Elo Report 2007

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CONTENTS I.

FOREWORD

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II.

SAFEGUARDING THE ENVIRONMENT THROUGH MANAGEMENT

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SOIL WATER CLIMATE CHANGE BIODIVERSITY/ NATURE AWARDS FOR ENVIRONMENT BIOMASS/BIOFUELS PLANT PROTECTION PRODUCTS GREEN BIOTECHNOLOGIES

III.

PROMOTING SUSTAINABLE AND ECONOMICALLY VIABLE AREAS THE SIMPLIFICATION OF THE CAP AND THE HEALTH CHECK RURAL DEVELOPMENT

IV.

FORESTRY SPECIFIC ACTION  EUROPEAN FOREST ENERGY NETWORK  EUROFORENET INTERNATIONAL, PANEUROPEAN AND EUROPEAN PROCESSES EUROPEAN FORESTBASED SECTOR TECHNOLOGY PLATFORM FTP ILLEGAL LOGGING CERTIFICATIONS BIODIVERSITY  STREAMLINING THE EUROPEAN BIODIVERSITY INDICATORS  SEBI 2010 LIFE+ FOREST FIRES FINAL REMARKS  CONCLUSION

5 7 8 10 15 16 19 21

23 23 26

28 28 29 30 30 30 30 31 31 32

V.

ENLARGEMENT

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VI.

STATUS OF PRIVATE PROPERTY

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DEBATE ON THE CONSTITUTIONAL TREATY EUROPEAN COURT OF HUMAN RIGHTS – ECHR FISCAL AND FINANCIAL ISSUES – REDUCED VAT AND EU REITS SUSTAINABLE ENERGY WEEK AND REVISION OF THE ENERGY PERFORMANCE OF BUILDINGS DIRECTIVE - EPBD HISTORIC HOUSES

VII. CONTACT WITH THE EUROPEAN PARLIAMENT URBAN AND HOUSING INTERGROUP SUSTAINABLE HUNTING, BIODIVERSITY AND COUNTRYSIDE ACTIVITIES INTERGROUP

VIII. PUBLICATIONS AND TOOLS EU framework for real estate investment trusts – EU REIT EUROFORENET COUNTRYSIDE

33 33 33 34 34

35 35 36

36 36 38 40

THE RURAL INVESTMENT SUPPORT FOR EUROPE RISE FOUNDATION

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PERSPECTIVES

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ABBREVATIONS & ACRONYMS

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Dear Members, Dear ELO Friends,

It is once again a great pleasure for me to present to you, our actions, our achievements and our hopes and to introduce the challenges we have to face. 2007 is over; a year during which ELO has been efficiently promoting the crucial role of private businesses and property for a prosperous countryside all over Europe in the framework of a balanced approach to social, environmental and economic considerations. It is not one at the expense of the others; it is a global approach which allows the countryside to develop its own richness and to be a unique asset for society as a whole. The livelihood of the countryside is only possible because some private managers are delivering this service. It is our belief that the future of Europe’s countryside is dependent on the individual management decisions of its millions of entrepreneurs and landowners. Burdensome regulations make little sense. Throughout European history they have demonstrated their total inefficiency when private enterprise and property are the best guarantee for economic, social and environmental protection and development, especially at a time when we are facing the first food crisis in decades. As a matter of fact the discussions about halting the loss of biodiversity or mitigating climate change are leading reasonable people to understand that without the voluntary contribution of millions of European landowners and rural users it will be impossible to make a success of these crucial challenges. As a landowner, on the one hand it is relevant for my production’s ability to keep my freedom of action as flexible as possible, on the other hand, due to my commitment to my corporate social responsibility, I like to see my management being recognised, as far as it will not set my activities in aspic and as a consequence destroy the nature the public authority was hoping to protect.

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We recognise that without land management, society and nature are in trouble. This works in both directions: land management and society need nature; and in crowded areas such as ours, nature needs the care of land management, farming and society. We are seeking to jolt the already outdated philosophy that the best way to tackle environmental problems is through more and more regulation. We suggest it isn’t, and that a far more effective way is to engage all the good volunteers from the private sector. It is not a coincidence that in 2007 ELO has been officially recognised for the first time as an environmental NGO by the European Commission. The role of the private manager as the key provider of environmental services in the countryside is, at last, publicly acknowledged at the EU level. Combined with the tremendous developments in food processing, retailing and food service, European land managers can meet the arising worldwide food deficit. However, not surprisingly, we have to recognise that modern science-based agriculture may have resulted in some loss of biodiversity and some damage to natural resources, soil water and air. This sets an even greater challenge for the modern land managers. We are asked to continue to innovate and produce the high quality food required, and in addition to reduce pollution as well as to increase the delivery of the environmental services of biodiversity and landscape. In addition to this, civil society expects us to produce more of Europe’s energy supplies without creating exaggerated tensions on the world food markets, and maybe even some additional flood protection and carbon sequestration too! Just to make this more interesting there is a drift in agricultural policy towards reducing the public financial support that this sector has enjoyed for the last half century and to expose Europe to more import competition from areas of the world which appear to have less concern for the environment. These are indeed major challenges, and it is clear that they can only be met by the efforts of private land managers working within a public policy framework suited for the task.

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To tackle those challenges we advocate one should initially understand three considerations: First, land management is like no other sector of the economy, it provides a complex, and constantly changing balance of private goods and environmental services. Second, these activities are spatially defined and climatically and biologically determined. Each plot of land is a unique mix of soil, water, climatic and ecological characteristics and is set into business structures defined by the local social and legal structures. Third, private businesses are delivering both private and public goods, and because of this securing payment for public goods. At least eight principles should underlie sustainable land management and should guide public food and environmental policies. These principles are: 1. 2. 3. 4. 5. 6. 7. 8.

An intergenerational time view, A science-based approach, Voluntary participation, Working in partnership, Proportionality, A decentralised approach, Working with natural cycles, Securing property rights and responsibilities.

We do not say that land managing owners are never responsible for environmental harm. We do however say that property rights can be developed to tackle this problem. Tradable emissions rights are an example. They can bring down overall levels of pollution, but also reward efficiency and innovation, unlike monolithic regulation. The challenge is to harness the behaviour that protects property rights at a time when new challenges such as the food crisis are arising. But let’s be clear, the economic, social and political framework has dramatically changed over the past half century. There are mounting concerns about global trends in population and economic growth, western consumption patterns, agricultural land availability, crop yields, soil and water availability, environmental degradation, biodiversity loss, and the threat to the cultural landscape, and their combined effects on food and the environment, with their economic, social and political implications.

We might be entering into the worst food crisis since World War II. The President of our Consultative Committee, Corrado PIRZIO-BIROLI, is expressing the view that such food crisis is accompanied by growing environmental stress. Britain’s chief scientific adviser has just defined food security as an enormous problem on a par with climate change. The World Food Program is unable to meet requests for increasingly expensive food aid. FAO Director General Jacques DIOUF has called for a coordinated response and a long-term solution to a structural food demand-supply gap, warned about growing social unrest and rising global hunger, and convened a conference in June to discuss the links between food, biofuels and climate change. Food supply and environmental security are interacting challenges threatening the future of our planet and its people. Climate change is happening, is man made; it’s global, and intensifies the food and environmental challenges, in particular in the developing countries, the majority of whom are net importers of food, catching up with western consumption patterns, and loosing agricultural land and top soil. As they seek to avoid food riots feeding internal insecurity and political opposition, these governments act to freeze internal retail food prices on staples, slashing import duties, and/or resorting to export taxes or embargoes, and/or food subsidies, and causing major budgetary costs and foreign debts. What happens with these countries, their soils and forests, their rural economies and their budgets will have an even greater impact on the world than what happens with ours. There is a distinct risk that Malthus will eventually prove right. We must therefore ask whether and how the world’s farmers and agricultural industry can double food production by 2030 to meet world demand using less water and less energy, and slashing gas emissions. To do this it is essential to protect the long-run food production capacity of the EU without avoidable environmental degradation. Advocates of scrapping the CAP ignore the risks this would involve. These include production intensification with increased pollution, land abandonment with rural desertification (nature needs caring) and

