52016SC0293

EUROPEAN COMMISSION

Brussels, 14.9.2016

SWD(2016) 293 final

COMMISSION STAFF WORKING DOCUMENT

Accompanying the document

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL

9th FINANCIAL REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on the
EUROPEAN AGRICULTURAL GUARANTEE FUND
2015 FINANCIAL YEAR

{COM(2016) 578 final}

TABLE OF CONTENTS

1.BUDGET PROCEDURE

1.1.Financial Framework 2014-2020.

1.2.Initial Draft Budget 2015 and Amending Letter 1/2015

1.3.Adoption of the 2015 budget

1.4.Revenue assigned to the EAGF

1.5.Part of the EAGF budget in total EU budget

2.CASH POSITION AND MANAGEMENT OF APPROPRIATIONS

2.1.Management of appropriations

2.1.1.Appropriations available for the 2015 financial year

2.1.2.Expenditure section of the EU budget in relation to EAGF

2.1.3.Assigned revenue section of the EU budget in relation to EAGF

2.1.4.Budget execution of appropriations available for the 2015 financial year

2.1.5.Assigned revenue received under shared management

2.1.6.Budget execution

2.1.7.Budget execution of voted appropriations - Expenditure under direct management made by the Commission

2.1.8.Budget execution - Expenditure under direct management made by the Commission - Automatic carryover from 2014

2.2.Monthly payments

2.2.1.Monthly payments to Member States under shared management

2.2.1.1.Monthly payments on the provision for expenditure

2.2.1.2.Decisions on monthly payments for 2015

2.2.1.3.Reductions and suspensions of monthly payments

2.2.2.Direct management expenditure by the Commission

3.THE IMPLEMENTATION OF THE 2015 EAGF BUDGET

3.1.The uptake of the EAGF budget appropriations

4.COMMENTS ON THE IMPLEMENTATION OF 2015 EAGF BUDGET

4.1.Chapter 05 02: Interventions in agricultural markets

4.1.1.Introduction

4.1.2.Article 05 02 04: Food programmes

4.1.3.Article 05 02 06: Olive oil

4.1.4.Article 05 02 07: Textile plants

4.1.5.Article 05 02 08: Fruits and vegetables

4.1.6.Article 05 02 09: Products of the wine-growing sector

4.1.7.Article 05 02 10: Promotion

4.1.8.Article 05 02 11: Other plant products/measures

4.1.9.Article 05 02 12: Milk and milk products

4.1.10.Article 05 02 15: Pig meat, eggs and poultry, bee-keeping and other animal products

4.2.Chapter 05 03: Direct Aids

4.2.1.Article 05 03 01: Decoupled direct aids

4.2.2.Article 05 03 02: Other direct aids

4.2.3.Article 05 03 03: Additional amounts of aid

4.2.4.Article 05 03 09: Reimbursement of direct aids in relation to financial discipline

4.2.5.Article 05 03 10: Reserve for crises in the agricultural sector

4.3.Chapter 05 04: Rural Development

4.3.1.Article 05 04 01: Rural Development financed by the ex-EAGGF-Guarantee. Completion of earlier programmes (2000 to 2006)

4.4.Chapter 05 07: Audit of agricultural expenditure

4.4.1.Article 05 07 01: Control of agricultural expenditure

4.4.2.Article 05 07 02: Settlement of disputes

4.5.Chapter 05 08: Policy strategy and coordination

4.5.1.Article 05 08 01: Farm accountancy data network (FADN)

4.5.2.Article 05 08 02: Surveys on the structure of agricultural holdings

4.5.3.Article 05 08 03: Restructuring of systems for agricultural surveys

4.5.4.Article 05 08 06: Enhancing public awareness of the common agricultural policy

4.5.5.Article 05 08 09: EAGF – Operational technical assistance

5.IMPLEMENTATION OF ASSIGNED REVENUE (policy area 05-agriculture and rural development)

5.1.Revenue assigned to EAGF

6.BREAKDOWN BY TYPE OF EXPENDITURE

7.SPECIFIC ACTIVITIES

7.1.Promotion measures – payments by Member States

8.CONTROL MEASURES

8.1.Introduction

8.2.Integrated Administration and Control System (IACS)

8.3.Market measures

8.4.Application of Chapter III of Title V Regulation (EU) No 1306/2013 (ex-post scrutiny)

9.CLEARANCE OF ACCOUNTS

9.1.Conformity clearance - Introduction

9.2.Conformity clearance – Audits and decisions adopted in 2015

9.2.1.Audits

9.2.2.Conformity decisions

9.3.Financial clearance

9.3.1.Introduction

9.3.2.Decisions

9.3.2.1.Financial clearance decision for the financial year 2010

9.3.2.2.Financial clearance decision for the financial year 2011

9.3.2.3.Financial clearance decision for the financial year 2012

9.3.2.4.Financial clearance decision for the financial year 2013

9.3.2.5.Financial clearance decision for the financial year 2014

9.4.Appeals brought before the Court of Justice against clearance decisions

9.4.1.Judgments handed down

9.4.2.New appeals

9.4.3.Appeals pending

10.RELATIONS WITH PARLIAMENT AND WITH THE EUROPEAN COURT OF AUDITORS

10.1.Relations with Parliament

10.2.Relations with the European Court of Auditors

10.2.1.Mission of the European Court of Auditors

10.2.2.Annual Report for financial year 2014

10.2.3.Special Reports by the Court of Auditors

11.BASIC RULES GOVERNING EAGF AND AMENDMENTS MADE IN 2015

11.1.Checks

11.2.Clearance of accounts

11.3.Public storage

12.ANNEXES

1.BUDGET PROCEDURE 1

1.1.Financial Framework 2014-2020.

CAP expenditure is funded within the financial framework for 2014-2020 as provided for in Council Regulation (EU) No 1311/2013. Specifically, CAP expenditure is part of the ceiling fixed for Heading 2 - Sustainable growth: natural resources. Within that overall ceiling, a specific sub-ceiling has been fixed for market related expenditure and direct payments.

The expenditure ceiling for market measures and direct payments had to be adjusted following the transfer of certain amounts of direct payments to rural development (financed by the European Agricultural Fund for Rural Development - EAFRD) for the years 2015-2020 (flexibility between CAP pillars and reduction of direct payments), of the transfer of the aids for cotton in Greece, the unspent amounts by Germany and Sweden and the voluntary adjustment of the United Kingdom as well as the transfer from rural development (EAFRD) for the years 2015-2020 to direct payments (flexibility). Therefore, on the basis of Commission Implementing Regulation (EU) No 367/2014 2 which sets the net balance available for expenditure of the European Agricultural Guarantee Fund (EAGF), the CAP amounts included in heading 2 of the financial framework (2014-2020) are:

(in EUR million current prices)

Heading 2*	2014	2015	2016	2017	2018	2019	2020
Total of which: - Market related expenditure and direct payments, a), b), c), d)	49 857 43 778.1	64 692 44 189.8	64 262 43 950.2	60 191 44 145.7	60 267 44 162.4	60 344 44 240.5	60 421 44 263.2
- Rural development a), b), c), d), e)	5 298.9	18 183.7	18 683.7	14 371.2	14 381.0	14 330.4	14 333.3
*) Sustainable growth: natural resources a) After transfer of EUR 622 million between EAGF and EAFRD for the financial year 2015 on the basis of Articles 136a(1) of Regulation (EC) No 73/2009 and article 14(1) of Regulation (EU) No 1307/2013,
b) After transfer of EUR 51.6 million between EAGF and EAFRD for the financial year 2015 for unspent amounts transferred each year for financial years 2014 and 2015 (SE and DE) on the basis of Articles 136 and 136b of Regulation (EC) No 73/2009,
c) After transfer of EUR 4 million between EAGF and EAFRD for the financial years 2014-2020 from the cotton sector (EL) on the basis of Article 66(1) of Regulation (EU) No 1307/2013, d) After transfer of EUR 499.4 million between EAFRD and EAGF for the financial year 2015 on the basis of Articles 136a(2) of Regulation (EC) No 73/2009 and article 14(2) of Regulation (EU) No 1307/2013. e) The EAFRD amounts reflect the re-programming carried out in 2015.

1.2.Initial Draft Budget 2015 and Amending Letter 1/2015

The initial 2015 Draft Budget was adopted by the Commission and proposed to the Budgetary Authority on 24 June 2014. The commitment appropriations proposed for the European Agricultural Guarantee Fund (EAGF) under heading 2 of the Multiannual Financial Framework 2014-2020 totalled EUR 43 903.8 million.

The Council adopted its position on the initial 2015 Draft Budget on 02 September 2014, reducing the commitment appropriations for EAGF by EUR 48.5 million. The European Parliament adopted its position on 22 October 2014, increasing the commitment appropriations for EAGF by EUR 41 million.

On 15 October 2014 the Commission adopted Amending Letter (AL) No 1 to the 2015 Draft Budget, lowering the requested commitment appropriations for EAGF by EUR 448 million compared to the initial Draft Budget.

1.3.Adoption of the 2015 budget

The Commission submitted a new Draft Budget 2015 on 27 November 2014 requesting commitment appropriations for EAGF at EUR 43 455.8 million. Following the presentation of this new Draft Budget for 2015, an intensive trilogue between the 3 parties (Commission, Council and European Parliament) took place on 8 December 2014. The Council agreed to the compromise package on 12 December 2014. Finally, the 2015 budget was adopted by the European Parliament on 17 December 2014. The budget's total commitment appropriations for EAGF amounted to EUR 43 455.8 million and its payment appropriations amounted to EUR 43 447.6 million.

The difference between commitment and payment appropriations is due to the fact, that for certain measures, which are directly implemented by the Commission, differentiated appropriations are used. These measures relate mainly to the promotion of agricultural products, to policy strategy and coordination measures for agriculture.

Specifically, of the voted EAGF commitment appropriations for policy area 05 amounting to EUR 43 455.8 million, EUR 2 400.7 million were foreseen for market measures under chapter 05 02, EUR 40 908.6 million were foreseen for direct aids under chapter 05 03, EUR 87.3 million were foreseen for audit of agricultural expenditure under chapter 05 07 and EUR 50.9 million for policy strategy and coordination under chapter 05 08.

For details, please see annex 1.

Subequently, in the course of the financial year 2015, the EAGF's appropriations for articles 05 08 06 (enhancing public awareness of the common agricultural policy) and 05 08 09 (EAGF – operational technical assistance) were reduced by EUR 0.1 million and EUR 0.8 million respectively through Amending Budget 7.

