Chapter 11- Agriculture and Rural Development

EU Common Agricultural Policy

Agriculture in the European Union (EU) is a very important sector and agricultural expenditures account for almost 40 % of the total EU budget. Direct aids have the biggest share (70%) in total agricultural budget followed by rural development (25%) and market measures (5%).

EU Agricultural Budget (Million Euro)

2012 (Execution)2013 (Budget)2014 (Draft Budget)
EU BUDGET147.443,3147.085,4139.634,5
Direct aids40.880,040.931,941.240,8
  • Decoupled direct aids
37.665,538.076,038.179,0
  • Other direct aids
3.213,92.854,92.636,7
  • Additional amounts of aid
0.61.00.6
  • Reserve for crisis
--424,5
Market measures3.406,02.773,42.636,7
Rural development14.594,714.805,013.987,3
TOTAL59.514,158.851,957.993,6

Source: EC- DG Agriculture and Rural Development http://ec.europa.eu/agriculture/statistics/agricultural/2013/pdf/c4-1-34_en.pdf

Under the EU multiannual financial framework for 2014-2020, the budget for "Sustainable Growth: Natural Resources" which includes the areas of agriculture, rural development and fisheries is determined as EUR 362.787 billion for seven years, of which roughly EUR 278 billion is foreseen for Direct Payments and market-related expenditure and EUR 85 billion for Rural Development.

EU's Common Agricultural Policy (CAP), is, as the title suggests, a common policy which is governed by common rules established at the EU level and replaces the national agricultural policies of the Member States, and was created basically to resolve the problems in the 1950s. Supply shortages during and after the II World War, ensuring a fair standard of living for farmers which constitute a major part in the active population of the EU, and necessity to eliminate the differences between national agricultural policies of the Member States led to the formation of a common agricultural policy (CAP).

The objectives of the CAP, which are still prevalent, are to assure the availability of supplies, to increase agricultural productivity, to ensure a stable income for farmers, to stabilise markets, and to ensure that supplies reach consumers at reasonable prices. In order to attain these objectives, three principles were established: single market (free movement of agricultural commodities between Member States), community preference (protection against low priced imports from the third countries and preference for Community produce in Community markets), and financial solidarity (establishment of a joint fund for the expenditures arising from the implementation of a common policy).

Although this system served well for the said purposes in the beginning, by the 1980s production surpluses had become a problem and the burden of the policy on the EU budget had increased significantly. Thus, from the end of the 1980s, policy adjustments had been made in order to alleviate these problems and with MacSharry reforms in 1992, intervention prices were decreased and direct payments per hectare and per head were introduced. 

Agenda 2000 reforms in 1999 had deepened the previous reforms and CAP included environment and rural development measures, and for this reason a rural development policy was formed as the second pillar of the CAP. Since then CAP has been functioning on a two-pillar structure. The first pillar consists of market measures (intervention, rules regarding production and marketing, external trade etc.) and direct aids while the second pillar includes rural development measures which is co-financed by the EU budget and Member States and implemented on the basis of national programmes prepared by Member States according to their regional priorities and needs.

Under 2003 reform aiming at making EU farmers more competitive and market orientated by breaking the link between subsidies and production, while providing the necessary income stability, most of the direct payments were decoupled and linked to the respect of environmental, food safety and animal welfare standards, called "cross-compliance".

Especially after the latest waves of enlargement, there were demands for a fairer distribution of payments between Member States and between farmers within a Member State, and the need to revise the agricultural support in a way to better respond the price fluctuations and environmental concerns. Moreover, recent food crisis, global warming, decrease in biodiversity and deterioration of natural resources underlined the necessity to reshape the CAP, which led to another reform in December 2013.