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reduced farm output, accelerated urbanization with additional infrastructural and environmental costs, potential difficulties for the internal market, higher world food prices with serious humanitarian, economic and political consequences. The same holds for the end of agricultural support elsewhere in the world. But, after the Health Check, CAP reform needs to continue step-by-step after 2013. As European Agriculture is becoming ever more market driven, appropriate tools need to be put in place to address widespread market failures. These market failures, partly related to technology shortfalls, are reflected in the looming world food imbalance, growing water shortages, and rising energy prices, as well as in the damage caused by competitive farming. Moreover, the delivery of public goods such as low-impact farming and maintenance of landscapes and wildlife habitats cannot just emerge from the market system. They require farmers to take specific actions that carry extra costs, which the market does not cover. They need to be remunerated by specific and targeted public payments if society is to enjoy those public goods. There is a case for a European Food & Environmental Security Policy; it is based on the Single Market, on evolving EU food and environment policies, on environmental directives, on the Göteborg declaration and the Lisbon process, and on the transboundary character of nature and climate change. The objectives of such a policy should be to provide incentives for private sector rural resource managers to produce socially optimal quantities of nutritious, high quality food and fibre, renewable energy, biodiversity, landscape, heritage, and soil, water and air management. Such a new policy is a world responsibility of the European Union and other countries that are relatively less affected and better placed to deal with climate change, and have the financial means to lead by example. The process towards a new approach cannot start from a budgetary framework. Europe must firstly agree upon the challenges that European and world agriculture, farmers and land managers, food indus-

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try and the agrifood system, and the rural areas will face over the coming years. Secondly, we must establish the tools to meet those challenges, starting from those that exist, but adding to them. Only after that can we assess the budgetary means required. These means notably concern Budget Heading 2 on the Protection and Management of Natural Resources. They need to respond to the fact that the CAP and environmental policy face bigger challenges in the first half of this century for an enlarging EU, and a more interdependent world community than they did in the last century. To sum up, we send out a call for new policy objectives for the next half century, and for special action affecting food supplies and environmental improvements. The demands on what we want from our land managers are increasing, they have a critical role in helping secure food and environmental security, there are pervasive market failures surrounding these activities, dealing with these market failures is part of EU policy. This requires the further development of the CAP, as well as the budgetary resources appropriate to meet the food and environmental challenges and produce the required security on both accounts. Wider and more challenging tasks cannot be met with shrinking budgetary means or even by all kind of burdensome regulations. It is our job to tackle it: the ELO is getting this message across to the EU institutions, the NGOs, the academic world and national representatives. The ELO is leading the debate on the relationship between ownership, business and environment both in terms of the concept and in order to develop prosperous countryside businesses and to fulfil its ethical mission. While the task is huge, we strongly believes the society is increasingly accepting this message The ELO could not achieve its goal without its members, its partners and you, who ever you are when you are sharing this conviction, in order to convey our message from European to national, regional if not local levels.

Thierry de l’ESCAILLE CEO & Secretary General

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II. SAFEGUARDING THE ENVIRONMENT THROUGH MANAGEMENT 2007 was important in terms of general public awareness on climate change and environmental concerns. Good stewardship of land has always taken into account biological aspects of land as rural activities are probably the economic sector which is most strongly dependent on the natural conditions, including climate. The landowners approach is based on the long term perspective, the production of biomass, energy and various services depending on the capacity of land. The environmental quality of the land is clearly part of its value for the present and the future generations. Most of the rural activities fall under the scope of environment legislations, and ELO ensures that the interests of rural enterprises are taken into account during the elaboration or interpretation of the legal instruments. Among the recent tools developed by the European Union are the Environmental Thematic Strategies covering seven areas, and the contribution of the EU to biodiversity through programmes and actions. ELO of course participated in the various consultations launched by the Commission. The 6th Environmental Action Programme requires the European Commission to prepare Thematic Strategies covering seven areas: 1. Air Pollution 2. Prevention and Recycling of Waste 3. Protection and Conservation of the Marine Environment 4. Soil 5. Sustainable Use of Pesticides 6. Sustainable use of Natural resources 7. Urban Environment The Thematic Strategies take a longer-term perspective in setting clear environmental objectives until around 2020 and will thus provide a stable policy framework. ELO participated in the consultation processes in order to ensure that the policy tools chosen have an added value, are cost effective and are the least burdensome for its members,

while reaching the objectives. It is important that the new tools address the problems in a holistic manner, based on sound science, while clarifying existing legislation. ELO also underlined the need for proportionate and workable legislation. ELO notably focused in 2007 on the environmental legislation affecting the main media and their interrelation on rural property: soil, water, air. Biodiversity was also a main concern, especially as it relates to rural multifunctionality and diversity. This includes of course forestry, agriculture, hunting, fishing and the production of environmental services

SOIL What is Soil ? Soil is a most valuable but finite resource under environmental pressure performing many functions vital to life such as food and biomass production, storage, filtration and transformation of many substances including water, carbon, and nitrogen, etc. Besides its role as raw materials provider, it also serves as a habitat and gene pool, as well as a platform for human activities, landscape and heritage. These functions involve complex interactions within the soil itself, between the soil and the crop/grazing animal and between the soil and the wider environment.

A need for protection ... For ELO, there is no doubt that the functions of soil are worthy of protection thanks to their socio-economic as well as environmental importance. Sustainable rural development can be reached through adequate soil management, combined with the protection of water and further natural resources. Both the European Commission and our organization recall that there is a need of better understanding and more research to be done in this respect. Besides, land managers and landowners are very well aware of the fundamental aspects of sustainable soil management.

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The intervention of man into this natural set of inter-relationships has provided the basis for much of modern life from food production to infrastructure grounds. The point is not to forbid human activities on soil, but to minimise their negative effects on its functions. Some European soils are facing major threats, reversible or not, enhanced by unsustainable use of soils and climate change.

... Addressed at EU level ... These threats were addressed during the Working Groups preparing the Thematic Strategy for Soil Protection in which ELO actively took part, focusing on erosion, contamination, sealing, compaction, reduced organic matter, salinisation and landslides.

In direct line with its policy, ELO enhances awareness with regard to environment and soil management in the rural world with its “Environment and Soil Management Award” in close cooperation with the scientific world and the European Union Services. The 2007 Soil award will be presented in 2008 on the occasion of the gala dinner that follows the First forum on the future of agriculture (27 March 2008) to Eugenio SEQUEIRA, Liga para a Protecção da Natureza for its outstanding contribution to soil recovery in a rural threatened ecosystem in Portugal.

This Strategy, which has been the subject of intense discussions between the European Institu-

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tions, the Members States and the numerous stakeholders during 4 years, has as its main objective to ensure the protection and sustainable use of soil in the EU by preventing soil degradation, preserving soil functions and restoring degraded soils. So far, only nine EU Member States have implemented specific legislation on soil protection. However, different EU policies such as water (including floods and droughts), nitrates, waste, chemicals, industrial pollution prevention, nature protection, pesticides or agriculture, are already contributing to soil protection. ELO agrees with the EU Commission that there needs to be a more holistic approach to the coordination of soil protection policies.

