scottish Government

SHEEP ANNUAL PREMIUM SCHEME: QUOTAS - 2004
Application for quota from the 2004 National Reserve
Explanatory Leaflet

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Application for quota from the 2004 National Reserve (136k)
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Explanatory Leaflet

Forms must be completed and returned to the Department no later than 28 May 2003.

INTRODUCTION

You may apply to the 2004 national reserve using form SAP-National Reserve-2004 only if you fall within one or more of the following categories:

• Category 1
  Participant in an environmental scheme in 1991 requiring reduction in numbers
• Category 2
  Producer taking over "quota deserted land"
• Category 3(a)
  Producer entering an "arable reversion" scheme
• Category 3(b)
  Newcomer in 2002, 2003 or 2004 under 40 years of age
• Category 4
  Newcomer in 2002, 2003 or 2004 40 years of age or over
• Category 5
  Producer entering the Organic Aid Scheme
• Category 6(a)
  First-time premium claimant in 2002, 2003 or 2004
• Category 6(b)
  Producer taking over land formerly used for sheep production but temporarily under non-agricultural use

Form SAP-National Reserve-2004 is NOT an application for Sheep Annual Premium.

The following paragraphs give guidance on the rules governing allocations from the national reserve and on how to complete the application form. Please read this leaflet carefully before completing application form SAP-National Reserve-2004.

Please make sure you understand the usage rules and the transfer and leasing rules that apply (paragraphs 53-56.)

• You may have definite plans which would enable you to meet the eligibility criteria for one or more of the categories of the 2004 national reserve but may not yet have all the relevant documents to prove your entitlement to an allocation from the reserve. If you are not able to submit the documentary evidence with your application by 28 May 2003 you should not submit an application to the reserve. If, before the 2004 sheep annual premium claim period closes (likely to be 4 February 2004), you have finalised your plans and wish to submit a 2004 premium claim, you may do so without affecting your eligibility to apply to any category of the 2005 sheep quota national reserve when it opens early in May 2004. To receive a 2004 premium payment, however, you must acquire quota by transfer or lease in the 2004 sheep quota trading period. However please note that any quota you acquire by transfer will be deducted from any allocation you receive from the 2005 national reserve (except in Category 1). Quota acquired by lease will not be deducted from any allocation you receive from the 2005 national reserve.
• Applications based on an intention to enter sheep farming but not supported by firm documentary evidence will be rejected.
• It is your responsibility to obtain the application form (SAP-National Reserve-2004), complete it correctly and ensure that it is received by the Department with all relevant documentation as soon as possible and in any event no later than the closing date of the application period (28 May 2003). In this context 'the Department' means Quota Management Section at the address below or any of the Department's local area offices.
• Proof that you posted your application is not sufficient. You must be able to show that it has been received.
• You are therefore advised to obtain acknowledgement of receipt of the application form from the Department by completing an acknowledgement card, affixing a stamp and returning it with your form. Cards which do not have a stamp, or are not completed (whether or not they have a stamp), will not be returned.
• If you have not received your acknowledgement within 7 working days of despatch, please contact the Department. If you deliver the form personally to the Department, you should obtain an acknowledgement of receipt at the time of delivery. Quota Management Section's address is printed below.
• If you doubt whether your application form will arrive at the Department by the deadline, you are advised to deliver it by hand. If you are unable to do this, the Department can take the date it receives a faxed copy of your completed form as the date of receipt, provided the original form (identical in every respect to the faxed version) is posted to the Department immediately. When posting the original form you should indicate clearly that it is a hard copy of one previously faxed to the Department. We recommend, however, that the faxing facility should only be used in exceptional circumstances where it is not possible for you to post the form or deliver it to the Department in time for it to arrive by the deadline.

HOW TO COMPLETE THE APPLICATION FORM
PART 1 - DETAILS OF PRODUCER APPLYING FOR QUOTA

QUESTIONS 1 AND 4

1. Producers are defined in the same way as under the Sheep Annual Premium Scheme 2004. If your application for premium is made with other farmers, for example in a partnership, the group as a whole will need to submit a single application to the reserve. If you appoint an agent to act for you, your name should still be given as the producer, although the agent may, with your written authority sign the form on your behalf. Enter the relevant details at Questions 1 and 4 of the application form.

