The Less Favoured Area Support Scheme (Scotland) Regulations 2005

Citation, commencement and application

1.—(1) These Regulations may be cited as the Less Favoured Area Support Scheme (Scotland) Regulations 2005 and shall come into force on 2nd December 2005.

(2) These Regulations apply to holdings in respect of which the Scottish Ministers are the competent authority, in accordance with the Common Agricultural Policy Single Payment and Support Schemes (Integrated Administration and Control System) Regulations 2005(1).

Interpretation

2.—(1) In these Regulations, unless the context otherwise requires–

“agricultural” includes the use of land–

(a)

for the purposes of horticulture, fruit growing, seed growing, dairy farming and livestock breeding and keeping;

(b)

as grazing land, meadow land, osier land, market gardens and nursery grounds; and

(c)

for woodlands, where that use is ancillary to the use of land for other agricultural purposes;

“alpaca” means any alpaca of any breed which are kept by way of business for the primary purpose of fibre production;

“animal” means any animal (including fish, reptiles or amphibians) bred or kept for the production of food, wool, skin or fur or for other farming purposes;

“applicant” means a person who has made an application for less favoured area support under these Regulations in accordance with regulation 3;

“area aid application” has the same meaning as in Article 6 of Council Regulation 3508/1992;

“authorised person” means a person who is authorised by the Scottish Ministers, either generally or specifically, to act in relation to matters arising under these Regulations;

“cattle” for the purposes of regulation 11 (enterprise mix), means–

(a)

suckler cows and heifers; and

(b)

for those applicants maintaining a dairy herd in the islands of Shetland, the islands of Orkney, the islands of Islay, Jura, Arran, Bute, Great Cumbrae, Little Cumbrae and the Kintyre Peninsula south of Tarbert, any other islands in the Outer Hebrides and the Inner Hebrides, or part of the Cowal peninsula as defined in Schedule 10, a livestock unit for each 5730 litres of milk quota held,

which the Scottish Ministers determine are to be taken into account from time to time;

“CLOPS” means cereals, linseed, oils and proteins corresponding to the types and use codes detailed in Schedule 4;

“Commission Regulation 796/2004” means Commission Regulation (EC) No. 796/2004 laying down detailed rules for the implementation of cross-compliance, modulation and the integrated administration and control system provided for in Council Regulation (EC) No. 1782/2003 establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmers(2) ;

“Commission Regulation 817/2004” means Commission Regulation (EC) No. 817/2004 laying down detailed rules for the application of Council Regulation (EC) No. 1257/1999 on support for rural development from the European Agricultural Guidance and Guarantee Fund (EAGGF);

“common grazing” has the same meaning as it has for the purpose of Article 11 of Commission Regulation 817/2004;

“competent authority” has the same meaning as in regulation 5 of the Common Agricultural Policy Single Payment and Support Schemes (Integrated Administration and Control System) Regulations 2005;

“Council Regulation 3508/1992” means Council Regulation (EEC) No. 3508/1992 establishing an Integrated Administration and Control System for certain Community aid schemes(3);

“Council Regulation 1782/2003” means Council Regulation (EC) No. 1782/2003 establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmers(4);

“Council Regulation 1257/1999” means Council Regulation (EC) No. 1257/1999 on support for rural development from the European Agricultural Guidance and Guarantee Fund (EAGGF) and amending and repealing certain Regulations(5);

“cross-border holding” means a holding in the United Kingdom which is situated partly in Scotland;

“designated maps” means the four maps numbered 1 to 4, each such map being marked “Map of less-favoured farming areas in Scotland”, dated 5th May 1991, signed by the Secretary of State for Scotland and deposited at the offices of the Scottish Executive Environment and Rural Affairs Department, Pentland House, 47 Robb’s Loan, Edinburgh EH14 1TY;

“eligible agricultural activity” means one or more of the following activities which, in the opinion of the Scottish Ministers are undertaken for a period or periods totalling not less than 183 days in the 2005 calendar year;–

(a)

maintaining a herd of suckler cows;

(b)

maintaining a flock of sheep comprising females of the ovine species which have lambed at least once or are at least 1 year old by 15th May in the Scheme year;

