ARABLE AREA PAYMENTS SCHEME 2004: RULE CHANGES:
NEW PROTEIN CROPS AND ENERGY CROPS AID: GUIDANCE TO PRODUCERS
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Dear Producer
ARABLE AREA PAYMENTS SCHEME 2004: RULE CHANGES: NEW PROTEIN CROPS AND ENERGY CROPS AID: GUIDANCE TO PRODUCERS
1. This letter advises of changes to the EU rules covering the 2004 Arable Area Payments Scheme (AAPS), which have only recently been agreed and were, therefore, too late to be included in the AAPS 2004 Explanatory Booklet. It also advises of new aid available for protein and energy crops.
(A) Set-aside
2. In response to a fall in production for the 2003 EU harvest and as announced in the News Release of 14 January, the Council of Ministers has reduced the obligatory set-aside requirement from 10% to 5 % for 2004. In addition, the European Commission has reduced the eligible sizes of set aside areas in line with those contained in the 2005 CAP Reform proposals. For 2004, the minimum set-aside plot area is 0.3 hectare for single blocks not less than 20 metres wide at all points. The minimum plot sizes for set aside areas next to permanent watercourses, dykes, hedges, woods and Sites of Special Scientific Interest must now be 0.1 hectares where the minimum strip width is 10 metres and a minimum plot size of 0.05 hectares where the minimum strip width is 6 metres. Please note that such set-aside strips must not be separated from those features.
Changes to the 2004 AAPS Booklet
3. Please make the following amendments to your copy of the AAPS 2004 Explanatory Booklet:
paragraph 6, delete "10%" and insert "5%";
paragraph 8, delete "10%" and insert "5%";
paragraph 40, second indent, after "10 metre strips", insert "and 0.05 hectares in the case of 6 metre strips", after "watercourses" insert " hedges, woods, dykes and Sites of Special Scientific Interest";
paragraph 46, delete "10%" and insert "5%";
paragraph 48, delete and replace with:
"The minimum set-aside plot is 0.05 hectares for strips at least 6 metres wide where these strips are next to permanent watercourses, hedges, woods, dykes and Sites of Special Scientific Interest (SSSIs);
The mimimum set-aside plot is 0.1 hectares for strips at least 10 metres wide where these strips are next to permanent watercourses, hedges, woods, dykes and SSSIs;
The minimum size for other set-aside plots is 0.3 for single blocks not less than 20 metres wide at all points"
paragraph 49, before "10 metres" insert " 6 and";
Appendix 1, replace with revised Appendix 1, attached to this letter at Annex 4;
Appendix 3, paragraph 3, line 2 amend "returns. That land must also have" to "returns, and land also….";
Appendix 5, final sentence under "Applicants with land in more than one yield region", delete "10%" insert "5%";
Appendix 5, paragraph 2.2, replace with:
Scotland LFA | 40 x | 5 | = 2.105 = 2.11 |
95 |
Scotland non-LFA | 60 x | 5 | = 3.158 = 3.16 |
95; and |
(B) Protein Crop Premium
4. From 2004, if you grow protein crops you will be eligible to apply for payment of the protein crop premium. The payment window for this premium will be 1 December 2004-30 June 2005. Eligible protein crops are the same as those eligible for AAPS aid, i.e.:
5. In regions where protein crops are traditionally sown in a mixture with cereals, the protein crop premium will be paid, if claimed, if you prove to our satisfaction, that the protein crops are predominant in the mixture.
6. The flat rate of aid is 55.57 euros per hectare on areas which are fully sown and cultivated in accordance with local standards. The protein crop premium is payable on eligible proteins grown on AAPS land, declared as forage, or grown on "other land" as declared in your IACS return. If you claim protein crops aid under AAPS, you are eligible to be paid both AAPS aid and the protein crop premium. If you grow protein crops on forage areas or other land, you will be eligible to be paid the protein crop premium only.
7. It should be noted that the basic AAPS payment for protein crops has been reduced from 72.5 euros per tonne to 63 euros per tonne for 2004.
(C) Energy Crops Scheme
8. A flat rate of aid of 45 euros per hectare, for areas sown under energy crops and meeting the conditions set out in Annex 1, is available from 2004. The payment window for this will also be 1 December 2004 to 30 June 2005.