QUESTION 2

2. Enter your holding number. If you have more than one current holding number, enter all your holding numbers in the boxes. If you previously claimed premium under any other farm code numbers (e.g. temporary numbers), enter these numbers in the boxes provided.

QUESTION 5

3. Your holding, and the quota you hold, are designated as being within a particular ring-fence area. If you already hold quota you will have been notified of the ring-fence in which your holding is located and should tick the corresponding box at Question 5. However, if you have acquired any additional land or disposed of any land including any land held on a short-term let, since you were notified of your ring-fence, you will need to check that this has not changed the ring-fence area designation of your holding.

4. If you do not yet hold any quota, or wish to confirm that your ring-fence area is still correct, the following information should allow you to determine the ring-fence in which your holding is located. If you need further assistance you should contact your local area office.

5. The ring-fences in Great Britain are:

• the LFA areas of the Scottish Highlands and Islands;
• the remainder of the Scottish LFA;
• the English Less Favoured Area (LFA);
• the Welsh LFA;
• the Great Britain non-Less Favoured Area.

6. You should use the application form SAP - National Reserve - 2004 only if your holding is located in Scotland in the LFA of the Scottish Highlands and Islands Enterprise area, the remaining Scottish LFA or the Great Britain non-LFA ring-fences. If your holding is located in England, Wales or Northern Ireland, you should contact the relevant Agriculture Department for a different application form.

7. Your holding is assigned to one ring-fence area only, depending on the location of the greatest proportion of the land you farm. You will only be paid premium if your quota corresponds to the ring-fence designation of your holding.

IMPORTANT

It is your responsibility to ensure that the correct ring-fence-area is ticked. If it is subsequently discovered that the wrong ring-fence has been ticked the quota will be withdrawn and in the event of limited availability it may not be possible to reallocate the quota for the correct ring-fence.

8. Your "holding" means all the land in the United Kingdom farmed by you or made available to you for farming (not just sheep production). Holdings occupying land in more than one ring-fence will be assigned to a single ring-fence on the basis of the 2004 IACS declaration which may include land held on a short-term let. If you are unsure of your ring-fence designation you are advised to contact your local area office. You should note that the acquisition or disposal of land on a short-term let may affect the ring-fence designation of your holding.

9. If your holding contains three or more production units such that at least 50% of your holding is in the LFA, but the largest production unit is in the non-LFA, the LFA designation will take precedence. For example, if 40% of your holding is located in the Great Britain non-LFA, 35% in the Scottish LFA and 25% in the English LFA, your holding is designated as Scottish LFA.

10. When taking a decision to move holding or acquire or dispose of land, you should bear in mind that you will not be able to dispose of any quota during the Scheme year in which your allocation from the national reserve becomes effective or in the following two years. This restriction applies to any quota you hold including any that does not match the ring-fence designation of your current holding.

11. If you make a successful application to the 2004 national reserve you will not be permitted to transfer out or lease out quota for three years commencing in 2004. Please see paragraphs 53-56 concerning restrictions on transfer or lease and withdrawal of unused quota if you receive quota from the national reserve.

12. The detailed eligibility rules, and the method for calculating maximum allocations, are set out in paragraphs 14-50. You will be allocated less than your maximum allocation if scaling is applied ( see paragraph 57).

13. You may apply to any category for which you are eligible, but you may not apply to more than one sub-category of the same category. Quota Management Section will be happy to explain the options to you, if necessary, but the final decision must be yours.

PART 2 - APPLICATION TO THE 2004 NATIONAL RESERVE
CATEGORY 1: QUESTIONS 6 AND 7

You are a producer who, at the time of the 1991 Sheep Annual Premium Schemes, was participating in a qualifying national environmental or extensification scheme that required a reduction in sheep numbers, and your participation in the scheme ended before the end of the application period for the 2002 Sheep Annual Premium Scheme (4 February 2002) or since the date on which you submitted your 2002 premium claim if this was earlier (tick box A);
or
you are a producer who is irrevocably committed to ending your participation in the scheme between now and the end of the application period for the 2004 Sheep Annual Premium Scheme (likely to be 4 February 2004) (tick box B);

14. In this context, "irrevocably committed" means that, before submitting your 2004 national reserve application, you must have entered into a binding agreement to end your participation in the scheme.