... Trough the Soil Thematic Strategy ... The Commission adopted a Soil Thematic Strategy (COM(2006) 231) and a Proposal for a Soil Framework Directive (COM(2006) 232) on 22 September 2006 with the objective to protect soils across the EU. The Strategy and the proposal have been sent to the other European Institutions. The European Parliament adopted the Directive on Wednesday 14 November 2007, with 501 votes in favour and 160 against under the codecision procedure (first reading). The Rapporteur Cristina GUTIERREZ-CORTINES said that the text takes into account “the enormous differences existing among soils and leaves the national authorities with the choice of the forms and the methods to protect them“. She also said that “this Directive is the first piece of Community law that recognises the positive role of agriculture on soil protection and tackles the issue of climate change“. The report has indeed redrafted the original proposal of the European Commission to conciliate the views of those who think this rule is necessary and those who think the existing rules in the Member States are enough to protect soils. It contains for example a provision stating that within five years of the transposition date, Member States will have to identify the “priority areas” which need special protection against erosion, organic matter decline, soil biodiversity

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loss, compaction, salinisation, landslides, desertification or acidification. It indicates that the choice of measures to combat these phenomena will be left to the MS. It states also that MS which already have national legislation in place will be exempted (Netherlands, Spain, Sweden, Austria, Belgium, Denmark, France, Germany, United Kingdom). However, in December 2007, in spite of the various attempts of the Presidency to present compromise proposals in order to meet delegations’ concerns, it was not possible, at this stage, to attain the qualified majority needed to reach political agreement on a draft directive establishing a framework for the protection of soil. Negotiations between MS on the subject have been very difficult. A group of MEPs lead by the Rapporteur Cristina GUTIÉRREZ-CORTINES have called for the controversial soil directive to return to the EU agenda as soon as possible and the Commission is also willing to overcome the political blocking alliance that prevent the MS to agree on the proposal. ELO has been and will continue to actively lobby the EU institutions and national governments to make sure that the new Thematic Strategy and its Framework Directive will be consistent with the existing policies and contribute to the elaboration of workable tools. The Organisation also participated in the Internet Consultation launched by the Commission on the subject.

... But a need for a sustainable approach, leaving room for subsidiarity ELO has welcomed the Strategy but has been calling to the Commission’s attention the question of whether the approach to sustainable soil management wouldn’t be better tackled through a guidance document linked to maintaining good agricultural and environmental conditions rather than via a regulatory framework such as a Soil Framework Directive. Through its lobby actions, the Organisation has also informed the Commission and the EU Parliament that Member Sates who already have the ad hoc legislation in place should not be subject to additional administrative requirements.

In any case, ELO has been and, in 2008, will be thoroughly monitoring the whole adoption process to make sure that it will be based on sound science, and that no additional burden will be imposed on land managers and owners, or at least, ensure that these constraints will be remunerated. The main barrier to the adoption of improved soil management practices in agriculture is indeed their cost. ELO has been constantly advocating in favour of incentives for environmental services provided by land businesses, such as agri-environmental payments, which is a very good way to encourage land businesses to mitigate the threats. The Soil Thematic Strategy entails: ­ A Communication from the EU Commission (COM(2006) 231) explaining why further action is needed to ensure a high level of soil protection, sets the overall objective of the Strategy and explains what kind of measures must be taken. It establishes a ten-year work program for the European Commission. ­ A proposal for a framework Directive (COM(2006) 232) setting out common principles for protecting soils across the EU. ­ 2 Impact Assessment (SEC (2006) 1165 and SEC(2006) 620) containing an analysis of the economic, social and environmental impacts of the different options that were considered in the preparatory phase of the strategy and of the measures finally elected by the Commission.

WATER Europe, in general terms, is characterized by abundant water resources. Nevertheless, due to the growth of Europe’s population and its needs, the demand for water is rising. Various human activities, such as agriculture, industry, urbanism or tourism, if unbalanced, can lead to an overexploitation of water resources. For that reason, ELO is actively participating in different meetings and actions, to promote and maintain a long term sustainable use of all natural resources, to ensure water security and environmental sustainability, and preventing water quality deterioration, loss of natural habitats or desertification.

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ELO believes that the future of European agriculture and forestry, as well as of the landscape, is without doubt linked to a sustainable water management. Therefore, to follow the setting of environmental objectives and their implementation, having significant economic and social impacts, ELO is involved in different activities organised by the European Commission – DG Environment, under the umbrella of CIS. At present, ELO is also full member of the Strategic Coordination Group, the Strategic Steering Groups “WFD and Agriculture”, “WFD and Hydro-morphology”, the Working Group on Flood Risks Management and Stakeholder Forum on Scarcity and Droughts. In all these groups, ELO seeks to improve the perception that other stakeholders have of landowners’ activities and their impacts on water. Taking into account the available resources and relevant timeframes, ELO also plays a key role in identifying instruments and measures within the CAP and the Rural Development Programme which can be used to help landowners and managers achieve the WFD objectives. At present is also taking part in the preparation of the forthcoming guidance document on “Land Use & Groundwater”, aiming to clarify land use pressures on groundwater in the light of the current legislative framework. ELO promotes best practices and incentives, and provides its expertise on other European policies linked to water resources, for example the Nitrates Directive, pesticides or Natura 2000 network. Participation in such events as the European Water Conference (March 2007) and the launch of the WISE (Water Information System for Europe, www.wise.eu), or in the preparation of the 5th World Water Forum (to be held in 2009 in Istanbul), allows ELO to anticipate the requirements for water management in the EU.

to a comprehensive and ambitious new international agreement on climate change by the end of 2009. For land managers and landowners, the impacts of climate change are mixed (a little warming does not necessary harm), but mostly negative, such as higher CO2 concentration, increase of droughts, floods and storms, often accompanied by an increased spread of plant and animal diseases, the combination of factors hence leading to greater volatility to manage.

Context: The EU produces around 22% of global greenhouse gas (GHG) emissions. In order to address climate change, the Kyoto Protocol (agreed on 11 December 1997 at the 3rd Conference of the Parties in Kyoto, entered into force on 16 February 2005) establishes an international policy context for the reduction of carbon emissions (the EU has agreed to a cut by 8% from its 1990 emission levels by 2008-2012) and increases in carbon sinks. It entails the principle of financial and technological transfers to land management projects and initiatives (through forestry and farming) that sequester and protect carbon stocks through the Clean Development Mechanism (CDM) and Land-Use, Land-Use Change and Forestry Mechanisms (LULUCF).

CLIMATE CHANGE

In December 2002, the EU created an emissions trading scheme (EU-ETS, became operational in 2005) in an effort to meet these tough targets through the first and biggest market enabling companies to trade carbon dioxide emissions into the atmosphere.

Climate change was the hottest topic in 2007, mainstreamed in the main policies at EU level, and culminating with the United Nations Climate Change Conference in Bali in December 2007, where the Bali Roadmap was adopted. As a result of the Conference, the EU’s top priority is to come

It means that quotas were introduced in six key industries (energy, steel, cement, glass, brick making, and paper/cardboard) as well as a system that punishes MS that fail to meet their obligations, starting from a fine amounting €40/ton of carbon dioxide in 2005, and rising to €100/ton in 2008.

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Towards a low carbon economy:

Special focus on carbon sequestration: CALM

At a time where the term “low carbon economy” (i.e. an economy which has a minimal output of GHG emissions into the biosphere) is at everyone’s lips, all sectors of society have the responsibility to reduce their own GHG emissions and to think carefully about their potential impacts on climate change and conversely what impact will climate change and global warming have on their activities. European landowners and land managers therefore have a crucial role to play!

For ELO: Carbon Sequestration has to be rewarded in accordance with its significant contribution to emission reduction targets.

