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Minister Coughlan announces arrangement for transfer of Single Payment Entitlements (including Trade for 2006)

The Minister for Agriculture and Food, Mary Coughlan T.D., today announced that the application form for the transfer of entitlements in respect of the 2006 Single Payment Scheme is now available on her Departments website www.agriculture.ie.

The Minister said that the application form caters for the transfer of entitlements with and without land.

As well as covering transactions involving the sale, lease and rent of entitlements the application form also covers transactions involving the gifting of entitlements to family members and the transfer of entitlements by way of inheritance.

Insofar as the selling of entitlements without land is concerned the EU Regulations provide that entitlements may only be sold without land when at least 80% have been "used" in one calendar year or alternatively when the applicant agreed to surrender all unused entitlements to the National Reserve. Farmers who may be considering selling all or some of their entitlements without land should first of all ensure that they have used at least 80% of those entitlements in 2005. The term "used" in this context means that at least 80% of the number of eligible hectares required for payment were declared on the 2005 Single Payment application form.

Farmers who are considering renting or leasing out some entitlements for 2006 should remember that the leased or rented out entitlements must be accompanied by an equivalent number of eligible hectares.

On 21 December last the Minister announced details of the claw-back arrangements for the trading of entitlements. The levels of claw-back that will be applied to the selected transactions are as follows:

  • Sales of entitlements without lands - 30% (maximum provided for in EU Regulation is 50%);
  • Sales of entitlements with lands where part of the holding is sold - 5% (maximum 10%);
  • Sales of entitlements with an entire holding 2.5% (maximum 5%).

The Minister said that a claw-back would not apply in the following circumstances:

  • transfer of entitlements (with or without lands) by way of gift (within families) or inheritance;
  • lease of entitlements with land;
  • rental agreements in respect of entitlements with land;
  • sale of entitlements (with or without lands) to new entrants to farming who satisfy certain objective criteria including age, income and educational qualifications.

In addition, the Minister said that no claw-back would be applied in the case of a farmer selling entitlements without land where the person concerned had insufficient land to use all of his/her entitlements in 2005 but where he/she was able to use at least 80% of the entitlements and did not apply to have the entitlements consolidated.

The Minister said she appreciated that some trading transactions may have taken place before her announcement of the claw-back arrangements on 21 December last. She has decided therefore that the claw-back arrangements announced on that date will only be applicable to trading transactions with an effective date after 21 December 2005.

Finally, the Minister said that under the EU Regulations farmers are free to transfer payment entitlements at any time of the year but the transferor must seek her Department's approval for the transfer 6 weeks in advance of the proposed transaction. However the entitlements must remain assigned to the transferor until such time as payment under the Single Payment Scheme has been made for the year in question following which they will be assigned to the transferee in respect of the following Scheme year. It was not possible to apply the 6 week rule in the first year of operation of Single Payment Scheme but these revised arrangements will be introduced for entitlements being transferred in respect of the 2007 and subsequent scheme years.

15 February, 2006

Date Released: 15 February 2006