Reduction in the number of allowances and not in their value for transfers
With a reduction in the number of rights and not in their value, transfers without land should be made to Greece, according to the Commission’s comments on the CAP’s strategic plans.
Ability to cover rights from transfers with other land so as not to lose 25% of their value
As the Commission notes in its document, it is not possible for member states that will follow a convergence model to reduce the value of the allowances transferred as they will then automatically go to the average. Therefore, the penalty that the Member States wish to impose is annulled by the convergence regulation. Therefore, in case of transfers without land, our country should think of another way of “punishment” and this, as the Commission proposes, may be to reduce their number. What does this mean in simple terms:
For example, a holder of 5 rights worth 300 euros wants to proceed to a transfer without land. With the model originally provided for in its strategic plan, Greece will transfer all 5 allowances but with 25% of their value reduced. So in the hands of the producer who buys them will reach 5 rights corresponding to 50 acres, worth 225 euros. Total aid i.e. EUR 1 125. With the model proposed by the Commission now, they can reach the producer instead of 5 allowances, four. Therefore, their value will be 1,200 euros (4 out of 300 the initial value). In addition, the producer will remain with 10 acres “bare” of royalties. Obviously the example is illustrative and it is not known how Greece will deal with this observation.
Read more HERE