Regulation (EU) 2020/2220 of the European Parliament and of the Council of 23 December 2020 laying down certain transitional provisions for support from the European Agricultural Fund for Rural Development (EAFRD) and from the European Agricultural Guarantee Fund (EAGF) in the years 2021 and 2022 and amending Regulations (EU) No 1305/2013, (EU) No 1306/2013 and (EU) No 1307/2013 as regards resources and application in the years 2021 and 2022 and Regulation (EU) No 1308/2013 as regards resources and the distribution of such support in respect of the years 2021 and 2022

TITLE I

TRANSITIONAL PROVISIONS

CHAPTER I

Extension of certain periods under Regulations (EU) No 1303/2013 and (EU) No 1310/2013 and continued application of Regulation (EU) No 1303/2013 for the programming years 2021 and 2022

Article 1

Extension of the period of duration of programmes supported by the European Agricultural Fund for Rural Development

By way of derogation from the first subparagraph, second sentence, of this paragraph, when reallocating funds to and spending funds for measures referred to in Article 6a of this Regulation and in Article 18(1), point (b), of Regulation (EU) No 1305/2013, Member States may decrease the overall share of the EAFRD contribution reserved for the measures referred to in Article 59(6) of Regulation (EU) No 1305/2013. That decrease shall not go beyond the EAFRD amounts reallocated to the measures referred to in Article 6a of this Regulation and in Article 18(1), point (b), of Regulation (EU) No 1305/2013, and shall not exceed 15 percentage points of the overall share of the EAFRD contribution set in the rural development programmes for the measures referred to in Article 59(6) of Regulation (EU) No 1305/2013. For that purpose, the overall share of the EAFRD contribution set in the rural development programmes as planned at the time of the extension of the period of duration of programmes supported by the EAFRD until31 December 2022, in accordance with paragraph 1 of this Article, shall be taken into account. The overall share reserved for the measures referred to in Article 59(6) of Regulation (EU) No 1305/2013 shall not be lower than the minimum threshold set out in that Article. The same decrease in percentage points may be applied to the additional resources referred to in Article 58a(2) of Regulation (EU) No 1305/2013 without reallocating funds to the measures referred to in Article 6a of this Regulation and in Article 18(1), point (b), of Regulation (EU) No 1305/2013.

Article 2

Continued application of Regulation (EU) No 1303/2013 to programmes supported by the EAFRD

Article 3

Eligibility of certain types of expenditure during the transitional period

Without prejudice to Article 2(2) of this Regulation, to Article 65(2) of Regulation (EU) No 1303/2013 and to Article 38 of Regulation (EU) No 1306/2013, the expenditure referred to in Article 3(1) of Regulation (EU) No 1310/2013 and in Article 16 of Delegated Regulation (EU) No 807/2014 shall be eligible for an EAFRD contribution from the 2021 and 2022 allocation for programmes supported by the EAFRD which were extended in accordance with Article 1 of this Regulation, subject to the following conditions:

(a) such expenditure is provided for in the respective rural development programme for the years covered by the transitional period;

(b) the EAFRD contribution rate of the corresponding measure under Regulation (EU) No 1305/2013, as set out in Annex I to Regulation (EU) No 1310/2013 and in Annex I to Delegated Regulation (EU) No 807/2014, applies;

(c) the system referred to in Article 67(2) of Regulation (EU) No 1306/2013 applies to the legal commitments undertaken under measures that correspond to support granted in accordance with points (a) and (b) of Article 21(1) and Articles 28 to 31, 33, 34 and 40 of Regulation (EU) No 1305/2013 and the relevant operations are clearly identified; and

(d) the payments for the legal commitments referred to in point (c) of this Article are made within the period laid down in Article 75 of Regulation (EU) No 1306/2013.

CHAPTER II

Preparation of future community-led local development strategies in the programming years 2021 and 2022

Article 4

Community-led local development

For programmes extended in accordance with Article 1 of this Regulation, the EAFRD may support the costs of capacity building and preparatory actions supporting the design and future implementation of community-led local development strategy under the new legal framework.

CHAPTER III

Payment entitlements for direct payments to farmers

Article 5

Definitive payment entitlements

CHAPTER IV

Transitional provisions relating to rural development

Article 6

Eligibility of expenditure incurred under Regulation (EU) No 1305/2013, and certain types of expenditure incurred under Regulations (EC) No 1698/2005 and (EC) No 1257/1999

Expenditure relating to legal commitments to beneficiaries incurred under Regulation (EU) No 1305/2013, and certain types of expenditure incurred under Council Regulations (EC) No 1698/2005 (¹) and (EC) No 1257/1999 (²) may be eligible for a contribution from the EAFRD in the period 2023-2027 from 1 January 2023, subject to the conditions to be determined in accordance with the CAP legal framework applicable in the period 2023-2027.

