The Agricultural Business Development Scheme (Scotland) Regulations 2000

Made: 20th December 2000

Laid before the Scottish Parliament: 21st December 2000

Coming into force: 29th January 2001

The Scottish Ministers, in exercise of the powers conferred by section 2(2) of the European Communities Act 1972 and of all other powers enabling them in that behalf, hereby make the following Regulations:

Citation, commencement and extent

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• (1) These Regulations may be cited as the Agricultural Business Development Scheme (Scotland) Regulations 2000 and shall come into force on 29th January 2001.

• (2) These Regulations shall extend to Scotland only.

Interpretation

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• (1) In these Regulations–

• “agriculture” includes horticulture, fruit growing, seed growing, dairy farming and livestock breeding and keeping, the use of land as grazing land, meadow land, osier land, market gardens and nursery grounds, and the use of land for woodlands where that is ancillary to the farming of land for other agricultural purposes, and “agricultural” shall be construed accordingly;

• “agricultural holding” means an agricultural holding within the meaning of section 1 of the Agricultural Holdings (Scotland) Act 1991 ;

• “agricultural unit” means a croft, agricultural holding or smallholding (and includes a common grazing) which is located within the scheme area, or which is partly located within the scheme area and is deemed to be located within the scheme area by the Scottish Ministers if they think fit;

• “application” means an application for financial assistance under the scheme made in accordance with regulations 4 or 5 and “applicant” and “apply” shall be construed accordingly;

• “approved” means approved by the Scottish Ministers in writing and “approve” and “approval” shall be construed accordingly;

• “authorised person” means a person appointed by the Scottish Ministers for the purpose of enforcement of these Regulations;

• “EU legislation” means–Council Regulation (EC) No 1257/1999 of 17th May 1999 on support for rural development from the European Agricultural Guidance and Guarantee Fund (EAGGF) and amending and repealing certain Regulations ;Council Regulation (EC) No 1260/1999 of 21st June 1999 laying down general provisions on the Structural Funds ; andCommission Regulation (EC) No 1750/1999 of 23rd July 1999 laying down detailed rules for the application of Council Regulation (EC) No 1257/1999 on support for rural development from the European Agricultural Guidance and Guarantee Fund (EAGGF) ;

• “croft” means a croft within the meaning of section 3 of the Crofters (Scotland) Act 1993 ;

• “collaborative venture” means a venture in respect of which an application for financial assistance under these Regulations is jointly submitted by three or more eligible persons in relation to three or more eligible businesses;

• “designated maps” means the four maps numbered 1 to 4, each such map being marked “map of less-favoured farming areas in Scotland” and with the number of the map, dated 5th May 1991, signed by the Secretary of State for Scotland and deposited at the offices of the Scottish Executive Rural Affairs Department, Pentland House, 47 Robb’s Loan, Edinburgh EH14 1TW;

• “eligible business” means a business which has been engaged in agriculture on an agricultural unit for a continuous period of two years ending with the date of the application;

• “eligible expenditure” means expenditure (including reasonable professional fees and charges) approved in relation to measures to be undertaken under the scheme;

• “eligible person” means–in relation to any measure–a person who is a legal occupier of an agricultural unit and who operates an eligible business on that unit; ora person authorised to act on behalf of such legal occupier; andin relation to a measure specified in Part II or Part III of the Schedule–where such legal occupier is a natural person, any member of the immediate family of the legal occupier who resides on or adjacent to that agricultural unit and is acting with the legal occupier’s consent; orwhere such legal occupier is a partnership or company, any member of the immediate family of a partner in that partnership or a director or secretary of that company who resides on or adjacent to that agricultural unit and is acting with the legal occupier’s consent except where that immediate family member is also a partner in that partnership or a director or secretary of that company;

• “financial assistance” means a payment made under these Regulations, and may include a payment from the Guidance Section of the European Agricultural Guidance and Guarantee Fund payable under the EU legislation;

• “immediate family” means wife, husband, partner, son, stepson, daughter, stepdaughter, mother, father, brother, sister;

• “less favoured area” means the land shown coloured in blue or in pink on the designated maps–which is situated in an area included in the list of less favoured farming areas adopted by Council Directive 84/169/EEC concerning the Community list of less favoured farming areas within the meaning of Directive 75/268/EEC (United Kingdom) as amended ; andwhich is, in the opinion of the Scottish Ministers, inherently suitable for extensive livestock production but not for the production of crops in quantity materially greater than that necessary to feed such livestock as are capable of being maintained on such land, and whose agricultural production is, in the opinion of the Scottish Ministers, restricted in its range by, or any combination of, soil, relief, aspect or climate;

