Title, application, commencement and interpretation

1.—(1) The title of this Order is the Agricultural Holdings (Units of Production) (Wales) Order 2023, it applies in relation to Wales and comes into force on 10 February 2023.

(2) In this Order—

“ designated maps” (“ mapiau dynodedig”) means the two volumes of maps numbered 1 and 2; each volume being marked “Volume of maps of less favoured farming areas in Wales” and with the number of the volume dated 20 May 1991 and signed by the Secretary of State for Wales and deposited at the offices of the Welsh Government, Cathays Park, Cardiff, CF10 3NQ;

“ disadvantaged land” (“ tir dan anfantais”) (except in the expression “ severely disadvantaged land”) means any area of land shown coloured blue on the designated maps;

“ eligible hectare” (“ hectar cymwys”) has the same meaning as in Article 32(2) of Regulation 1307/2013;

“ less favoured area” (“ ardal lai ffafriol”) means any area of disadvantaged land or severely disadvantaged land;

“ Regulation 1307/2013” (“ Rheoliad 1307/2013”) means Regulation (EU) No 1307/2013 of the European Parliament and of the Council of 17 December 2013 establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy( 3);

“ severely disadvantaged land” (“ tir dan anfantais ddifrifol”) means any area of land shown coloured pink on the designated maps.

Assessment of the productive capacity of land

2.—(1) Paragraphs (2), (3) and (4) have effect for the purpose of the assessment of the productive capacity of a unit of agricultural land situated in Wales, in order to determine whether that unit is a commercial unit of agricultural land within the meaning of paragraph 3(1) of Schedule 6 to the Agricultural Holdings Act 1986.

(2) Where the land in question is capable, when farmed under competent management, of being used to produce any livestock, farm arable crop, outdoor horticultural crop or fruit as mentioned in any of the entries 1 to 3 in column 1 of the Schedule to this Order, then—

(a) the unit of production prescribed in relation to that use of the land is the unit in the corresponding entry in column 2,

(b) the amount determined for the period of 12 months, beginning with 12 September 2021, as the net annual income from that unit of production in that period is the amount in the corresponding entry in column 3, and

(c) the amount determined for the period of 12 months, beginning with 12 September 2022, as the net annual income from that unit of production in that period is the amount in the corresponding entry in column 4.

(3) Where land capable, when farmed under competent management, of producing a net annual income was an eligible hectare in 2020 in accordance with entry 4 in column 1 of the Schedule to this Order, then—

(a) the unit of production prescribed in relation to that use of the land is the unit in the corresponding entry in column 2, and

(b) the amount determined for the period of 12 months, beginning with 12 September 2021, as the net annual income from that unit of production in that period is the amount in the corresponding entry in column 3.

(4) Where land capable, when farmed under competent management, of producing a net annual income was an eligible hectare in 2021 in accordance with entry 4 in column 1 of the Schedule to this Order, then—

(a) the unit of production prescribed in relation to that use of the land is the unit in the corresponding entry in column 2, and

(b) the amount determined for the period of 12 months, beginning with 12 September 2022, as the net annual income from that unit of production in that period is the amount in the corresponding entry in column 4.

Article 2

SCHEDULE Prescribed units of production and determination of net annual income

EXPLANATORY NOTE

(This note is not part of the Order)

This Order prescribes units of production for the assessment of the productive capacity of agricultural land situated in Wales and sets out the amount which is to be regarded as the net annual income from each such unit for the periods 12 September 2021 to 11 September 2022 and 12 September 2022 to 11 September 2023, for certain purposes of the Agricultural Holdings Act 1986 (“ the 1986 Act”).

An assessment of the productive capacity of agricultural land is required in determining whether or not the land in question is a “ commercial unit of agricultural land” for the purposes of the succession provisions of the 1986 Act; in particular sections 36(3) and 50(2) which address this question. A “commercial unit of agricultural land” is a unit of agricultural land, which, when farmed under competent management, is capable of producing a net annual income which is not less than the aggregate of the average annual earnings of two full-time male agricultural workers aged 20 years or over. Paragraph 3 of Schedule 6 to the 1986 Act provides a definition of “commercial unit of agricultural land”.

Article 2 of this Order provides that, in determining this annual income figure, whenever a particular farming use mentioned in column 1 of the Schedule is relevant to the assessment of the productive capacity of the land in question, the units of production specified in column 2 and the net annual income specified in column 3 or 4 will form the basis of the assessment.

This Order includes net annual income figures for land which was in 2020 or 2021, an eligible hectare within the meaning of Article 32(2) of Regulation (EU) No 1307/2013 of the European Parliament and of the Council of 17 December 2013 establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy. There are separate figures in the Schedule for disadvantaged land and severely disadvantaged land, land in a less favoured area and other land.

The Welsh Ministers’ code of practice on the carrying out of regulatory impact assessments was considered in relation to this Order. As a result, it was not considered necessary to carry out a regulatory impact assessment as to the likely costs and benefits of complying with this Order.