Post-2013 CAP is now implemented through four Basic Regulations:

  1. Regulation (EU) No 1305/2013 of the European Parliament and of the Council of 17 December 2013 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) and repealing Council Regulation (EC) No 1698/2005 (Rural Development Regulation)
  2. Regulation (EU) No 1306/2013 of the European Parliament and of the Council of 17 December 2013 on the financing, management and monitoring of the common agricultural policy and repealing Council Regulations (EEC) No 352/78, (EC) No 165/94, (EC) No 2799/98, (EC) No 814/2000, (EC) No 1290/2005 and (EC) No 485/2008 (Horizontal Regulation)
  3. Regulation (EU) No 1307/2013 of the European Parliament and of the Council of 17 December 2013 establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy and repealing Council Regulation (EC) No 637/2008 and Council Regulation (EC) No 73/2009 (Direct Payments Regulation)
  4. Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 (Market Measures Regulation)

EU Direct Payments

Agricultural support in the European Union (EU) accounts for a large part in the EU agricultural budget. In 2013, direct payment expenditures had the biggest share with 70 % in total agricultural expenditures, within which 93 % was allocated to decoupled payments. The CAP, which was established in 1960s, is the basis of the support to agriculture in the EU and has always been in a reform process according to the changes in internal and external conditions.

Agricultural support, which was given as price support in the early years, was shifted to direct payments per head and per hectare by 1992 reform and in 2003 most of the direct payments were delinked form production. These new payments, called Single Farm Payment (afterwards referred to as Single Payment Scheme-SPS) were calculated based on the reference amount that farmers received during the reference period (2000-2002) and conditioned on maintaining the land in good agricultural and environmental condition as well as the respect of environmental, food safety and animal welfare standards, called "cross-compliance". In addition to SPS, Member States were allowed to grant coupled payments up to %10 of their national envelops in certain sectors in clearly determined circumstances.

For Member States which became EU members in 2004 and 2007, a different and simpler support system was established. Under this system called "Single Area Payment Scheme (SAPS)", farmers receive a uniform payment per hectare and this amount of payment is calculated by dividing the total national envelope by the total eligible agricultural land.

The most recent reform of the CAP realised in 2013 made major changes in the design of the direct payments. The reason behind is to make the distribution of direct payments fairer between Member States and also within the Member State itself, and to provide Member States with flexibility in terms of implementation and financing of the agricultural support taking into account of their respective economic, social and structural conditions.

The rules concerning the direct payments are set out in the "Regulation (EU) No 1307/2013 of the European Parliament and of the Council of 17 December 2013 establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy and repealing Council Regulation (EC) No 637/2008 and Council Regulation (EC) No 73/2009". Under this Regulation, direct payments are extended to nine payment schemes, five of which is compulsory, which was previously consisted of SPS and coupled payments paid in certain conditions.

   Compulsory Payment SchemesVoluntary Payment Schemes
  • Basic Payment Scheme
  • Single Area Payment Scheme 
  • Green Payment
  • Young Farmers Scheme
  • Crop-spesific Payment for Cotton
  • Small Farmer Scheme
  • Coupled Support
  • Payment for areas with natural constraints
  • Redistributive Payment

 

"Basic Payment Scheme" has replaced the Single Payment Scheme. Direct payments where the amount is lower than 100 € or where the eligible area of the holding for which support is claimed is less than one hectare shall not be supported.

"Single Area Payment Scheme" will continue to be available until 2020.

"Green Payment" is granted to farmers in addition to the Basic Payment Scheme/SAPS for respecting certain agricultural practices beneficial for the environment such as crop diversification, maintaining permanent grassland and having ecological focus area on the agricultural area of at least %5 - i.e. field margins, hedges, trees, fallow land, landscape features, buffer strips. Farmers who already apply environmentally beneficial practices such as organic farming and agri-environmental measures are considered eligible.

"Young Farmers Scheme" is paid for farmers, who are under 40 years of age and are entering the sector for the first time or during the five years preceding their first aid application, for a maximum period of five years as an additional payment of %25 of the value of their payment entitlements, which can still be complemented by a start-up aid under the second pillar on condition that they are entitled to basic payment.

"Crop-spesific Payment for Cotton" is paid for cotton farmers in Bulgaria, Greece, Spain and Portugal. The amount of payment is calculated for each Member State according to the base area, yield and reference amount.

 "Small Farmer Scheme" offers to its participants a simplified and uniform payment which is exempt from the green payment obligations, and has more flexible cross compliance requirements. Participating farmers receive an annual payment fixed by the Member State of between 500 € and 1250 €.