(c)

maintaining a dairy herd in–

(i)

the islands of Shetland;

(ii)

the islands of Orkney;

(iii)

the islands of Islay, Jura, Arran, Bute, Great Cumbrae, Little Cumbrae and the Kintyre Peninsula south of Tarbert;

(iv)

any other islands in the Outer Hebrides and the Inner Hebrides; or

(v)

part of the Cowal peninsula as defined in Schedule 10;

(d)

maintaining a breeding herd of farmed deer for meat production;

(e)

maintaining a breeding herd of goats for fibre production;

(f)

maintaining a breeding herd of alpaca for fibre production; or

(g)

maintaining a breeding herd of llamas for fibre production;

“eligible land” has the same meaning as in regulation 6;

“eligible livestock unit” means a livestock unit determined in accordance with regulation 10(4) and Part I of Schedule 1;

“farmed deer” means any deer (of any species) which are managed on a holding enclosed by a deer-proof barrier and are kept on the holding by way of business for the primary purpose of the production of meat;

“forage area” has the same meaning as in Article 131(2)(b) of Council Regulation 1782/2003;

“goat” means any goat (of any species) which is kept by way of business for the primary purpose of fibre production;

“holding” has the same meaning as in Article 2(b) of Council Regulation 1782/2003;

“less favoured area” means the land shown coloured in blue or in pink on the designated maps–

(a)

which is situated in an area included in the list of less favoured farming areas adopted by Council Directive 84/169/EEC concerning the Community list of less-favoured farming areas within the meaning of Article 21 of Council Regulation (EC) No. 950/97(6); and

(b)

which is, in the opinion of the Scottish Ministers, inherently suitable for extensive livestock production but not for the production of crops in quantity materially greater than that necessary to feed such livestock as are capable of being maintained on such land, and whose agricultural production is, in the opinion of the Scottish Ministers, restricted in its range by, or any combination of, soil, relief, aspect or climate;

“livestock” means suckler cow, dairy cow, beef heifer, dairy heifer, sheep, goat, farmed deer, alpaca and llama;

“livestock unit” means a unit of measurement of livestock numbers, and each of the following constitute one livestock unit:–

(a)

one suckler cow;

(b)

1.66 heifers 8 months and over;

(c)

6.66 breeding ewes;

(d)

6.66 breeding female goats;

(e)

3.33 breeding female farmed deer 27 months and over;

(f)

5 breeding female farmed deer over 6 months but less than 27 months;

(g)

3.33 breeding female alpaca;

(h)

5730 litres of milk quota;

(i)

3.33 breeding female llamas;

“llama” means any llama of any breed which is kept by way of business for the primary purpose of fibre production;

“maximum stocking density” means 1.40 livestock units per hectare;

“minimum stocking density” means 0.12 livestock units per hectare;

“payable area” means the adjusted area of land on which less favoured area support is to be paid, calculated in accordance with regulation 9 and, where appropriate, regulation 11;

“rough grazings and other semi-natural areas” means land containing semi-natural vegetation including heathland, heather moorland, bog, unimproved grassland and rough grassland which is used or suitable for grazing;

“Scheme Year” means a calendar year commencing on 1st January;

“Scheme 2005 payment” means the sum to which the applicant is entitled in respect of the period from 1st January 2004 to 31st December 2004;

“Scheme 2006 payment” means the sum to which the applicant is entitled in respect of the period from 1st January 2005 to 31st December 2005;

“shared grazing” means land used for grazing within a field used by two or more producers;

“Sheep Annual Premium Scheme” means the Sheep Annual Premium Regulations 1992(7);

“single application” has the same meaning as in Article 2(11) of Commission Regulation 796/2004;

“suckler cow” means an adult female bovine animal kept in a regular breeding herd which is not maintained primarily for the production of milk;

“Suckler Cow Premium Scheme” means the Suckler Cow Premium (Scotland) Regulations 2001(8);

“the 1996 Regulations” means the Hill Livestock (Compensatory Allowances) Regulations 1996(9);

“the 1999 Regulations” means the Hill Livestock (Compensatory Allowances) (Scotland) Regulations 1999(10);

“the 2001 Regulations” means the Less Favoured Area Support Scheme (Scotland) Regulations 2001(11);

“the 2002 Regulations” means the Less Favoured Area Support Scheme (Scotland) Regulations 2002(12);

“the 2003 Regulations” means the Less Favoured Area Support Scheme (Scotland) Regulations 2003(13);

“the 2004 Regulations” means the Less Favoured Area Support Scheme (Scotland) Regulations 2004(14);

“usual good farming practices” means those practices undertaken on a holding in compliance with–

(a)

the provisions of environmental legislation set out in Part I of Schedule 2; and

(b)

the verifiable standards set out in Part II of Schedule 2.

