Background Common Agricultural Policy (CAP)
3.The description of the Common Agricultural Policy (“CAP”) that follows is to aid the understanding of the effect of Part 1 of this Act, which makes provision in relation to the former EU CAP rules as they will have effect as retained EU law(1) under the European Union (Withdrawal) Act 2018 (the “2018 Act”),(2) following the UK withdrawal from the EU on 31 January 2020.
4.The CAP is the EU policy to provide financial support to farmers in Member States. It is said to have two “pillars”. Pillar 1 provides for direct payments to farmers, and also covers common market organisation (CMO). Pillar 2 provides for measures that support rural development, and in particular good environmental outcomes, farming productivity, socio-economic development and rural growth.
5.The CAP is managed and funded at European level from the resources of the EU budget. The majority of CAP funds are allocated to direct payments, which is based on the amount of land the recipient owns.
6.The declared objectives of the CAP are as follows:(3)
	To support farmers and improve agricultural productivity, ensuring a stable supply of affordable food,
	To safeguard European Union farmers to make a reasonable living,
	To help tackle climate change and the sustainable management of natural resources,
	To maintain rural areas and landscapes across the EU, and
	To keep the rural economy alive by promoting jobs in farming, agri-foods industries and associated sectors.
7.Within the UK, agriculture is devolved and therefore the Scottish Ministers are responsible for rural support, which includes implementing the CAP in Scotland.
8.The legal framework of the CAP is to be found in a series of directly applicable EU regulations that will, as modified for that purpose, become retained EU law after exit. The 5 basic acts (broadly equivalent to UK primary legislation) are:
	Regulation 1305/2013(4) (“the Rural Development Regulation”): This Regulation establishes support for Rural Development by the European Agricultural Fund for Rural Development,
	Regulation 1303/2013(5) (“the common provisions Regulation”): This Regulation lays down common provisions on EU funds, and in particular on the European Agricultural Fund for Rural Development,
	Regulation 1306/2013(6) (“the Horizontal Regulation”): This Regulation covers the financing, management and monitoring of the Common Agricultural Policy, and in particular it provides for cross-cutting measures that apply to all areas of the CAP,
	Regulation 1307/2013(7) (“the Direct Payments Regulation”): This Regulation establishes rules for Direct Payments to farmers under support schemes within the framework of the CAP, and
	Regulation 1308/2013(8) (“The Single CMO Regulation”): This Regulation establishes a common organisation of the markets in agricultural products (“CMO”).
9.In addition, Regulation 1370/2013 provides for measures in respect of, and rules on, aid and refunds and similar matters as regards agricultural products and the CMO.
10.There is a body of EU subordinate legislation in the shape of delegated and implementing acts made under powers in the basic acts, which set out further detailed provisions in relation to the CAP.
11.There is also a body of national implementing legislation, including Scottish statutory instruments made by the Scottish Ministers as regards devolved matters in Scotland.