In 2007, the EU Commission proposed an Energy package including a Renewable Energy Roadmap that included a unilateral 20% reduction in GHG emissions by 2020 and a separate Strategic Energy Technology Plan (SET Plan) was also proposed in order to support the 20% targets by increasing the use of 'clean' or low GHG-emitting energy technologies. Financing issues related to this Plan have been delayed until November 2008. On 23 January 2008: the EU Commission proposed a new bouquet of measures: the socalled Climate change and energy package, which includes ­ An updated Emissions Trading System to create a borderless ETS to drive cuts in GHG emissions from big industrial emitters with an EU-wide CO2 cap ­ Specific, binding national targets so that Member States know exactly what they have to do outside the ETS, in sectors like transport, buildings, agriculture and waste. ­ New rules to stimulate carbon capture and storage (CCS) ­ A new approach through a Directive proposal to actively promote renewable targets, again including binding national targets. ­ New state aid rules.

CALM means Carbon Accounting for Land Managers. It is a publicly available, fully-free, on-line, business-based calculator of annual flows of GHG emissions and carbon sequestration from a defined land-based business. It follows the widely used and internationally agreed Intergovernmental Panel on Climate Change (IPCC) methodology for business to understand, quantify and manage their GHG emissions. The methods used for the national GHG inventory have thus been adapted for application to individual businesses.

The rural world is aware of its share of responsibility in terms of contribution to climate change - as farming is the source of 2 powerful greenhouse gases (methane and nitrous oxide) which must be reduced-, but also of its unique role in mitigating climate change through good land management practices (i.e. leverage effect).

In 2005, ELO, the CLA together with the University of East Anglia launched a research project monitoring the greenhouse gas impact of land management activities: the CLIO/CALM project. This study, which was published in 2006, investigates more specifically the carbon sequestration capacities of farms and forests on private estates in Europe.

CALM will enable farmers and land managers to assess their level of emissions and sequestration and then consider remediation measures taking into account for example energy efficiency, fertiliser use efficiency, manure systems, renewable energy. ELO already actively promotes concrete measures : ­ Enhance water resources through building of reservoirs ­ Adapt cultivation practices (no-tillage) and cropping ­ Livestock management through prevention of heat stress and diseases ­ Mitigation of soil erosion by maintaining vegetation cover ­ Conversion to uneven-aged, mixed species forests with continuous cover and replacement of individual tree species (better suited to the site and climate) ­ Greater investment in sea defences and coastal management techniques

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­ Careful management of native biodiversity and effective control of alien invasive species + management and creation of habitats at lower altitudes (including wetlands and along the migration routes) ­ Economic and sectoral diversification (i.e. tourism, sustainable hunting/angling…) These management systems are public goods and environmental services which should be supported by the EU. The carbon calculator is available on ELO’s website.

The rural environment and European forests are significant tools for climate change mitigation thanks to the production and supply of carbonsaving renewable energy (including “2nd generation and beyond” biofuels) and of sustainable building materials (timber or hemp for eco-building), as well as their carbon storage capacity in soil and trees (see CALM project). Unfortunately, the interest in carbon sinks varies between countries. For ELO there is a clear need for developing a common position taking into account the wide range of social and economic benefits that land-use projects could provide. For the past few years, ELO has been - and still is actively promoting the use of alternative energies, through for instance converting estates’ use of fossil fuels energy to renewable energy sources such as biomass, wind turbines, hydro electrical, solar, etc. It important to recall that there is not only one type of renewable energy but a real bouquet enabling combinations. During 2007, ELO actively promoted these activities on the occasion of the various events that it organized in the EU 27, namely on the occasion of ELO’s participation at the Irish National Ploughing Championship that took place in Tullamore (Ireland) on 25-27 September 2007, in the tent of the EU Commission, during the Green Week in Brussels (May 2007), etc, as well as through its position papers and various articles published in the press. ELO has also worked in collaboration with its partners to find environmentally friendly low carbon solutions.

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BIODIVERSITY / NATURE Over the generations the countryside has preserved the environmental riches we currently enjoy in Europe since it is the foundation for productive services and a storehouse of food and non-food resources. Sustainable development requires the 3 pillars – environmental, social and economic – to be balanced. Excessively burdensome transposition of Community texts can hinder the viability of rural businesses. Natura 2000 and the preservation of biodiversity must not lead to a long list of short-sighted bans. The implementation of the network must be based on scientifically established needs so that the management plan can protect those species which are in need of protection. A good understanding of what Natura 2000 implies an ongoing dialogue between the different administrations, scientists, environmental bodies and the users of the land. Conservation objectives can only be achieved in partnership with the managers and users of the land. Interaction between man and nature is fundamental. The recent enlargement of the European Union and the growth of the Natura 2000 network that ensued demonstrate that there is still a need to inform and communicate with rural stakeholders Aware of this problem, ELO has once again begun a programme intended to respond to this demand.

A/ Natura 2000 Networking Programme (NNP) Launched on 13 March in Brussels, co-organised with EUROPARC and EUROSITE and with the support of the European Commission - DG Environment - the Natura 2000 Networking Programme (NNP) was the next step of the Natura Networking Initiative, organised in 2006. Covering several topics, the three partners demonstrated their common will to reflect the commitment of their members and partners to conservation and European biodiversity. The Train the Trainers seminar (23-27 April, near Vienna) was followed by 15 na-

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tional workshops and a final conference ( 28 November in Brussels) plus ‘technical’ support such as guidelines, practical cases, survey, the Twinning Lite project and the website www.natura.org. The Austrian seminar, organized on the shores of the Danube delta, brought together over 30 ‘ambassadors’ representing almost all the EU countries. For five days people who work with Natura 2000 on a daily basis were able to network (an idea copied in the Twinning Lite project with a sort of sponsoring scheme among the various members). This seminar enabled them to share their experiences and perceptions of the problems and thus communicate more efficiently with a broader public. Cooperating, supporting each other and ultimately contributing to a better understanding of Natura 2000 were some of the keys to the success of this meeting on the Danube. The future challenges were also examined, the biggest one being the funding of environmental policies. The fact is that with the exception of LIFE+, environmental policies are not directly funded as such but are part of integrated systems and thus use funds available to the CAP (Common Agricultural Policy), rural development, structural funds, research funds or even fisheries funds, which shows how complicated it can be even for the informed user. Apart from the question of fund accessibility, the need for information to be accessible is the most pressing one for rural stakeholders. With a network composed of 25,000 sites, i.e. 20% of the EU’s territory (April 2007, but the EU data was for 25 Member States), today with the EU’s 27 countries the network covers 9 biogeographical zones. To respond to that DG Environment has drafted specialist documents, such as management models, targeted workshops and on-line helpdesks etc. However, the implementation and management of these environmental policies is the responsibility of the Member States. Each partner in the NNP project organized 5 workshops and ELO was responsible for 5 national seminars taking place in Latvia (12 July), Romania (4 September), Luxemburg (12 September), Poland (9 November) and Portugal (14 November). All workshops were co-organised with the support of

our respective members, in the presence of representatives of the ministries of the environment and agriculture, the European Commission, local and regional authorities, businesses, NGOs and our members and local partners. It is interesting to note that their conclusions coincide. The most important of these is the issue of who should fund environmental services. Managing the land requires long-term perspectives and five year management plans have been judged too short if we take into account the two major European reforms underway – that of the CAP via the 2008 health check, and that of the budget intended to prepare the 2008-2020 perspectives. The need to draw up the right specifications as part of detailed legislation was also mentioned as a primary point. The participants also highlighted the need to be included in the designation and adjustment process of environmental legislation. This is in order to avoid the landowner discovering that his estate is part of the Natura 2000 network and not having a clue how it works. This active participation builds trust between the different users of the natural environment and promotes knowledge of everyone’s needs. Such a ‘bottom up’ approach on a local and national level prevents the wrong message getting through and means problems can be anticipated in the field and more readily settled in the event of a dispute. This consensus, backed up by explicit and transparent rules, is vital to clearly identify the advantages for the users and managers of the Natura 2000 sites. By pooling examples of good and bad practices, they can find new activities and thus adjust better to market demand. The final NNP conference took place on 28 November 2007 in Brussels. As ELO strongly underlines, private owners have been protecting nature and biodiversity for decades. They adapt as nature evolves, with the intention of transferring it to future generations. However, it is indispensable to find the right balance between economic needs, environmental conservation and social imperatives in order to continue this approach on a daily basis. This is only possible if economic conditions are reliable.