(2) Unless the context otherwise requires, any reference in these Regulations to a numbered regulation or paragraph or to a Schedule is a reference to the regulation or paragraph of the regulation or the Schedule so numbered in these Regulations.

(3) Any reference in these Regulations to anything done in writing or produced in written form includes a reference to an electronic communication, as defined in section 15 of Electronic Communications Act 2000(15), which has been recorded and is consequently capable of being reproduced.

Applications for payment of less favoured area support

3.—(1) An application for less favoured area support shall be in such form and shall contain such particulars relating to that application as the Scottish Ministers may reasonably require.

(2) An applicant shall submit the application for less favoured area support in respect of the Scheme Year in question to the Scottish Ministers on or before a date each year which the Scottish Ministers shall determine from time to time.

(3) Subject to paragraph (4), if an applicant submits an application for less favoured area support in respect of the relevant Scheme Year later than the date determined by the Scottish Ministers, the Scottish Ministers must reduce, or as the case may be exclude the applicant from, payment of less favoured area support in accordance with Article 21 of Commission Regulation 796/2004.

(4) Paragraph (3) shall not apply to an applicant who has not previously claimed any subsidy dependent upon an area aid application, who submits a claim form in accordance with regulation 6(1)(b).

Eligibility for payment of less favoured area support

4.—(1) Payment of less favoured area support may be made to an applicant in respect of a Scheme Year only if–

(a) subject to paragraphs (2) and (3), that applicant has given an undertaking, in such form as the Scottish Ministers may reasonably require, to continue to use eligible land for eligible agricultural activities for a period of not less than five years from the first payment made under–

(i) these Regulations;

(ii) the 2004 Regulations;

(iii) the 2003 Regulations;

(iv) the 2002 Regulations;

(v) the 2001 Regulations;

(vi) the 1999 Regulations; or

(vii) the 1996 Regulations;

(b) that applicant applies usual good farming practices on their holding;

(c) that applicant does not use on the holding any of the substances referred to in Article 14.2 of Council Regulation 1257/1999; and

(d) that applicant complies with the environmental controls set out in Schedule 3 in respect of the holding.

(2) An applicant may be released from the undertaking referred to in paragraph (1)(a)–

(a) if the applicant has, during the period for which the undertaking was given, transferred all or part of the holding to another person and that person agrees to take over the undertaking;

(b) if, where the applicant has ceased farming during the period for which the undertaking was given, the applicant’s successor agrees to take over the undertaking; or

(c) if, in the opinion of the Scottish Ministers, the applicant is prevented from continuing to discharge that undertaking by reason of any material circumstances beyond the control of that person.

(3) In the event that the applicant has ceased farming and the applicant’s successor does not agree to be bound by the undertaking referred to in paragraph (1), the Scottish Ministers may, if satisfied that the applicant has, at the time of the cessation of farming, honoured a significant proportion of the undertaking, release the applicant from that undertaking.

Payment of less favoured area support

5.  The Scottish Ministers may pay, on such occasions as they consider fit, in respect of the Scheme Year in question to an applicant less favoured area support for carrying out eligible agricultural activity on eligible land which is not less than 3 hectares.

Eligible land

6.—(1) Subject to paragraph (2), eligible land comprises the number of hectares of forage area in a less favoured area–

(a) as declared in a single application submitted to the Scottish Ministers, on or before 15th May in the Scheme Year for which payment is to be made, by the applicant in accordance with Article 11 of Council Regulation 796/2004; or

(b) where the applicant has not previously claimed any subsidy dependent upon a single application form, as declared by the applicant in a form which the Scottish Ministers shall from time to time specify.