15. Your allocation of quota from the reserve will be calculated by reference to the number on which you received premium payments under the Sheep Annual Premium Scheme in the year before you entered the environmental scheme. The qualifying schemes covered by this category are:

• Management Agreements on Sites of Special Scientific Interest (SSSIs);
• Management Agreements on land adjacent to Sites of Special Scientific Interest (SSSIs);
• Management Agreements on National Nature Reserves (NNRs);
• Wildlife Enhancement Scheme.

16. See paragraph 20 below for Environmentally Sensitive Areas Schemes and the Pilot Sheep Extensification Scheme.

17. You may be eligible to apply to Category 1 if you have entered into a Management Agreement made under Section 49A of the Countryside (Scotland) Act 1967.

18. It may be necessary for the Department to contact Scottish Natural Heritage or any other appropriate body in order to confirm the reduction in the number of animals under your agreement. By signing the declaration at Part 3 of the application form SAP-National Reserve-2004, you are agreeing that the Department may approach the appropriate body about your agreement with them.

19. If your participation in the environmental scheme is to end after you submit your 2004 premium claim, you will be eligible to apply to the national reserve at a future date. A different form will be available for future applications.

20. If, at the time of the 1991 Sheep Annual Premium Scheme, you were a participant in an Environmentally Sensitive Areas Scheme or in the Pilot Sheep Extensification Scheme and were required to reduce sheep numbers, you will be able to obtain quota automatically on request at the end of your participation in the scheme. You should not apply to the national reserve. If in doubt, contact the Quota Management Section.

CATEGORY 2: QUESTIONS 8-13

You are a producer who, has taken over land from which quota has been removed by a departing tenant or sharefarmer (tick box A);
or
you are a producer who is irrevocably committed between now and the end of the application period for the 2004 Sheep Annual Premium Scheme (4 February 2004) to taking over land from which quota has been removed by a departing tenant or sharefarmer (tick box B);

NB The tenancy or sharefarming agreement of the outgoing tenant or sharefarmer MUST have been drawn up BEFORE 1 January 1993. Where the outgoing tenant or sharefarmer's tenancy or sharefarming agreement was dated on or after 1 January 1993 the application will be rejected.

21. In this context, "irrevocably committed" means that, before submitting form SAP-National Reserve-2004, you must have entered into a binding agreement to take over the land. Documentary evidence of this commitment will be required (e.g. a letter from a solicitor or land agent).

22. You are eligible to apply to this category if you have taken over (or are irrevocably committed to taking over before the end of the application period for the 2004 Sheep Annual Premium Scheme) all or part of the land from which the outgoing tenant or sharefarmer had removed or will have removed quota (either by taking it to a new holding or by disposing of it via transfer or lease). Please note that you will not be eligible under this category if the land given up was held or if the land taken over is held under a short-term let. Nor will you be eligible if the outgoing tenant or sharefarmer did not or will not give up all of the land covered by the tenancy or sharefarming agreement.

23. To enable the Department to assess eligibility, you must ensure that the landlord of the land you have taken over completes the relevant sections of the Annex to the application form. This Annex, when completed, will provide the Department with the information necessary to confirm whether you had taken over or are irrevocably committed to taking over land from which quota had been removed or will be removed by a departing tenant or sharefarmer; and therefore whether or not you satisfy the eligibility criteria.