1.4.Revenue assigned to the EAGF 3

In accordance with Article 43 of Regulation (EC) No 1306/2013 on the financing of the Common Agricultural Policy 4 , revenue originating from financial corrections under conformity clearance decisions, from irregularities and from the milk levy are designated as revenue assigned to the financing of EAGF expenditure. According to these rules, assigned revenue can be used to cover the financing of any EAGF expenditure. If a part of this revenue is not used, then this part will be automatically carried forward to the following budget year.

At the time of establishment of the 2015 budget, an estimate of the revenue was made both for the amount expected to be collected in the course of the 2015 budget year as well as of the amount which was expected to be carried over from the budget year 2014 into 2015. This estimate amounted to EUR 1 768.6 million and it was taken into consideration when the Budgetary Authority adopted the 2015 budget. Specifically:

–Revenue from the conformity clearance corrections and from irregularities was estimated at EUR 868.6 million and EUR 165 million respectively while the receipts from the milk levy were estimated at EUR 405 million. Thus, the total amount of assigned revenue expected to be collected in the course of the 2015 budget year was estimated at EUR 1 438.6 million.

–The amount of assigned revenue expected to be carried over from the budget year 2014 into 2015 was estimated at EUR 330 million.

In the 2015 budget, this initially estimated revenue of EUR 1 768.6 million was assigned to six schemes, i.e.:

–EUR 362.4 million for the operational funds for producer organisations in the fruits and vegetables sector including the exceptional support measures for members of these organisations,

–EUR 106.9 million for the exceptional support measures for non-members of producer organisations under other measures for the fruits and vegetables sector,

–EUR 0.9 million for storage measures for skimmed milk powder in the milk and milk products sector,

–EUR 2.9 million for storage measures for butter and cream in the milk and milk products sector,

–EUR 50.5 million for the exceptional support measures for milk producers and for the private storage for cheese under other measures for the milk and milk products sector,

–EUR 1 245 million for the single payment scheme (direct aids).

For the aforementioned schemes, the sum of the voted appropriations by the Budgetary Authority and the assigned revenue mentioned above corresponds to a total estimate of available appropriations of:

–EUR 903.9 million for the operational funds for producer organisations in the fruits and vegetables sector including the exceptional support measures for members of these organisations,

–EUR 107.6 million for the exceptional support measures for non- members of producer organisations under other measures for the fruits and vegetables sector,

–EUR 50.6 million for the exceptional support measures for milk producers and for the private storage for cheese under other measures for the milk and milk products sector,

–EUR 29 587 million for the single payment scheme (direct aids).

It should be noted that the Budgetary Authority did not vote any appropriations for the storage measures for skimmed milk powder and for butter and cream in the milk and milk products sector.

1.5.Part of the EAGF budget in total EU budget

The final EAGF budget's (commitment appropriations) part of the total EU budget for each year of the period 2009-2015 appears in annex 2.

2.CASH POSITION AND MANAGEMENT OF APPROPRIATIONS

2.1.Management of appropriations

2.1.1.Appropriations available for the 2015 financial year

In EUR
Expenditure section of budget (1)	Commitment appropriations	Payment appropriations	Revenue section of budget (AR) (2)	Forecasts
1. Initial appropriations for EAGF of which	43 455 780 762	43 447 624 585	1. Clearance decisions	868 600 000
1a. Appropriations under shared management	43 388 597 789	43 388 597 789	2. Irregularities	165 000 000
1b. Appropriations under direct management	67 182 973	59 026 796	3. Super levy from milk producers	405 000 000
2. Amending Budget	-900 000	-900 000	Total forecast of AR	1 438 600 000
3. Transfer to / out of EAGF in the year		-107 268
4. Final appropriations for EAGF of which	43 454 880 762	43 446 617 317
4a. Appropriations under shared management	43 388 791 789	43 388 791 789
4b. Appropriations under direct management	66 088 973	57 825 528
(1) Appropriations entered in the 2015 budget after deducting the expected assigned revenue to be collected in 2015 and the one carried over from 2014 to 2015 in accordance with Article 14 of Regulation (EU, EURATOM) No 966/2012. (2) AR: Assigned revenue to be collected. There are no amounts of revenue entered on the revenue line (p.m.) 5 , but the forecast amount is indicated in the budget remarks.

2.1.2.Expenditure section of the EU budget in relation to EAGF

The initial commitment appropriations for 2015 totalled EUR 43 455 780 762. This was a net amount after deducting the expected assigned revenue to be collected in 2015 and the one carried over from 2014 to 2015. The initial payment appropriations amounted to EUR 43 447 624 585.

In financial year 2015, there were an Amending Budget and a transfer of payment appropriations out of EAGF. The commitment and payment appropriations finally available to the EAGF, after the Amending Budget and the transfer, for the 2015 financial year amounted to EUR 43 454 880 762 and EUR 43 446 617 317 respectively.

Part of the appropriations coming from assigned revenue received in 2014 was not used in that financial year and it was automatically carried forward to 2015. The amount of these appropriations totalled EUR 341 269 448. Also an amount of EUR 868 195 629 appropriations was made available for the reimbursement of direct aids in relation to financial discipline following Commission Decision C(2015)827 relating to the non-automatic carryover of appropriations from the 2014 budget to the 2015 budget.

2.1.3.Assigned revenue section of the EU budget in relation to EAGF

For more details, please see point 1.4.

2.1.4.Budget execution of appropriations available for the 2015 financial year

In EUR
	Execution of commitment appropriations	Execution of payment appropriations
Shared management (1)	44 883 460 321.82	44 883 460 321.82
Expenditure under direct management	64 654 779.75	56 154 302.09
Total	44 948 115 101.57	44 939 614 623.91

(1) Committed amounts. Commitments and payments less assigned revenue of EUR 1 631 635 502.23 (see point 5 and annex 8) received for shared management: EUR 43 251 824 819.59.

For the financial year 2015, the actual amount of commitment appropriations used amounted to EUR 44 948 115 101.57 while that for payment appropriations amounted to EUR 44 939 614 623.91.

2.1.5.Assigned revenue received under shared management

In EUR
Assigned revenue
Forecasted revenue	1 438 600 000.00
Revenue received	1 631 635 502.23
Difference	193 035 502.23

For details, please see points 1.4 and 5.1.

2.1.6.Budget execution

	In EUR
Expenditure under shared management (1)
		Final appropriations (C1)	Non automatic carry over of 2014 C1 appropriations (C2)	Assigned revenue appropriations (C4)	Carry over of assigned revenue appropriations (C5) from 2014
Appropriations		43 388 791 789.00	868 195 629.00	1 631 635 502.23	341 269 447.90
Execution		42 952 988 817.08	853 965 493.25	735 236 563.59	341 269 447.90
Appropriations cancelled		25 999 400.92	14 230 135.75	-	0.00
Carry over to 2016		409 803 571.00	0.00	896 398 938.64	-

(1) Commitment appropriations = Payment appropriations

Appropriations available for the financing of the measures under shared management with Member States (excluding expenditure under direct management by the Commission) amounted to EUR 43 389 million compared to actual expenditure of EUR 42 953 million. The amount of EUR 409.8 million was carried over to budget year 2016 with Commission Decision C(2016)857 of 10 February 2016 on non-automatic carryover of appropriations from the 2015 budget to the 2016 budget.

The 2015 appropriations coming from assigned revenue amounted to EUR 1 631.6 million of which an amount of EUR 32.2 million was used in chapter 05 02 and an amount of EUR 703 million was used in chapter 05 03. The remaining amount of EUR 896.4 million was automatically carried over to budget year 2016.

Part of the appropriations coming from assigned revenue received in 2014 was not used in financial year 2014 and was automatically carried forward to 2015 (C5 fund source). These appropriations amounted to EUR 341.3 million and had to be used in accordance with Article 14 of the Financial Regulation within that year. It should be noted that all these appropriations carried over from previous financial year have been fully used in 2015 in accordance with the Financial Regulation.

2.1.7.Budget execution of voted appropriations - Expenditure under direct management made by the Commission

In EUR
Expenditure under direct management	Commitment appropriations	De- commitments	Payment appropriations	Carry over to 2016 (2)
Appropriations (C1) (1)	66 088 973.00	-	57 825 528.22	-
Execution (C1)	64 654 779.75	-	41 675 092.27	13 821 274.51
Appropriations cancelled	1 434 193.25	-	2 329 161.44	-
(1) C1 denotes the budget's voted appropriations. This amount includes transfers to ''shared management'' for a total amount of EUR -194 000.00 for commitment and payment appropriations, a transfer ''out'' of EAGF of EUR -107 267.78 for payment appropriations and an Amending Budget of EUR -900 000.00 for commitment and payment appropriations. (2) Carry over to 2016 only for non-differentiated appropriations.

The available commitment appropriations for expenditure under direct management in the 2015 budget were EUR 66.1 million. An amount of EUR 64.7 million was committed in 2015. The balance of these appropriations, EUR 1.4 million, was cancelled.

The majority of EAGF commitment appropriations for expenditure under direct management made by the Commission are differentiated appropriations.

The automatic carry over to 2016, which relates only to non-differentiated appropriations, amounts to EUR 13.8 million.

For details, please see annex 5 and 6.

2.1.8.Budget execution - Expenditure under direct management made by the Commission - Automatic carryover from 2014

In EUR
Carry over from 2014 to 2015	Commitments	De-commitments	Payments	Cancelled appropriations
Carried over appropriations	16 114 870.92	1 024 592.83	14 479 209.82	611 068.27

The automatic carry over from 2014 to 2015 only concerned expenditure under direct management for non-differentiated appropriations. As indicated in the table above, an amount of EUR 16.1 million was carried over from 2014 to 2015. In 2015 an amount of EUR 1 million from this carry over was de-committed. The payments made amounted to EUR 14.5 million and the appropriations cancelled totalled EUR 0.6 million.

For details, please see annex 6.

2.2.Monthly payments

2.2.1.Monthly payments to Member States under shared management

2.2.1.1.Monthly payments on the provision for expenditure

Article 18(1) of Regulation (EU) No 1306/2013 states that "monthly payments shall be made by the Commission for expenditure effected by Member States' accredited paying agencies during the reference month". Monthly payments shall be made to each Member State at the latest on the third working day of the second month following that in which the expenditure is incurred.