(2) Where the forage area contains land used for CLOPS, the number of hectares declared for CLOPS and treated as eligible land for the purposes of the Scheme 2006 payment of the applicant shall not exceed the number of hectares of CLOPS for which an applicant received a Scheme 2005 payment.

(3) Eligible land includes land in respect of which the applicant has a right of use pursuant to arrangements such as short term lets, seasonal grazing and common grazing.

(4) If an application made in accordance with regulation 3 relates in part to land upon which an activity is carried out which is not an eligible agricultural activity for the purposes of these Regulations, the Scottish Ministers shall determine the area of land which is to be attributed to the eligible agricultural activity.

Transfer of a holding

7.—(1) In determining eligible land under regulation 6(1), the decision of the Scottish Ministers shall be in accordance with Article 74 of Commission Regulation 796/2004 as appropriate.

(2) For the purpose of paragraph 6 of Article 74 of Commission Regulation 796/2004, the Scottish Ministers shall grant less favoured area support to the transferor of a holding, if the transferor–

(a) fulfils the conditions laid down by paragraphs 2 to 5 of Article 74 of Commission Regulation 796/2004; and

(b) has been in continuous occupation of the holding for a period of not less than 183 calendar days in the Scheme Year concerned.

Amount of less favoured area support

8.—(1) Subject to paragraph (2) and regulation 13 (minimum payment), the amount of less favoured area support shall be calculated in accordance with the following formula:–

LFAS = P × R

Where

LFAS is the amount of less favoured area support payable;

P is the payable area calculated in accordance with regulation 9 and, where appropriate, adjusted in accordance with regulation 11; and

R is the rate of payment determined in accordance with regulation 12.

(2) Where an applicant has eligible land in more than one grazing category (as determined for the purposes of regulation 9) then–

(a) the calculation in paragraph (1) shall be applied in respect of the total area of eligible land in each grazing category and, for the purposes of each calculation–

(i) P is the payable area of land in each grazing category calculated in accordance with regulation 9 and, where appropriate, adjusted in accordance with regulation 11; and

(ii) R is the rate of payment for each type of grazing category determined in accordance with regulation 12; and

(b) the total amount of less favoured area support payable shall be the sum of each of those calculations.

Determination of Payable Area

9.—(1) Subject to regulation 10, the payable area shall be the total of the areas of eligible land of the applicant in each grazing category, adjusted in accordance with the following formula:–

P = E × V

Where

P is the payable area;

E is the area of eligible land in each field or shared grazing in calendar year 2005; and

V is the hectare value for each field or shared grazing determined in accordance with paragraph (2).

(2) For the purpose of paragraph (1) the hectare value shall be the entry in the third column of Schedule 5 corresponding to the grazing category in the second column of that Schedule.

(3) For the purposes of this regulation the grazing category of each field or shared grazing of the applicant shall be the entry in the second column of Schedule 5 corresponding to the entry in the first column of that Schedule relating to the stocking density of the applicant who declared the field or shared grazing in an area aid application on or before 15th May 2001.

(4) Subject to paragraph (5), for the purposes of paragraph (3), the stocking density for each field or shared grazing shall be the stocking density that was determined for that field or shared grazing by regulation 9 of the 2003 Regulations following upon an application for less favoured area support under those Regulations.

(5) Where no stocking density was determined under regulation 9 of the 2003 Regulations for a field or shared grazing then, for the purposes of paragraph (3), the Scottish Ministers shall determine a stocking density figure for that part of the land of the applicant.

Stocking density outwith maximum and minimum parameters

10.—(1) Subject to paragraph (7), the following provisions of this regulation shall apply for the purposes of the Scheme 2006 payment where the stocking density calculated in accordance with paragraph (4) and Parts I and II of Schedule 1 using eligible livestock units calculated for the purpose of the Scheme 2005 payment, in accordance with paragraph (4) based on eligible agricultural activity in the calendar year 2004, and eligible land in the calendar year 2005 is either less than the minimum stocking density or greater than the maximum stocking density–

(a) at the start of the retention period where eligibility rests on livestock claimed under the Sheep Annual Premium Scheme;

(b) at the start of the retention period where eligibility rests on livestock claimed under the Suckler Cow Premium Scheme;

(c) during the calendar year 2004 where eligibility rests on livestock declared separately in an application for less favoured area support;

(d) on 31st March 2004, where eligibility rests on maintaining a dairy herd in the area referred to in paragraph (c) of the definition of “eligible agricultural activity” in regulation 2(1); or

(e) in the opinion of the Scottish Ministers where eligibility must be determined from a combination of livestock described in sub-paragraphs (a) to (d) above.