 "Coupled Support" may be granted to cereals, oilseeds, protein crops, grain legumes, flax, hemp, rice, nuts, starch potato, milk and milk products, seeds, sheepmeat and goatmeat, beef and veal, olive oil, silkworms, dried fodder, hops, sugar beet, cane and chicory, fruit and vegetables and short rotation coppice; and sectors or regions of a Member State where specific types of farming or specific agricultural sectors that are particularly important for economic, social or environmental reasons undergo certain difficulties in order only to maintain current levels of production in the sectors or regions concerned. This payment is paid annually within defined quantitative limits and be based on fixed areas and yields or on a fixed number of animals.

"Payment for Areas with Natural Constraints" may be granted for the continuation of farming and conservation of biodiversity in the areas where agricultural production is carried out in harsh natural conditions.

"Redistributive Payments" may be granted to farmers on their first 30 hectares up to 30% of the national envelope as an additional annual payment. 

EU Common Market Organisations (CMO)

Common Market Organisations (CMO) have been the most effective tool in terms of market regulation since the creation of the Common Agricultural Policy (CAP) in the 1960s, and was initially established for 21 products or product groups. This complex and detailed set of regulations was reduced to one single regulation as part of the simplification of the CAP. Council Regulation (EC) No 1234/2007 establishing a common organisation of agricultural markets and on specific provisions for certain agricultural products (so-called "Single CMO Regulation") was published on 22 October 2007.

Recently, with the new CAP reform in 2013, a new Regulation (Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007) was enacted. This Regulation maintained the structure of the former Regulation in which rules regarding market policy such as intervention, private storage, customs tariffs, export refunds, safeguard measures, state aid and competition rules were reorganised according to tools and policy areas.

CMO Regulation covers following products/sectors:

1)         Cereals 12) Wine
2)         Rice13) Live trees and ornamental plants
3)         Sugar14) Tobacco
4)         Dried fodder 15) Beef and veal
5)         Seeds16) Milk and milk products
6)         Hops 17) Pigmeat
7)         Olive oil and table olives 18) Sheepmeat and goatmeat
8)         Flax and hemp19) Eggs
9)         Fruit and vegetables 20) Poultrymeat
10)     Processed fruit and vegetables21) Other products
11)     Bananas 

 

The Regulation also provides measures for ethyl alcohol of agricultural origin, apiculture products and silkworms which previously did not have a proper CMO but was regulated by a series of rules.

Under the reformed CMO, it is aimed to improve the market orientation and increase competitiveness of farmers by further reducing the public intervention tools while introducing new crises management tools in order to protect farmers from unexpected market disturbances.

Market intervention may take two forms: public intervention and private storage aid.

Public intervention can only be made for certain products in specified intervention periods at public intervention price. This price signifies either the price at which products shall be bought in under public intervention where this is done at a fixed price or the maximum price at which products eligible for public intervention may be bought in where this is done by tendering. Disposal of products bought in under public intervention e.g. distribution of food to most deprived persons is carried out in a way to avoid any disturbance of the market.

Products eligible for public intervention are as follows:

  • Common wheat, durum wheat, barley and maize,
  • Paddy rice,
  • Fresh or chilled meat of the beef and veal,
  • Butter,
  • Skimmed milk powder

Private storage aid, on the other hand, may be granted to white sugar, olive oil, flax fibre, fresh or chilled meat of bovine animals, butter, cheese, skimmed milk powder, pigmeat, sheepmeat and goatmeat. Private storage aid for butter, which was previously compulsory, has become voluntary as in the case of other eligible products.

Within the context of CMO, there are also aid schemes for olive oil and table olives, fruit and vegetables, wine, milk, apiculture and hops sectors, in the form of aid to national support programmes of the Member States or to work programmes drawn by producer organisations in the abovementioned sectors.

With regard to product regulation, milk quotas were removed on 31 Mart 2015, and sugar quotas are foreseen to en in 2017. In the wine sector, it is decided to end the system of wine planting rights at the end of 2015, with the introduction of a system of authorisations for new vine planting from 2016.