The monthly payments are a reimbursement of net expenditure (after deduction of revenue) which has been already carried out and are made available on the basis of the monthly declarations forwarded by the Member States 6 . The monthly booking of expenditure and revenue is subject to checks and corrections on the basis of these declarations. Moreover, these payments will become final following the Commission's verifications under the accounting clearance of accounts procedure.

Payments made by the Member States from 16 October 2014 to 15 October 2015 are covered by the system for monthly payments.

For financial year 2015, the total net amount of monthly payments made, after the deduction of clearance and other corrections, was EUR 43 251 824 819.59.

2.2.1.2.Decisions on monthly payments for 2015

For the financial year 2015, the Commission adopted twelve decisions on monthly payments. Furthermore, an additional monthly payment decision, adjusting those already granted for the total expenditure chargeable to the year, was adopted in December 2015. For details, please see Annex 4.

2.2.1.3.Reductions and suspensions of monthly payments

In 2015, reductions for a net amount of EUR 27.2 million were made to the monthly payments effected to the Member States. The categories of corrections are detailed in the following points.

a.Reductions of the monthly payments as a result of the non-compliance with the payment deadlines

Pursuant to Article 40 of Regulation (EU) No 1306/2013, certain Member States did not always respect the payment deadlines fixed by the Union legislation for the payment of aids to beneficiaries.

The payment deadlines ensure an equal treatment between the beneficiaries in all the Member States and avoid the situation in which delays of payments would result in aids no longer having the intended economic effect. In addition, the deadlines help budgetary discipline by ensuring that the expenditure which falls in each budget year is more easily forecast.

As a result of non-respecting the set payment deadlines, the Commission decided reductions for a total amount of EUR 3.8 million.

b.Reductions of the monthly payments as a result of overspending the financial ceilings

For some aid measures financed by EAGF, financial ceilings are determined in the sectoral regulations, which have to be adhered to. Expenditure exceeding these ceilings is considered as "non eligible expenditure" and has to be corrected.

These corrections lead to reductions of the monthly payments. As a result of overspending these financial ceilings, the Commission made financial corrections for a total amount of EUR 4.6 million.

c. Reductions of the monthly payments as a result of non-eligibility

For some measures expenditure paid after the deadline is not eligible and the Commission made financial corrections for a total amount of EUR 3.0 million.

d. Reductions of the monthly payments as a result of the application of Commission Decision C(2014)8997 of 2.12.2014

Following the Commission Decision C(2014)8997 of 2 December 2014 the Commission made financial corrections for Greece for a total amount of EUR 15.8 million.

2.2.2.Direct management expenditure by the Commission

In certain cases, the Commission makes payments directly for certain measures. These concern payments for actions for instance related to controls, to promotion actions and to information actions on the agricultural policy.

For details, please see annexes 5 and 6.

3.THE IMPLEMENTATION OF THE 2015 EAGF BUDGET

3.1.The uptake of the EAGF budget appropriations

The implementation of the budget amounted to EUR 44 948.1 million. This expenditure was funded by the budget's initial appropriations and by using the revenue assigned to policy area 05-Agriculture and Rural Development, composed of the entire amount of EUR 341.3 million carried over from 2014 and of a part of the assigned revenue collected in 2015 amounting to EUR 735.2 million out of a total EUR 1 631.6 million.

Within policy area 05-Agriculture and Rural Development, the expenditure for market measures amounted to EUR 2 666.9 million and for direct aids to
EUR 42 168 million. The expenditure incurred for certain market measures and direct aids exceeded the budget’s voted appropriations and it was partly covered by transfers of appropriations from other items of the budget and partly by the revenue which was assigned to the EAGF budget.

For details of the budget's implementation by policy area, please see annex 7.

Annex 12 presents a breakdown of the expenditure on market measures, direct aids and audit of agricultural expenditure by item and by Member State.

4.COMMENTS ON THE IMPLEMENTATION OF 2015 EAGF BUDGET

A brief commentary on the implementation of the 2015 EAGF budget's appropriations as well as on the use of the assigned revenue available in 2015 is presented hereafter based on details appearing in the annexed tables:

–Annex 7: Analysis of execution of the 2015 EAGF budget. The expenditure incurred for each item of the budget appears in column 6. Columns 1, 2, 3 and 4 indicate, respectively, the source and amount of funding which originates either from voted appropriations or from transfers of assigned revenue and of voted appropriations from other items of the budget.

–Annex 8: Assigned revenue (C4) collected and used in 2015

–Annex 9: Assigned revenue (C5) carried over from 2014 and used in 2015

–Annex 12: Expenditure by Member State, by item and by fund suorce.

This presentation is made at the level of each chapter, article and item of the agricultural budget.

4.1.Chapter 05 02: Interventions in agricultural markets

4.1.1.Introduction

Total payments for this chapter of the 2015 budget amounted to EUR 2 666.9 million and they were funded by the voted appropriations amounting to EUR 2 343 million and by assigned revenue amounting to EUR 323.8 million. The latter was used to cover the expenditure incurred in the fruits and vegetables and in the milk and milk products sectors (NB: for details, see points 4.1.5 and 4.1.9). Appropriations amounting to EUR 54.9 million were transferred to other parts of the EAGF budget. The remaining balance of assigned revenue collected in 2015 amounted to EUR 199.8 million and it was carried over to 2016. In items where the needs exceeded the budgetary appropriations, the additional expenditure was covered through transfers from other items of the budget. Equally, for the market measures where the budget's appropriations were under-spent, the resulting available appropriations were transferred to other items of the budget in order to cover additional expenditure as needed.

Annex 7 presents these details at the level of each budget item.

4.1.2.Article 05 02 04: Food programmes

It should be noted that 2013 was the last year of implementing the food programmes under the EAGF. On the basis of Regulation (EU) No 223/2014, as of 1 Jaunary 2014, these programmes are implemented through the Fund for European Aid to the Most Deprived financed within Heading 3 of the MFF.

For this reason, there were no appropriations for the EAGF foreseen in the 2015 budget for these programmes. However, the EAGF accounts show that Member States recovered and declared to EAGF unduly paid aids amounting to EUR 3.2 million which concerned market purchases under the 2013 food programme.

4.1.3.Article 05 02 06: Olive oil

The under-execution of EUR 2 million was due to the slightly lower expenditure incurred by some Member States for the 2014/2015 work programmes included in their quality improvement measures compared to the expenditure foreseen in the 2015 budget for these programmes.

4.1.4.Article 05 02 07: Textile plants

The execution of this sector’s appropriations was almost as foreseen in the 2015 budget.

4.1.5.Article 05 02 08: Fruits and vegetables

The 2015 budget foresaw total available appropriations amounting to EUR 1 305.5 million in order to cover the needs of all the measures for this sector. The Budgetary Authority voted appropriations of EUR 836.2 million as it took into account the estimated revenue assigned to this sector which amounted to EUR 469.3 million. The expenditure incurred by Member States in 2015 amounted to EUR 1 118.6 million. All the schemes funded under this article were under-implemented compared to the total estimated needs foreseen in the 2015 budget. The balance of the unused assigned revenue of EUR 147 million was carried over to the budget year 2016 to cover the needs of that year.

Specifically, the total needs in the 2015 budget for the operational funds for producer organisations were estimated at EUR 903.9 million. The expenditure incurred by Member States amounted to EUR 813.1 million and it was funded by voted appropriations amounting to EUR 538.2 million and by assigned revenue of EUR 274.9 million. This expenditure was lower than the 2015 budget’s forecasted needs both because of the lower expenditure incurred for the payment of the first instalment of the 2015 operational programmes by the approved producer organisations and of the lower expenditure incurred for the temporary exceptional measures taken by the Commission for producers that are members of producer organisations.

Furthermore, compared to the forecasted needs in the 2015 budget, lower expenditure was incurred by Member States for the aid to producer groups for preliminary recognition amounting to EUR 120.3 million and for the school fruit scheme amounting to EUR 104.1 million as Member States did not fully utilise the increased envelope decided for the 2014/2015 school year.

Finally, the forecasted needs in the 2015 budget for other measures, including the temporary exceptional measures adopted by the Commission for farmers, who are not members of producer organisations, after the Russian ban on imports amounted to EUR 107.6 million. Member States incurred lower expenditure amounting to EUR 81.1 million compared to the initially estimated needs. This expenditure was funded by voted appropriations amounting to EUR 44.7 million and by assigned revenue of EUR 36.4 million. However, the implementation of certain of these temporary exceptional measures involving both members and non-members of producer organisations has been extended to 30 June 2016 and therefore the corresponding expenditure is expected to continue in 2016.

4.1.6.Article 05 02 09: Products of the wine-growing sector

The under-execution of EUR 63.2 million compared to the forecasted 2015 budget needs regarding national support programmes was due to the lower expenditure incurred by some Member States for the promotion and investment components of their national wine programmes compared to their respective budget ceilings foreseen in the 2015 budget for these programmes.

4.1.7.Article 05 02 10: Promotion

As regards promotion measures-payments by Member States, the over-execution of EUR 2.3 million compared to the forecasted 2015 budget needs was due to the higher expenditure incurred by some Member States for their promotion programmes which are approved by the Commission compared to the expenditure foreseen in the 2015 budget for these programmes.

As regards direct payments made by the European Union, the Commission committed appropriations of around EUR 1.2 million which was almost equal to the amount foreseen in the 2015 budget for these payments.

4.1.8.Article 05 02 11: Other plant products/measures

This sector’s appropriations were over-executed by EUR 6.7 million compared to the forecasted 2015 budget needs of EUR 233.4 million; this over-execution was due to the higher expenditure incurred by some Member States for their POSEI - market measures programmes.

4.1.9.Article 05 02 12: Milk and milk products

The 2015 budget foresaw total available appropriations amounting to EUR 131.4 million in order to cover the needs of all the measures for this sector. The Budgetary Authority voted appropriations of EUR 77.1 million as it took into account the estimated revenue assigned to this budget article which amounted to EUR 54.3 million. The expenditure incurred by Member States in 2015 amounted to EUR 119.6 million. All the schemes funded under this article were under-implemented compared to the total estimated needs foreseen in the 2015 budget. The balance of the unused assigned revenue of EUR 52.7 million was carried over to the budget year 2016 to cover the needs of that year.

