SECTION 1 — Dismantling of ginning facilities
Scope
1. Full and permanent dismantling of ginning facilities as referred to in Article 7(1)(a) of Regulation (EC) No 637/2008 shall require:
(a)
the definitive and total cessation of the ginning of cotton in the factory or factories concerned;
(b)
the dismantling of all ginning equipment thereof, and the removal of the ginning equipment from the site or sites, within one year of the approval of the application by the Member State;
(c)
the definitive exclusion of the ginning equipment from cotton processing in the Community, by:
(i)
removal of equipment to a third country;
(ii)
guaranteed application of equipment in another sector; or
(iii)
destruction of equipment;
(d)
the restoring of the good environmental conditions of the factory site or sites and the facilitation of redeployment of the workforce; and
(e)
the written commitment not to use the production site or sites for the ginning of cotton during a period of 10 years.
Ginning equipment means all specific equipment used for the transformation of unginned cotton into ginned cotton and its by-products, including feeders, dryers, cleaners, stick machines, gins, condensers, lint cleaners and bale presses.
2. Member States may impose additional requirements with regard to dismantling as referred to in paragraph 1.
3. The ginning facilities referred to in paragraph 1 need to be in good working condition for an application to be eligible.
4. Factory buildings and sites may continue to be used for activities unrelated to cotton production, processing or trade.
Community contribution
1. Member States shall decide, on the basis of objective and non-discriminatory criteria, the amount of aid to be granted under the measure referred to in Article 10.
2. The aid per ginning factory shall be limited to a maximum amount of EUR 100 per tonne of unginned cotton for the quantity of cotton processed in that factory, which has been eligible for support under Chapter V of Council Regulation (EC) No 1051/2001 ( 6 ) , in the marketing year 2005/06.
SECTION 2 — Investments in the ginning industry
Scope
Support for the measure referred to in Article 7(1)(b) of Regulation (EC) No 637/2008 shall be granted for tangible or intangible investments which improve the overall performance of the enterprise and concern:
(a)
the processing and/or marketing of cotton; and/or
(b)
the development of new processes and technologies linked to cotton.
Eligible expenditure
1. The supported investments shall respect the Community standards applicable to the investment concerned.
2. Eligible expenditure shall be:
(a)
the improvement of immovable property;
(b)
the purchase or lease purchase of new machinery and equipment, including computer software up to the market value of the asset, and excluding other costs connected with the leasing contract, such as lessor’s margin, interest refinancing costs, overheads and insurance charges;
(c)
general costs linked to expenditure referred to in points (a) and (b), such as fees of architects and engineers and consultation fees, feasibility studies, the acquisition of patent rights and licences.
3. Costs for the development of new processes and technologies as referred to in Article 12 shall concern preparatory operations, such as design, process or technology development and tests and tangible and/or intangible investments related to them, before the use of the newly developed processes and technologies for commercial purposes.
4. Simple replacement investments shall not be eligible expenditure.
Community contribution
1. The Community contribution for support referred to in Article 12 shall be limited to the following maximum aid rates:
(a)
50 % in regions classified as convergence regions in accordance with Council Regulation (EC) No 1083/2006 ( 7 ) ;
(b)
40 % in regions other than convergence regions.
2. Support shall not be granted to the firms in difficulty within the meaning of Section 2.1 of the Community guidelines on State aid for rescuing and restructuring firms in difficulty ( 8 ) .
3. Article 72 of Council Regulation (EC) No 1698/2005 ( 9 ) shall apply mutatis mutandis to support referred to in Article 12.
SECTION 3 — Participation of farmers in cotton quality schemes
Scope
Support for the measure referred to in Article 7(1)(c) of Regulation (EC) No 637/2008 shall:
(a)
be granted for Community quality schemes for cotton established under Council Regulation (EC) No 834/2007 ( 10 ) , or Council Regulation (EC) No 510/2006 ( 11 ) , or quality schemes recognised by the Member States;
(b)
be granted as an annual incentive payment whose level shall be determined according to the level of the fixed costs arising from participation in supported schemes, for a maximum duration of four years.
Schemes whose sole purpose is to provide a higher level of control of respect of obligatory standards under Community or national law shall not be eligible for support under this section.