As for the marketing of agricultural products, marketing standards are established for products/product groups such as olive oil and table olives, fruit and vegetables, processed fruit and vegetables, live plants and milk. These standards may be related to quality of products, labelling, storage and transport. In addition, especially in the wine sector, there are certain rules regarding the protection of designation of origin and geographical indication, and labelling and presentation of wines.

As regards producer organisations (POs), rules related to the recognition of POs and inter-branch organisations, which were previously limited to certain sectors (hops, olive oil and table olives, fruit and vegetables, processed fruit and vegetables and silkworm) are extended to cover all sectors in order to improve farmers' negotiating position in the food chain, as decided in the reform. Member States may grant recognition to POs, which are formed on the initiative of the producers acting together in production, harvest, storage, packaging and marketing of products. For this purpose, POs have to draw up a work programme. Furthermore, under certain conditions, POs operating in the olive oil, beef, cereals and certain other arable crops sectors have the possibility negotiate supply contracts.

Concerning crisis management, especially after the global food crisis and price fluctuations, certain emergency measures are put forward in case of a market disturbance and outbreak of animal diseases, and a Crisis Reserve has been created which will be financed by annually reducing direct payments and can be used for all sectors. In case of severe imbalance in the market, the Commission may also authorise POs to take certain temporary measures to stabilise the supply in the market.

The rules regarding the trade with third countries include management of import and export licences, customs tariffs, import and export quotas, safeguard measures and export refunds.

EU Rural Development Policy

Rural development is a vitally important and primary policy area for the EU with over half of the population living in rural areas - accounting for 90% of the territory of the 27 Member States -. Furthermore, 53% of the total employment and 45% of the gross production value of the EU is generated from the rural areas.

As the second pillar of the Common Agriculture Policy (CAP), the EU Rural Development Policy has been developed and evolved through various reforms following the creation of CAP. Importance of the rural development policy has been gradually enhanced especially with the Agenda 2000 reform, and the budget that is allocated for this policy area has increased. From 2000's to the latest reforms, many subjects such as protection of environment in the rural areas, production of healthy and quality foods, environmental conditions and forestry have come in to prominence. The latest reform was in 2013 in line with the EU's 2020 strategy. Under the 1305/2013/EC Regulation of European Parliament and Council on support for rural development by EAFRD, following targets are set:

  1. Fostering the competitiveness of agriculture;
  2. Ensuring the sustainable management of natural resources, and climate action;
  3. Achieving a balanced territorial development of rural economies and communities including the creation and maintenance of employment.

Besides, within the framework of this Regulation, 6 priorities have been determined by the European Commission in order to reach the above mentioned targets: Fostering knowledge transfer and innovation in agriculture, forestry, and rural areas, enhancing farm productivity and competitiveness of all types of agricultural production, promoting food chain organization and risk management, preserving and enhancing ecosystems related to agriculture and forestry, promoting resource efficiency and supporting the shift towards a low carbon and climate resilient economy in agriculture, food and forestry sectors, promoting social inclusion, poverty reduction and economic development in rural areas.

The rural development policy is managed via national or regional 7-year rural development programs in the Member States. In this context, for the 2014-2020 period, total 118 rural development programs are going to be implemented in 28 Member States. Rural development programs are financed by both EU and the Member States, and contribution rates vary according to the measures.

At least 4 of the abovementioned priorities have to be in the Member States' rural development programs. However, if these programs are regional programs, number of the priorities can be less than 4. Thematic sub-programs covering Member States' specific needs have been designated by the Commission in order to contribute to the priorities of the EU's rural development area. These thematic sub-programs are young farmers, small farmers, mountainous areas, insufficient supply chains, women in rural area, reduction in climate change, adaptation of climate change and biodiversity. If the Member States select these measures related with these thematic sub-programs, support rate can be higher.

Besides, in the context of LEADER approach which is an element of Rural Development Policy, it is aimed to identify local problems and to create individual projects in order to solve these problems with the participation of local actors.