(2) Where the stocking density calculated in accordance with paragraph (4) and Parts I and II of Schedule 1 based on eligible agricultural activity undertaken in calendar year 2004 is less than the minimum stocking density, the eligible land for the purposes of the calculation at regulation 9(1) shall be the number of hectares calculated in accordance with the following formula:–

E₁ = K÷M

Where

E₁ is the area of eligible land adjusted in accordance with this regulation;

K is, subject to paragraph (6), the number of eligible livestock units based on eligible agricultural activity undertaken in calendar year 2004; and

M is the minimum stocking density.

(3) Where the stocking density calculated in accordance with paragraph (4) and Parts I and II of Schedule 1 based on eligible agricultural activity undertaken in calendar year 2004 is greater than the maximum stocking density, the eligible land for the purposes of the calculation at regulation 9(1) shall be the number of hectares calculated in accordance with the following formula:–

Where

E₂ is the area of eligible land adjusted in accordance with this regulation;

F is the area of eligible land determined in accordance with regulation 9(1);

Q is the maximum stocking density; and

J is the number of eligible livestock units based on eligible agricultural activity undertaken in calendar year 2004.

(4) For the purposes of paragraphs (1), (2) and (3), the number of eligible livestock units shall be calculated using–

(a) where eligibility rests solely on livestock claimed under the Sheep Annual Premium Scheme, the greater of–

(i) the number of ewes and gimmers declared as the flock composition as part of a claim for Sheep Annual Premium; or

(ii) the lesser of the number of livestock claimed and the number of livestock quota units held;

(b) where eligibility rests solely on livestock claimed under the Suckler Cow Premium Scheme, the greater of–

(i) the number of cows declared as the herd composition as part of a claim for Suckler Cow Premium; or

(ii) the lesser of the number of livestock claimed and the number of livestock quota units held;

(c) where neither sub-paragraph (a) nor (b) applies, the number of livestock units determined by a decision of the Scottish Ministers using any, or a combination of any, of the following:–

(i) livestock described in sub-paragraph (a) above;

(ii) livestock described in sub-paragraph (b) above;

(iii) livestock units calculated from numbers of deer, goats, alpacas or llamas held throughout the relevant calendar year;

(iv) where the applicant has not claimed any subsidy under the Sheep Annual Premium Scheme, ewes, gimmers and hoggs declared separately as being held throughout the Scheme Year;

(v) where the applicant has not claimed any subsidy under the Suckler Cow Premium Scheme, suckler cows declared separately as being held throughout the Scheme Year; or

(vi) where the applicant maintains a dairy herd in an area referred to in paragraph (c) of the definition of “eligible agricultural activity” in regulation 2(1), livestock units calculated from litres of milk quota held as at 31st March 2004.

(5) Where–

(a) an applicant has land in more than one grazing category (as determined for the purposes of regulation 9); and

(b) where eligible land, for the purpose of the calculation in regulation 9(1), for that applicant has been reduced under paragraph (2) or (3),

the Scottish Ministers shall apply that reduction in eligible land proportionately to the total of the eligible land in each grazing category for the purpose of the calculation in regulation 9(1).

(6) Where an applicant fails to achieve the minimum stocking density as a result of not being able to re-stock following slaughter of livestock under the Animal Health Act 1981(16) or in consequence of the service of a notice or an order being in place under the Foot-and-Mouth Disease Order 1983(17), the Scottish Ministers may, by a decision, determine the total number of livestock units to be used for the purpose of the calculation at paragraph (2).

