After article 5 of the principal Orders set out in Part II of the Schedule there shall be inserted–
Penalty in the event of breach of agreement
(5A) In the event of breach of an agreement, the Secretary of State may, by way of penalty imposed by virtue of Article 20(2) (reimbursement of aid and penalties) of the Commission Regulation, withhold from or, as the case may be, require the crofter, farmer or common grazings committee to pay an amount not exceeding 10% of the aid payable, including any amount already paid, to the crofter, farmer or common grazings committee in respect of that agreement in addition to withholding or, as the case may be, recovering such aid.
Recovery of interest
(5B)
(1) Where by virtue of Article 11 of the Commission Regulation a crofter, farmer or common grazings committee is required to reimburse in accordance with Article 20(1) of the Commission Regulation the aid paid under an agreement, the rate of interest shall be that provided in paragraph (2).
(2) Where a crofter, farmer or common grazings committee is by virtue of Article 20(1) of the Commission Regulation required to reimburse the amount of a wrongful payment with interest for the period between payment and the reimbursement, the rate of interest shall be one percentage point above the sterling three month London interbank offered rate applicable during the period.