EC greenlights aid for UK farmers

The European Commission has authorised a temporary scheme granting aid of up to EUR 15,000 to British farmers.. Aid under this scheme can be granted until 31 December 2010 and will take the form of a direct grant.

The European Commission authorised the UK scheme with a budget of approximately £20 million (€22.3 million) which aims at supporting farmers who get into difficulties as a result of the current economic crisis. Aid under this scheme can be granted until 31 December 2010 and will take the form of a direct grant.

This scheme is a further application of the Commission's Temporary Framework for State aid measures to support access to finance in the current financial and economic crisis, as amended end of October 2009 in order to allow Member States to grant limited amounts of aid to primary agricultural producers.

The scheme is open to farmers in all sub-sectors of primary agricultural production, provided they were not already in difficulty on 1 July 2008 (i.e. before the beginning of the crisis). It is limited in time until 31 December 2010 and complements other crisis measures already put in place by the UK authorities in application of the Temporary Crisis Framework.

The scheme provides aid in the form of direct grant, interest rate subsidy, loan with an aid element and guarantee. The approved scheme is UK-wide, allowing aid to be granted at country, regional and local level and is applied in a decentralised way by all relevant aid awarding authorities.

The new UK scheme meets all the conditions of the Temporary Crisis Framework as amended. In particular, the UK authorities demonstrated that it is necessary, proportional and appropriate to remedy a serious disturbance in the economy. The Commission therefore considered that the scheme can be approved under Article 107(3)(b) of the Treaty on the Functioning of the European Union (former Article 87(3)(b) of the EC Treaty).