Article 6a

Exceptional temporary support to farmers, forest holders and SMEs particularly affected by natural disasters

Support under this Article shall be granted to:

(a) farmers;

(b) private and public forest holders and other private law and public bodies and their associations, excluding State-owned forest managed by the State;

(c) SMEs active in the processing, marketing or development of agricultural products covered by Annex I to the TFEU or cotton, except fishery products; or

(d) SMEs active in the processing, mobilising and marketing of forest products.

With regard to the processing of agricultural products, the output of the production process may be a product not covered by Annex I to the TFEU.

Article 6b

Provisions applicable to the exceptional temporary support to farmers, forest holders and SMEs particularly affected by natural disasters

Article 6c

Force majeure

As regards the implementation of Regulation (EU) No 1306/2013 for the purposes of the financing, management and monitoring of the CAP when recognising the cases of ‘force majeure’, as referred to in Article 2(2) of that Regulation, where a severe natural disaster gravely affects a well-determined area, the Member State concerned may consider that whole area to be gravely affected by that disaster.

Article 6d

Commission implementing powers

The Commission may adopt implementing acts laying down rules necessary for the implementation of the measure referred to in Article 6a through rural development programmes within the legal framework applicable in the programming period 2014–2020, extended in accordance with Article 1, on:

(a) monitoring and evaluation of the rural development policy;

(b) presentation of the rural development programmes;

(c) presentation of the annual implementation reports;

(d) implementation of checks and penalties.

Article 6e

Committee procedure

TITLE II

AMENDMENTS

Article 7

Amendments to Regulation (EU) No 1305/2013

Regulation (EU) No 1305/2013 is amended as follows:

(1) point (h) of Article 8(1) is amended as follows: (a) point (i) is replaced by the following: ‘(i) a table setting out, in accordance with Article 58(4) and Article 58a(2) of this Regulation, the total EAFRD contribution planned for each year. That table shall indicate separately the additional resources as referred to in Article 58a(2) of this Regulation. When applicable, that table shall also indicate separately, within the total EAFRD contribution, the appropriations provided for the less developed regions and the funds transferred to the EAFRD pursuant to Article 7(2) of Regulation (EU) No 1307/2013. The planned annual EAFRD contribution shall be compatible with the Multiannual Financial Framework;’; (b) point (ii) is replaced by the following: ‘(ii) a table setting out, for each measure, for each type of operation with a specific EAFRD contribution rate, for the type of operation referred to in Article 37(1) and Article 39a, for the type of operation referred to in Article 38(3) and Article 39(1) when a Member State applies a percentage less than 30 %, and for technical assistance, the total Union contribution planned and the applicable EAFRD contribution rate. Where applicable, that table shall indicate separately the EAFRD contribution rate for less developed regions and for other regions;’;

(2) in Article 28(5), the following subparagraphs are added: ‘For new commitments to be undertaken from 2021, Member States shall determine a shorter period of one to three years in their rural development programmes. If Member States provide for an annual extension of commitments after the termination of the initial period in accordance with the first subparagraph, from 2022 the extension shall not go beyond one year. By way of derogation from the second subparagraph, for new commitments to be undertaken in 2021 and 2022, Member States may determine a period of longer than three years in their rural development programmes based on the nature of the commitments and the environmental and climate-related objectives sought.’;

(3) in Article 29(3), the following subparagraphs are added: ‘For new commitments to be undertaken from 2021, Member States shall determine a shorter period of one to three years in their rural development programmes. If Member States provide for an annual extension for the maintenance of organic farming after the termination of the initial period in accordance with the first subparagraph, from 2022 the extension shall not go beyond one year. By way of derogation from the second subparagraph, for new commitments to be undertaken in 2021 and 2022, where support is granted for conversion to organic farming, Member States may determine a period of longer than three years in their rural development programmes.’;

(4) in Article 31(5), the second subparagraph is replaced by the following: ‘In the years 2021 and 2022, for programmes extended in accordance with Article 1 of Regulation (EU) 2020/2220 of the European Parliament and of the Council (⁷), where degressive payments were not granted by the Member States for the maximum duration of four years up to 2020, those Member States may decide to continue those payments until the end of 2022 but for no longer than four years in total. In that case, the payments in the years 2021 and 2022 shall not exceed EUR 25 per hectare.