• “measure” means a measure specified in the Schedule;

• “scheme” means the measures to assist rural communities described at Priority 4, Sub Priority (a), Measures 1, 3, Sub-Measure (i), and 5 (Agriculture only) of the Highlands and Islands Special Transitional Programme approved by Commission Decision of 8th August 2000 on the adoption of the Single Programming Document for the Highlands and Islands Special Transitional Programme and entitled, for the purposes of these Regulations, the Agricultural Business Development Scheme;

• “scheme area” means the area of Scotland comprising–the area of the Argyll and Bute Council, excluding the Parishes of Arrochar, Cardross, Luss, Rhu and Roseneath;the area of the Highland Council;the area of the Orkney Islands Council;the area of the Shetland Islands Council;the area of the Western Isles Council;in the area of the North Ayrshire Council, the islands of Arran, Great Cumbrae and Little Cumbrae; andin the area of the Moray Council, the Parishes of Aberlour, Cabrach, Dallas, Dyke, Edinkillie, Forres, Inveravon, Kinloss, Kirkmichael, Knockando, Mortlach, Rafford and Rothes;

• “smallholding” means any holding within the meaning of sections 2 and 32 of the Small Landholders (Scotland) Act 1911 .

• (2) A reference in these Regulations to anything done in writing or produced in written form includes a reference to an electronic communication, as defined in the Electronic Communications Act 2000 , which has been recorded and is consequently capable of being reproduced.

• (3) References in these Regulations to a numbered regulation or to the Schedule shall be construed as a reference to the regulation so numbered in or to the Schedule to these Regulations.

Objectives

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Subject to the provisions of these Regulations, the Scottish Ministers may in accordance with the EU legislation make payments of financial assistance under the scheme where they are satisfied that the payments will help to achieve one or more of the following objectives–

• (a) re structuring of an eligible business or re-orientation of its agricultural production;

• (b) diversification of farm incomes by creating new or improving existing agricultural activities;

• (c) diversification outwith agricultural activities to provide alternative sources of income; or

• (d) improvement of co-operation and collaboration by encouraging collaborative ventures.

Business Plans

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• (1) The Scottish Ministers may require that an eligible person, who intends to make an application under regulation 5, prepares a business plan in accordance with the following paragraphs of this regulation.

• (2) The business plan shall be in writing in such form as the Scottish Ministers reasonably may require and shall include statements of–

• (a) the assets and liabilities of the eligible business;

• (b) the current viability of the eligible business and proposals for enhancing its current viability; and

• (c) the skills and training requirements for the eligible business.

• (3) The Scottish Ministers may approve a business plan submitted in accordance with this regulation.

• (4) The Scottish Ministers may pay to an eligible person financial assistance towards the costs of an approved business plan–

• (a) if the business plan has been prepared by an independent adviser, at the rate of 50% subject to a maximum payment of £400; or

• (b) in any other case, at a fixed amount of £100.

Applications

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• (1) Subject to paragraph (6) below, an eligible person who wishes to obtain financial assistance towards the cost of any measure to be undertaken under the scheme may submit an application to the Scottish Ministers for approval which shall be in accordance with the following provisions of this regulation.

• (2) An application shall be made in writing in such form as the Scottish Ministers reasonably may require and shall include–

• (a) sufficient information to show that the measure is being undertaken by an eligible person;

• (b) confirmation that the measure is located within the scheme area;

• (c) a description of the measure proposed;

• (d) a business plan approved under regulation 4, if such a plan was required by the Scottish Ministers under regulation 4;

• (e) a statement that the measure could not proceed without financial assistance under the scheme;

• (f) sufficient information to show that the measure is likely to meet at least one of the objectives specified in regulation 3; and

• (g) confirmation–

• (i) as to what public funding (if any) towards the cost of the measure has been sought, otherwise than under these Regulations; and

• (ii) that it is not intended to seek any public funding towards such costs, otherwise than under these Regulations

• (3) The applicant shall furnish to the Scottish Ministers such further information and evidence in relation to the application as the Scottish Ministers reasonably may require in order to allow proper consideration of the application.

• (4) An eligible person may submit more than one application under this regulation.

• (5) An application shall not be submitted in respect of more than one eligible business unless it is an application in respect of a collaborative venture.

• (6) The Scottish Ministers may at any time suspend the operation of the scheme and, while so suspended, no application under paragraph (1) above may be submitted to them.

Determination of applications

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• (1) Subject to the provisions of these Regulations, the Scottish Ministers as they think fit may in accordance with the EU legislation–

• (a) refuse to approve an application or approve it in whole or in part;

• (b) cause such approval to be given, and any payments by way of financial assistance to be made, subject to such conditions as they may impose; or

• (c) at any time on giving reasonable notice vary the approval or amend such conditions attached to the approval.

