The mechanism was adopted in March 2022 after Russia’s invasion of Ukraine, which caused the costs of energy and fertilizers to soar, of which the two countries at war were major producers.
This “temporary crisis framework” allowed Member States, until the end of June 2024, to grant up to 280,000 euros in public aid to agricultural businesses affected by the crisis, as well as up to 335,000 euros for agricultural businesses. fisheries and aquaculture sector — a clear relaxation of the EU’s strict state aid rules.
Strong demand from the 27
From now on, States will have until December 31, 2024, if they wish, to distribute this aid to affected agricultural operations. The level of the aid ceilings does not change, but this six-month period “gives more time to implement support measures if necessary”, explains the European executive.
This was a strong demand from the Twenty-Seven, faced since January with the anger of the agricultural sector – particularly fueled by imports of Ukrainian cereals and products exempt from customs duties.
Meeting in Luxembourg on Monday, the Ministers of Agriculture from around fifteen Member States, including France and Germany, also called on the Commission to increase the maximum level of public aid that a country can grant. to an agricultural operation without formal notification or prior green light from Brussels.
Financing requiring details
According to legislation amended in 2019, Member States can allocate up to 20,000 euros – or even 25,000 euros under certain conditions – in public subsidies (apart from European CAP funds) to an agricultural operation over a period of three years without having to inform the Commission, guardian of competition.
Beyond that, they must detail this financing to Brussels, which may possibly oppose it. These fifteen states wish to raise this ceiling to 50,000 euros per farm over three years. The Commission confirmed on Thursday that it would “launch a review” of the regulation on this so-called “de minimis” agricultural aid, “in light of the inflationary pressures of recent years and the high prices of raw materials affecting the agricultural sector”.
On the other hand, other temporary public aid mechanisms, adopted following the war in Ukraine to support other affected sectors (industries, etc.) or to compensate for the surge in energy prices, will end in June as expected. “Temporary state aid instruments must be limited to responding to specific needs linked to the crisis,” warned Commission Vice-President Margrethe Vestager.