Specifically, the 2015 needs for storage measures for skimmed milk powder (SMP) were estimated at EUR 0.9 million. The expenditure incurred amounted to EUR 0.73 million and it was funded by voted appropriations amounting to EUR 0.45 million and by assigned revenue of EUR 0.28 million. It should be noted that public storage for SMP was opened in July 2015. Total purchases of 17 013 t were made and the expenditure incurred for technical and financial costs amounted to EUR 0.13 million. Furthermore, expenditure amounting to EUR 0.6 million was incurred for the private storage of SMP.

In addition, the 2015 needs for storage measures for butter were estimated at EUR 2.9 million. The expenditure incurred amounted to EUR 2.68 million and it was funded by voted appropriations amounting to EUR 1.71 million and by assigned revenue of EUR 0.97 million.

For the school milk scheme, Member States incurred expenditure amounting to EUR 73.4 million which was lower compared to the forecasted 2015 needs of EUR 77 million because of lower expenditure for a part of the 2014/2015 school year.

Finally, the 2015 needs for other measures including the temporary exceptional measures adopted by the Commission after the Russian ban on imports for certain cheeses and for the targeted support for the Baltic countries amounted to EUR 50.6 million. Member States incurred lower expenditure amounting to EUR 42.8 million compared to the initially estimated needs and it was funded by voted appropriations amounting to EUR 31.6 million and by assigned revenue of EUR 11.2 million. While the targeted support for the Baltic countries and Finland was fully paid, the expenditure for cheese storage was lower than foreseen and it amounted to EUR 3.5 million. The implementation of certain of these temporary exceptional measures, notably on storage measures, has been extended to 30 September 2016 and therefore the corresponding expenditure is expected to continue in 2016.

4.1.10.Article 05 02 15: Pig meat, eggs and poultry, bee-keeping and other animal products

The 2015 budget foresaw total available appropriations amounting to EUR 40.8 million in order to cover the needs of all the measures for this sector. The expenditure incurred by Member States in 2015 amounted to EUR 44.2 million and it was funded both by the voted appropriations of EUR 40.8 million and by transfers of appropriations amounting to EUR 3.4 million from other areas of the 2015 budget.

The expenditure incurred for specific aid for beekeeping amounted to EUR 27.7 million compared to forecasted needs of EUR 31 million included in the 2015 budget. This difference is due to late payments by one Member State for its annual beekeeping programme which was declared in 2016 instead of 2015.

Furthermore, the expenditure incurred for the exceptional support measures for the sector of eggs and poultry for Italy, under Commission Implementing regulation (EU) 1071/2014, amounted to EUR 4.9 million, which was lower than the expenditure of EUR 8.8 million foreseen in the 2015 budget which was based on the eligible claims notified by Italy.

Finally, the over-execution observed for this sector was due to the expenditure of EUR 11.5 million incurred by Member States for the private storage of pig-meat under Commission Implementing Regulation (EU) 2015/360, which was adopted by the Commission in the course of 2015 in order to counter the difficult market situation in this sector. The measure was not foreseen at the time of adoption of the 2015 budget in December 2014 and, therefore, the budget did not foresee any appropriations for this private storage scheme.

4.2.Chapter 05 03: Direct Aids

Total payments for this chapter of the 2015 budget amounted to EUR 42 168 million and they were funded by the voted appropriations amounting to EUR 40 561.4 million and by assigned revenue amounting to EUR 752.7 million. The latter was used to cover the expenditure incurred for the single payment scheme (NB: for details, see point 4.2.1). The unused voted appropriations amounted to EUR 347.2 million as evidenced by the difference between the voted appropriations of EUR 40 561.4 million used for the reimbursement to Member States and the initial voted appropriations of EUR 40 908.6 million included in the 2015 budget. These unused voted appropriations were reinforced with a transfer of voted appropriations amounting to EUR 85.8 million from other parts of the EAGF budget, thus, allowing the reconstitution of the unused amount of the reserve for crises of EUR 433 million, which was established from the proposed financial discipline in 2015, and which was transferred to budget article 05 03 09 so that, the amount of the effectively applied financial discipline of EUR 409.8 million, could be carried over into 2016 for its reimbursement to the Member States concerned. The remaining balance of assigned revenue collected in 2015 amounted to EUR 696.6 million and it was carried over to 2016. In items where the needs exceeded the budget’s voted appropriations, the additional expenditure was covered through transfers of voted appropriations from other items of the budget or of assigned revenue. Equally, for direct payments where the budget's appropriations were under-spent, the resulting available appropriations were transferred to other items of the budget in order to cover additional expenditure as needed.

Annex 7 presents these details at the level of each budget item.

4.2.1.Article 05 03 01: Decoupled direct aids

The main schemes funded by this article's appropriations are the single payment scheme (SPS), the single area payment scheme (SAPS) and the decoupled specific support under article 68 of Council Regulation (EC) No 73/2009. All aid schemes in this article are paid independently of production but on certain conditions e.g. respect of cross-compliance. The 2015 budgetary needs for decoupled direct aids amounted to EUR 38 642 million for which the Budgetary Authority voted appropriations amounting to EUR 37 397 million after taking into consideration assigned revenue for this sector amounting to EUR 1 245 million. The expenditure incurred by Member States for all schemes in this article amounted to EUR 38 293.5 million, thus, exceeding the 2015 voted appropriations of EUR 37 397 million by EUR 896.5 million. This latter amount of expenditure declared was partly covered by transfers from other budget items amounting to EUR 143.8 million and partly by assigned revenue amounting to EUR 752.7 million. The expenditure incurred by Member States for decoupled direct aids covered 99.1% of the needs foreseen in the 2015 budget for these aids. This slight under-execution concerned mainly the single payment scheme (SPS) and the single area payment scheme (SAPS).

As regards SPS, the 2015 budgetary needs were estimated at EUR 29 587 million. In order to cover these needs, the Budgetary Authority voted appropriations amounting to EUR 28 342 million after taking into account the revenue of EUR 1 245 million assigned to this scheme. The expenditure declared by Member States for this scheme amounted to around EUR 29 282 million and covered 99% of the estimated needs. This implementation rate was slightly better compared to 2014 with one of the main reasons for this under-implementation being the existence of payment entitlements which were not activated or which remained unused in the national reserves. This expenditure was funded by the scheme’s voted appropriations of EUR 28 342 million, by assigned revenue of around EUR 752.7 million and by transfers from other budget items amounting to EUR 187.3 million. The unused balance of the available assigned revenue was transferred to the 2016 budget. (NB: For details on the implementation of assigned revenue, please see point 5.1).

As regards SAPS, the appropriations in the 2015 budget amounted to EUR 7 806 million. Member States incurred payments amounting to EUR 7 770.3 million, thus, covering 99.5% of the estimated needs which is similar to the implementation rate of previous years.

As regards the decoupled specific support under article 68 of Council Regulation (EC) No 73/2009, the expenditure incurred by Member States amounted to EUR 500.6 million, which resulted in an under-execution of the 2015 budget’s appropriations of around EUR 6.4 million. The execution of this scheme improved in this last year of its implementation, largely due to the possibility for Member States to redefine the details of the implemented measures under article 68.

As regards the other schemes funded through this budget article, their implementation was as foreseen in the 2015 budget, including the Redistributive payment which is the first new scheme of the 2013 reform that was implemented in 2015.

4.2.2.Article 05 03 02: Other direct aids

The appropriations of this article cover expenditure for other direct aids for which Member States have chosen to maintain a limited link between the payment of these aids and production for a number of sectors, under well defined conditions and within clear limits, in order to avoid the abandonment of this production. Thirteen schemes are funded under this article.

For these schemes, the Commission had estimated that appropriations amounting to EUR 3 078.4 million were needed in 2015. Member States incurred expenditure amounting to EUR 3 020.5 million.

For most of these schemes, the Member States concerned incurred expenditure which was slightly lower than the 2015 budget's appropriations. The most important under-executions concerned the specific support schemes under article 68 of Council Regulation (EC) No 73/2009 involving around EUR 32 million. Despite this under-execution, the implementation rate for this scheme improved compared to the preceeding year, largely due to the possibility for Member States to redefine the details of the implemented measures under article 68. Furthermore, the POSEI-EU support programmes showed an under-execution of around EUR 10.1 million because of lower expenditure incurred by the Member States concerned.

As regards item 05 03 02 99 – Other (direct aids), the 2015 budget included appropriations of EUR 6.2 million intended to cover expenditure and corrections for older schemes which were not covered under other budget items of the coupled direct aids sector. However, Member States incurred expenditure for older schemes amounting to around EUR 2.8 million. They also declared net corrections and recoveries of around EUR 9.4 million which were intended to be eventually re-booked to their proper budget item in a later period. In order to cover the funding needs of other items of the 2015 budget, appropriations amounting to EUR 12.6 million were transferred out of this budget item, thus leading to an under-execution of around EUR 6.4 million.

4.2.3.Article 05 03 03: Additional amounts of aid

While the appropriations foreseen in the 2015 budget for this scheme amounted to EUR 0.2 million, Member States incurred insignificant expenditure and thus under-executed the budget’s appropriations by almost a similar amount.

4.2.4.Article 05 03 09: Reimbursement of direct aids in relation to financial discipline

No appropriations are allocated to this article by the Budgetary Authority. This article was established for the first time in budget year 2014 to facilitate the collection of non-committed voted appropriations involving only the budget year 2014 supplemented by the appropriations of the unused reserve for crises in order to be carried over into the next budget year 2015 and finance the reimbursement of the financial discipline applied to direct aids in respect of calendar year 2014 7 .

Each year, if applicable, a Commission Implementing Regulation sets the amounts that each Member State has to reimburse to farmers and, in accordance with Article 163(3) of Regulation (EU, Euratom) No 966/2012, determines that the expenditure in relation to this reimbursement shall only be eligible for Union financing if the amounts have been paid to the beneficiaries before 16 October of the financial year to which the appropriations are carried over. From the amount of EUR 868.2 million, corresponding to the financial discipline applied during financial year 2014, which was carried over to budget 2015 for reimbursement, Member States reimbursed EUR 854 million. The difference of EUR 14.2 million reverts to the 2015 budget for its return to Member States via the first Amending Budget of the following budget year.

As regards financial year 2016, Commission Implementing Regulation (EU) 2015/2094 sets the amount of reimbursement to EUR 409.8 million. This amount corresponds to the amount of financial discipline effectively applied for claim year 2015 and it is only this amount which was carried over into the 2016 budget. The difference between the reserve for crises of EUR 433 million and the carried over amount of EUR 409.8 million reverts to the 2015 budget for its return to Member States via the first Amending Budget of the following budget year.