9. For 2004, if you grow energy crops on any land other than set-aside land, whether AAPS eligible or not, you may claim the energy crop payment. The aid is only payable on those areas whose production is covered by a contract between you and the processor (or where you have provided a declaration if you are processing the crop on your holding). Further details are included in Annex 1. If you claim for energy crops under AAPS, you will be eligible to be paid both the AAPS payment and the energy crop payment provided both the land and the crops are AAPS eligible. If you grow energy crops on other land, you will be eligible to be paid the energy crops scheme payment only.
10. Further details relating to completing the Arable Aid Application (AAA) form will be contained in the IACS 2004 Booklet, due to be issued in March 2004. In the meantime, please contact your local Area Office if you have any queries.
Yours faithfully
Bill Denholm
Arable Area Payments Scheme Manager
ANNEX 1
AID FOR ENERGY CROPS
Applying for aid
Use of raw material
1. Energy crops means crops supplied essentially for the production of the following energy products:
Any agricultural raw materials (except sugarbeet) may be grown on areas qualifying for aid provided that they are intended primarily for use in the manufacture of the energy products referred to above Such crops can be grown on any land whether AAPS eligible or not, EXCEPT set-aside land.
Selling to Processors
2. If you are selling to a processor, production must be covered by a contract between you and the processing industry.
3. You must deliver all raw materials harvested to a first processor, who shall take delivery of them and ensure that an equivalent quantity of such raw materials is used within the Community for the manufacture of one or more energy products listed at paragraph 1.
4. Where the first processor uses the raw material actually harvested to manufacture an intermediate product or a by-product, he may use an equivalent quantity of such intermediate products or by-products to manufacture one or more end products. He must inform the competent authority with whom the security is lodged, i.e. the Rural Payments Agency (RPA).
Processing on your Holding
5. However, you may undertake processing on your holding, in which case you may:
(a) use all the cereals or all the oilseeds falling within CN codes 1201 00 90, ex 1205 00 90 and 1206 00 91 ( see Annex 3) harvested
(i) as fuel for heating your agricultural holding;
(ii) for the production on the holding of power or bio-fuels;
(b) process into bio-gas falling within CN code 2711 29 00 ( see Annex 3) on your holdings, all the raw material harvested.
In these cases, you must provide a declaration, in place of a contract, to use or process directly the raw material covered by your declaration. The declaration should be submitted with your AAA.
6. We will need an accurate assessment of the weight delivered. You must keep separate accounts for the raw material used and the products and by-products resulting from its processing. However, in the case of cereals and oilseeds, where either the straw or the entire plant is used, weighing may be replaced by volumetric measurement of the raw material. If you use the volumetric assessment, you must keep the crop separate from other crops until an accurate weight is confirmed on a weigh bridge approved by the local authority.
7. We will apply adequate checks to ensure that the raw material is used directly on the holding or is processed into bio-gas falling within CN code 2711 29 00.
8. Cereals and oilseeds used as per point (a) of paragraph 5 above must be denatured in accordance with the method laid down by SEERAD. We may, however, authorise the oil produced by processing oilseeds in accordance with point (a) (ii) to be denatured instead of the oilseeds themselves, provided that such denaturing takes place immediately after the seeds are processed into oil and that the use to which the seeds are put is checked.
9. If you are processing on your holding, your declaration should include details as outlined in c-h in paragraph 11.
Contract
10. In support of your application for aid, you must submit to the RPA the contract you have concluded with a first processor or your declaration if processing on your holding.
11. You must ensure that contracts specify the following:
(a) the names and addresses of the parties to the contract;
(b) the duration of the contract;
(c) the variety of all raw materials concerned and the area planted with each variety;
(d) any conditions applicable to the delivery of the forecast quantities of raw materials;
(e) the forecast quantities of raw materials, classified by variety, and any conditions governing their delivery. Such quantities must be no less than the representative yield established the previous year for the raw material in question;
(f) an undertaking to fulfil your obligations ;
(g) the intended primary end uses for the raw material;
(h) the field identification number of each field in which you are claiming energy crops aid.
12. You must ensure that the contracts are concluded in time to allow the first processor to deposit a copy with RPA by the closing date.