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B/ SUSTAINABLE HUNTING and ANGLING ELO believes that for hunting and angling to be sustainable they need to be well integrated into all the activities of the countryside as well as accepted by the public while respecting biodiversity (in part through the Natura 2000 management plans). Wildlife territory managers, hunters and anglers have every interest in preserving the habitats and diversity of the species living on their territories and must therefore be considered capable of providing solutions to the challenges of biodiversity. Sustainable hunting and angling, together with the appropriate management of wildlife territories provide undeniable added value to our common heritage. However, these truths must be explained to society which all too often is unaware of them and misunderstands their vital function. Throughout 2007, ELO has been spreading the message, thanks to a vast communication campaign with the publication of articles in numerous periodicals, that communication is an essential part of conservation; the lack of it often leads to paralysis and even hostility. A constructive dialogue between wildlife managers and the different rural stakeholders is fundamental, requiring honesty and transparency. Sterile battles where both sides lose out are pointless, not to mention harmful to biodiversity.

The ELO’s “Pilot Wildlife Estates” and “Sustainable Hunting” Initiatives are in line with the whole set of EU environmental legislation, as well as with the Guidance Documents on Hunting of the EU Commission and with the Agreement between BirdLife and FACE, the Federation of the EU Associations for Hunting and Conservation. ELO runs the Secretariat of the European Parliament Intergroup on Sustainable Hunting, Biodiversity and Countryside activities in partnership with FACE.

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I. “Pilot Wildlife Estates” Initiative (PWEi) It is in this spirit that ELO and its partners launched the ‘Pilot Wildlife Estates’ (PWEi) initiative in 2003. This new management and communication instrument sets up a network of hunting territories which are considered to be exemplary. This network acts as a catalyst for initiatives which are designed to lead to new management formulae. Apart from a highly beneficial exchange of experience, the initiative has established simple but precise principles for the good management and conservation of ‘wild life’ territories throughout Europe, divided up according to the different biogeographical regions of the European Union. This initiative is currently being orchestrated by ELO in cooperation with ONCFS (National Office of Hunting and Wild Fauna), ANPC (Association of Portuguese Hunting Producers), IIMA (Iberian Institute for the Environment) and the European Commission. Creating a set of principles, criteria and indicators means hunting and fishing grounds can be managed transparently and objectively, taking into account the three pillars of sustainability, i.e. conservation, economics and socio-cultural aspects. The idea is to produce guidelines for each biogeographical region and a ‘label’ promoting the concept of ‘sustainable hunting’ in these areas. This label is to be based on good practice, using criteria and indicators identified in the exemplary territories selected. To apply for a label each territory must follow a two-speed procedure. The first stage consists in signing a Charter listing the founding principles and concepts of the PWE initiative. Then to obtain the label the candidate territory fills in a questionnaire to prove it fulfils the eligibility criteria and other general requirements, as well as a series of specific criteria assessed against a grid for each biogeographical region. The specific criteria and assessment grids proposed by the first pilot territories were approved in full by the European working party during the plenary in Spa at the end of August 2007. These territories, which apply the concept of sustainable hunting fully according to

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both European and international regulations, received their labels on this occasion as recognition for exemplary management. They are the Crown Hunting Grounds in Belgium (Hertogenwald and St Michel-Freÿr) for the region of continental Europe, La Garganta in Spain and Herdade da Raposa in Portugal for the Mediterranean, and the Chambord Estate for the Atlantic regions.

good practices and management in hunting estates will be produced. This handbook will consist of guidelines based on the different experiences of all partners involved today in the PWE initiative. In 2008, it will be then proceeded to the extension of the labellisation to other estates

PWEi is an integrated initiative which does not simply focus on conservation of biodiversity but also accommodates socio-economic aspects. In particular it allows diversification of income in the countryside by creating a ‘wild life products’ economy such as hunting, bird-watching, marketing local produce or landscape conservation. This is crucial at a time when cuts to the Community budget will inevitably affect farming and the financing of rural development. Turning now to the socio-cultural aspects of PWEi, they too clearly have a positive impact on the involvement of the local community as well as creating jobs in managing wild life and its habitats. Wild habitats possess considerable potential for society, in part due to the show-case effect they have in raising awareness about the quality and variety of wild life and its habitats. Thanks to their exemplary management, the first areas with PWEi labels will serve as a model for many other territories. In November 2007, the initiative was presented at EU level on the occasion of the business and biodiversity conference that took place in Lisbon, organised by the Portuguese Presidency. The next steps foreseen in 2008 for the initiative are the adaptation of the evaluation grid and the labellisation of test cases for the Nordic, Boreal and Alpine regions, followed by the setting-up of the national evaluation committees. In a first period, labellisations will take place upon invitation of the members of the EU PWEi Evaluation Committee and through the various national Evaluation committees. On the basis of these test cases a handbook of

II. Sustainable Hunting and Angling Initiative (SHAI) ELO has launched the SHAI project, in partnership with FACE and IUCN and with the support of the European Commission. ELO had previously participated in the Sustainable Hunting Initiative (SHI) aiming at addressing the controversy and confrontation between hunters and other conservationists by facilitating dialogue on issues raised by the interpretation of the Birds Directive. The rationale behind this initiative was that these stakeholders share a common interest in preserving wild birds and their habitats. Building on the achievements of SHI, the SHAI programme seeks to identify and assess the progresses and weaknesses in reaching the hunting community and explore the possibilities of extending the SHI to non-bird species covered under the Habitats Directive (mainly mammals) and engaging other wildlife recreational users particularly anglers.

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The establishment of the Natura 2000 network is a major achievement for the conservation of biodiversity and of biological resources in the EU and it is now a priority to ensure that there is sufficient expertise, local knowledge and resources for the management of these Natura 2000 sites. ELO believes that one of the key obstacles in the creation of the network has been local opposition, often stemming from misunderstanding about the aim and implications of the network. For the future management of sites this problem is likely to persist. In this process, all concerned stakeholders – such as private rural actors, public authorities, conservation NGOs – must be involved. This is why raising awareness through the provision of clear and reliable information and by open and constructive dialogue between these stakeholders is essential to the success of the network. In this respect, hunters and anglers together form a stakeholder group which is highly representative of rural communities, with close links to land use practices, and covering a broad spectrum of socioeconomic backgrounds. Raising awareness of hunters and anglers is therefore an efficient way to transmit the aims of the network to our rural actors at local level, living in and around Natura 2000 sites. Therefore ELO’s ambition in the SHAI programme ambitions is to further ameliorate the sound implementation of the Natura 2000 network to the benefit of the countryside and nature.

C/ ELO participation in various European Commission meetings ELO lobby action during 2007 was also focussed on technical aspects of the elaboration of the environmental legislation related to biodiversity protection or interpretation of existing legislation. Indeed, the potential pressure on the rural activities depends on the interpretation of the concepts defined in the directives and their national implementation. Therefore ELO participated in the European Commission expert groups such as the Habitats Committees, the biodiversity expert

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group SEBI-Streamlining European Biodiversity Indicators, the Invasive Alien Species and the Business and Biodiversity initiative. During theses meetings, the ELO members’ viewpoints were regularly expressed either orally or via written contributions. These groups are particularly interesting as in addition to the representatives of the Commission, the participants come from the European Environmental Agency (EEA), national ministries and other NGOs.

