These Regulations, which replace the Less Favoured Area Support Scheme (Scotland) Regulations 2002, make provision for the purposes of implementation of Council Regulation (EC) No. 1257/1999 on support for rural development from the European Agricultural Guidance and Guarantee Fund and Commission Regulation (EC) No. 445/2002 laying down detailed rules for the application of Council Regulation No. 1257/1999.

They apply to holdings in respect of which the Scottish Ministers are the competent authority under the Integrated Administration and Control System Regulations 1993 (regulation 1(2)).

Applications for less favoured area support (“LFAS”) are to be made to the Scottish Ministers on a date which they shall determine each year. Failure to meet the deadline will result in reduction of the payment of support (regulation 3).

Eligibility for payment of LFAS is dependent upon the applicant meeting the criteria set out in regulation 4. It can only be paid to an applicant who carries out an eligible agricultural activity (defined in regulation 2(1)) on eligible land (defined in regulation 6). No payment will be made where the amount of eligible land is less than 3 hectares (regulation 5). There is provision at regulation 7 to determine to whom payment should be made where a holding is transferred during a Scheme Year.

LFAS is paid for eligible hectares on farms in Scottish less favoured areas at specified rates (regulations 8 and 12). The rate is fixed according to the fragility of the parish in which the applicant’s main farm lies (regulation 12 and Schedule 6). The area of land on which LFAS is paid is normally the area of eligible land which the applicant has, adjusted in accordance with a formula set out in regulation 9(1). The manner in which the area of eligible land is adjusted will depend on the grazing category of that land (regulation 9(2)). The grazing category is allocated according to the stocking density of the applicant’s land (regulation 9(3)). The manner of calculating the stocking density for different types of land is set out in regulation 9(4) to 9(12). However, where the applicant has a stocking density which falls above the maximum stocking density or below the minimum stocking density, then the area of land on which LFAS is to be paid is instead calculated in accordance with formulae set out in regulation 10. The maximum and minimum stocking densities are laid out in regulation 2. There is provision at regulation 10 (4) to allow Scottish Ministers to determine the total number of livestock units where an applicant has not been able to achieve the minimum stocking density because of slaughter in consequence of foot and mouth disease.

Where more than 10% of the applicant’s livestock units are made up of cattle, the area of land on which LFAS will be paid will be increased in accordance with the adjustment set out in regulation 11 and Schedule 4.

There are transitional arrangements for payments in 2003 (regulation 13). LFAS may be increased if an applicant is due to receive less under these Regulations when compared with a figure of 50% of any payment paid under the 1999 Regulations. In all cases, LFAS is subject to a minimum payment of £350 (regulation 14). There is also provision to reduce the payment to be paid under the transitional provisions where the forage area of the holding was reduced by more than 25% during any of the calendar years 2000, 2001 or 2002. For the 2003 payment, where an applicant has increased the amount of eligible land since being paid under the 1999 Regulations the Scottish Ministers will fix the amount of the 1999 payment for the purposes of calculations in regulation 13.

Regulation 15 contains powers of enforcement. Regulation 17 provides for withholding or recovery of LFAS where there is a breach of the rules of the Scheme. Regulations 20 to 23 deal with offences and penalties.

Regulations 24 to 26 deal with an applicant’s right of appeal against decisions taken by the Scottish Ministers. Regulation 27 makes consequential amendments to the Agricultural Subsidies (Appeals) (Scotland) Regulations 2000.