24. The maximum allocation will be calculated as follows:

(a) if you have taken over (or if you are irrevocably committed to taking over) all the land covered by the tenancy or sharefarming agreement and from which quota has been removed, your allocation will be based on the initial allocation of quota of the departing tenant or sharefarmer;

(b) if you have taken over (or if you are irrevocably committed to taking over) only part of the land covered by the tenancy or sharefarming agreement and from which quota has been removed, your allocation will be based on the proportion of the available forage area you have taken over;

25. In all cases the calculations refer ONLY to the amount of quota held by the departing tenant or sharefarmer for the land which was the subject of the tenancy or sharefarming agreement in question; quota which the departing tenant or sharefarmer acquired by transfer or lease will not be taken into account. If the departing tenant or sharefarmer is awarded quota from Category 1 of the 2004 reserve, this will be taken into account in the calculation. Where the incoming producer already holds quota but no other land, this quota will be deducted from the maximum allocation. If you wish to have your allocation limited to a lower number of quota units than the maximum allocation, please give the figure at Question 12 on form SAP - National Reserve - 2004.

26. Forage area is the area of land available for feeding or grazing livestock as determined by the details entered on the IACS form (except in the case of producers exempt from stocking density rules where, for 2004, the area of land available has been entered on a separate Land Declaration form). If necessary, contact your local area office for details.

CATEGORY 3(a): QUESTIONS 14-16

You are a producer who, since end of the application period for the 2002 Sheep Annual Premium Scheme (4 February 2002) or since the date on which you submitted your 2002 premium claim if this was earlier, has entered sheep production or increased the number of eligible sheep in an existing flock because you have reverted from arable to livestock farming (tick box A);
or
you are a producer who, since end of the application period for the 2003 Sheep Annual Premium Scheme (4 February 2003) or since the date on which you submitted your 2003 premium claim if this was earlier, has entered sheep production or increased the number of eligible sheep in an existing flock because you have reverted from arable to livestock farming (tick box B);
or
you are a producer who is irrevocably committed between now and the end of the application period for the 2004 Sheep Annual Premium Scheme (likely to be 4 February 2004), to entering sheep production or is increasing the number of eligible sheep in an existing flock because you are returning arable land to livestock farming (tick box C);

27. In this context, "irrevocably committed" means that, before submitting your 2004 national reserve application, you must have entered into a binding agreement under one of the schemes listed in paragraph 28.

28. In order to qualify under this category, the reversion from arable land to livestock farming must either already have been undertaken, or will be undertaken before the end of the application period for the 2004 Sheep Annual Premium Scheme, as part of a commitment you have entered into under one of the following schemes:

• Management Agreements on Sites of Special Scientific Interest (SSSIs);
• Management Agreements on land adjacent to Sites of Special Scientific Interest (SSSIs);
• Management Agreements on National Nature Reserves (NNRs);
• Management Agreements made under Section 49A of the Countryside (Scotland) Act 1967.

29. Producers should contact their local area office for clarification, if necessary.

30. The maximum allocation will be equivalent to the number of extra sheep that you need in order to fulfil the requirements of your scheme. Note that it may be necessary for the Department to consult your project officer in order to confirm the increase in the number of animals under your agreement. By signing the declaration at Part 3 of the application form, you are agreeing that the Department may approach your project officer about your agreement with them.

CATEGORY 3(b): QUESTIONS 17-20

You are a young newcomer to farming who submitted a claim for sheep annual premium for the first time in the 2002 Scheme year but either did not apply to the 2002 National Reserve of sheep quota, or did apply to the 2002 Sheep national reserve and was totally unsuccessful. (tick box A);
or
you are a young newcomer to farming who submitted a claim for sheep premium for the first time in the 2003 Scheme year (tick box B).
or
you are a young newcomer to farming who intends to make a first claim for premium under the 2004 Sheep Annual Premium Scheme (tick box C).

31. In order to qualify under this category you must:

• be applying as an individual producer (Scottish partnerships, members of Scottish partnerships, and limited companies are not eligible);
• be under 40 years of age on the date on which your application for quota from the reserve is received by the Department;
• not previously have been involved in any aspect of farming as a sole producer, manager or as a partner in any farming enterprise;
• not have claimed sheep annual premium at any time before the 2002 scheme year.
• either hold an appropriate qualification or be able to show that you have at least one year's agricultural experience that is relevant to sheep farming (as an employee).

