The peculiarities of the single payment scheme for payment of payment entitlements

The single payment scheme established by Regulation No. 1782/2003 operates through modes of intervention that are profoundly different from the previous schemes, providing for the payment of a subsidy to farmers linked exclusively to the size of the total farm area devoted to agricultural activity, regardless of the quantity of production and, in principle, the type of cultivation carried out thereon. Therefore, the only additional constraint to which the payment of the aid amount is subject turns out to be that of maintaining good agronomic and environmental conditions and complying with standards relating to the environment, animal safety, and animal welfare and health.

The main peculiarity of this support scheme is that it divides the amount of subsidy to be paid to each farmer-namely, the single payment-into tranches (called “payment entitlements” by the EU legislature and “aid titles” in domestic acts) that can be the subject of negotiated acts.

The final fixing of titles to aid took place, at the end of the administrative procedure for their initial allocation, with the notification to the entitled persons of a letter containing the number and unit amount of the titles finally allocated.

It is considered, however, useful, also for the purpose of a more informed reconstruction of their legal nature, to quickly mention their genetic phase.

Regulation 1782/2003 provides for the identification of those eligible for the grant through the provision of three different cases:

1. (a )the common way of allocating aid titles, covered by Article 33( a), is based on the historical data of the use, in a reference period (three years 2000-2002), of subsidies under at least one of the support schemes listed in Annex VI of the Regulation. This provision refers to support schemes pertaining to arable crops, starch potatoes, grain legumes, rice, beef, sheep and goat meat, dried fodder, cotton, hops, olive oil, tobacco, sugar beet, sugarcane and chicory for sugar or inulin syrup production, and milk and dairy products.
2. (b) the first hypothesis of allocation, so-called in the original way, is equated with certain situations in which the farmer applying for aid fixation is not the historical one but the one for which special conditions exist (Art. 33(1)( b), (2) and (3).

Specifically:

– the farmer who has received the farm or part of it through actual or anticipated inheritance;

– in case of change of legal status or name, the farmer who manages the farm;

– In the case of a merger, the farmer running the new farm;

– in case of demerger, proportionally the farmers who manage the farms resulting from the demerger.

1. (c) In exceptional cases, the regulations provide for the possibility:

– Of a first derivative allocation;

– Of an allocation from the national reserve. This case provided for:

– (a) farmers who started farming after December 31, 2002, or in 2002 but without receiving any direct payments in that year;

– (b) areas under restructuring and/or development programs related to a form of public intervention in order to prevent land abandonment and/or compensate specific disadvantages for farmers.

It should, however, be borne in mind that the allocation of rights from the national reserve is quantitatively limited in correspondence to the number of hectares owned (owned or leased) at the time of application and in relation to which no entitlement to aid has otherwise accrued;

• of transfer either temporarily or permanently, but, in any case, connected to corresponding land-related events.

The right to the allocation of the subsidy arises by the mere fact of being in one of the circumstances provided for in the regulation, and is subject only to the submission of the application for the establishment of titles to the aid, possession, at that time, of the status of a farmer and the availability of a farm of a minimum size of not less than 0.3 hectares.

In the legislation there is also provision for a system of identification and registration of payment entitlements put in place by means of an electronic registry in which identification data on the entitlement holder; value; date of establishment; date of last activation; manner of acquisition of entitlements; type of entitlement; transfer; and other events pertaining to each entitlement must be recorded.

In Italy, the National Register of Titles including two sections has been established at SIAN (National Agricultural Information System):

• Section A, in which all the characteristic elements of the aid titles are given;
• Section B, showing all movements made on them.

Finally, it should be noted that the registration of movements relating to transfers of securities or changes in the characteristics of securities is done through the submission to the territorially competent paying agency of an application for the transfer of securities; and that it is only allowed to be completed by the person defined as “active” (transferee, buyer, heir, new company).
Attorney Chiara Roncarolo

Attorney Maurizio Randazzo