Last but not least, there are some measures specified in the 2014-2020 EU Rural Development Policy: Knowledge transfer and information actions, advisory services, farm management and farm relief services, quality schemes for agricultural products, and foodstuffs, investments in physical assets, restoring agricultural production potential damaged by natural disasters and catastrophic events and introduction of appropriate prevention actions, farm and business development, basic services and village renewal in rural areas, investments in forest area development and improvement of the viability of forests, setting -up of producer groups and organizations, agri-environment-climate, organic farming, Natura 2000 and Water Framework Directive payments, payments to areas facing natural or other specific constraints, animal welfare, forest-environmental and climate services and forest conservation, co-operation, risk management.

EU's total rural development budget that is allocated to the Member States for 7 years is 95.5 billion Euros as it is seen below:

When it is compared to the 2007-2013 Rural Development Policy, new rural development policy aims simplification in order to make financial management easier in accordance with the EU priorities. Also, number of the measures is decreased, and the notion of "axis" is abolished, and measures are grouped under priorities. However, the rural development budget remains almost the same comparing with the previous period.

Besides, through the new policy, it is aimed that rural development measures and direct payments are linked, and connection between these two policy areas are strengthened. Issues such as fight against climate change are inserted to agri-environment measure. Furthermore, Member States are obliged to use at least 30% of the budget of their rural development programs for the agri-environment measure.   

Horizontal Issues

1.       Integrated Administration and Control System(IACS)

Integrated Administration and Control System is the system which enables European Union to administrate and control the support applications of farmers under the Common Agricultural Policy (CAP).

EU rules on IACS have been regulated by Regulation No. 1306/2013 of financing, administrating and monitoring of the CAP.

Supports administrated and controlled under IACS are shown below:

  • Single Payment Scheme
  • Single Area Payment Scheme
  • Other direct payments
  • Rural Development Measures based on area/animal
  • Agri-Environmental Measures
  • Area Payments allocated to less developed regions

The sub-systems that help IACS to work are shown below:

  • Computerized database
  • Land Parcel Identification System (LPIS)
  • System for the identification and registration of payment entitlements
  • Aid applications
  • Integrated control system
  • Registration system for farmers who have applied for the support

In all the stages of evaluating the support applications, the controls shown below are performed:

  • Visual Controls: The controls to check that application forms are properly filled and submitted.
  • Harmonization Controls: The controls to compare the information logged into the system with the source documents.
  • Administrative Controls: The controls to check the accuracy of the given data and data on the system. These controls have two parts:
  • Basic Control: The controls to compare and check the data acquired during the application and the data registered as enterprises in the system.
  • Cross Check: The controls to reveal the duplicate applications for the same area or the same payment entitlement by comparing the data acquired during the application with the data presented by the other enterprises.
  1. On-the-Spot checks: The controls to check the data acquired in application and the actual situations of the enterprises. These checks are performed through remote sensing with the data provided by a satellite.

The Project on Digitization of Land Parcel Identification System has been started in October 2014 in Turkey within the scope of establishment of IACS. As a requirement of the project, ortho-photos of Turkey will be taken and geographical database will be obtained by digitization of the ortho-photos according to the standards of LPIS.

2.       The Farm Accountancy Data Network (FADN)

FADN which contains physical and economic data is one of the most important tools used by the European Commission to shape the CAP. The data collected by FADN is used for determining and monitoring the annual agricultural income of the enterprises and for assessing the performance of the enterprises and for many other purposes (such as scientific searches, disaster relief aids etc.). By this way, it is possible to analyse the effects of agricultural policy to the sector. FADN is the only system in which the micro economic data based on the enterprises are collected and analysed.

In 27 Member States, data collected from 85.000 enterprises which are chosen by a modelling method representing 6.400.000 enterprises is analysed by means of FADN. The system is regulated by the Regulation No. 79/65.

In order to contribute to the works for the establishment of the system, "Establishment of pilot FADN" project has been conducted between the years of 2007-2009 in context of 2006 PHARE Program. The consecutive project named "Extension and Enabling the Sustainability of Establishment of pilot FADN project" has started in May 2011 and has ended in December 2012.