Amendment and termination
13. The first processor may delegate to a third party, collection of the raw material from the farmer applying for aid.
14. When the contract or declaration is amended or the contract terminated after you have lodged an aid application, you may maintain the aid application only on condition that, with a view to allowing the requisite inspections to be carried out, you inform us of such amendment or termination, no later than the closing date set for amendment of the application.
Exceptional circumstances
15. Where you inform us that, owing to exceptional circumstances, you will not be able to supply all or part of the raw materials specified in the contract or declaration, we may, after obtaining sufficient evidence of such special circumstances, authorise such amendments to contracts or declarations as appear justified, or may authorise their termination.
16. Where the land covered by contracts is reduced as a result of their amendments, or where contracts are terminated, you will lose the right to aid in respect of areas struck out of the contracts.
Alterations to end uses
17. First processors may alter the intended primary end uses of raw materials, once the raw materials under contract have been delivered to the first processor and once the specified conditions have been fulfilled. The first processor must give prior notice to allow for appropriate controls.
Representative yields and quantities delivered
Representative yields
18. Each year before the harvest, we will establish and advise you of the representative yields which will have to be attained.
Quantities delivered
19. You must declare the total quantity of raw materials harvested by variety to us and must confirm the quantities of raw materials delivered and the parties to whom such deliveries are made. The actual quantities to be delivered by you must at least correspond to the representative yield. In duly justified cases, we may, by way of exception, allow a shortfall of up to 10% in the yield. Where we have authorised amendments or termination of contracts we may, where it seems justified to do so, reduce the quantities that you are required to deliver.
Reduction in aid
20. Where you fail to deliver the requisite quantity of any given raw material, you will be deemed to have failed to fulfil your obligations under the energy crops scheme.
Payment
21. Payments of aid may be made to you before the raw materials are processed. However, such payments will only be made where the requisite quantities of raw materials have been delivered to the first processor and where:
(a) the appropriate declaration referred to in paragraph 19 has been made;
(b) a copy of the contract has been deposited with the RPA and the conditions referred to in paragraph 1 have been fulfilled and the appropriate information has been forwarded by the first processor;
(c) the RPA has received proof that the full security has been lodged (see paragraphs 33 -36);
(d) we have checked that the relevant conditions detailed in paragraphs 10, 11 and 12 have been met in respect of each application.
22. In the case of biennial crops, where the raw materials are harvested, and hence delivered, in the course of the second year of cultivation only, payment will be made in each of the two years following the conclusion of the contract, on condition that:
(a) the obligations laid down in points (b), (c) and (d) of paragraph 21 are fulfilled as from the first year of cultivation; and
(b) the obligations laid down in point (a) of paragraph 21 are fulfilled, and the information referred to at paragraph 30 is communicated in the second year of cultivation.
23. Payments will only be made in respect of the first year of cultivation if we receive proof that the security has been lodged. In the second year of cultivation, a new security is not required in order for payment to be made.
24. In the case of permanent or multi-annual crops, payment of the aid will be made in each of the years following the conclusion of the contract, from the first year.
Number of processors
25. Energy products must be produced, at the most, by a second processor, so that raw materials and semi-processed products are sold no more than twice before final processing. This means that processing can only be a 2 stage process at most.
Contract and obligations on applicant and first processor
26. First processors shall deposit copies of the contracts with RPA before the closing date for the submission of aid applications for the year in question (17 May for 2004).
27. Where applicants and first processors amend or terminate contracts prior to the closing date for amendments in a given year, the first processors will deposit with the RPA a copy of the amended or terminated contract, no later than that date.
28. First processors must provide the RPA with the requisite information on the processing chain in question, in particular as regards prices and the technical processing coefficients to be used for determining the quantities of end products that may be obtained.
29. First processors who have taken over the raw materials from you will inform the RPA of the quantities of raw materials received, specifying the variety, the name and address of the party to the contract who delivered the raw materials, the place of delivery and the contract reference, within the time limit set.
30. Where processors sell or transfer to second processors in other Member States they should contact the local authority for advice.
31. Processing into the end products must take place by 31 July of the second year following the year in which the raw material is harvested
First processors' securities
32. First processors must lodge a full security as detailed in paragraph 21 with the RPA by the closing date for submission of payment applications for the year in question.