• (2) The Scottish Ministers shall in writing–

• (a) notify the applicant of their decision in respect of that application; and

• (b) notify the applicant whose application has been approved under this regulation of any conditions, relating to such approval, which they have imposed or amended under paragraph (1) above.

• (3) The Scottish Ministers shall not approve an application for financial assistance in relation to a measure unless they are satisfied that–

• (a) the measure is to be carried out by the eligible person;

• (b) completion of the measure is likely to meet at least one of the objectives of the scheme specified in regulation 3;

• (c) the application relates to one or more of the measures set out in the Schedule;

• (d) in relation to applications for measures in Parts I and II of the Schedule–

• (i) the economic viability of the eligible business is demonstrated;

• (ii) the eligible business complies with the minimum standards regarding the environment, hygiene and animal welfare; and

• (iii) the eligible person possesses adequate agricultural skill and competence;

• (e) subject to paragraph (3A) below, other public funding towards the cost of the measure has not been or will not be sought in respect of the measure, other than under these Regulations; and

• (f) the provision of such a measure is appropriate having regard to the need for, and existing provision of, measures of that type in the scheme area.

• (3A) Where an applicant has sought public funding in respect of the measure concerned otherwise than under these Regulations, but the public funding so sought was not obtained, the duty of the Scottish Ministers to be satisfied as to the matters set out in paragraph (3)(e) above shall not apply in relation to such public funding so sought and not obtained.

• (4) Before approving an application (in whole or in part), the Scottish Ministers may consult such persons as they consider appropriate.

Financial assistance

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• (1) The Scottish Ministers may give to an eligible person, whose application has been approved under regulation 6, such financial assistance under the scheme towards eligible expenditure on the approved measures as they may consider appropriate.

• (2) Subject to paragraphs (4) and (6) below, the amount of financial assistance payable in respect of any measure in Parts I and II of the Schedule shall–

• (a) in the case of an eligible business wholly located in a less-favoured area, be up to 50% of eligible expenditure;

• (b) in the case of an eligible business located wholly outwith a less-favoured area, be up to 40% of eligible expenditure; or

• (c) in the case of an eligible business partly located within and partly located outwith a less-favoured area, be at the rate of up to 40% or up to 50% as the Scottish Ministers may determine as they think fit.

• (3) Subject to paragraphs (4) and (6) below, the amount of financial assistance payable in respect of any measure in Part III of the Schedule shall be up to 50% of eligible expenditure.

• (4) The total amount of financial assistance payable to one or more eligible persons in respect of one eligible business shall not exceed the sum of £40,000.

• (5) In paragraph (4) above, for the purposes of calculating the total amount of financial assistance, no regard shall be had to any amount payable in respect of an approved business plan under regulation 4 or in respect of any training costs which form part of the eligible expenditure.

• (6) Where an application for financial assistance is made in relation to a collaborative venture–

• (a) such assistance shall not be given unless each eligible person and eligible business is actively involved in the collaborative venture; and

• (b) the total amount of financial assistance payable in respect of each eligible business (whether in consequence of the application made in relation to the collaborative venture or in consequence of any other application made in relation to such eligible business) shall not exceed £40,000.

Claims for financial assistance

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A claim for financial assistance under these Regulations shall be made in such form and manner and at such time as the Scottish Ministers may from time to time require, and the eligible person shall furnish all particulars and information relating to such claim and copies of such documents and records relating thereto as the Scottish Ministers reasonably may require, including in particular–

• (a) evidence that the amount of eligible expenditure for which financial assistance is claimed has been incurred including details of any discount received by the eligible person; and

• (b) documentary evidence that the approved measure has been carried out in accordance with the application approved by the Scottish Ministers.

Payment of assistance

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The Scottish Ministers may determine the manner and timing of the payment of financial assistance under these Regulations.

Information and Records

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• (1) Subject to paragraphs (2) and (3) below, an eligible person shall, for a period of five years, or seven years in the case of financial assistance payable for housing for rent, following the last payment of financial assistance under these Regulations–

• (i) retain all invoices, accounts and other relevant documents in relation to an approved measure and produce them for inspection if required to do so by the Scottish Ministers; and

• (ii) provide the Scottish Ministers with such additional information in relation to the approved measure or the financial assistance paid in pursuance of that measure as they may require.

• (2) If the eligible person transfers the original of any such document to another person in the normal course of business, the duty under paragraph (1) above shall be treated as having been fulfilled if there is kept a copy of that document for the said period.