FADN system has been established in 9 pilot provinces thanks to the contribution of the first EU twinning project started in 2007. Following the "Directive on the Establishment and Operation Procedure and Principles of FADN System" which was published on the Official Gazette No. 27118 of 22/01/2009, the legislation harmonization was completed.

FADN has been extended to whole Turkey by 2015 and the data has been collected from 6000 enterprises. Feedbacks are provided to the enterprises of which the data is collected from in the end of the year and they are financially analyzed. The system is optional and in order to include more enterprises to the system, 425TL/enterprise incentive pay is offered to the enterprises.

3.        EU Paying Agencies

The main EU legislation concerning Paying Agencies is the Regulation No. 1306/2013 on the financing, management and monitoring of the Common Agricultural Policy.

Paying Agencies are the institutions to use the financial support that is provided by European Agricultural Guarantee Fund (EAGF) and European Agricultural Fund for Rural Development (EAFRD) for the implementation of the CAP.

Working areas of the Paying Agencies are given below:

  • Intervention buying and sales,
  • Export refunds,
  • Monitoring product quotas,
  • Import and export licenses,
  • Direct income payments,
  • Rural development measures,
  • Food aids,
  • Fisheries.

    There are 3 supreme authorities/institutions regarding paying agencies:

1-Competent Authority

Each Member State has to establish a "Competent Authority" that has broad authorities related with the accreditation of paying agencies, 

2-Certification Agency

This is an independent agency that audits the annual accounts and functioning of the Paying Agency according to the international standards, and reports the outcomes to the Competent Authority and to the EAGF.

3-Coordination Unit

If there is more than one Paying Agency in a country, establishment of a "Coordination Unit" is necessary.

Duties of the Coordination Unit are given below:

  • Gathering and organizing the information regarding current Paying Agencies in order to transmit it to the Commission,
  • Making suggestions to the Component Authority on conferral, maintaining and withdrawal of the accreditation of a Paying Agency relying on Certification Agencies' annual reports and Commission's reports.

Along with these three agencies, if there are delegated duties, "Delegated Bodies" also participate in the process. In this regard:

  • Paying Agencies can delegate some of its duties by signing a time-limited protocol with proper agencies and corporations.
  • Authorized agency holds its main activities.
  • Current experience of authorized agencies is taken into account, and their storages and technical stuff are used for the duty in question.
  • Even though an agency is authorized for a given duty, Paying Agency has the ultimate responsibility.

In order to be accredited, Paying Agency must have an administrative structure and an internal control system assuring that payments are legally and regularly made. For this purpose, Paying Agency must comply with the minimum accreditation conditions regarding internal environment, control activities, information, communication and observation that are laid down by the Commission. Paying Agencies which met these conditions are accredited.

Numbers, organizational structures and practices of Paying Agencies of the Member States vary from one Member State to another. There are 83 paying agencies in 28 EU Member States.

In the context of recent change in the EU policy, it is targeted that each Member State has only one Paying Agency.

In accordance with the latest legislation, each Member State has to have one accredited paying agency at national level taking into account of its own constitutional provisions. In case Member State comprises of regions, it has to have one paying agency per region.  However, where paying agencies are established at regional level, Member States shall, in addition, either accredit a paying agency at national level for aid schemes which, by their nature, have to be managed at national level or shall confer the management of these schemes on their regional paying agencies.

4.       EU Farm Advisory System (FAS)

Farm Advisory System (FAS) is a comprehensive system set up by Member States (MS) in order to help farmers to better understand and meet the EU rules for environment, public and animal health, animal welfare and the good agricultural and environmental conditions. FAS covers the overall organization and various public and/or private operator bodies contributing to the delivery of the various farm advisory services to farmers required within a MS. On the other hand, Farm Advisory Services refers the various advisory activities, called services, to be provided to farmers, ranging from information to one-to-one advice to group advice to overall farm advice.