33. The securities to be lodged in respect of each raw material will be calculated by multiplying the sum of all areas cultivated under this scheme, covered by a contract signed by the first processor concerned and used to produce that raw material, by the rate of 60 euros per hectare.
34. Where contracts are amended or terminated, the securities lodged will be adjusted accordingly.
35. A percentage of the security will be released for each raw material on condition that the RPA of the first processor is in possession of proof that the quantity of raw material in question has been processed in compliance with the requirements laid down.
Land Eligibility
36. Land used to produce raw materials grown under this scheme is not eligible for aid for forestry (except the planting costs of short rotation coppice).
Sale, Transfer or Delivery to another Member State
37. Where first processors sell or transfer intermediate goods to second processors in other Member States, the products must be accompanied by T5 control copies (contact your local Area Office for further details).
ANNEX 2
EXTRACT FROM EC DIRECTIVE 2003/30/EC ARTICLE 2 POINT 2
At least the products listed below are considered as biofuels:
(a) "bioethanol": ethanol produced from biomass and/or the biodegradable fraction of waste, to be used as biofuel;
(b) "biodiesel": a methyl-ester produced from vegetable or animal oil, of diesel quality, to be used as biofuel;
(c) "biogas": a fuel gas produced from biomass and/or from the biodegradable fraction of waste, that can be purified to natural gas quality, to be used as biofuel, or woodgas;
(d) "biomethanol": methanol produced from biomass, to be used as biofuel;
(e) "biodimethylether": dimethylether produced from biomass, to be used as biofuel;
(f) "bio-ETBE (ethyl-tertio-butyl-ether)": ETBE produced on the basis of bioethanol. The percentage by volume of bio-ETBE that is calculated as biofuel is 47%;
(g) "bio-MTBE (methyl-tertio-butyl-ether)": a fuel produced on the biomass of biomethanol. The percentage by volume of bio-MTBE that is calculated as biofuel is 36%;
(h) "synthetic biofuels": synthetic hydrocarbons or mixtures of synthetic hydrocarbons, which have been produced from biomass;
(i) "biohydrogen": hydrogen produced from biomass, and/or from the biodegradable fraction of waste, to be used as biofuel;
(j) "pure vegetable oil": oil produced from oil plants through pressing, extraction or comparable procedures , crude or refined but chemically unmodified, when compatible with the types of engines involved and the corresponding emission requirements.
ANNEX 3
CN Codes.
Complete and authoritative details within EC Regulation (EC) No 1789/2003. Summary below is for information. If in doubt contact your local Area Office.
1201 00 90 Soya beans other than for sowing.
ex1205 00 90 Rape or colza seeds other than for sowing (only those types referred to in Articles 4(1) and 4(2)(a), (b) and (e) of Commission Regulation (EC) No 2316/1999 i.e. certified seed of double-zero (00) varieties of colza and rape seed notified and entered as such in the Common Catalogue.
1206 00 91 Sunflower seeds other than for sowing.
2711 29 00 Petroleum gases and other gaseous hydrocarbons in gaseous state, other than natural gas.
ANNEX 4
Appendix 1
How to work out your set-aside requirement for 2004
For 2004, the minimum set-aside requirement is 5% in both the Scottish LFA and non-LFA. However, if you are offsetting set-aside (that is, you are claiming arable crops in one yield region against set-aside in another), please refer to appendix 5.
1 If you know the total area of land you want to claim area and set-aside payments on
Total area x | 5 | = set-aside area |
100 |
For example, if you want to enter 200 hectares of arable cropping and set-aside land into the main scheme, the sum is as follows.
200 x 5 ÷ 100 = 10
To be eligible to receive AAPS aid on the cropping part of this claim, you must set aside at least 10 hectares and crop the remainder of the 190 hectares.
When working out your total set-aside requirement, if you round down to the nearest second decimal place, you will automatically not have enough set-aside land to qualify the whole of your arable cropping claim for payment.
As a result, when working out your set-aside requirement, we strongly advise you to work to three decimal places and to round up to the nearest second decimal place in order to qualify the whole of your arable cropping claim for payment.