(7) Where the Scottish Ministers do not hold for an applicant any details of eligible livestock units, based on eligible agricultural activity in 2004 in relation to a Scheme 2005 payment–

(a) the stocking density referred to in paragraph (1) shall be calculated in accordance with Parts I and II of Schedule 1 on the basis of eligible agricultural activity undertaken in calendar year 2005; and

(b) the eligible livestock units referred to in paragraph (4) shall be calculated using the number of livestock units determined by a decision of Scottish Ministers using numbers of suckler cows, ewes, gimmers, hoggs, deer, goats, alpacas and llamas declared separately as being held throughout the 2005 calendar year and, where the applicant maintains a dairy herd in the area referred to in paragraph (c) of the definition of “eligible agricultural activity” in regulation 2(1), livestock units calculated from litres of milk quota held as at 31st March 2005.

Enterprise mix

11.—(1) Subject to paragraphs (3) and (4), where the applicant maintains at least 10% of the total eligible livestock units of the applicant based on eligible agricultural activity undertaken in the calendar year 2004 as cattle, the payable area calculated in accordance with regulation 9 shall be adjusted in accordance with this regulation according to the following formula:–

P₁ = P₂ × Z

Where

P₁ is the payable area adjusted in accordance with this regulation;

P₂ is the payable area calculated in accordance with regulation 9; and

Z is the multiplier contained in the second column of Schedule 6 corresponding to either:

(a)

the appropriate proportion of eligible livestock units, based on eligible agricultural activity in the calendar year 2004, maintained as cattle; or

(b)

if paragraph (3) applies, the appropriate proportion of livestock units, determined in accordance with paragraph (4) and Part I of Schedule 1, based on eligible agricultural activity in the calendar year 2005, maintained as cattle.

(2) Where an applicant fails to achieve the necessary cattle livestock units for the purposes of this regulation as a result of not being able to re-stock following slaughter of livestock under the Animal Health Act 1981 in consequence of the service of a notice or an order being in place under the Foot-and-Mouth Disease Order 1983, the Scottish Ministers may, by a decision, determine the total number of cattle livestock units to be used for the purposes of this regulation.

(3) Where–

(a) the Scottish Ministers do not hold for an applicant any details of eligible livestock units, based on eligible activity in 2004 in relation to a Scheme 2005 payment; or

(b) the multiplier determined in accordance with Schedule 6 based on eligible agricultural activity undertaken in 2004, and the multiplier contained in the second column of Schedule 6 corresponding to the appropriate proportion of livestock units, determined in accordance with paragraph (4) on the basis of eligible agricultural activity in 2005, are found, following administrative and periodic checks carried out in accordance with Articles 67 to 69 of Commission Regulation 817/2004, or notification by the applicant, to be different

the livestock units referred to in paragraph (1) shall be determined in accordance with paragraph (4).

(4) Where it is established in accordance with paragraph (3) that a different multiplier is appropriate, livestock units for the purposes of paragraph (1) shall be calculated using the number of livestock units determined by a decision of the Scottish Ministers using numbers of suckler cows, ewes, gimmers hoggs, deer, goats, alpacas and llamas held throughout the 2005 calendar year and, where the applicant maintains a dairy herd in an area referred to in paragraph (c) of the definition of “eligible agricultural activity” in regulation 2(1), livestock units calculated from litres of milk quota held as at 31st March 2005.

Rate of Payment of less favoured area support

12.—(1) For the purposes of regulation 8, the rate of payment of less favoured area support shall be determined in accordance with this regulation.

(2) Where, for the purposes of regulation 9, the grazing category of land, as specified in Schedule 5, is A or B, the rate of payment shall be the rate per hectare of the payable area set out in the entry in the second column in Part I (More Disadvantaged Land) of Schedule 7 corresponding to the fragility category in the first column of that Part of that Schedule applicable to the applicant in terms of paragraph (4).

(3) Where, for the purposes of regulation 9, the grazing category of land, as specified in Schedule 5, is C or D, the rate of payment shall be the rate per hectare of the payable area set out in the entry in the second column in Part II (Less Disadvantaged Land) of Schedule 7 corresponding to the fragility category in the first column of that Part of that Schedule applicable to the applicant in terms of paragraph (4).

(4) For the purposes of paragraphs (2) and (3), the fragility category applicable to the applicant shall be determined according to the fragility category of the parish in which the main farm of the applicant lies as set out in Schedule 8 to these Regulations.

