Farm certification schemes for sustainable agriculture

A wide range of mandatory and voluntary schemes (functioning at all stages of the food supply chain) operate currently in Europe. Their number continues to increase on a constant basis. Their role is crucial in the context of the European Green Deal, the associated Commission Communications (Farm to Fork strategy and the Biodiversity strategy) and the new regulatory framework of the Common Agricultural Policy (CAP).

All of them set ambitious environmental objectives to the farming sector and farm certification schemes could be instrumental in reaching the associated targets and monitoring the corresponding results indicators. Three out of nine of the CAP’s [1] post-2023 specific objectives focus on the environment and climate. They cover climate change, management of natural resources, and biodiversity.

Overall, the CAP’s objectives will cover the three dimensions of sustainability, namely: environmental, economic and social. They are part of the following Specific Objectives:

• SO 4: Contribute to climate change mitigation and adaptation, as well as sustainable energy;
• SO 5: Foster sustainable development and efficient management of natural resources such as water, soil and air;
• SO 6: Contribute to the protection of biodiversity, enhance ecosystem services and preserve habitats and landscapes;
• SO 9: Improve animal welfare and address antimicrobial resistance.

The CAP is instrumental in managing the transition towards a sustainable food system and in strengthening the efforts of European farmers to contribute to the EU’s climate objectives and to protect the environment. The CAPs provisions will support as well the delivery of the Green Deal. Among its main targets are namely: Reduce by 50% the overall use and risk of chemical pesticides and reduce use by 50% of more hazardous pesticides by 2030; Achieve at least 25% of the EU’s agricultural land under organic farming and a significant increase in organic aquaculture by 2030; Reduce sales of antimicrobials for farmed animals and in aquaculture by 50% by 2030; Reduce nutrient losses by at least 50% while ensuring no deterioration in soil fertility; this will reduce use of fertilisers by at least 20 % by 2030; Bring back at least 10% of agricultural area under high diversity landscape features by 2030.

The CAP‘s targets relevant to environment and climate will be delivered through three main policy tools: the “conditionality” of direct payments; the new so-called “eco-schemes” in Pillar 1; and environmental and climate-related regulations in Pillar 2 (AECM II). Another essential modification of the existing provisions is that the three policy tools combined offer to Member States much more important role to play than they have had in the previous programming period. One of the promising aspects of this reform is the introduction of Eco-schemes in Pillar 1, which represents most of the CAP budget. This new instrument, 100% EUfunded, could help farmers to introduce new practices and evolve towards more sustainable models. It could be a first step towards the remuneration of public goods and environmental services.

The new Eco-scheme represents an important opportunity for organic farmers at a time when the second pillar money is being severely cut, which endangers the future of conversion and maintenance measures. Agricultural practices that could be supported by eco-schemes have to meet the following conditions: they should cover activities related to climate, environment, animal welfare and antimicrobial resistance; they shall be defined on the basis of the needs and priorities identified at national/regional levels; their level of ambition has to go beyond the requirements and obligations established under the baseline (including conditionality); they shall contribute to reaching the EU Green Deal targets.

The list of potential agricultural practices includes organic farming practices, agroecology such as crop rotation with leguminous crops or low intensity grass-based livestock system. Furthermore, they also comprise carbon farming, with for example conservation agriculture or the extensive use of permanent grassland.

Other agricultural practices that could be supported by ecoschemes include precision farming with for instance precision crop farming to reduce inputs or the use of feed additives to decrease emissions from enteric fermentation, and husbandry practices in favour of animal welfare and/or reducing the needs for antimicrobial substances.

The new type of payment based on the list of eco-schemes elaborated at Member States level will distribute a substantial budget. Member States will in principle plan to spend at least 25% of their direct payments budget on eco-schemes. They will also have the option to go beyond and spend more than this ceiling.

During a two-year “learning period” (2023 and 2024), a Member State is authorised to spend less than 25% in case of a lower-than-planned takeup by farmers, provided that it makes up for any significant shortfalls by the end of 2027. Built-in flexibilities are also offered to Member States. Eco-schemes will fund annual or multi-annual commitments, according to the needs identified in CAP Strategic Plans. Payments can be set as a “compensation” or go beyond compensation if the relevant World Trade Organisation rules are respected.