D/ ELO synergy with other lobby groups on biodiversity: the Natura 2000 Users Forum ELO during 2007 also worked in close collaboration with other lobby groups involved in biodiversity management via its Natura 2000 Users Forum. This platform enables us to share information with other groups acting at the European level and to create synergies on common concerns. The core task was focussed on the articles of the Natura 2000 Directives, notably article 6.4, article 8, article 12 on strict liability and article 17 on reporting, and the maritime designation process.

E/ ELO support to its members ELO during 2007 provided information and support to its members on specific cases related to Natura 2000 and biodiversity protection, notably concerning the local interpretation of the Directives and the relation with the local stakeholders and administrations. These cases not only have a local interest but also underline the difficulties of an adequate implementation in the field and become show cases for our network.

F/ ELO Participation in Green Week 2007 ELO actively participated on behalf of its members in Green Week 2007 organized in Brussels by the European Commission, having two stands, in the

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Charlemagne building and - for the 1st time in the Green Week edition- also in the Parc du Cinquantenaire. As on previous occasions, FCS and ELO wanted to share the experience of the management of private properties, via best practices, to better respond to the new needs of the European citizens: protection of biodiversity and human activities, man and nature, scarcity of natural resources such as water etc. One of the drivers was to involve the next generation, via its daughter organization (Young Friends of the Countryside), which gathers members between 18-35 years old, to develop and link the environmental spirit with the economic viability, to connect the countryside “lifestyle” and the technology innovation (such as renewable energies, use of water resources, air protection, Climate Change etc). The ELO and FCS members’ action was particularly well perceived and the stand received a lot of visitors asking questions and details.

development in rural areas. These aim at rewarding innovative, environmentally friendly and entrepreneurial achievements in the European countryside.

1. Anders WALL Award Since 2002, the Anders WALL Foundation (Sweden), Friends of the Countryside, DG Environment and the Royal Agriculture Academy of Stockholm have been presenting an annual award to encourage and promote efforts made by creative entrepreneurs who have contributed to the creation of a “positive rural environment”: landscape preservation, biodiversity enhancement, cultural heritage conservation and contribution to the rural economy. The Anders WALL Award 2007 was presented to the Jarras-Listel estate, represented by Paul-François VRANKEN, who understood very early on the role of environmental protection combined with sustainable use of landscape for wine production on a relict sandbank from the Rhone river included in the Natura 2000 network. http://www.friendsofthecountryside.net/ award.htm

AWARDS FOR ENVIRONMENT ELO, its sister organisation Friends of the Countryside, and their partners have created a series of European Awards in order to promote sustainable development in rural areas. These aim at rewarding innovative, environmentally friendly and entrepreneurial achievements in the European countryside. ELO, its sister organisation Friends of the Countryside, and their partners have created a series of European Awards in order to promote sustainable

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2. Belleuropa Award The Belleuropa project, was launched in Italy in the late 1990’s, thanks to the initiative of Giuseppe NATTA, a leading environmental figure, with the cooperation of ELO. Belleuropa is based on the principle that in much of Europe, the rural territory is highly degraded, and a quality environment is thus a scarce resource upon which much value is placed today. The Belleuropa Award is presented to a rural property, which thanks to agri-environmental measures has developed into an important example of Third Generation agricultural production, achieving significant results from an environmental point of view. In 2007, the Belleuropa Award was presented to les Salins du Midi (France).

K. KOSTOPOULOS, E. SEQUEIRA, T. de L’ESCAILLE

BIOMASS/BIOFUELS Today’s world is undeniably facing climate change. The dramatic consequences of the latter, when combined with the rising demand in food following the steepening of the population curve above all in developing countries, and with a global energy demand forecast to increase by 50% by 2025hence two factors really not likely to improve the situation-, imply that we need to find measures to mitigate global warming, namely in reducing greenhouse gases (GHG) emissions.

C. PIRZIOBIROLI and B. GAUTHIERDARCET

3. Environment and Soil Management Award Created by ELO, under the patronage of Commissioner DIMAS, with the cooperation of DG Environment, the Universities of Vienna and Ljubljana, the EU Joint Research Centre of Ispra and Syngenta International, the Environment and Soil Management Award recognizes outstanding management achievements contributing to the improvement of environmental quality and to the protection of soil and land. The 2007 award was given to Eugénio SEQUEIRA, President of the Liga para a Protecção da Natureza for its outstanding contribution to soil recovery in a rural threatened ecosystem in Portugal http://www.elo.org/index.php?page=pages/soi l.php

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ELO promotes sustainable agricultural non food production when it is implemented through good practices and agri-environmental measures which most of the time require incentives to help landowners and land managers to provide the environmental services that society expects from them.

The EU also has to decrease its energy dependency, namely through the diversification of fuel supply sources thanks to renewable energies. In addition, global production has been growing worldwide involving the increase of waste and byproducts which need to be taken care of. Besides, it is important to diversify the agricultural market outlets as well as employment opportunities in rural areas in order to avoid abandonment of land, which is very detrimental for the environment.

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The EU Commission has set up energy and climate change policy objectives: to reduce greenhouse gas emissions by 20% and ensure 20% of renewable energy sources in the EU energy mix; in order to reduce EU primary energy use by 20% by 2020. It would save the EU some € 100 billion and cut emissions by almost 800 million tonnes a year. To that end, there is a strong need to develop costeffective low carbon technologies, including the use of biomass and sustainable biofuels. With this mind, in 2007 ELO organised and attended numerous conferences and events throughout the EU 27, such as the Sustainable Energy week that took place in Brussels, as well as meetings with MEPs, national and EU high-level officials, in order to explore partnership opportunities with ELO on this matter.

3 main types of biomass • Agricultural resources (flax, rape, chicory, beetroot, perennial grasses, miscanthus, etc) • Forestry resources (forest residues, wood industry sub-products, very-short-rotation coppices) see ELO’s EUROFORENET programme. • Waste (manure, agro-alimentary industries, etc) Uses • Biomass for heat • Biomass for transport fuels (biodiesel form oilseed rape, bioethanol from wheat, sugar beet.., ETBE, etc) • Biomass for electricity • New products from Biomass research (biochemicals, solvents, biopolymers, biolubricants, biomaterials , etc) • Building materials Processes combustion, gasification, cogeneration, biomethanisation, plant chemistry, etc

Biomass is all renewable raw material of plant or animal origin destined for non-food use, and can be considered as one of the most important renewable energy sources thanks to several benefits including large savings in GHG emissions. Its sustainable use is part of a virtuous circle that enables the efficient management of waste, supporting an integrated approach, and when produced locally

allows minimising fossil fuel use in processing and fuel transport. It is nevertheless crucial to remember that biofuels widely vary in terms of their impact; it is hence necessary to monitor the whole life cycle of each type of biofuel, i.e. how they are produced (intensive v. extensive production, use of fossil-based fertilisers, fossil fuels, etc.) and their impacts on soil, water resources, biodiversity etc. Energy Efficiency is a key word: 2nd (and 3rd) generation biofuels have a bigger potential than 1st generation crops, which are limited and can compete directly with food production, even though they prepare the way for the next generations. However these new alternative materials are faced with the technical challenges of being converted into high-performance fuels and to ensuring that life-cycle CO2 production is low, performance of the fuel is high and manufacture can be commercially viable. In addition, they are expensive to produce. More research, adequate policy and legal framework are needed, as well as deeper involvement of the decisions makers and of the investors.