For example, you want to enter 162.04 hectares of arable cropping and set-aside land into the scheme. The sum is as follows.
162.04 x 5 ÷ 100 = 8.102 = 8.10 (rounded to the nearest second decimal place)
So, you must enter 153.94 hectares of arable cropping and 8.10 hectares of set-aside land. However, a set-aside area of 8.10 hectares is not enough to cover the whole of the 153.94 hectares of cropping claimed. The sum for the maximum area of arable cropping on which aid can be paid is as follows.
8.10 x 95 ÷ 5 = 153.90 hectares
In this example, payment on the arable cropping claim would be restricted to 153.90 hectares.
To confirm the maximum area of cropping on which you will be paid AAPS aid, we strongly advise you to carry out the calculation in 3.
2 If you know the area of cropped land you want to claim cereals, linseed, oilseeds, proteins, flax and hemp payments on
cropped area x | 5 | = set-aside area |
95 |
For example, if you want to crop 140 hectares, the sum is as follows.
140 x 5 ÷ 95 = 7.368 = 7.37 (rounded up to the nearest second decimal place)
So, you must set aside at least 7.37 hectares for the whole of your 140 hectares of cropping to receive AAPS aid.
When working out your set-aside requirement, if you round down to the nearest second decimal place, you will automatically not have enough set-aside land to qualify the whole of your arable cropping claim for payment.
As a result, when working out your set-aside requirement, we strongly advise you to work to three decimal places and to round up to the nearest second decimal place in order to qualify the whole of your arable cropping claim for payment.
For example, you want to crop 84 hectares. The sum is as follows.
84 x 5 ÷ 95 = 4.421 =4.42 (rounded down to the nearest second decimal place)
However, a set-aside area of 4.42 hectares is not enough to cover the whole of the 84 hectares of arable cropping claimed. The sum for the maximum area of arable cropping on which AAPS aid can be paid is as follows.
4.42 x 95 ÷ 5 = 83.98 hectares
In this example, payment on the arable cropping claim would be restricted to 83.98 hectares.
To confirm the maximum cropping area on which you will be paid AAPS aid, we strongly advise you to carry out the calculation as in 3 below.
3 If you know the total area of land you want to enter into set-aside
set-aside area x | 95 | = maximum cropping area on which you can be paid AAPS aid |
5 |
For example, if you want to set aside 7.43 hectares, the sum is as follows.
7.43 x 95 ÷ 5 = 141.17
As a result, you can claim AAPS aid up to a maximum cropping area of 141.17 hectares.
ANNEX 5
Example 1
In 2004, you farm and claim for 100 hectares in the Scottish LFA and 100 hectares in the Scottish non-LFA yield regions. If you decide to site all of your set-aside land in the Scottish LFA, you must adjust your AAPS claim as follows.
Your claim in the Scottish non-LFA would be for 100 hectares of cropped land.
The set-aside requirement for the 100 hectares of non-LFA cropping is as follows.
100 x (5 ÷ 95) = 5.263 hectares
(rounded up from 5.264)
As you have no non-LFA set-aside and the LFA region has a lower reference yield, you must multiply the 5.264-hectare requirement by 1.09 to get the area to be set aside in the LFA region.
5.264 x 1.09 = 5.74 hectares
(rounded up from 5.738)
As a result, your claim in the Scottish LFA region would be reduced to the following.
100 - 5.74 = 94.26 hectares
The 94.26 hectares include the area of LFA land you want to claim cropping and set-aside payments on. So, the minimum set-aside requirement for the LFA land is as follows.
94.26 x 5% = 4.72 hectares
(rounded up from 4.713)
In summary, your overall AAPS claim for 2004 would be:
100 hectares of non-LFA cropping;
a maximum of 89.54 hectares of LFA cropping (94.26-8.79); and
a minimum of 10.46 hectares of LFA set-aside land (4.72 + 5.74).
If you choose to offset your set-aside requirement and don't have enough set-aside land to support all the cropping parts of your claim, we will pay in full for the yield region that has enough set-aside land. We will also use the set-aside excess in that region to set the supported cropping area in the other yield region (or regions).