32. If you are a producer intending to make a first claim for premium under the 2004 Scheme, you will need to provide documentary evidence confirming your intention to enter sheep production (e.g. a letter from a solicitor or land agent about a proposed purchase or lease of land). You will also need to provide documentary proof of your age.

33. Confirmation of your age and either the qualification or year's experience will have to be submitted with the application form. In the case of a qualification this may be in the form of a certificate from the awarding body. Confirmation of a year's agricultural experience relevant to sheep farming may be in the form of a letter from a former employer.

34. Your local area office holds a list of appropriate qualifications e.g. National Certificate (NC), College Certificate (CC), Certificate (C), First Certificate (FC), First Diploma (FD), National Diploma (ND), Higher National Diploma (HND), National Proficiency Test (NPT), First Degree or higher.

35. If you claimed premium for the first time in the 2002 or 2003 Scheme years the maximum allocation which can be made to you with effect from the 2004 Scheme year will be equivalent to the number of eligible sheep on which you submitted your first claim for premium in 2002 or 2003.

Example: You leased in 10 units of quota in 2002 to cover your SAPS claim for that year but either did not apply to the 2002 National Reserve, or did apply to the 2002 National Reserve and were totally unsuccessful.

You subsequently increase your flock and apply to the 2004 National Reserve for 60 quota units.

The maximum allocation to which you can be eligible is 10 units as your allocation will be based on the animals claimed in 2002.

36. If your first claim for sheep annual premium is to be in 2004 your allocation will be equivalent to the number of sheep on which you intend to claim premium in 2004.

CATEGORY 4: QUESTIONS 21-24

You are a newcomer to farming who submitted a claim for sheep annual premium for the first time in the 2002 Scheme year but either did not apply to the 2002 National Reserve of sheep quota, or did apply to the 2002 sheep national reserve and was totally unsuccessful. (tick box A);
or
you are a newcomer to farming who submitted a claim for sheep premium fot the first time in the 2003 Scheme year (tick box B).
or
you are a newcomer to farming who intends to make a first claim for premium under the 2004 Sheep Annual Premium Scheme (tick box C).

37. In order to qualify under this category you must:

• be applying as an individual producer (Scottish partnerships, members of Scottish partnerships, and limited companies are not eligible);
• be 40 years of age or over on the date on which your application for quota from the reserve is received by the Department;
• not previously have been involved in any aspect of farming as a sole producer, manager or as a partner in any farming enterprise;
• not have claimed sheep annual premium at any time before the 2002 scheme year.
• either hold an appropriate qualification or be able to show that you have at least one year's agricultural experience that is relevant to sheep farming (as an employee).

38. If you are a producer intending to make a first claim for premium under the 2004 Scheme, you will need to provide documentary evidence confirming your intention to enter sheep production (e.g. a letter from a solicitor or land agent about a proposed purchase or lease of land).

39. Confirmation of the qualification or year's experience will have to be submitted with the application form. In the case of a qualification this may be in the form of a certificate from the awarding body. Confirmation of a year's agricultural experience relevant to sheep farming may be in the form of a letter from a former employer.

40. Your Local Area Office holds a list of appropriate qualifications e.g. National Certificate (NC), College Certificate (CC), Certificate (C), First Certificate (FC), First Diploma (FD), National Diploma (ND), Higher National Diploma (HND), National Proficiency Test (NPT), First Degree or higher.

41. If you claimed premium for the first time in the 2002 or 2003 Scheme years the maximum allocation which can be made to you with effect from the 2004 Scheme year will be the number of eligible sheep on which you submitted your first claim for premium in 2002 or 2003.

Example: You leased in 10 units of quota in 2002 to cover your SAPS claim for that year but either did not apply to the 2002 National Reserve, or did apply to the 2002 National Reserve and were totally unsuccessful.

You subsequently increase your flock and apply to the 2004 National Reserve for 60 quota units.

The maximum allocation to which you can be eligible is 10 units as your allocation will be based on the animals claimed in 2002.

42. If your first claim for sheep annual premium is to be in 2004 your allocation will be equivalent to the number of sheep on which you intend to claim premium in 2004.

