Article 1
Open ↗Regulation (EU) No 702/2014 is amended as follows: (1) in Article 1(5), points (a) and (b) are replaced by the following: ‘(a) aid schemes which do not explicitly exclude the payment of individual aid in favour of an undertaking which is subject to an outstanding recovery order following a previous Commission decision declaring an aid granted by the same Member State illegal and incompatible with the internal market; (b) ad hoc aid to an undertaking referred to in point (a)’; (2) in Article 6(5), the following point (j) is added: ‘(j) aid for the participation of active farmers in quality schemes for cotton and foodstuffs where the conditions laid down in Article 48 are fulfilled’; (3) Article 32 is amended as follows: (a) in paragraph 8, in the first subparagraph, the introductory wording is replaced by the following: ‘Save where support is provided in the form of financial instruments, aid for afforestation and the creation of woodland related to investment operations shall cover the following eligible costs:’; (b) in paragraph 9, the following second subparagraph is added: ‘The first subparagraph shall not apply to aid which is granted in the form of financial instruments.’; (4) Article 33 is amended as follows: (a) in paragraph 4, the first subparagraph is replaced by the following: ‘The aid for agroforestry systems shall cover the costs of establishment, regeneration or renovation and an annual premium per hectare.’; (b) in paragraph 5, in the first subparagraph, the introductory wording is replaced by the following: ‘Save where support is provided in the form of financial instruments, the aid for agroforestry systems related to investment operations shall cover the following eligible costs:’; (c) in paragraph 6, the following second subparagraph is added: ‘The first subparagraph shall not apply to aid which is provided in the form of financial instruments.’; (d) paragraph 7 is replaced by the following: ‘7. The following costs for establishment, regeneration or renovation of the agroforestry system may be eligible: (a) the costs for planting trees, including the costs of the plantation material, the plantation, the storing and the treatments of seedlings with the necessary prevention and protection materials; (b) the costs for converting existing forests or other wooded land, including the costs for felling trees, thinning and pruning and protection against grazing animals; (c) other costs directly linked to the establishment, regeneration or renovation of an agroforestry system, such as costs for feasibility studies, establishment plan, soil examination, soil preparation and protection; (d) the costs of silvopastoral, namely, grazing system watering and protective facilities; (e) the costs of the necessary treatment connected to the establishment, regeneration or renovation of an agroforestry system, including watering and cutting; (f) the costs for replanting during the first year after the establishment, regeneration or renovation of an agroforestry system.’; (e) in paragraph 9, the introductory wording is replaced by the following: ‘Member States shall determine the minimum and maximum number of trees per hectare, taking account of the following:’; (f) in paragraph 11, point (a) is replaced by the following: ‘(a) 80 % of the eligible costs for investment operations and of the costs for establishment, regeneration or renovation referred to in paragraphs 5 and 7; and’; (5) Article 35 is amended as follows: (a) in paragraph 5, the following second subparagraph is added: ‘The first subparagraph shall not apply to aid which is provided in the form of financial instruments.’; (b) in paragraph 6, in the first subparagraph, the introductory wording is replaced by the following: ‘Save where support is provided in the form of financial instruments, the aid shall cover the following eligible costs:’; (c) in paragraph 7, the first subparagraph is replaced by the following: ‘Save where support is provided in the form of financial instruments, costs other than those referred to in paragraph 6(a) and (b) connected with leasing contracts, such as lessor's margin, interest refinancing costs, overheads and insurance charges shall not be considered to be eligible costs.’; (6) Article 38(2) is amended as follows: (a) in the first subparagraph, the following second sentence is added: ‘Infrastructure installed as a result of demonstration may be used after the operation is completed.’; (b) the following fourth subparagraph is added: ‘Aid for demonstration projects which is co-financed under the EAFRD or granted as additional national financing to such aid, and which is provided in the form of financial instruments, may cover eligible costs other than those referred to in paragraph 3(b), provided that the costs are fully eligible under Regulation (EU) No 1305/2013 and that the aid is identical to the underlying measure included in the rural development programme approved under that Regulation.’; (7) in Article 39(4), the following third subparagraph is added: ‘Aid which is co-financed under the EAFRD, or granted as additional national financing to such co-financed aid, may be paid to the Managing