Types of certification schemes

A range of mandatory and voluntary certification schemes exist at EU and Member State level. EU quality policy aims to protect the names of specific products to promote 2 their unique characteristics, linked to their geographical origin as well as traditional know-how. The EU geographical indications system protects the names of products that originate from specific regions and have specific qualities or enjoy a reputation linked to the production territory. The differences between PDO and PGI are linked primarily to how much of the product’s raw materials must come from the area, or how much of the production process has to take place within the specific region. GI is specific for spirit drinks and aromatised wines. The organic logs are also certified in the EU based on a set of criteria. The organic logo gives a coherent visual identity to EU produced organic products sold in the EU. This makes it easier for EU based consumers to identify organic products and helps farmers to market them across all EU countries.The organic logo can only be used on products that have been certified as organic by an authorised control agency or body. This means that they have fulfilled strict conditions on how they are produced, transported and stored. There is also a substantial growth in voluntary certification schemes for agricultural products and foodstuffs. Inventory of certification schemes for agricultural products and foodstuffs marketed in the EU Member States2 lists more than 440 different schemes, most of which were established during the last decade. According to the EU best practice guidelines for voluntary certification schemes for agricultural products and foodstuffs 2010/C 341/04 certification schemes for agricultural products and foodstuffs provide assurance (through a certification mechanism) that certain characteristics or attributes of the product or its production method or system, laid down in specifications, have been observed.

The schemes currently registered across the EU Member States cover a wide range of different initiatives that function at different stages of the food supply chain (pre- or post-farm gate; covering all or part of the food supply chain; affecting all sectors or just one market segment, etc.). They can operate at business-to-business (B2B) level or at business-to-consumer (B2C) level. There is also a destinction to be made between those who use logos and those (often B2B schemes) who do not. In the variety of schemes existing there are also schemes which function on the basis of third-party attestation or self-declaration or through selection by the scheme owner. Another important classification criterion pertains to whether the scheme assesses products and processes (mostly B2C) or management systems (mostly B2B). In terms of specified requirements, schemes may attest compliance with provisions laid down by governmental authorities (baseline) or they can add criteria which go beyond the legal requirements (above baseline).

As it is stated in the EU best practice guidelines for voluntary certification schemes for agricultural products and foodstuffs 2010/C 341/04 certification schemes can bring benefits:

• to intermediate actors in the food supply chain, by assuring standards and thereby protecting liability and reputation for product and label claims
• to producers, by increasing market access, market share and product margins for certified products and also, potentially, by increasing efficiency and reducing transaction costs, and
• to consumers, by providing reliable and trustworthy information on product and process attributes

Some stakeholders have argued that certification schemes can have drawbacks:

• threats to the single market;
• questions relating to the transparency of scheme requirements and the credibility of claims particularly for schemes that certify compliance with baseline requirements
• potential for misleading consumers
• costs and burdens on farmers, particularly where they have to join several schemes to meet demands from their buyers
• risk of rejection from the market of producers not participating in key certification schemes
• impacts on international trade, especially with developing countries 2Study conducted by Areté for DG AGRI, 2009; see http://ec.europa.eu/agriculture/quality/index_en.html

Main types of certification schemes according to EU best practice guidelines for voluntary certification schemes

Type of attestation	Self-declaration	Certification (third-party attestation)
Audience	B2C	B2C	BTB
Objective of specified requirements	Products and processes	Mostly procucts (including services) and processes	Mostly management systems
Content of requirements	Mostly above baseline	Mostyly above baseline	Baseline and above baseline

In order to be instrumental for the delivery of the CAP post- 2023 objectives, only the schemes that could be arranged in the following categories can be selected in the strategic plans of the Member States. In January 2021, the European Commission published a List of potential AGRICULTURAL PRACTICES that ECO-SCHEMES could support[2] . The introduction of the eco-schemes as an instrument for the delivery of the CAP post-2023 generated provoked a debate – both strengths and weaknesses were highlighted by the experts and the civil society.