4.2.5.Article 05 03 10: Reserve for crises in the agricultural sector

The appropriations of this article are intended to cover expenditure for measures which have to be taken in order to cope with major crises affecting agricultural production or distribution. The reserve is to be established by applying, at the beginning of each year, a reduction to the direct aids through the financial discipline mechanism in accordance with Articles 25 and 26 of Regulation (EU) No 1306/2013 as well as Article 8 of Regulation (EU) No 1307/2013. This reserve may not exceed a maximum annual amount of EUR 400 million (in 2011 prices). For the budget year 2015, the equivalent amount of the crisis reserve in current prices was EUR 433 million. The reserve was not used in financial year 2015.

For the 2015 claim year, the financial discipline was calculated exclusively for the constitution of the crisis reserve of EUR 433 million. However, by the end of the financial year, non-committed voted appropriations corresponding to the amount of financial discipline effectively applied for claim year 2015 (taking into account the unused amount of the reserve) was transferred to budget article 05 03 09 in order to be carried-over to the next financial year and, in this way, fund the reimbursement of financial discipline imposed on farmers in the calendar year 2015. (NB: Please see point 4.2.4).

4.3.Chapter 05 04: Rural Development

4.3.1.Article 05 04 01: Rural Development financed by the ex-EAGGF-Guarantee. Completion of earlier programmes (2000 to 2006)

No commitment appropriations can be made anymore for these programmes. Member States are now closing these programmes and they recover unduly paid amounts. The final net amount recovered under this article was equal to around EUR 1.2 million and it was used for funding other budget items.

4.4.Chapter 05 07: Audit of agricultural expenditure

4.4.1.Article 05 07 01: Control of agricultural expenditure

This article involves the measures taken in order to reinforce the means of on-the-spot controls and to improve the systems of verification so as to limit the risk of frauds and irregularities in detriment of the Union budget. It also includes the expenditure which could be necessary in order to fund possible accounting and conformity corrections in favour of Member States.

The European Union directly funded the purchase of satellite images within the framework of the Integrated Administrative and Control System (IACS) amounted to EUR 7.5 million. This amount was covered by voted appropriations of EUR 6.8 million which were foreseen in the 2015 budget for Monitoring and preventive measures-Direct payments by the European Union and by transfers from other parts of the budget amounting to EUR 0.7 million.

As regards the accounting clearance corrections in favour of Member States, the Commission took decisions which involved such corrections of approximately EUR 20.2 million. As regards the conformity clearance corrections in favour of Member States, the Commission took decisions which involved such corrections of approximately EUR 29.2 million. The Budgetary Authority had voted appropriations for the funding of these corrections in favour of the Member States of EUR 20 million and the balance was eventually covered by transferring appropriations of EUR 29.4 million from other items of the 2015 budget.

4.4.2.Article 05 07 02: Settlement of disputes

The appropriations in this article are intended to cover expenditure for which the Commission could be held liable by decision of a court of justice, including the cost of settling claims for damages and interest. On 27 September 2012, the European Court of Justice delivered its judgment in joined cases C-113/10, C-147/10 and C-234/10 (the Jüllich-II judgement). The 2015 budget foresaw appropriations amounting to EUR 60.5 million for the payment of compensatory interest to operators under this judgement. However, Member States incurred and declared expenditure amounting to around EUR 1.7 million for these payments. Therefore, appropriations amounting to EUR 58.8 million were transferred to other items of the 2015 budget in order to fund needs for these items.

4.5.Chapter 05 08: Policy strategy and coordination

4.5.1.Article 05 08 01: Farm accountancy data network (FADN)

Appropriations committed with regard to the cost of data collection on farm holdings under this network amounted to EUR 14.7 million, thus, taking up almost all of the appropriations foreseen in the 2015 budget.

4.5.2.Article 05 08 02: Surveys on the structure of agricultural holdings

Appropriations committed with regard to the cost of farm structure surveys amounted to EUR 19.3 million, thus, taking up almost all of the appropriations foreseen in the 2015 budget.

4.5.3.Article 05 08 03: Restructuring of systems for agricultural surveys

Appropriations committed with regard to the cost of restructuring of systems of agricultural surveys amounted to EUR 4.7 million, thus, taking up almost all of the appropriations foreseen in the 2015 budget.

4.5.4.Article 05 08 06: Enhancing public awareness of the common agricultural policy

Appropriations committed with regard to the cost of actions, fairs and publications aimed at enhancing public awareness of the CAP amounted to around EUR 7.3 million, thus, taking up almost all of the appropriations foreseen in the 2015 budget.

4.5.5.Article 05 08 09: EAGF – Operational technical assistance

Appropriations committed with regard to operational technical assistance for the EAGF amounted to approximately EUR 1.8 million and it under-executed the appropriations of EUR 3.7 million foreseen in the 2015 budget. This under-execution was mainly due to delays in the conclusion of audit support contracts which were foreseen in the 2015 budget.

5.IMPLEMENTATION OF ASSIGNED REVENUE (policy area 05-agriculture and rural development)

5.1.Revenue assigned to EAGF

The assigned revenue actually carried over from 2014 into 2015, amounted to EUR 341.3 million and has been entirely used in financing expenditure of the 2015 budget year in accordance with article 14 of the Financial Regulation. As presented in annex 9, this amount covered expenditure of EUR 280.6 million for the operational funds for producer organisations and for other measures (temporary exceptional measures) in the fruits and vegetables sector, of EUR 11 million for storage measures for skimmed powder and butter as well as for other measures (temporary exceptional measures) in the milk and milk products sector and of EUR 49.7 million for the single payment scheme.

As regards the assigned revenue collected in 2015, annex 8 shows that this revenue amounted to EUR 1 631.6 million and it originated from:

–The corrections of the conformity clearance procedure which amounted to EUR 1 066.6 million.

–The receipts from irregularities which amounted to EUR 155.5 million.

–The milk levy collections which amounted to EUR 409.6 million.

The assigned revenue collected in 2015 was used to cover expenditure incurred for the following measures:

–EUR 30.7 million for the exceptional support measures for non- members of producer organisations under other measures in the fruits and vegetables sector,

–EUR 0.2 million and EUR 0.9 million for storage measures for skimmed milk powder and for butter and cream correspondingly in the milk and milk products sector,

–EUR 0.5 million for the exceptional support measures for milk producers and for the private storage for cheese under other measures in the milk and milk products sector,

–EUR 703 million for the single payment scheme (direct aids).

The balance of the assigned revenue collected in 2015 amounting to EUR 896.4 million was automatically carried over into the 2016 budget in order to fund budgetary needs of that year.

6.BREAKDOWN BY TYPE OF EXPENDITURE

The total EAGF expenditure amounted to EUR 44 948.1 million. Hereafter, this expenditure is presented broken down into the main reporting categories along with the percentage that these represent in the total EAGF expenditure for 2015:

Storage

Expenditure for storage amounted to EUR 18.4 million, i.e. 0.04% of the total expenditure. This amount mainly represents the expenditure incurred for the private storage of butter.

Export refunds

Spending on export refunds amounted to EUR 0.3 million, i.e. 0.001% of the total expenditure and it related to paying outstanding balances for past exports of non-Annex I products, beef, pigmeat and poultry.

Other market measures

In addition to storage and export refunds, the expenditure for other market measures amounted to EUR 2 698 million, i.e. 6% of the year's total. This category covers expenditure mainly relating to olive oil, fruit and vegetables, wine, textile plants, POSEI, promotion measures, milk and milk products and bee-keeping. This expenditure incorporates other minor amounts and it includes the corrections arising from the clearance of accounts and settlement of disputes.

Direct aids

Expenditure for direct aids amounted to EUR 42 168 million, i.e. 93.8% of the total.

Expenditure under direct management

This expenditure amounted to EUR 64.7 million (in commitment appropriations), i.e. 0.1% of the total, and it was paid directly by the Commission. It mostly covered the expenditure relating to farm accounting, surveys on farm structures, information on the CAP, technical assistance, etc.

Rural development under ex-EAGGF-Guarantee

The evolution of the breakdown of EAGF expenditure by type for the period 2009-2015 is presented in annex 25.

7.SPECIFIC ACTIVITIES

7.1.Promotion measures – payments by Member States

The legal basis for information and promotion programmes for agricultural products implemented in the EU and elsewhere is provided by Council Regulation (EC) No 3/2008 and Commission Regulation (EC) No 501/2008.

Programmes are submitted by representative trade and inter-trade organisations to Member States which are responsible for the programme management once the Commission has confirmed the selection and agreed the part-financing.

In 2015, 74 new promotion programmes, including 7 multi Member States programmes, were approved by two Commission decisions both covering the internal market (30) and third countries (44). The EU will contribute EUR 118.7 million for these 74 new promotion programmes. The additional EUR 30 million of EU funding approved in September 2014 for CAP promotion programmes starting in 2015 correspond to the medium-term response to Russian embargo. This increased financing allowed for 2015 to reorientate promotion measures to other third countries such as Middle East, North America and China, etc.

The selected programmes covered fresh and processed fruits and vegetables, dairy products, PDOs (Protected Designation of Origin), PGIs (Protected Geographical Indication) and TSGs (Traditional Specialities Guaranteed), olives and olive oil, organic products, ornamental horticulture, meat, poultry, processed products from cereals and rice, flax, seeds, spirit and wine. Seven of these programmes were proposed by more than one Member State while third country programmes aimed at the Middle East, North American and Latin American, Chinese, Japanese, South-East Asia, South Korean and Australian markets but also at low level at Russian, African, Kazakhstan, Belarussian, Norwegian, Azerbaijan, Bosnian & Herzegovian, Ukranian, Albanese, Serbian, Montenegro, Zwiss, New Zealand and Indian markets.

A part of the promotion and information measures is carried out at the initiative of the Commission. In this framework, the Commission organised a specific GI campaign in China entitled "Tastes of Europe". The campaign was running for some 6 months and was launced in May 2015 in Beijing in the framework of the celebrations of the 40th year of diplomatic relations between EU and China.

Regarding the reform of the promotion regime, Regulation (EU) No 1144/2014 of the European Parliament and of the Council repealing Council Regulation No 3/2008 was adopted on 22 October 2014 while Delegated Regulation (EU) 2015/1829 and Implementing Regulation (EU) 2015/1831 of the Commission were adopted respectively on 23 April 2015 and on 7 October 2015.

The new promotion policy is designed to help the sector's professionals to find new markets, consolidate existing ones, and promote the high standards of EU agricultural products to consumers in Europe and around the world.