CATEGORY 5: QUESTIONS 25-27

You are a producer who since the end of the application period for the 2002 Sheep Annual Premium Scheme (4 February 2002) or since the date on which you submitted your 2002 premium claim if this was earlier, has entered sheep production, or increased the number of eligible sheep in an existing flock, because you are converting to organic production under the Organic Aid Scheme (tick box A);
or
you are a producer who since the end of the application period for the 2003 Sheep Annual Premium Scheme (4 February 2003) or since the date on which you submitted your 2003 premium claim if this was earlier, has entered sheep production, or increased the number of eligible sheep in an existing flock, because you are converting to organic production under the Organic Aid Scheme (tick box B);
or
you are a producer who is irrevocably committed between now and the end of the application period for the 2004 Sheep Annual Premium Scheme (likely to be 4 February 2004) to entering sheep production, or increasing the number of eligible sheep in an existing flock, because you are converting to organic production under the Organic Aid Scheme (tick box C);
or
you are a producer who had converted to organic production before the introduction of the Organic Aid Scheme and you are increasing eligible sheep numbers (tick box D).

43. You are a producer who is eligible to apply to this category either if your application to the Organic Aid Scheme has been accepted and, under the Scheme, you have entered sheep production or increased the number of eligible sheep in your flock, or if you are irrevocably committed to doing so before the end of the application period for the 2004 Sheep Annual Premium Scheme. In this context "irrevocably committed" means that, before submitting form SAP - National Reserve - 2004, you must have submitted an application to the Organic Aid Scheme. However you can only be considered eligible under this category once your application to the Organic Aid Scheme has been approved. The maximum allocation will be equivalent to the number of extra sheep needed to fulfil the requirements of your approved plan. If your application is not approved, any allocation of quota under this category will be removed.

CATEGORY 6(a): QUESTION 28

You are a producer who submitted a claim for sheep annual premium for the first time in the 2002 Scheme year but either did not apply to the 2002 National Reserve of sheep quota, or did apply to the 2002 Sheep national reserve and was totally unsuccessful. (tick box A);
or
you are a producer who submitted a claim for sheep annual premium for the first time in the 2003 Scheme year (tick box B).
or
you are a producer who intends to make a first claim for premium anywhere in the UK under the 2004 Scheme (tick box C).

44. You will be eligible to apply to this category only if your first application for Sheep Annual Premium anywhere in the U.K. was in 2002, 2003 or will be in 2004.

45. If you claimed premium for the first time in the 2002 or 2003 Scheme years the maximum allocation which can be made to you with effect from the 2004 Scheme year will be equivalent to the number of eligible sheep on which you submitted your first claim for premium in 2002 or 2003.

Example: You leased in 10 units of quota in 2002 to cover your SAPS claim for that year but either did not apply to the 2002 National Reserve, or did apply to the 2002 National Reserve and were totally unsuccessful.

You subsequently increase your flock and apply to the 2004 National Reserve for 60 quota units.

The maximum allocation to which you can be eligible is 10 units as your allocation will be based on the animals claimed in 2002.

46. If your first claim for sheep annual premium is to be in 2004 your allocation will be equivalent to the number of eligble sheep on which you intend to claim premium in 2004.

47. You will need to provide documentary evidence confirming your intention to enter sheep production (eg. a letter from a solicitor or land agent about a proposed purchase or lease of land).

CATEGORY 6(b): QUESTIONS 29-31

In cases where agricultural land has been taken out of agricultural use (e.g. by the National Coal Board), and later returned to agricultural use and the applicant has then taken over the land for livestock production, unless the 'non-agricultural use' included part or all of 1991 and 1992 (the relevant base years used for the calculation of the original initial allocations of SAPS quota) then the application will be rejected. This is because the land was in fact in agricultural use during the base years for inItial SAP quota allocations (1991 and 1992). Any appropriate quota allocation would therefore have been made to the producer concerned in 1993.