(5) For the purpose of paragraph (4), the main farm of the applicant shall be the farm identified as the main farm in the application for less favoured area support submitted by the applicant in accordance with regulation 3.

Minimum payment

13.  In respect of the Scheme 2006 payment, the amount of less favoured area support paid by the Scottish Ministers under these Regulations shall be not less than £350.

Powers of authorised persons

14.—(1) An authorised person may, at all reasonable hours and on producing if so required a duly authenticated document showing the authority of that person, exercise the powers specified in this regulation for the purposes of–

(a) verification of the accuracy of an application by carrying out administrative and periodic checks which a Member State is required to carry out under Articles 67 to 69 of Commission Regulation 817/2004; or

(b) ascertaining whether an offence under these Regulations has been or is being committed,

and in doing so may be accompanied by a person assigned to assist the authorised person, for those purposes.

(2) An authorised person may enter any land or premises (other than dwelling houses not being used in connection with these Regulations).

(3) An authorised person who has entered any land or premises by virtue of this regulation may–

(a) inspect and verify the total area of such land;

(b) inspect and count livestock on such land and require the applicant to arrange for the collection of animals, penning and securing;

(c) require production of and examine any records in whatever form, and take copies of those records;

(d) remove and retain any document or other record referred to in sub-paragraph (c) above which may be required for use as evidence in proceedings under these Regulations; and

(e) inspect and verify that the applicant has complied with the environmental controls set out in Schedule 3 and with usual good farming practices.

(4) An authorised person may require, where any computer and any associated apparatus or material which is or has been used in connection with any such records mentioned in paragraph (3)(c), wherever situated, records which are kept by means of such computer or associated apparatus or material to be produced in a visible and legible form in which they may be taken away.

Assistance to authorised persons

15.  An applicant, any employee or agent of an applicant or any person having, or appearing to have, charge of animals on the land shall give to an authorised person such assistance as the authorised person may reasonably request so as to enable that person to exercise any power conferred by regulation 14.

Withholding or recovery of less favoured area support

16.  The Scottish Ministers may withhold or recover the whole or any part of any payment of less favoured area support payable or paid to an applicant in any of the following circumstances:–

(a) where the applicant fails to comply with the terms of an undertaking given by that applicant pursuant to regulation 4(1)(a) from which the applicant has not been released under regulation 4(2) or 4(3);

(b) where the applicant, or an employee or agent of the applicant intentionally obstructs an authorised person in exercise of the powers under regulation 14, or fails without reasonable excuse to comply with a requirement or request made by an authorised person under regulation 14 or 15;

(c) where, in the opinion of the Scottish Ministers, the applicant has failed to act in accordance with usual good farming practices on or in relation to the holding;

(d) where, in the opinion of the Scottish Ministers, the applicant has failed to comply with the environmental controls set out in Schedule 3 on or in relation to the holding.

Rate of interest

17.  For the purpose of Article 73 of Commission Regulation 796/2004, interest shall be charged thereon at the rate of one percentage point above the sterling three month London Interbank Offered Rate on a day-to-day basis for the period specified in that Article.

Cross-border holdings

18.  Schedule 9 applies to agency arrangements and to cross-border holdings.

Offences

19.—(1) Any person who, for the purposes of obtaining for the benefit of that or any other person part of, or the whole of, a payment of less favoured area support under these Regulations, knowingly or recklessly makes a statement which is false in any material particular, shall be guilty of an offence.

(2) Any person who intentionally obstructs an authorised person (or a person assisting that authorised person in accordance with regulation 15) in the exercise of the powers conferred by regulation 14 shall be guilty of an offence.

(3) Any person who without reasonable excuse fails to comply with a requirement made under regulation 14 or request under regulation 15 shall be guilty of an offence.

Penalties

20.—(1) A person guilty of an offence under regulation 19(1) or (2) shall be liable on summary conviction to a fine not exceeding level 3 on the standard scale.

(2) A person guilty of an offence under regulation 19(3) shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.

Time limit for prosecutions

21.—(1) Summary proceedings for an offence under regulation 19 may be commenced within the period of 12 months from the date on which the offence was committed.

(2) Subsection (3) of section 136 of the Criminal Procedure (Scotland) Act 1995(18) (date of commencement of proceedings) applies for the purposes of this regulation as it does for the purposes of that section.