8.CONTROL MEASURES

8.1.Introduction

The EU legislation provides for a comprehensive system of management and controls which relies on four levels:

(a) compulsory administrative structure at the level of Member States, centred around the establishment of paying agencies and an accreditation authority at high level which is competent for issuing and withdrawing the agency’s accreditation. The decision for issuing the accreditation is based on a detailed review by an external audit body;

(b) detailed systems for controls and dissuasive sanctions to be applied by those paying agencies, with common basic features and special rules tailored to the specificities of each aid regime;

(c) ex-post controls by independent audit bodies on the paying agencies' annual accounts and the functioning of their internal control procedures (under Commission Delegated Regulation (EU) No 907/2014 8 , Commission Implementing Regulation (EU) No 908/2014 9 and Commission Implementing Regulation (EU) No 2015/775 10 ) and by special departments on aid measures other than direct aids covered by the IACS (checks based on Chapter III of Title V of Regulation (EU) No 1306/2013);

(d) clearance of accounts procedure through the Commission's annual financial clearance and multi-annual conformity clearance.

These four levels establish a comprehensive system for the management and control of agricultural expenditure. It includes, on the one hand, all the necessary building blocks to guarantee a sound administration of the expenditure at Member States’ level and, on the other hand, allows the Commission to counter the risk of financial losses as a result of any deficiencies in the set-up and operation of those building blocks through the clearance of accounts procedure.

Article 58 of Regulation (EU) No 1306/2013 provides for the general obligation of Member States to ensure that transactions financed by the EAGF and the EAFRD are carried out and executed correctly, to prevent and deal with irregularities and to recover amounts unduly paid.

In complement to this general obligation, there is a system of controls and dissuasive sanctions of final beneficiaries which reflects the specific features of the regime and the risk involved in its administration.

The controls are carried out by the paying agencies or by delegated bodies operating under their supervision and effective, dissuasive and proportionate sanctions are imposed if the controls reveal non-compliance with EU rules. The system generally provides for exhaustive administrative controls of 100% of the aid applications, cross-checks with other databases where this is considered appropriate as well as pre-payment on-the-spot controls of a sample of transactions ranging between 1% and 100%, depending on the risk associated with the regime in question. For example, the control rate in the framework of the Integrated Administration and Control System (IACS) is normally 5%. If the on-the-spot controls reveal a high number of irregularities, additional controls must be carried out. The sample of transactions is determined on a risk and/or random basis.

In addition, for most regimes which are not subject to the IACS, on top of the primary and secondary control levels, ex-post controls must be carried out in accordance with the provisions of Chapter III of Title V in Regulation (EU) No 1306/2013.

8.2.Integrated Administration and Control System (IACS)

Regulation (EU) No 1306/2013, Regulation (EU) No 1307/2013 11 , Commission Delegated Regulation (EU) No 639/2014 12 and Commission Delegated Regulation (EU) No 640/2014 13 contain the rules on the IACS.

A fully operational IACS consists of: a computerised database, an identification system for agricultural parcels and farmers claiming aid, a system for identification and registration of payment entitlements, aid applications and integrated controls system (claim processing, on-the-spot checks and sanctioning mechanisms) and a system for identifying and registering animals where applicable. The IACS is fully automated and provides highly efficient controls by maximising the use of computerised and remote controls.

This system foresees a 100% administrative control covering the eligibility of the claim, complemented by administrative cross-controls with standing databases ensuring that only areas or animals that fulfil all eligible requirements are paid the premium and by a minimum 5% of on-the-spot checks to check the existence and eligibility of the area or the animals claimed.

The use of standing databases, which are appropriately updated, is well adapted to the schemes whereby aids are directly paid to the farmers and based on the surfaces or on the number of animals, in that the risk can be reduced to the lowest levels.

For the financial year 2015, the IACS covered almost 94% of the EAGF expenditure. Furthermore, the relevant components of the IACS are applicable to the rural development measures, which are based on area or number of animals. Such measures include, inter alia, agri-environment and animal welfare measures, less-favoured areas and areas with environmental restrictions and afforestation of agricultural land. For financial year 2015, around 54% of payments made under the EAFRD were also covered.

The Commission services verify the effectiveness of Member States' IACS and homogenous implementation by means of both on-the-spot auditing and general supervision based on annually supplied financial and statistical data. It has been established already for some years now that the IACS provides an excellent and cost effective means of ensuring the proper use of EU funds.

8.3.Market measures

Market interventions, for example storage aid or aid to producer organisations, are not covered by IACS but they are governed by specific rules as regards controls and sanctions which are set out in horizontal and sector-based regulations.

Aids are paid on the basis of claims, often involving the lodging of administrative and/or end-use securities, which are systematically (100%) checked administratively for completeness and correctness. The more financially important aid schemes are also subject to regular accounting controls performed in situ on commercial and financial documents.

8.4.Application of Chapter III of Title V Regulation (EU) No 1306/2013 (ex-post scrutiny)

An ex-post control system is provided for under Regulation (EU) No 1306/2013 in Title V, Chapter III. It provides for an ex-post control system which is a complement to the sectoral control systems described above. The system constitutes an extra layer of control which contributes to the assurance that transactions have been carried out in conformity with the rules or otherwise allows recovering the unduly paid amounts.

The ex-post scrutiny is to be carried out by a body in the Member State, which is independent of the departments within the paying agency responsible for the pre-payment controls and the payments. It covers a wide range of CAP subsidies including sector schemes for fruit and vegetables, wine and POSEI aids. In fact, the ex-post scrutiny covers all aids paid to beneficiaries from EAGF (except payments covered by IACS and those excluded by Article 14 of Regulation (EU) No 907/2014).

In 2015, 4 Member States were visited to review the implementation of scrutiny. Member States scrutiny services completed ex-post controls in respect of undertakings to which payments were made in financial year 2013. The annual reports in respect of the respective scrutiny period (July 2014-June 2015) shows that 97% of the planned scrutinies were completed and 3% of planned scrutinies were still ongoing. The regulation also foresees Member States providing mutual assistance in the performance of scrutinies. In the 2014/2015 scrutiny period, 50 such requests were fulfilled.

9.CLEARANCE OF ACCOUNTS

9.1.Conformity clearance - Introduction

It is primarily the Member States' responsibility to check that transactions are carried out and executed correctly via a system of control and dissuasive sanctions. Where Member States fail to meet this requirement, the Commission applies financial corrections to protect the financial interests of the EU.

The conformity clearance relates to the legality and regularity of transactions. It is designed to exclude expenditure from EU financing which has not been effected in compliance with EU rules, thus shielding the EU budget from expenditure that should not be charged to it (financial corrections). In contrast, it is not a mechanism by which irregular payments to beneficiaries are recovered, which according to the principle of shared management is the sole responsibility of Member States.

Financial corrections are determined on the basis of the nature and gravity of the infringement and the financial damage caused to the EU. Where possible, the amount is calculated on the basis of the loss actually caused or on the basis of an extrapolation. Where this is not possible, flat-rates are used which take account of the severity of the deficiencies in the national control systems in order to reflect the financial risk for the EU.

Where undue payments are or can be identified as a result of the conformity clearance procedures, Member States are required to follow them up by recovery actions against the final beneficiaries. However, even where this is not possible because the financial corrections only relate to deficiencies in the Member States' management and control systems, financial corrections are an important means to improve these systems and thus to prevent or detect and recover irregular payments to final beneficiaries. The conformity clearance, thereby, contributes to the legality and regularity of the transactions at the level of the final beneficiaries.

9.2.Conformity clearance – Audits and decisions adopted in 2015

9.2.1.Audits

The following table presents an overview of the conformity missions and their coverage in respect of financial year 2015, broken down per ABB-activity:

Financial Year 2015

ABB 02

ABB 03

ABB 041)

Total2)

Number of conformity audits with missions carried out3)

114

1) concerns only EAFRD.

2) including 11 audits covering cross-compliance and 7 IT audits. The entitlements and irregularity areas have not been subject to audits in financial year 2015.

3) if an audit covers more than one ABB, it is allocated to all ABBs covered by that audit.

9.2.2.Conformity decisions

Three conformity clearance decisions having an impact on the financial year 2015 were adopted involving financial corrections in a number of sectors. These decisions had an overall financial impact for EAGF by excluding from EU financing a total of EUR 2 011 million:

Decision 2014/950/EU of 19 December 2014 – 46th Decision, financial impact of EUR 68.63 million,

Decision 2015/103/EU of 16 January 2015 – 47th Decision, financial impact of EUR 1 243.11 million,

Decision 2015/1119/EU of 22 June 2015 – 48th Decision, financial impact of EUR 699.26 million.

For the decisions 46 (2014/950/EU), 47 (2015/103/EU) and 48 (2015/1119/EU) due to the relative magnitude of corrections compared to certain Member State’s GDP, the Commission decided that corrections amounting to EUR 1 344.15 million could be paid in 3 equal annual instalments. In addition, financial corrections for Greece in decision 48 are included in a new deferral decision (C(2015)4122 of 22 June 2015) amounting to EUR 321.12 million for EAGF.

The breakdown of financial impact according to sectors is as follows: (in EUR million)

	Decision 46	Decision 47	Decision 48
Area aids / Arable crops	78.09	942.39	564.98
Cotton, flax and hemp, silk worms	0.00	0.00	0.50
Dried fodder and seeds	0.00	0.04	0.00
Export refunds	0.06	0.25	0.04
Financial audit	1.58	-0.22	8.41
Fruit and vegetables	1.06	6.52	63.25
Intervention storage	0.00	1.72	0.00
Irregularities	0.00	-0.01	2.02
Livestock premiums	0.00	122.83	9.59
Milk products	0.00	0.00	3.10
POSEI	0.00	0.00	1.06
Potato starch	0.00	-28.95	0.00
Specific support (Art.68 of Reg.73/2009)	0.48	15.32	46.30
Sugar	8.70	180.92	0.00
Wine	-21.34	2.30	0.00
Total	68.63	1 243.11	699.26

Under Regulation (EU) No 1306/2013, an automatic clearing mechanism is applied to irregular payments not recovered 4 years after the establishment of the irregularity, or 8 years after the establishment of the irregularity when the recovery is challenged in national courts. The financial consequences of non recovery are shared by the Member State concerned and the EU on a 50% - 50% basis. Even after the application of this mechanism, Member States are, however, obliged to pursue their recovery procedures and, if they fail to do so with the necessary diligence, the Commission may decide to charge the entire outstanding amounts to the Member States concerned.