Among the strengths are namely:

Strengths of Eco-schemes:

• Eco-schemes allow for using the Pillar 1 direct payment budget for achieving environmental and climate objectives in a more targeted way;
• Regional programming of Ecoschemes is possible, even if part of national CAP strategic plans
• MS have more flexibility in the amount they pay to farmers than with AECM as the payment level may be calculated as a top-up to the income support for sustainability. Payment calculations are not limited to the requirement only to pay incurred costs or income forgone;
• There is a legal right to receive the payment, which means that farmers who want to and are eligible cannot be excluded for budgetary or other reasons;
• Programming on MS not regional level: opportunity to design measures in a more coherent way (e.g. national support for organic farming, pasture based ruminant systems, HNV farming etc.)
• The commitment is normally for one year, which means adoption barriers to farmers may be lower as they can try out Eco-schemes without committing to a multi-annual contract;
• Higher acceptance in agricultural sector as only genuine farmers are eligible as beneficiaries.

Weaknesses of Eco-schemes:

• Budgetary rules do not allow unspent funds under the EAGF to be rolled over to the subsequent year if the target uptake value has not been reached, unlike the EAFRD. Legal clarification is needed in order to understand if some flexibility can be applied to the budgetary rules once the unspent funds are used to fund the specific environmental and climate objectives;
• If too many participants, either Basic or Eco-scheme payments may have to be reduced to respect budgets;
• Risk of double funding: AECMs can be supported as Pillar 1 Eco-schemes and as AECMs in Pillar 2. Pillar 1 EcoSchemes should not overlap with Pillar 2 AECMs to avoid double funding, but there is a danger that efforts to mitigate the risk of double funding could negatively impact on complementarity between schemes;[3]
• Environment and climate measures need a long-term perspective to achieve impacts. Annual commitments linked to annual budgets may be ineffective, e.g. for increasing biodiversity, as farmers can drop the measure after one year, but longer-term commitments can be programmed despite budget constraints;
• Eco-schemes and payment rates could change annually. Thus, compared to multiannual commitments, farmers’ planning security decreases
• Eco-schemes cannot be used for food quality or animal welfare measures, although if they have an environment/climate objective they may be eligible. Discussions are continuing about whether to formally include animal welfare measures in Eco-schemes
• Member States’ flexibility in scope of design of Eco-schemes could lead to ineffective agri-environment and climate measures (race to the bottom) It is also important to highlight the differences between eco-scemes and pillar 2 agri-environmental measures

Differences between eco-schemes and pillar 2 agri-environmental measures

	PILLAR 1 ECO-SCHEME: SCHEMES FOR THE CLIMATE AND THE ENIRONMET (ART.28)	PILLAR 2 AECM: ENVIRONMENT, CLIMATE and OTHER MANAGEMENT COMMITMENTS (ART. 65)
Beneficiaries	"Genuine" Farmers	Farmers and land managers, collective contracts possible
Fund	100% EU financed (EAGF)	EU and nationallyco-financed (EAFRD)
Focus	Agricultural activities delivering CAP Specific objectives	Environment, climate and other management commitments delivering CAP Specific objectives
Duration	Annual, possibly multiannual	Multiannual up to 5-7 years or more
Payment calculation	Full or partial compensation for costs incurred/income foregone (including opportunity costs) as for AECM, or Fixed top-up payment to the basic income support (based on member state justufication)	Full or partial compenasation for costs incurred/income foregone (including opportunity costs)
Payment basis	Annual, per hectare	Per hectare, head of livestock, number of trees, etc, annual fat-rate or as one-of payment per unit
Eligibility criteria	Fulfilling the genuine farmet, eligible hectares criteria defined by the Member States, other selection criteria could also be defined by the Member States	Achieving one or more of the CAP specific objectives; other selection criteria could be defined by the Member States
Time of application	With main application (15th May)	Initial application before the first commitment year, then annually (15th May)
Links with other measures	General Reference to Article 13 advisory services	Beneficiearies must be allowed access to the knowledge and information they need to implement the scheme
Minimum spending requirement	No (but still being debated by the EU Council and Parliament)	At least 30% of EAFRD-budget for measures which address CAP Specific objectives

[1] For more details on CAP post-2023 https://ec.europa.eu/commission/presscorner/detail/en/IP_21_2711