Authority referred to in point (a) of Article 65(2) of Regulation (EU) No 1305/2013.’; (8) Article 40 is amended as follows: (a) in paragraph 4, the following second subparagraph is added: ‘The first subparagraph shall not apply to aid which is provided in the form of financial instruments.’; (b) in paragraph 6, the introductory wording is replaced by the following: ‘Save where support is provided in the form of financial instruments, the aid shall cover the following eligible costs:’; (c) in paragraph 7, the first subparagraph is replaced by the following: ‘Save where support is provided in the form of financial instruments, costs other than those referred to in paragraph 6(a) and (b) connected with leasing contracts, such as lessor's margin, interest refinancing costs, overheads and insurance charges shall not be considered to be eligible costs.’; (9) Article 41 is amended as follows: (a) in paragraph 4, the following second subparagraph is added: ‘The first subparagraph shall not apply to aid which is provided in the form of financial instruments.’; (b) in paragraph 6, the introductory wording is replaced by the following: ‘Save where support is provided in the form of financial instruments, the aid shall cover the following eligible costs:’; (c) in paragraph 7, the first subparagraph is replaced by the following: ‘Save where support is provided in the form of financial instruments, costs other than those referred to in paragraph 6(a) and (b) connected with leasing contracts, such as lessor's margin, interest refinancing costs, overheads and insurance charges shall not be considered to be eligible costs.’; (d) in paragraph 9, the second, third and fourth subparagraphs are replaced by the following: ‘Save where support is provided in the form of financial instruments, the following conditions shall apply: (a) the investments in renewable energy infrastructure that consume or produce energy shall comply with minimum standards for energy efficiency for, where such standards exist at national level; (b) investments in installations, the primary purpose of which is electricity production from biomass, shall not be eligible for aid unless a minimum percentage of heat energy, to be determined by the Member States, is utilised; (c) aid to bioenergy investment projects shall be limited to bioenergy meeting the applicable sustainability criteria laid down in Union legislation, including in Article 17(2) to (6) of Directive 2009/28/EC.’; (10) Article 44 is amended as follows: (a) in paragraph 5, the following second subparagraph is added: ‘The first subparagraph shall not apply to aid which is provided in the form of financial instruments.’; (b) in paragraph 7, the introductory wording is replaced by the following: ‘Save where support is provided in the form of financial instruments, the aid shall cover the following eligible costs:’; (c) in paragraph 8, the first subparagraph is replaced by the following: ‘Save where support is provided in the form of financial instruments, costs other than those referred to in paragraph 7(a) and (b) connected with leasing contracts, such as lessor's margin, interest refinancing costs, overheads and insurance charges shall not be considered to be eligible costs.’; (11) Article 45 is amended as follows: (a) in paragraph 6, the following third subparagraph is added: ‘The business plan shall have a maximum duration of five years.’; (b) in paragraph 7, the first paragraph is replaced by the following: ‘The aid shall be paid in at least two instalments.’; (12) in Article 46(5), the second sentence is replaced by the following: ‘The aid shall be paid to the provider of the advisory services or to the Managing Authority referred to in point (a) of Article 65(2) of Regulation (EU) No 1305/2013.’; (13) Article 47(3) is amended as follows: (a) in the first subparagraph, the following second sentence is added: ‘Infrastructure installed as a result of demonstration may be used after the operation is completed.’; (b) the following third subparagraph is added: ‘Aid for demonstration projects which is provided in the form of financial instruments may cover other eligible costs than those referred to in point (b) of paragraph 4, provided that the costs are fully eligible under Regulation (EU) No 1305/2013.’; (14) Article 48 is amended as follows: (a) paragraph 1 is replaced by the following: ‘1. Aid for new participation, or participation in the five preceding years, of active farmers and groups of farmers that operate as SMEs, in quality schemes for cotton and foodstuffs shall be compatible with the internal market within the meaning of Article 107(3)(c) of the Treaty and shall be exempted from the notification requirement of Article 108(3) thereof where it fulfils the conditions laid down in paragraphs 2 to 7 of this Article and in Chapter I of this Regulation.’; (b) in paragraph 6, the following second subparagraph is added: ‘If the initial participation in the quality scheme started before the application for support, the maximum period of five years shall be reduced by the number of years which have elapsed between that initial participation and the time of the application for support.’.