FAS, initially introduced by the 2003 Common Agricultural Policy (CAP) Reform and MS had been requested to set up the system no later than the 1st of January 2007, in accordance with the article 13 of Regulation (EC) No 1782/2003.  Accompanied by the cross- compliance mechanism which is a set of rules that farmers receiving direct payments are obligated to comply with, the basic rationale of FAS is to provide farmers advisory services to fulfil these mandatory requirements and manage to prevent any punitive consequences that may arise pursuant to the cross-compliance.

The advisory activity, at MS level, has to have the capacity to provide information and advice covering at least the scope of cross-compliance, i.e. the Statutory Management Requirements (SMR) and Good Agricultural and Environmental Conditions (GAEC) referred to in articles 4 and 6 of the Regulation (EU) 73/2009.  On the other hand, MS, in setting-up the FAS, have wide latitude to design the FAS in such a way to meet their own needs and priorities.  Although, in the first place, farmers who receive more than EUR 15,000 of direct payments per year had been designated to as the first priority service takers, by the recent modification following the "Health check  revision of the CAP (2007 – 2008), MS are left free to decide on the farmers that will get service with priority.

FAS, in any way without affecting farmers' responsibility and liability related to legal obligations, should help farmers to gain greater awareness on and meet the EU rules for environment, public and animal health, animal welfare and the GAEC. Advisory services have been completely separated from the supervision and criminal control mechanisms. In this respect, farmers benefit from advisory services on the voluntary basis and are free to take action as a result of advisory activities. Another fundamental basis of the system being privacy, FAS MS authorities should act responsible about keeping confidential the information obtained from the farmers during advisory services.  

Farm Advisory Services may partially be funded by the second CAP pillar (Regulation (EC) No 1698/2005) with possible support from the European Agricultural Fund for Rural Development (EAFRD), under measure 114 and 115. The setting up of farm management, farm relief and farm advisory services, as well as forestry advisory services may be supported by MS in their rural development program for 5 years in a gradually decreasing way, under measure 115. The use of advisory services by farmers under measure 114 may be partially funded under EAFRD. The amount of support, provided that the upper limit set to 1,500 euros, is 80 percent of the eligible cost of each advisory service. 

EU State Aid

In general terms, state aid is defined as all kinds of economic advantages provided by public authorities to a sector or one/more firm. Agricultural state aid is provided within three principles: Accordance with the general principles of competition policy, consistency with the EU's Common 
Agricultural Policy and Rural Development Policy and consideration of EU`s international commitments.

Agricultural state aid rules were revised between 2012 and 2014. In this framework, related legislation is as follows:
  • Guidelines for state aid in the agricultural and forestry sectors and in rural areas 2014 – 2020
  • Agricultural Block Exemption Regulation
  • Agricultural De Minimis* Regulation
  • General De Minimis Regulation

(*The de minimis rule defines the amount of aid that can be paid without being considered as a state aid within the meaning of the Treaty.)

Within the scope of Guidelines for State Aid In The Agricultural And Forestry Sectors and In Rural Areas 2014 – 2020, general criteria is defined for Member States’ national aid schemes for primary agricultural production, processing and marketing of agricultural products.

According to the Agricultural Block Exemption Regulation, certain categories of State aid are available without prior notification to the Commission for agricultural, forestry sectors and rural areas. 

With the Agricultural De Minimis Regulation, aid rules are determined for holdings which produce primary agricultural products. 

In General De Minimis Regulation, aid rules are specified for holdings dealing with the processing and marketing of agricultural products and for forestry sector.​

EU Organic Farming

Organic farming is a type of agricultural production model, which is certificated and all the production and consumption stages are under control, using only the inputs that allowed by legislation. (That means no chemical inputs are used.) The aim of the organic farming is to protect environment, plant, human and animal health while avoiding pollution of the soil, water resources and the air.

The regulations related to organic farming in EU are:

  • Council Regulation (EC) No 834/2007 of 28 June 2007 on organic production and labeling of organic products
  • Commission Regulation (EC) No 889/2008 of 5 September 2008 laying down detailed rules on organic production and labelling of organic products with regard to organic production, labelling and control
  • Commission Regulation (EC) No 1235/2008 of 8 December 2008 laying down detailed rules on arrangements for imports of organic products from third countries 

Council Regulation (EC) No 834/2007 lays down the rules on general farm production, plant production, seaweed, animal production, aquaculture and some exceptional circumstances.