Example 2
In 2004, you farm and claim for 100 hectares in the Scottish LFA and 100 hectares in the Scottish non-LFA. If you decide to site two hectares of your set-aside land in the Scottish non-LFA and the rest in the Scottish LFA, you must adjust your AAPS claim as follows.
98 x | 5 | = 5.16 hectares |
95 |
(rounded up from 10.888) | |
As you have two hectares of non-LFA set-aside land, your offset requirement to the LFA region is as follows.
5.16 - 2 = 3.16 hectares
As the LFA region has a lower reference yield, the 8.89-hectare requirement must be multiplied by 1.09 to get the area to be set aside in the LFA.
3.16 x 1.09 = 3.45 hectares
(rounded up from 3.444 hectares)
As a result, your claim in the Scottish LFA would be reduced to the following.
100 - 3.45 = 96.55 hectares
The 96.55 hectares include the area of LFA land you want to claim cropping and set-aside payments on. So, the minimum set-aside requirement for the LFA land is as follows.
96.55 x 5% = 4.83 hectares
(rounded up from 4.828)
In summary, your overall AAPS claim for 2004 would be:
98 hectares of non-LFA cropping;
two hectares of non-LFA set-aside land;
a maximum of 81.27 hectares of LFA cropping
(96.55 - 4.83); and
If you choose to offset your set-aside requirement and don't have enough set-aside land to support all the cropping parts of your claim, we will pay in full for the yield region that has enough set-aside land. We will also use the set-aside excess in that region to set the supported cropping area in the other yield region (or regions).
Example 3
In 2004, you farm and claim for 100 hectares in the Scottish LFA and 100 hectares in the Scottish non-LFA. If you decide to site all of your set-aside land in the Scottish non-LFA, you must adjust your AAPS claim as follows.
Your claim in the Scottish LFA would be for 100 hectares of cropped land.
Your total set-aside requirement for the 100 hectares of LFA and 100 hectares of non-LFA is as follows.
200 hectares x 5% = 10 hectares
As the non-LFA region has a higher reference yield, there is no need to use a factor to the non-LFA land being set aside for LFA crops.
As a result, your claim in the Scottish non-LFA region would be reduced to
the following.
100 - 10 = 90 hectares
The 90 hectares is the maximum area of non-LFA land you can claim
cropping on.
In summary, your overall AAPS claim for 2004 would be:
100 hectares of LFA cropping;
a maximum of 90 hectares of non-LFA cropping; and
a minimum of 10 hectares of non-LFA set-aside land.
If you choose to offset your set-aside requirement and don't have enough set-aside land to support all the cropping parts of your claim, we will pay in full for the yield region that has enough set-aside land. We will also use the set-aside excess in that region to set the supported cropping area in the other yield region (or regions).
Example 4
In 2004, you farm and claim for 100 hectares in the Scottish LFA and 100 hectares in the Scottish non-LFA. If you decide to site three hectares of set-aside land in the Scottish LFA and the rest in the Scottish non-LFA, you must adjust your AAPS claim as follows.
Your claim in the Scottish LFA would be for 97 hectares of cropped land and three hectares for set-aside land.
Your total set-aside requirement for 100 hectares of LFA and 100 hectares of
non-LFA is as follows.
200 hectares x 5% = 10 hectares
As you have three hectares of LFA set-aside land, your requirement in the non-LFA is as follows.
10 - 3 = 7 hectares
As the non-LFA region has a higher reference yield than the LFA region, you don't need to use a factor to the non-LFA land being set aside for LFA crops.
As a result, your cropping claim in the Scottish non-LFA would be reduced to the following.
100 - 7 = 93 hectares
The 93 hectares is the maximum area of non-LFA land you can claim cropping on.
In summary, your overall AAPS claim for 2004 would be:
97 hectares of LFA cropping;
three hectares of LFA set-aside land;
a maximum of 93 hectares of non-LFA cropping (100 -7); and
a minimum of 7 hectares of non-LFA set-aside land.
If you choose to offset your set-aside requirement and don't have enough set-aside land to support all the cropping parts of your claim, we will pay in full for the yield region that has enough set-aside land. We will use the set-aside excess in that region to set the supported cropping area in the other yield region (or regions).
2.6 If you are not sure how to follow these rules, please get professional advice or consult your local area office.