[2] 1. PRACTICES ESTABLISHED IN EU POLICY INSTRUMENTS: Organic farming practices, as defined in Regulation (EU) 2018/848 (b, c, d, f, g) Conversion to organic farming (b, c, d, f, g) Maintenance of organic farming (b, c, d, f, g) Integrated Pest Management practices, as defined in Sustainable Use Directive (b, c, d, e, f) and including: Buffer strips with management practices and without pesticide (c, e, f) Mechanical weed control (c, e, f) Increased use of resilient, pest-resistant crop varieties and species (b) Land lying fallow with species composition for biodiversity purpose (c, e, f) 2. OTHER PRACTICES: Agro-ecology including Crop rotation with leguminous crops (a, b, d, f) Mixed cropping - multi cropping (b, d, e, f) Cover crop between tree rows on permanent crops - orchards, vineyards, olive trees - above conditionality (a, c, d, e, f) Winter soil cover and catch crops above conditionality (a, b, c, d) Low intensity grass-based livestock system (a, c, d, g) Use of crops/plant varieties more resilient to climate change (b, c, e, f) Mixed species/diverse sward of permanent grassland for biodiversity purpose (pollination, birds, game feedstocks) (c, d, e, f) Improved rice cultivation to decrease methane emissions (e.g. alternate wet and dry techniques) (a) Practices and standards as set under organic farming rules (b, c, d, f) Husbandry and animal welfare plans including Feeding plans: suitability of and access to feed and water, feed and water quality analyses (e.g. micotoxines), optimised feed strategies (g) Friendly housing conditions: increased space allowances per animal, improved flooring (e.g., straw bedding provided on a daily basis), free farrowing, provision of enriched environment (e.g. rooting for pigs, perching, nest-building materials, etc.), shading/sprinklers/ventilation to cope with heat stress (b, g) Practices and standards as set under organic farming rules (g) Practices increasing animal robustness, fertility, longevity and adaptability, e.g. lifespan of dairy cows; breeding lower emission animals, promoting genetic diversity and resilience (a, b, g) Animal health prevention and control plans: overall plan for reducing the risk of infections that require antimicrobials and covering all relevant husbandry practices, e.g. crawl space between two rearing belts, vaccination and treatments, enhanced biosecurity, use of feed additives, etc. (g) Providing access to pastures and increasing grazing period for grazing animals (a, b, g) Provide and manage regular access to open air areas (g) EXAMPLES OF AGRICULTURE PRACTICES Agro-forestry including Establishment and maintenance of landscape features above conditionality (a, c, d, e) Management and cutting plan of landscape features (e, f) Establishment and maintenance of high-biodiversity silvopastoral systems High nature value (HNV) farming including Land lying fallow with species composition for biodiversity purpose (pollination, birds, game feedstocks, etc.) (c, e, f) Shepherding on open spaces and between per3Available at https://ec.europa.eu/info/sites/default/files/food-farming-fisheries/key_policies/documents/factsheet-agri-practices -under-ecoscheme_en.pdf 4 manent crops, transhumance and common grazing (b, d, e, f, g) Semi-natural habitat creation and enhancement (a, b, c, d, e, f, g) Reduction of fertiliser use, low intensity management in arable crops (a, b, c, d, e, f, g) Carbon farming including Conservation agriculture (a, d) Rewetting wetlands/peatlands, paludiculture (a, c, d, e) Minimum water table level during winter (a, c, d) Appropriate management of residues, i.e. burying of agricultural residues, seeding on residues (a, c, d) Establishment and maintenance of permanent grassland (a, c, d, e, f) Extensive use of permanent grassland (a, c, d) Precision farming including Nutrients management plan, use of innovative approaches to minimise nutrient release, optimal pH for nutrient uptake, circular agriculture (a, c, d, f) Precision crop farming to reduce inputs (fertilisers, water, plant protection products) (e, f) Improving irrigation efficiency (b) Improve nutrient management, including implementation of nitrates-related measures that go beyond the conditionality obligations (c, d, e,) measures to reduce and prevent water, air and soil pollution from excess nutrients such as soil sampling if not already obligatory, creation of nutrient traps (c, d, e,) Protecting water resources, including Managing crop water demand (switching to less water intensive crops, changing planting dates, optimised irrigation schedules) (b) Other practices beneficial for soil, including Erosion prevention strips and wind breaks (b, d, e,) Establishment or maintenance of terraces and strip cropping (b, d, e,) Other practices related to GHG emissions”.

[3] For more details, please see USING ECO-SCHEMES IN THE NEW CAP A GUIDE FOR MANAGING AUTHORITIES https://www.or ganicseurope.bio/content/uploads/2020/06/ifoam-eco-schemes-web_compressed-1.pdf?dd 5