(5) in Article 33(2), the following subparagraphs are added: ‘For new commitments to be undertaken as from 2021, Member States shall determine a shorter period of one to three years in their rural development programmes. If Member States provide for an annual renewal of commitments after the termination of the initial period in accordance with the second subparagraph, as from 2022 the renewal shall not go beyond one year. By way of derogation from the third subparagraph, for new commitments to be undertaken in 2021 and 2022, Member States may determine a period of longer than three years in their rural development programmes based on the nature of the commitments and the animal welfare benefits sought.’;

(6) in Article 38(3), the second subparagraph is replaced by the following: ‘Support under point (b) of Article 36(1) shall only be granted to cover for loss caused by the outbreak of adverse climatic events, animal or plant disease, pest infestation, or measures adopted in accordance with Directive 2000/29/EC to eradicate or contain a plant disease or pest or environmental incident, which destroy more than 30 % of the average annual production of the farmer in the preceding three-year period or a three-year average based on the preceding five-year period, excluding the highest and lowest entry. Indexes may be used in order to calculate the annual production of the farmer. The calculation method used shall permit the determination of the actual loss of an individual farmer in a given year. Member States may decide to reduce that percentage of 30 %, however, to not less than 20 %.’;

(7) in Article 39, paragraph 1 is replaced by the following: ‘1. Support under point (c) of Article 36(1) shall only be granted where the drop in income exceeds 30 % of the average annual income of the individual farmer in the preceding three-year period or a three-year average based on the preceding five-year period excluding the highest and lowest entry. Income for the purposes of point (c) of Article 36(1) shall refer to the sum of revenues the farmer receives from the market, including any form of public support, deducting input costs. Payments by the mutual fund to farmers shall compensate for less than 70 % of the income lost in the year the producer becomes eligible to receive this assistance. Indexes may be used to calculate the annual loss of income of the farmer. Member States may decide to reduce that percentage of 30 %, however, to not less than 20 %.’;

(8) in Article 39b, paragraph 4 is replaced by the following: ‘4. The support shall take the form of a lump sum payment to be paid by 31 December 2021, based on applications for support approved by the competent authority by 30 June 2021. The subsequent reimbursement by the Commission shall be made in accordance with budget appropriations and subject to available funding. The level of payment may be differentiated by categories of beneficiaries, in accordance with objective and non-discriminatory criteria.’;

(9) in Article 42, paragraph 1 is replaced by the following: ‘1. In addition to the tasks referred to in Article 34 of Regulation (EU) No 1303/2013 and in Article 4 of Regulation (EU) 2020/2220, local action groups may also perform additional tasks delegated to them by the Managing Authority and/or the paying agency.’;

(10) in Article 51(2), the following subparagraph is added: ‘By way of derogation from the first subparagraph, Member States for which the total amount of Union support for rural development for the years 2014-2020 as laid down in Annex I to this Regulation is less than EUR 1 800 million may, after the extension of their programmes in accordance with Article 1 of Regulation (EU) 2020/2220, decide to devote 5 % of the total amount of each rural development programme to tasks referred to in Article 59 of Regulation (EU) No 1303/2013.’;

(11) Article 58 is amended as follows: (a) in paragraph 1, the following subparagraph is added: ‘Without prejudice to paragraphs 5, 6 and 7, the total amount of Union support for rural development under this Regulation for the period from 1 January 2021 to 31 December 2022 shall be a maximum of EUR 26 896 831 880 , in current prices, in accordance with the multiannual financial framework for the years 2021 to 2027.’; (b) paragraph 7 is replaced by the following: ‘7. In order to take account of the developments relating to the annual breakdown referred to in paragraph 4 of this Article, including the transfers referred to in paragraphs 5 and 6 of this Article and the transfers resulting from the application of Article 1 of Regulation (EU) 2020/2220, to make technical adjustments without changing the overall allocations, or to take account of any other change provided for by a legislative act after the adoption of this Regulation, the Commission shall be empowered to adopt delegated acts, in accordance with Article 83 of this Regulation, to review the ceilings set out in Annex I to this Regulation.’;

(12) the following Article is inserted: ‘Article 58a Resources for the recovery of the Union agricultural sector and rural areas

That amount of EUR 8 070 486 840 in current prices shall constitute external assigned revenues in accordance with Article 21(5) of Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (⁹). It shall be made available as additional resources for budgetary commitment under the EAFRD for the years 2021 and 2022, in addition to the total resources set out in Article 58 of this Regulation as follows: — 2021: EUR 2 387 718 000 ; — 2022: EUR 5 682 768 840 . For the purpose of this Regulation and Regulations (EU) No 1306/2013 and (EU) No 1307/2013, those additional resources shall be considered as amounts financing measures under the EAFRD. They shall be considered as being part of the total amount of Union support for rural development, as referred to in Article 58(1) of this Regulation, to which they shall be added when reference is made to the total amount of Union support for rural development. Article 14 of Regulation (EU) No 1307/2013 shall not apply to the additional resources referred to in this paragraph and in paragraph 2 of this Article.

(a) organic farming; (b) mitigation of, and adaptation to, climate change, including reduction of greenhouse gas emissions from agriculture; (c) soil conservation, including the enhancement of soil fertility through carbon sequestration; (d) improvement of the use and management of water, including water saving; (e) creation, conservation and restoration of habitats favourable to biodiversity; (f) reduction of the risks and impacts of pesticide and antimicrobial use; (g) animal welfare; (h) LEADER cooperation activities.