In view of the substantial change in the method for the delimitation of areas facing significant natural constraints in the new programming period, the obligation imposed upon the farmer to continue farming in the area for five years should not apply to new legal commitments undertaken in 2014.

In view of the serious difficulties that a number of Member States still face with respect to their financial stability, and in order, during the transition from the current to the new programming period, to limit the negative effects resulting from those difficulties by allowing for maximum utilisation of the EAFRD funds available, it is necessary to extend the duration of the derogation which increases the maximum EAFRD contribution rates provided for in Article 70(4c) of Regulation (EC) No 1698/2005 to the final date of eligibility of expenditure for the 2007-2013 programming period, namely to 31 December 2015.

In order to comply with Regulation (EU) No 1311/2013 and in particular the levelling of the amount available for granting direct support to farmers as well as the external convergence mechanism, it is necessary to modify the national ceilings fixed in Annex VIII to Regulation (EC) No 73/2009 for 2014. The modification of the national ceilings will inevitably have an impact on the amounts that individual farmers may receive as direct payments in 2014. The way in which this modification will impact on the value of payment entitlements and the level of other direct payments should therefore be laid down. In order to take account of the situation of smaller farmers, especially as no modulation or adjustment mechanism, including in particular the exemption of direct payments up to EUR 5 000 from such mechanism, is applicable in 2014, Member States which do not grant a redistributive payment and which do not opt for transferring funds to rural development support via the flexibility mechanism should be allowed not to reduce the value of all payment entitlements.

Certain provisions of Regulation (EC) No 73/2009, in particular as regards the elements covered by the figures set out in Annex VIII to that Regulation and the link with the possibility given to Member States to use the funds unspent in the single payment scheme to finance the specific support, should be clarified on the basis of experience gained in the financial implementation of that Regulation.

Under Regulation (EC) No 73/2009, Member States could decide to use a certain percentage of their national ceiling for specific support for their farmers, as well as to review a previous decision by deciding to modify, or put an end to, such support. It is appropriate to provide for an additional review of those decisions, with effect from calendar year 2014. At the same time, the special conditions set out in Article 69(5) of Regulation (EC) No 73/2009 pursuant to which the specific support is paid in some Member States, which are due to expire in 2013, need to be extended for one more year, in order to avoid disruption in the degree of support. In view of the introduction of the voluntary coupled support that will be available from 1 January 2015 for certain sectors or regions in clearly defined cases, it is appropriate to allow Member States to increase the level of certain types of specific support under Article 68 of Regulation (EC) No 73/2009 to 6,5 % in 2014.

The unitary support to farmers with smaller holdings should be sufficient in order to achieve the objective of income support effectively. As no modulation or adjustment mechanism, including in particular the exemption of direct payments up to EUR 5 000 from such mechanism, is applicable in 2014, Member States should be allowed already in 2014 to redistribute direct support between farmers by granting them an extra payment for the first hectares.

The single area payment scheme laid down in Regulation (EC) No 73/2009 is transitional and was due to end on 31 December 2013. In the context of the reform of the common agricultural policy ("the CAP"), it was decided that Member States applying this scheme should be allowed to apply it for the purpose of granting the basic payment for a further transitional period until the end of 2020 at the latest. Therefore, the period of application of the single area payment scheme in Regulation (EC) No 73/2009 should be extended by one year. Moreover, in order to take account of ongoing land restructuring and for reasons of simplification, the eligible agricultural area in those Member States should also include those eligible areas which were not in good agricultural condition on 30 June 2003, as will be the case from 1 January 2015 under Regulation (EU) No 1307/2013.

In accordance with Article 133a of Regulation (EC) No 73/2009, new Member States other than Bulgaria and Romania applying the single area payment scheme may grant transitional national aid to farmers in 2013. In view of the prolongation of the single area payment scheme for the year 2014, those Member States should retain that possibility in 2014. In view of the level of complementary national direct payments under Article 132 of Regulation (EC) No 73/2009 in Bulgaria and Romania in 2014, those Member States should be able to opt for transitional national aid in 2014 instead of granting complementary national direct payments.

Transitional national aid is to be granted subject to the same conditions as those applied to this aid in 2013 or, in the case of Bulgaria and Romania, subject to the same conditions as those applied to complementary national direct payments in 2013. However, in order to simplify the management of the transitional national aid in 2014, the reductions referred to in Article 132(2) in conjunction with Articles 7 and 10 of Regulation (EC) No 73/2009 should not be applied. Furthermore, in order to ensure that the transitional national aid is coherent with the convergence mechanism, the maximum level of aid per sector should be limited to a certain percentage. In view of the difficult financial situation in Cyprus, certain adaptations should be provided for that Member State.

With a view to allowing Member States to address the needs of their agricultural sectors or to strengthen their rural development policy in a more flexible way, they should be given the possibility to transfer funds from their direct payments ceilings to their support assigned for rural development and vice versa. At the same time, those Member States in which the level of direct support remains lower than 90 % of the Union average level of support should be given the possibility to transfer additional funds from their support assigned for rural development to their direct payments ceilings. Such decisions should be made, within certain limits, for the whole period of financial years 2015-2020, with the possibility of review in 2017, provided that any decision based on such review does not entail any decrease in the amounts assigned for rural development.

Finland has been authorised to pay national support to certain agricultural sectors in southern Finland in accordance with Article 141 of the 1994 Act of Accession. Taking into account the timing of the CAP reform, and due to the fact that the economic situation of agriculture in southern Finland is difficult and that the producers are, therefore, still in need of specific support, it is appropriate to provide for integration measures whereby Finland may, in accordance with Article 42 of the Treaty on the Functioning of the European Union, be authorised by the Commission to grant national aid in southern Finland under certain conditions. Income aid should be gradually reduced over the whole period and, by 2020, should not exceed 30 % of the amounts granted in 2013.

The provisions on the farm advisory system, the integrated administration and control system and cross-compliance laid down in Title III, Chapter II of Title V and Title VI, respectively, of Regulation (EU) No 1306/2013 should apply from 1 January 2015.

Following the insertion of Article 136a into Regulation (EC) No 73/2009, references to Article 14 of Regulation (EU) No 1307/2013 in Regulation (EU) No 1305/2013 need to be amended.

Regulations (EC) No 73/2009, (EU) No 1307/2013, (EU) No 1306/2013, (EU) No 1308/2013 and (EU) No 1305/2013 should therefore be amended accordingly.

In order to allow for the prompt application of the transitional provisions envisaged, this Regulation should enter into force on the day of its publication and should apply from 1 January 2014. In order to avoid any overlap between the rules on flexibility between pillars laid down in Regulation (EC) No 73/2009 and Regulation (EU) No 1307/2013 as amended by this Regulation, that particular amendment to Regulation (EC) No 73/2009 should apply from 31 December 2013 and the amendments to Regulation (EU) No 1307/2013, should apply from the date of entry into force of that Regulation. Furthermore, the amendments to Annexes II and III to Regulation (EC) No 73/2009, which aim to ensure the continuation of the current rules on cross-compliance, should apply from the date of repeal of Directive 80/68/EEC, namely 22 December 2013.

Taking into account the fact that 2014 will be a transitional year during which Member States will have to prepare the full implementation of the CAP reform, it is important to ensure that the administrative burden resulting from the transitional arrangements laid down in this Regulation is kept to the absolute minimum.