Commission Regulation (EC) No 889/2008 lays down the rules on restrictions regarding soil management and fertilizers; on prohibition of production without soil; on combat with pests, diseases and weed; on mushroom production; on transitional process; on parallel production and on seed database.

Commission Regulation (EC) No 889/2008 lays down the rules for the products of animal origin, animal shelters, farming rules, fodders, animal health and rules related to transitional period. This regulation also provides detailed rules for production of sea weed and aquaculture products and for some exceptional circumstances.

Lately, the new organic farming policy for the new decade has been discussed in several platforms and bodies of the EU.

In our country, organic farming activities have been started in 90's in accordance with the importer firms' demands. The Law on Organic Farming No. 5262 was published on 03.12.2004. The Regulation on the Principles and Implementation of Organic Farming prepared according to the Law and harmonized with the EU legislation was published in the Official Gazette No. 27676 on 18.08.2010.  This regulation was amended in 2011 and 2012.

Within the scope of studies related to our application in 2003 for Turkey's inclusion in the recognized third countries list of the EU on the imports of organic farming products, a technical file was sent to the European Commission. Besides, two "on the spot verification" missions was carried out in 2013. The final report is expected to be announced in this year.​

EU Quality Policy/ Geographical Indications

"Geographical indications" mean an indication which identifies a product originating in a specific place, region or a country whose quality, reputation and characteristics are essentially or exclusively due to that place/region/country.

Geographical indications are protected by registration. Main purposes of registration of geographical indications are listed below:

  • Quality protection and maintenance of the supply of that specific product (protection of the product)
  • Enabling the producers who produce that specific product in that specific area or according to its specific production methods primarily benefit from the protection of registration (protection of the producer)
  • Hindering the deception of consumers by preventing the use of geographical  indications' inscriptions on counterfeit products that do not have required qualifications (protection of consumers)
  • Protection of the country's national and cultural values

Geographical indications protect not only a single producer but also all the people that produce under specific conditions.

In the EU, geographical indications in the scope of Quality Policy under the subject of Agriculture and Rural Development are considered in three groups, namely PDO (protected designations of origin), PGI (protected geographical indication) and TSG (traditional specialty guaranteed).

Protected Designation of Origin (PDO) covers agricultural products or foodstuff which are produced, processed and prepared using a certain technical knowledge in a certain geographical area (i.e. Prosciutto di Parma).

Protected Geographical Indications (PGI) covers agricultural products or foodstuffs which are closely linked to the geographical area. At least one of the stages of production, processing or preparation must have taken place in that area (i.e. Scotch Beef – United Kingdom - Scotland).

For the traditional specialty guaranteed (TSG), the tradition of production tools or the traditional character in production composition is the main focus (i.e. Mozzarella – Italian tradition).

In EU, registration of the geographical indication regarding PDO, PGI and TSG for the agricultural products and foodstuff is regulated by the Regulation No. 1151/2012 on Quality Schemes of Agricultural Products and Foodstuff.

In accordance with the Regulation 1151/2012, non-member states identified as the "third countries" have the right to apply for the registration and to object to the application published by the Commission.

In this context, application is possible for EU registration for the products that are registered at national level by the Turkish Patent Institute (TPI). However, only one Turkish product was registered at EU level so far.

  • The application was made on 10.07.2009 for the protected geographical indication (PGI) for Antep Baklavası. Registration process was finalized on 21.12.2013 so that Antep Baklavası is under the protection at the EU level now.  
  • Even though the legal investigation duration time of the applications for the PGI registration of Afyon Pastırması and Afyon Sucuğu along with PDO registration of Aydın İnciri and Malatya Kayısısı has expired, no response has been issued yet regarding their decline or approval.

According to the data by June 2015, total 1279 geographical indications for food and agricultural products have been registered in the EU; 590 of which is PDO, 639 of which is PGI, and 49 of which is TSG.

In addition, 1752 geographical indications for wines have been registered in EU; 1293 of which is PDO, and 459 of which is PGI.​

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