You are a producer who, since the end of the application period for the 2002 Sheep Annual Premium Scheme (4 February 2002) or since the date on which you submitted your 2002 premium claim if this was earlier, has taken over part of an area of land that was formerly used for sheep production by other producers and then temporarily taken out of agricultural use (tick box A);
or
you are a producer who, since the end of the application period for the 2003 Sheep Annual Premium Scheme (4 February 2003) or since the date on which you submitted your 2003 premium claim if this was earlier, has taken over part of an area of land that was formerly used for sheep production by other producers and then temporarily taken out of agricultural use (tick box B).
or
you are a producer who is irrevocably committed between now and the end of the application period for the 2004 Sheep Annual Premium Scheme (likely to be 4 February 2004) to taking over part of an area of land that was formerly used for sheep production by other producers and them temporarily taken out of agricultural use (tick box C).

48. In this context, "irrevocably committed" means that, before submitting form SAP-National Reserve-2004, you must have entered into a binding agreement to acquire the land. Documentary evidence of this commitment will be required (e.g. a letter from a solicitor or land agent).

49. You will have taken over part of an area which was acquired for non-agricultural use such as for industrial, military, commercial or construction purposes e.g. open cast coal mining, road building or pipeline laying. There must have been an undertaking that the land would in due course be returned to agricultural use. You will be eligible to apply to this category if you can provide supporting documentary proof that the land was temporarily taken over for non-agricultural use and that it would be returned to agricultural use. This may be in the form of correspondence with the body that temporarily took over the land, or certification from a land agent or similar independent professional adviser.

50. The maximum allocation will be equivalent to the number of sheep which the land you are taking over or are irrevocably committed to taking over can support.

KEY POINTS FOR ALL APPLICANTS

Effective date of quota you receive from the reserve, if your application on form SAP-National Reserve-2004 is successful.

51. Quota allocated to you as a result of an application will become effective for use in support of your 2004 claim for premium.

52. Please note that if you apply successfully to Category 3(b), 4 or 6(a) of the 2004 reserve and receive an allocation (even if this is scaled back - see paragraph 57) you will not be eligible to apply to the same category again in 2005.

Usage rules and withdrawal of unused quota.

53. These rules apply to all of the quota you hold, not just your national reserve quota, but do not include quota you have leased in.

54. You must use at least 70% of all your permanently held quota in each year. If you do not, the amount unused in the year in question will be withdrawn, unless you can show that exceptional circumstances prevented you from using quota. For recipients of a national reserve allocation, quota can only be "used" by claiming premium on it. Leasing out is not possible for the first three years ( see paragraphs 10 and 11)

55. Producers with 20 or less quota rights must use at least 70% of their quota units every other year. Failure to meet the requirement will result in the number they do not use in the second year being withdrawn without compensation.

Restrictions on transfer and lease of quota if you receive quota from the national reserve.

56. If you are allocated quota from the reserve it will be effective from 2004, and you may not dispose of any quota by transfer or lease for the three Scheme years starting with 2004. This means that you must not dispose of any quota by transfer or lease for the 2004, 2005 or 2006 Sheep Annual Premium Scheme years.

How much quota will you be allocated from the national reserve?

57. The categories in the reserve will be handled in priority order. This means that applications to Category 1 will be considered before applications to Category 2 and so on. If there is not enough quota to meet demand in any given category, all producers' maximum entitlements in that category will be scaled back pro rata. You can apply to as many categories of the reserve as you are eligible for but you can receive quota only once in respect of the same set of circumstances. You cannot apply to more than one sub-category of the same category in the same year. All sub-categories within a category have equal priority.

58. Until all applications are received and compared with the amount of quota available in the reserve, it is not possible to say what your allocation, if any, will be.

How will quota acquired by transfer prior to the 2004 Scheme be taken into account?

59. Any quota held by you other than quota leased in may be taken into account when calculating your allocation from the national reserve.

If you have any problems completing form SAP-National Reserve-2004

60. Contact:

Quota Management Section,
Room 220, Pentland House,
47 Robb's Loan,
Edinburgh EH14 1TW.

61. You may use the telephone number given below to contact the person dealing with your application: - or Fax 0131 244 6006

If your Local Area Office is