Eligibility criteria
1. To be eligible for support, quality schemes recognised by Member States, as referred to in point (a) of the first subparagraph of Article 15, shall comply with the following criteria:
(a)
the specificity of the final product under such schemes shall be derived from detailed obligations on farming and processing methods that guarantee:
(i)
specific characteristics including the production process; or
(ii)
a quality of the final product that goes significantly beyond the commercial commodity standards as regards plant health or environmental protection;
(b)
the schemes involve binding product specifications and compliance with those specifications shall be verified by an independent inspection body;
(c)
the schemes shall be open to all producers;
(d)
the schemes shall be transparent and assure complete traceability of the products;
(e)
the schemes shall respond to current and foreseeable market opportunities.
2. Support may be granted to farmers participating in a quality scheme only if the quality product has been officially recognised under the Regulations and provisions of the Community schemes or quality schemes recognised by a Member State, as provided for in point (a) of the first subparagraph of Article 15.
As regards the quality schemes established under Regulation (EC) No 510/2006, support may only be granted in respect of names registered in the Community register.
3. Where support for participation in a quality scheme under Regulation (EC) No 834/2007 is included in a restructuring programme, the fixed costs resulting from the participation in that quality scheme shall not be taken into account in calculating the amount of support in the framework of an agri-environment measure to support organic farming.
4. For the purpose of point (b) of the first subparagraph of Article 15, ‘fixed costs’ means the costs incurred for entering a supported quality scheme and the annual contribution for participating in that scheme, including, where necessary, expenditure on checks required to verify compliance with the specifications of the scheme.
Community contribution
Support for the measure referred to in Article 15 shall be limited to a maximum amount of EUR 3 000 per holding per year.
SECTION 4 — Information and promotion
Scope
1. Support for the measure referred to in Article 7(1)(d) of Regulation (EC) No 637/2008 shall concern cotton covered by the quality schemes referred to in Article 15 and products mainly produced with this cotton.
2. Information and promotion activities supported under Regulation (EC) No 3/2008 shall not qualify for support.
Eligible activities
1. The information and promotion activities eligible for support shall be activities designed to induce consumers to buy cotton covered by quality schemes included in Article 15, or products mainly produced with this cotton.
Such activities shall draw attention to the specific features or advantages of the products concerned, notably the quality, specific production methods, and respect for the environment linked to the quality scheme concerned, and may include the dissemination of scientific and technical knowledge about those products. Such activities shall include, in particular, the organisation of, and/or participation in, fairs and exhibitions, similar public relations exercises and advertising via the different channels of communication or at the points of sale.
2. Only information, promotion and advertising activities in the internal market shall be eligible for support.
Such activities shall not incite consumers to buy a product due to its particular origin, except for products covered by the quality scheme introduced by Regulation (EC) No 510/2006. The origin of a product may nevertheless be indicated provided the mention of the origin is subordinate to the main message.
Activities related to the promotion of commercial brands shall not be eligible for support.
3. When activities referred to in paragraph 1 concern a product included in the Community quality schemes established under Regulation (EC) No 834/2007 or Regulation (EC) No 510/2006, the Community logo provided for under those schemes shall appear on information, promotion and/or advertising material.
4. The Member States shall ensure that all draft information, promotion and advertising materials drawn up in the context of a supported activity comply with Community legislation. To that end, beneficiaries shall transmit such draft materials to the competent authority of the Member State.
Community contribution
Support for the measure referred to in Article 18 shall be limited to 70 % of the cost of the activity.
SECTION 5 — Aid to machinery contractors
Scope
Aid for the measure referred to in Article 7(1)(e) of Regulation (EC) No 637/2008 shall be granted on the basis of objective and non-discriminatory criteria, for the losses incurred including the loss of value of specialised harvest machinery, which can not be used for other purposes.
Community contribution
1. Member States shall determine the level of aid to be granted under the measure referred to in Article 21. This aid shall not exceed the losses incurred and shall be limited to a maximum amount of EUR 10 per tonne for the quantity of unginned cotton harvested under contract in the marketing year 2005/06, that was delivered to a ginning factory subject to dismantling as provided for in Article 10.
2. Member States shall ensure the beneficiaries of the support comply with the criteria listed in Article 7(2)(d) of Regulation (EC) No 637/2008.
Source: EUR-Lex (Publications Office of the EU), © European Union, reuse permitted under Commission Decision 2011/833/EU.