Regarding financial year 2014, Member States reported the information about recovery cases by 15 February 2015. The Member States recovered during financial year 2014 around EUR 150.3 million for EAGF. Recovered amounts were EUR 150.7 million for EAFRD and EUR 17.5 million for TRDI. The outstanding amount still to be recovered from beneficiaries at the end of that financial year was EUR 1 229.8 million for EAGF, EUR 340.2 million for EAFRD and EUR 19.5 million for TRDI. The financial consequences to the Member States for non recovery of EAGF cases dating from 2010 or 2006 account to EUR 12.5 million. During financial year 2014, around EUR 24.5 million was borne by the EU budget for EAGF cases reported irrecoverable.

9.3.Financial clearance

9.3.1.Introduction

The financial clearance covers the completeness, accuracy and veracity of paying agencies' accounts as well as the internal control systems set up by these paying agencies. Within this framework, Directorate-General for Agriculture and Rural Development (DG AGRI) pays particular attention to the certifying bodies’ conclusions and recommendations (where weaknesses are found), following their reviews of the paying agencies’ compliance with the accreditation criteria. As part of this review, the DG AGRI departments also cover aspects relating to conformity issues and protecting the financial interests of the EU as regards the advances paid, securities obtained and intervention stocks.

The Commission adopts an annual clearance of accounts decision clearing the paying agencies' annual accounts on the basis of the certificates and reports from the certifying bodies, but without prejudice to any subsequent decisions to recover expenditure which proves not to have been in accordance with the EU rules. As from financial year 2014, these accounts are recevied by the Commission by 15 February of the year following the financial year in question. The Commission must clear the accounts and adopt its clearance decision by 31 May of the year following the financial year in question.

9.3.2.Decisions

9.3.2.1.Financial clearance decision for the financial year 2010

On 29 April 2011, the Commission adopted a Decision clearing the annual accounts of 74 paying agencies in respect of their expenditure financed by the EAGF. By means of its decision, it cleared amounts of EUR 38 862.4 million.

With Commission Decision C(2015) 393, adopted on 02 February 2015, the Commission cleared the accounts of OPEKEPE (Greece) and ARBEA (Italy) amounting to EUR 2 460 million.

9.3.2.2.Financial clearance decision for the financial year 2011

With Commission Decision 2012/240/EU adopted on 27 April 2012, the Commission cleared the accounts of all paying agencies for EAGF, except for HAMBURG-JONAS (Germany) and PIAA (Romania). Concerning the accounts of PIAA (Romania), the work is still ongoing. The accounts of HAMBURG-JONAS (Germany), will be cleared during 2016 amounting to EUR 35 million.

9.3.2.3.Financial clearance decision for the financial year 2012

On 26 April 2013, the Commission adopted a Decision clearing the annual accounts of 75 paying agencies in respect of EAGF expenditure. With this decision, expenditure amounting to EUR 43 324 million was cleared. On 5 August 2014, the Commission adopted a Decision clearing the annual accounts of financial year 2012 HELABA (Germany). This decision cleared EUR 220 million of expenditure. The decision to clear the accounts of BIRB (Belgium), and HAMBURG-JONAS (Germany), amounting to EUR 34,5 million will be done in 2016.

9.3.2.4.Financial clearance decision for the financial year 2013

On 29 April 2014, the Commission adopted a Decision clearing the annual accounts of 76 paying agencies in respect of EAGF expenditure. With this decision, expenditure amounting to EUR 40 628.5 million was cleared. The accounts of BIRB (Belgium), OPEKEPE (Greece) and PIAA (Romania), amounting to EUR 3 530 million, were disjoint and are subject to a later clearance.

9.3.2.5.Financial clearance decision for the financial year 2014

On 28 May 2015, the Commission adopted a Decision clearing the annual accounts of 74 paying agencies in respect of EAGF expenditure. With this decision, expenditure amounting to EUR 39 561 million was cleared. The accounts of five paying agencies (Hamburg and Mecklenburg-Vorpommern (Germany), OPEKEPE (Greece), SAISA (Italy) and PIAA (Romania)), amounting to EUR 3 793,3 million, were disjoint and are subject to a later clearance.

9.4.Appeals brought before the Court of Justice against clearance decisions

9.4.1.Judgments handed down

In the financial year 2015, the Court handed down 11 judgments in appeals brought by the Member States against conformity clearance decisions.

In financial year 2015, the Court partially annulled:

Decision 36 by judgement of 06 November 2014 in the case T-632/11 brought by Greece.

In financial year 2015, the Court annulled:

Decision 42 by judgement of 24 September 2015 in the case T-557/13 brought by Germany.

In financial year 2015, the Court rejected appeals brought in the following cases:

judgement of 16 October 2014 in case C-273/13 P brought by Poland;

judgement of 06 November 2014 in case C-610/13 P brought by the Netherlands;

judgement of 02 December 2014 in case T-661/11 brought by Italy;

judgement of 05 February 2015 in case T-387/12 brought by Italy;

judgement of 16 June 2015 in case T-3/11 brought by Portugal;

judgement of 19 June 2015 in case T-358/11 brought by Italy;

judgement of 06 July 2015 in case T-44/11 brought by Italy;

judgement of 02 October 2015 in case T-245/13 brought by the UK;

judgement of 02 October 2015 in case T-503/12 brought by the UK.

9.4.2.New appeals

In the financial year 2015, 17 new appeals were brought by the Member States against clearance decisions:

Case Number	Member State	Lodging Date
T-112/15	Greece	02/03/2015
T-118/15	Slovenia	06/03/2015
T-135/15	Italy	26/03/2015
T-139/15	Hungary	27/03/2015
T-141/15	Czech Republic	27/03/2015
T-143/15	Spain	30/03/2015
T-145/15	Romania	29/03/2015
T-156/15	France	27/03/2015
T-157/15	Estonia	30/03/2015
T-501/15	The Netherlands	31/08/2015
T-502/15	Spain	01/09/2015
T-505/15	Hungary	02/09/2015
T-506/15	Greece	29/08/2015
T-507/15	Poland	02/09/2015
T-550/15	Portugal	23/09/2015
T-551/15	Portugal	25/09/2015
T-556/15	Portugal	25/09/2015

9.4.3.Appeals pending

The situation as at 15 October 2015 with regard to appeals pending is shown, together with the amounts concerned, in annex 26.

10.RELATIONS WITH PARLIAMENT AND WITH THE EUROPEAN COURT OF AUDITORS

10.1.Relations with Parliament

The European Parliament is, together with the Council, part of the EU’s Budgetary Authority. It is, thus, one of the most important discussion partners of the Commission on budgetary matters and, therefore, on the EAGF.

Three EP committees are involved in the discussions and the preparation for the plenary on agricultural budgetary matters. These are the Committee on Agriculture and Rural Development, the Committee on Budgets and the Committee on Budgetary Control.

Since 2014 the Committee on Agriculture and Rural Development provides an opinion on the discharge procedure to the Committee on Budgetary Control.

The Committee on Budgetary Control monitored the correct implementation of the 2013 budget. It was asked to draw up the Parliamentary Decision (OJ L 255, 30.9.2015) by which discharge (in respect to the implementation of the general budget of the European Union for the 2013 financial year) was granted to the Commission on 29 April 2015.

10.2.Relations with the European Court of Auditors

10.2.1.Mission of the European Court of Auditors

The European Court of Auditors is the external auditor of the European Union. Articles 285 to 287 of the Treaty on the Functioning of the European Union provide that the Court shall audit the Union finances with a view to improving financial management and reporting on the use of public funds. The Court of Auditors should provide the European Parliament and the Council with a statement of assurance as to the reliability of the accounts and the legality and regularity of the underlying transactions. This statement, which can be complemented by specific assessments for various policy areas, is of prime importance to the European Parliament in its deliberations on granting discharge to the Commission for the implementation of the budget.

As part of its work, the Court carries out numerous audits within the Commission services. Court officials frequently visit the Directorate-General for Agriculture and Rural Development (DG AGRI) to gather facts and figures needed for the Court's opinions, as well as for its annual and special reports. In the light of these investigations the Court frequently makes suggestions and recommendations to the Commission on how to improve its financial management and make supervisory and control systems more effective.

10.2.2.Annual Report for financial year 2014

Every year the Court of Auditors publishes its Annual report on the implementation of the EU budget in which it gives a statement of assurance on the reliability of the consolidated accounts of the EU as well as on the legality and regularity of transactions. This is supplemented with specific assessments of each major area of EU activity. The report is published along with the Institutions' replies and is presented to the European Parliament in November.

In line with International Audit Standards, contradictory meetings take place between the auditor (the Court of auditors) and the auditee (the Commission and the other Institutions and bodies) before the report is published. In these meetings, the Court's findings and conclusions are discussed to ensure agreement on the underlying facts. The wording of the auditee's replies is also discussed.

In the Annual report for financial year 2014, the activities of the Directorate-General for Agriculture and Rural development are considered under one single chapter, Chapter 7 – Natural Resources. However, transactions financed under the EAGF are assessed separately from those financed under the EAFRD which are considered along with other policies (environment, climate action and fisheries).

For EAGF - Market and direct support, based on the results of the testing of 183 transactions, the Court estimates the level of error to be 2.9% (para 7.18). For 2013, the error rate for this policy group was 3.6%. Cross-compliance infringements accounted for 0.7 percentage points (para 7.20), an increase from 0.5 percentage points last year. The Court has decided not to include cross-compliance infringements in its error rate as of financial year 2015 (para 1.15).

As it has done in the past, the Court stressed that, in many cases, Member States had sufficient information to detect and correct errors before declaring the expenditure to the Commission. Had they acted on this information, the error rate would have been 0.6 percentage point lower. In addition, and for the first time, the Court reported on the errors made by national authorities. They estimate that for this policy area, their impact was 0.7 percentage point. (para 7.20)

In total, 51% of transactions audited were affected by error (para 7.18), a decrease from 61% in 2013. Most of the errors (44%) related to overstatement in the number of eligible hectares (graph 7.3) and cross-compliance (24%).

In its assessment of the control systems for EAGF, the Court reviewed IACS in Croatia and in paying agencies which had implemented action plans to remedy identified weaknesses. For Croatia, they considered the system reliable and only reported minor deficiencies (para 7.37). For the remedial actions, the Court indicated that the overall situation had improved but that weaknesses nevertheless persisted in some countries (para 7.40). Remedial actions in Bulgaria, Portugal and Romania were considered satisfactory (box 7.7) while further improvements were expected in Greece, Spain and Italy (box 7.8).