EU support for bioenergy: The use of biomass for energy receives support from the Common Agricultural Policy through the CAP reform (decoupled income support, energy crops on set-aside areas, energy crop premium, sugar reform – with sugar beet for ethanol eligible under both regimes, exempt from quotas, etc), from the Rural development Regulation (2007-2013) with its set of measures in support of renewable energy (e.g. biomass supply chains, processing capacity, bioenergy installations, including energy use of forest material), and from funds dedicated to Research through technology Platforms (industry-led co-operation to develop Strategic Research Agendas (SRAs) which set R&D goals and priorities such as forest-based Sector Technology Platform (www.forestplatform.com); biofuels Technology Platform (www.biofuelstp.eu), plants for the future (www.epsoweb.org), sustainable Chemistry (www.suschem.org) and the 7th RTD framework programme as well as Intelligent Energy for Europe.

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Main EU legislation regulating the use of biomass/biofuels: – Directive 2001/77/EC on the promotion of electricity produced from renewable energy sources in the internal electricity market – Directive 2002/91/EC on the energy performance of buildings – Directive 2003/30/EC on the promotion of the use of biofuels or other renewable fuels for transport – Directive 2003/87/EC on a scheme for greenhouse gas emission allowance trading within the Community – Directive 2004/8/EC on the promotion of cogeneration based on a useful heat demand in the internal energy market – EU Biomass Action Plan 7/12/2005: COM(2005) 628 final – EU Strategy for Biofuels 8/02/2006: COM(2006) 34 final-adopted by Council 8/06/2006 – EU Forest Action Plan 15/6/2006 (COM(2006)302 final) - Proposal to revise Directive 98/70/EC relating to the quality of petrol and diesel fuels and amending Council Directive 93/12/EC, 31 January 2007 - Communication Towards a low carbon future – A European Strategic Energy Technology Plan Com(2007) 0723 In 2008: 23 January: “Climate and Energy package” including a new approach to actively promote renewable targets, again including binding national targets - Proposal for a Directive of the EP and of the Council on the promotion of the use of energy from renewable sources {COM(2008) 30 final}

ELO and the RISE Foundation jointly organised in January 2008 a Seminar entitled “food, feed and bioenergy: priorities and dilemmas” where ELO Consultative Committee Chairman and RISE Foundation CEO Corrado PIRZIO-BIROLI delivered a key note address explaining that escalating prices and environmental degradation are signs that the population explosion, urbanization, economic development and that changes in consumption patterns are progressively causing food, feed and energy shortages, and leading the world towards eventual environmental collapse. Food-, energy-

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and environmental security have become major policy challenges for our planet and its people, and biofuels influences all of them. The conclusion of the Seminar highlighted that the development of sustainability criteria and carbon certification is necessary in order to provide the framework for decisions as to which plants and what production methods provide an acceptable net contribution to GHG reduction and should therefore play a part in target implementation. For ELO, the key question for Europe is whether it is justified to establish strict biofuels targets - such as the 10% obligation of transport fuel by 2020 as advocated by the Commission in the EU Climate and Energy Package- and provide incentives for biofuels to enable an emerging industry. Biofuels are a key part of our current and future energy mix. Diversification into biofuels can bring many benefits with it, especially as technology and research allow increasing use of second (and beyond) generation sources. It can lead to a win-win situation which could be beneficial universally for the rural world, governments, the environment and investors. However, it is important to ensure that any action taken is properly researched, targets are realistic and, most of all, sustainable. In making these decisions, ethical and political issues, in relation to food security and the competition between food and fuel must be carefully considered, as well as the geopolitical consequences and impacts on the developing world. In addition, ELO, strongly concerned by the irreversible effect of intensive energy crops production caused by massive deforestation in third countries such as Brazil, would welcome the cre-

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ation of certificates to ensure that biomass imported from such countries respect environmental standards, such as cross-compliance requirements. It could also avoid the risk of distortion of competition for EU farmers, who have to respect these requirements to receive their direct payments.

PLANT PROTECTION PRODUCTS The primary function of the rural world is to feed an ever growing population through the use of safe products. Food safety is indeed a major requirement that Europeans consider the responsibility of the agricultural sector. This has been made possible thanks to the development of pesticides, principally composed of the plant protection products (PPPs) and the biocidal products to manage pests, diseases and weeds. This synergy between agriculture and food also means quality and control over production processes and final products, hence representing one of the main strengths of European agriculture. The 21st Century sees the development of another crucial function which will help to reduce energy dependency on fossil fuels: the production of fossil fuel alternatives. Future generations of land managers will thus face an enormous challenge. To that end, they need to have the means necessary to carry out their tasks, while making sure that fulfilling these vital needs will not adversely affect biodiversity. Modern farming is hence inextricably linked to environmental protection and the enhancement of local economies and communities. In 2007, ELO through its lobby and awareness raising actions has been constantly recalling that rural entrepreneurs and landowners are responsible stewards of their land, strongly convinced that business, social and environmental performances are mutually dependent. Accordingly, in October 2007, ELO, together with the NFU (UK National Farmers Union) has sent a position paper to the European Parliament as its Environment Committee has voted in favour of

overly restrictive legislation, namely as regards the replacement of Directive 91/414. This action aimed to ensure that the proposed revision of the Directive will maintain a high level of protection for health and the environment whilst being consistent with the rest of the environmental legislation package (i.e. on water, soil, nitrates, etc), and promote sustainability through proper scientifically based risk assessment, and not hazard based cut-off criteria. It should not lead to a radical reduction in the use of PPPs which would adversely affect the activities of land users.

Thematic Strategy on the Sustainable Use of Pesticides In 2006, the Commission presented its proposal on future European policy on the authorisation and use of plant protection products. It was adopted in July 2006. This Strategy on the Sustainable Use of Pesticides aims to address the threats posed by the use of pesticides to human health and the environment, whilst maintaining crop productivity. Its objectives are twofold in targeting both the issue at source with regards to PPPs producers on the one hand, and PPPs users on the other. Together with the Strategy, the Commission has introduced a proposal for a Regulation revising the 1991 Directive on the placing of plant protection products on the market, and a proposal for a Framework Directive that sets out common objectives and requirements aiming to ensure coherence throughout the EU between the MS which have already adopted measures to address these threats and the MS which have not yet done so. It also provides for measures intended to keep users and the general public better informed and measures enabling the impact of pesticides on public health and the environment to be reduced It includes proposal of measures such as: • a ban on aerial spraying, except in special cases; • national action plans with the necessary flexibility for adapting measures to the specific situation of the various Member States; • regular inspection of application equipment and measures governing the handling and storage of pesticides, their packaging and remnants;

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• protection of the aquatic environment and of areas with "sensitive" groups in line with i.e. the Water Framework Directive, the Birds Directive or the Habitats Directive, • measuring progress in risk reduction through harmonised indicators; • establishment of a system of information exchange for continuous development and improvement of appropriate guidance, best practices, and recommendations. The strategy contains two additional legislative proposals: one on the requirements to be met by new pesticide application equipment and the other on the collection of statistics on PPPs.