Offences by bodies corporate

22.—(1) Where an offence under these Regulations is committed by a body corporate or a partnership and is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any director, manager, secretary or other similar officer of the body corporate, or any person who was purporting to act in any such capacity (or, in the case of a partnership, a partner or any person who was purporting to act as such), that person as well as the body corporate or the partnership, as the case may be, shall be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

(2) Where the affairs of a body corporate are managed by its members, paragraph (1) shall apply in relation to the acts or defaults of a member in connection with the member’s management functions as if that member were a director of the body corporate.

Appeal against decision as to eligibility of holding

23.—(1) An applicant may, no later than 60 days following the date of intimation of the Scottish Ministers' decision as to the eligibility of the holding under regulation 6(1), make an application in writing to the Scottish Ministers to have that decision reviewed by persons appointed by the Scottish Ministers for that purpose.

(2) An application under this regulation is to be treated as made if it is received by the Scottish Ministers.

(3) The application must be accompanied by such information as the persons appointed consider necessary.

(4) Such persons appointed under paragraph (1) shall review the decision and notify their determination to the Scottish Ministers, and by recorded delivery mail to the applicant, within 10 days of reaching that determination.

(5) Subject to regulation 24, the determination of such persons appointed shall be binding on the Scottish Ministers.

(6) The Scottish Ministers may make such payment, by way of fee or reimbursement of expenses, to any such persons appointed under paragraph (1), as appears to them to be appropriate.

Review

24.—(1) An applicant may apply to the Scottish Ministers in writing for review of the determination referred to in regulation 23(4).

(2) The applicant must apply to the Scottish Ministers for review within 60 days of the date of the determination referred to in regulation 23(4).

(3) On an application for a review under this regulation, the Scottish Ministers shall refer the matter to a person appointed by the Chairman of the Scottish Branch of the Royal Institution of Chartered Surveyors.

(4) The person appointed for the purpose of this regulation shall review the said determination and may–

(a) consider any document or other evidence produced by the applicant or the Scottish Ministers (whether or not that document or other evidence was available at the time of the said determination);

(b) invite the applicant and the Scottish Ministers to provide such further information relevant to the review as the person appointed considers appropriate; and

(c) give the applicant and the Scottish Ministers an opportunity to give evidence or to make representations in person or through a representative.

(5) The person appointed shall review the said determination and shall make a decision confirming or refusing that determination, and shall intimate that decision to the Scottish Ministers and to the applicant in writing.

(6) The person appointed shall be entitled to require the reasonable costs of the review to be paid by such party as that person may direct, and the person appointed shall determine the amount of such costs.

Amendment of the Agricultural Subsidies (Appeals) (Scotland) Regulations 2004

25.—(1) The Agricultural Subsidies (Appeals) (Scotland) Regulations 2004(19) shall be amended in accordance with this regulation.

(2) In regulation 3 (Application in relation to IACS matters) for “(g)” substitute “(ga)”.

(3) In regulation 4 (decisions amenable to review and appeal), insert–

(a) in paragraph (e) after “2004”–

“or under regulation 16 of the Less Favoured Area Support Scheme (Scotland) Regulations 2005.”; and

(b) after paragraph (g)–

“(ga) a decision by the Scottish Ministers under regulation 7(2), 9(5), 10(4), 10(6), 10(7), 11(2) and 11(4) of the Less Favoured Area Support Scheme (Scotland) Regulations 2005;”.

Revocation and savings provisions

26.—(1) Subject to the savings referred to in paragraph (2), the Less Favoured Area Support Scheme (Scotland) Regulations 2004(20), the Less Favoured Area Support Scheme (Scotland) Amendment Regulations 2004(21) and the Less Favoured Area Support Scheme (Scotland) Amendment Regulations 2005(22) are hereby revoked.

(2) Notwithstanding paragraph (1), in respect of a Scheme 2004 payment or a Scheme 2005 payment, within the meaning of the 2004 Regulations, the 2004 Regulations shall continue to have effect as if those Regulations had not been revoked.

ROSS FINNIE

A member of the Scottish Executive

St Andrew’s House, Edinburgh

10th November 2005