For Rural development, environment, climate action and fisheries, based on a sample of 176 transactions, the Court estimated the error rate at 6.2% (para 7.25). This is a decrease from 6.7% in 2013. Cross-compliance infringements contributed to 0.2 percentage points of that error rate (para 7.33). The Court also estimates that if Member States had acted on the information at their disposal to detect and correct errors before declaring the expenditure, the error rate would have been 3.3 percentage points lower (para 7.28). Furthermore, the Court quantifies the impact of errors made by national authorities at 0.6 percentage points (para 7.28).

The frequency of errors for rural development continued to decrease, from 57% in 2013 to 49% in 2014 (para 7.27). Ineligibility is the main cause of errors (44%) followed by non-compliance with agri-environmental commitments (28%) (graph 7.4). For the root causes of errors, the Court refers to its special report 23/2014 published in February 2015 (para 7.29).

The Court makes a positive assessment of the Commission's work in the framework of the clearance of accounts procedure (para 7.60) as well as on the Commission's audit work (para 7.62).

The recommendations addressed to the Commission are (para 7.77):

For rural development:

–take appropriate measures to require that Member States' action plans include remedial actions addressing the frequently found causes of error;

–revise the strategy for its rural development conformity audits so as to establish whether systems weaknesses found in one specific region, for Member States with regional programmes, are also present in the other regions, especially for investment measures;

For both EAGF and rural development

–ensure that the new assurance procedure on legality and regularity of transactions, which will become mandatory as of the financial year 2015, is correctly applied by the certification bodies and produces reliable information about the level of error, so as to be able to rely on it.

The Commission has accepted all recommendations.

10.2.3.Special Reports by the Court of Auditors

In calendar year 2015, the Court published four special reports covering DG AGRI's activities:

Special Report No 23/2014 "Errors in rural development spending: what are the causes and how are they being addresses?" (published on 17 February 2015);

Special Report No 24/2014 "Is EU support for preventing and restoring damage to forests caused by fire and natural disasters well managed?" (published on 24 February 2015);

Special Report No 4/2015"Technical assistance: what contribution has it made to agriculture and rural development?" (published on 24 April 2015);

Special Report No 5/2015 "Are financial instruments a successful and promising tool in the rural development area?" (published on 28 April 2015).

11.BASIC RULES GOVERNING EAGF AND AMENDMENTS MADE IN 2015

11.1.Checks

–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 (OJ L 347, 20.12.2013, p. 549);

–Commission Delegated Regulation (EU) No 640/2014 of 11 March 2014 supplementing Regulation (EU) No 1306/2013 of the European Parliament and of the Council with regard to the integrated administration and control system and conditions for refusal or withdrawal of payments and administrative penalties applicable to direct payments, rural development support and cross compliance (OJ L 181, 20.6.2014, p. 48);

–Commission Implementing Regulation (EU) No 809/2014 of 17 July 2014 laying down rules for the application of Regulation (EU) No 1306/2013 of the European Parliament and of the Council with regard to the integrated administration and control system, rural development measures and cross compliance (OJ L 227, 31.7.2014, p. 69);

–Commission Delegated Regulation (EU) No 907/2014 of 11 March 2014 supplementing Regulation (EU) No 1306/2013 of the European Parliament and of the Council with regard to paying agencies and other bodies, financial management, clearance of accounts, securities and use of euro (OJ L 255, 28.8.2014, p.18);

–Commission Implementing Regulation (EU) No 908/2014 of 6 August 2014 laying down rules for the application of Regulation (EU) No 1306/2013 of the European Parliament and of the Council with regard to paying agencies and other bodies, financial management, clearance of accounts, rules on checks, securities and transparency (OJ L 255, 28.8.2014, p.59);

–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 (OJ L 347, 20.12.2013, p. 608);

–Commission Delegated Regulation (EU) No 639/2014 of 11 March 2014 supplementing Regulation (EU) No 1307/2013 of the European Parliament and of the Council establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy and amending Annex X to that Regulation (OJ L 181, 20.6.2014, p. 1);

–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 (OJ L 347, 20.12.2013, p. 671);

–Regulation (EU) No 1310/2013 of the European Parliament and of the Council of 17 December 2013 laying down certain transitional provisions on support for rural development by the European Agricultural Fund for Rural Development (EAFRD), amending Regulation (EU) No 1305/2013 of the European Parliament and of the Council as regards resources and their distribution in respect of the year 2014 and amending Council Regulation (EC) No 73/2009 and Regulations (EU) No 1307/2013, (EU) No 1306/2013 and (EU) No 1308/2013 of the European Parliament and of the Council as regards their application in the year 2014 (OJ L 347, 20.12.2013, p. 865).

11.2.Clearance of accounts

–Commission Implementing Regulation (EU) 2015/775 of 18 May 2015 amending Implementing Regulation (EU) No 908/2014 as regards conformity clearance (OJ L 122, 19.5.2015, p. 1);

–Commission Implementing Regulation (EU) 2015/2222 of 1 December 2015 amending Implementing Regulation (EU) No 908/2014 as regards declarations of expenditure, conformity clearance and the content of the annual accounts (OJ L 316, 2.12.2015, p. 2).

11.3.Public storage

(a) Basic rules

–Council Regulation (EU) No 1370/2013 of 16 December 2013 determining measures on fixing certain aids and refunds related to the common organisation of the markets in agricultural products (O.J. L 346 of 20/12/2013, p. 12);

–Regulation (EU) No 223/2014 of the European Parliament and of the Council of 11 March 2014 on the Fund for European Aid to the Most Deprived (O.J. L 72 of 12/3/2014, p 1);

–Commission Delegated Regulation (EU) No 906/2014 of 11 March 2014 supplementing Regulation (EU) No 1306/2013 of the European Parliament and of the Council with regard to public intervention expenditure (O.J. L 255 of 28/8/2014, p. 1);

–Commission Regulation (EU) No 1272/2009 of 11 December 2009 laying down common detailed rules for the implementation of Council Regulation (EC) No 1234/2007 as regards buying-in and selling of agricultural products under public intervention (OJ L349, 29/12/2009, p.1.).

(b) Depreciation on buying in

–No depreciation on buying-in was fixed for the 2015 accounting year.

–No depreciation at the end of the 2015 financial year was fixed;

(d) Uniform interest rate for reimbursing Member States' financing costs

–Commission Implementing Regulation (EU) No 1079/2014 of 14 October 2014 fixing the interest rates to be used for calculating the costs of financing intervention measures comprising buying-in, storage and disposal for the 2015 EAGF accounting year. (OJ L 297, 15/10/2014, p. 7).

(e) Standard amounts for reimbursing physical storage operations

–Commission Implementing Decision C(2014)5616 of 11 August 2014 (not published) fixing, for the 2015 financial year, the standard amounts to be used for financing physical operations arising from the public storage of agricultural products.

(f) Declaration rules

12.ANNEXES

ANNEXES

General

1. EAGF budgetary procedure for 2015

2. Part of EAGF budget in the EU budget, 2009 to 2015

Cash position and management of appropriations

3. Summary of outturn for 2015

4. Monthly reimbursements to Member States in the 2015 financial year

5. Payments under direct management by the European Commission in the 2015 financial year (Differentiated Appropriations)

6. Payments under direct management by the European Comm. in the 2015 financial year (Non-Differentiated Appropriations)

Budget outturn

7. EAGF 2015 Analysis of budget execution

8. EAGF 2015 Analysis of execution of assigned revenue C4

9. EAGF 2015 Analysis of execution of assigned revenue C5

10. EAGF 2015 Expenditure for direct aids by measure and by Member State

11. EAGF 2015 Expenditure for intervention in storage

12 EAGF 2015 Expenditure by Member State, by item and by fund source

13. EAGF 2015 Expenditure by sector according to the economic nature of the measures

14. EAGF 2015 Quantity & value of products in public intervention stores

15. Evolution of EAGF Expenditure by article of the budget. Financial years 2009 to 2015

16. Evolution of EAGF Expenditure by sector and measure. Financial years 2009 to 2015

17. Evolution of EAGF Expenditure by sector and in % terms. Financial years 2009 to 2015

18. Evolution of EAGF Expenditure by Member State & in % terms. Financial years 2009 to 2015

19. Evolution of EAGF Direct aids expenditure by measure. Financial years 2009 to 2015

20. Evolution of EAGF Direct aids expenditure by sector. Financial years 2009 to 2015

21. Evolution of EAGF Direct aids expenditure by article of budget. Financial years 2009 to 2015

22. Evolution of EAGF Export refunds expenditure by sector. Financial years 2009 to 2015

23. Evolution of EAGF Export refunds expenditure by Member State. Financial years 2009 to 2015

24. Evolution of EAGF Storage expenditure. Analytical table. Financial years 2008 to 2015

25. Evolution of the breakdown of EAGF expenditure. Financial years 2009 to 2015

Clearance of accounts

26. Appeals against Clearance of Accounts Decisions pending on 15 October 2015

27. Financial corrections (Decisions 1 - 48) by decision and financial year

(1) This procedure is presented in annex 1.

(2) OJ L 108 of 11.4.2014, p. 13.

(3) These amounts are not entered in the revenue lines of the budget (article 670 for the revenue assigned to the EAGF), which mention "p.m." ("pour mémoire"), but the forecast amount is mentioned in the budgetary remarks for this article.

(4) OJ L 347 of 20.12.2013, p. 549.

(5) p.m.: "pour mémoire".

(6) These monthly declarations of expenditure are transmitted by the Member States by the declaration of the 12th of the month N+1.

(7) These appropriations may be carried over, in accordance with Article 169(3) of the Financial Regulation (EU, Euratom) No 966/2012, and in accordance with Article 26(5) of Regulation (EU) No 1306/2013, Member States shall reimburse the final recipients who are subject, in the financial year to which the appropriations are carried over, to the application of financial discipline in accordance with Article 26, paragraphs (1) to (4) thereof.

(8) OJ L 255, 28.8.2014, p.18

(9) OJ L 255, 28.8.2014, p.59

(10) OJ L 122, 19.5.2015, p. 1

(11) OJ L 347, 20.12.2013, p.608

(12) OJ L 181, 20.6.2014, p. 1

(13) OJ L 181, 20.6.2014, p.48

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