EU Commission Seeks Public Input on Proposed Amendments to Agricultural State Aid Rules

Brussels (Brussels Morning) – The European Commission is seeking public input on proposed amendments to the Agricultural de Minimis Regulation, which could raise aid limits for farmers to account for inflation and streamline support processes.

The European Commission has undertaken public consultation asking all interested parties to comment on draft targeted amendments to the regulations on small amounts of aid to the agricultural sector (‘Agricultural de minimis Regulation’). All interested parties can react to the public consultation until 21 July 2024.

What Changes Are Proposed for Agricultural De Minimis Regulation?

According to the European Commission, the Agricultural de Minimis Regulation exempts small amounts from State aid control since they are supposed to not affect competition and trade in the Single Market.

The Commission states that following its last modification in 2019, Member States can currently grant authorisation to the agricultural sector of up to €20,000 per beneficiary over three fiscal years without previous notification for Commission approval. If a Member State has a main register at the national level to report de minimis aid, a higher ceiling applies, of €25,000 over three fiscal years. Besides these ceilings per beneficiary, each EU Member State has a maximum national amount for such authorisation (a so-called ‘national cap’), to bypass any potential distortion of competition.

The Commission has taken directives of the European Council’s conclusions of 17 and 18 April 2024 on the significance of a competitive, sustainable, and resilient agricultural sector. Against this background and given the increasing inflationary stress on the farming sector and high commodity prices, the Commission has undertaken a targeted revision of the Agricultural de Minimis Regulation on 2 May 2024, earlier than the planned examination.

What Amendments Are Being Made to Agricultural Aid Rules?

The draft amendments contain the growth of the maximum de minimis ceiling per company over three years, from €25,000 to €37,000, to account for inflation. The adjustment of the ‘national caps’, which are estimated based on the value of agricultural output. The current regulations take into account the reference years 2012-2017 for this calculation. This reference period would be extended to 2012-2023, which allows the EU to take account of the increased value of agricultural production, especially during the last years, thereby increasing the national cap for all Member States.

By raising the maximum de minimis ceiling per company to account for inflation, the suggested amendments will widen the possibilities for Member States to deliver support to farmers in a simpler, faster, more natural and efficient manner, as such support does not require to be notified to nor approved by the Commission. 

In addition, the proposed amendments will facilitate the administrative burden for farmers via the introduction of mandatory central de minimis registers, which will relieve reporting obligations for the farmers – mostly micro, small and medium-sized companies.