The relationship between the competitiveness as well as the quality of European agriculture and the evolution of the regulatory framework for the placing of PPPs on the market is obvious. In the same vein, in January 2008, ELO jointly with the CLA and the UK National Gamekeeper Organisation sent a position paper advocating for a reasonable use of burrows baiting, indicating to DG ENVI that they were seriously concerned that decisions arising out of the implementation of the EU Biocidal Products Directive would lead to a ban on the use of rodenticides (rat poisons) within rat burrows. The regulatory framework should ensure proper controls of parallel products and guard against the traffic of dangerous imitations/counterfeited products, and ensure competitiveness as well as harmonisation of authorisation where possible. It should also encourage innovation together with Intellectual Property Protection of data and a rapid evaluation of new safer products. In addition, individual measures should be evaluated in taking into account the economic and administrative burden for farmers and regulatory authorities and there should be flexibility afforded to Member States to adapt individual measures to local conditions and practices without compromising the end result. The current approach is based on the strict application of environmental criteria. ELO condemns the current trend to “delist” certain active substances without satisfactory alternatives. This cre-

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ates a risk for our members who face serious availability problems for certain categories of pesticides such as insecticides and rodenticides and this is very likely to cause a distortion of competition at a global level. If approved in their current form, the modifications to Pesticides market-access legislation will generate significant negative impacts. A shrink in the capacity for self-sufficiency in the rural world would create inevitable negative repercussions, not only in terms of food supply, but is also likely to impact the whole supply chain composed of the other economic actors (such as agri-food industries, wholesale and retail trade, storage and transport services, etc.), hence ignoring the objectives of the Lisbon Strategy, which aim at “making the EU the most competitive economy in the world and achieving full employment by 2010”. We are carefully following this process to best protect the interests of our members.

Specific Basic Legal Framework • Plant protection products (PPPs) are covered by Council Directive 91/414/EEC defining strict rules for their authorisation. The Directive requires very extensive risk assessments for effects on health and environment to be carried out, before a PPP can be placed on the market and used. Community rules also exist that define maximum residue limits (MRLs) on food and feedstuffs. MRLs are set at Community level for about 150 plant protection products and at Member State level for any other unharmonised products. • The Biocidal Product Directive (98/8/EC) aims to provide a high level of protection for humans, animals and the environment and targets the harmonisation of the European market for biocidal products and their active substances. • Thematic Strategy on the Sustainable Use of Pesticides (COM(2006)327 final, adopted 12/07/2006) • In December 2007 the Council reached political agreement on a common position on a Directive on the sustainable use of pesticides and took note of the state of play on the draft Regulation concerning the placing of plant protection products on the market (11755/06).

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ELO believes that new products are developed for use according to food and sanitary safety requirements within sustainable agriculture and integrated pest management. They have been placed on the market in order to mitigate the threats to natural resources and soil and are part of good practices when combined with appropriate cultivation techniques such as conservation tillage or use of environmental-friendly machinery. PPPs contribute to high agricultural yields, helping to ensure that good quality food is available at reasonable prices, and biocides/rodenticides are useful for public health protection. Nevertheless, when not used sustainably, some pesticides may have possibly negative effects on human health and biodiversity, which is why a balanced approach based inter alia on training for PPP users is necessary: In this respect ELO is part of the TOPPS EU project (Train Operators to Prevent Point Sources). This project is aimed at identifying the “Best Management Practices” and disseminating them through advice, training and demonstrations on a larger co-ordinated scale in Europe with the intention of minimising PPP contamination in water through agriculture ELO is also a Friend of the pan-European Sense + Sustainability Campaign launched by its partner ECPA (European Crop Protection). Initiatives such as these campaigns aim to raise standards of agricultural production and reflect the industry’s commitment, together with other partners in the food chain. It encourages farmer training and education, and promotes integrated farming as one of several ways in which sustainable crop protection can be achieved.

GREEN BIOTECHNOLOGIES The EU Commission defines GMOs as « organisms in which the genetic material (DNA) has been altered in a way that does not occur naturally by mating or natural recombination ». The most common types of GMOs that have been developed and commercialised are genetically modified crop plant species, such as genetically modified maize, soybean,

oilseed rape and cotton varieties. Basic legislation/useful documents: Directive 90/219/EC on contained use activities with GMOs Directive 2001/18/EC on the deliberate release of GMOs into the environment Regulation 1829/2003 on GM food/feed Regulation 1946/2003 on the transboundary movement of GMOs Regulation 1830/2003 traceability and labelling of GMOs Second Report from the Commission to the Council and the European Parliament on the experience of Member States with GMOs placed on the market under Directive 2001/18/EC. (COM(2007) 81 final)Annexes to the Report SEC (2007) 274 -Authorisations List of products authorised under Directive 90/220/EEC List of products authorised under Directive 2001/18/EC List of pending products under Directive 2001/18/EC -List of safeguard clauses

The dramatic consequences of climate change and loss of biodiversity, when combined with the rising demand in food following the steepening of the population curve above all in developing countries, and with a global energy demand forecast to increase by 50% by 2025, imply that the demand in natural resources will put the rural world under huge pressure to increase productivity while sparing natural resources, notably water. At the same time, consumers are demanding higher and higher food quality. ELO believes that within the context of a balanced approach, green biotechnologies, and especially GMOs, are a powerful tool that can be used to help meeting these needs. The number of Member States (MS) cultivating GM crops and their total area of cultivation is increasing. It’s visible: in 2007, GM crops represented 110,000 hectares in 8 EU MS: Portugal, Spain, Germany, France, Czech Republic, Slovakia, Poland and Romania. As a matter of fact, biotechnology is being exploited at an accelerating rate by Europe’s competitors. Planting in Europe has however been

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much slower, but is increasing as farmers further realize the benefits of biotech crops. GMOs can provide clear benefits for agriculture and the society as a whole. They include sustainable benefits for farmers as they increase global crop productivity in improving food feed, fibre, environmental and energy security. Some concrete non-exhaustive examples: preventing insect feeding damage, improving weed control programs, preventing crop loss to plant disease, using less pesticides, mitigating loss of soil organic matter, fighting erosion and compaction through less ploughing, and a crucial sparing of water resources, as well as direct benefits for consumers such as improving the quality and nutritional benefits of food crops, hence contributing to the alleviation of poverty and hunger. In addition, they allow a much more efficient production of “green fuel.” Besides, green biotechnologies have already reduced the global environmental footprint of production agriculture by 14% including reductions of CO2 emissions equivalent to taking 5 million cars off the road for one year. ELO is in favour of research which would produce genetically enhanced plants able to increase yields, make industrial processes more efficient and cleaner, while providing safer, healthier and better-tasting food for consumers. In addition, this new generation of « biotech products » could also be used to develop pharmaceutical products for human health or proteins for life-saving drugs. The European Commission has developed a legislative framework based on the precautionary principle to ensure that GMOs that are grown, marketed and imported meet the highest standards of safety for the environment, and for human and animal health, subject to risk assessment. In 2007 special attention was dedicated to the concept of coexistence.

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What does coexistence mean? Directive 2001/18/EC covering the deliberate release into the environment of GMOs allows MS to establish coexistence measures. The coexistence refers to the ability of farmers to choose between conventional, organic or GMbased crop production, in compliance with EU legislation on labelling and-or purity standards to avoid commingling and cross-pollination, and relates to the economic consequences of farmers complying with the coexistence measures as well as dealing with adventitious presence (AP) of GM trait in non-GM crops. A major concern when adopting GM crops in agricultural systems relates to the possibility of unwanted GM inputs into non GM crops. The EU regulations have introduced a 0.9% labelling threshold for the AP of GM material in nonGM products. ELO participated in the 3rd edition of the conference in coexistence between GMOs and non GM agricultural supply chain (GMCC07) that took place in Seville, on 20-21 November 2007. The upshot of the conference showed that coexistence raises questions such as harvest purity, crop transformation, transport and segregation efficiency. National measures adopted or proposed in the MS regarding coexistence: Draft coexistence legislation has to be notified to the EU Commission. In August 2007, 15 MS notified theirs. In some cases, the competence for coexistence measures lies at the regional level. In 2007, the legislation had already been adopted after notification in 7 MS: Austria, Czech Republic, Germany, Denmark, Portugal, Hungary and Slovakia. Romania adopted coexistence legislation before its accession to the EU. In some cases, framework legislation was adopted or proposed, with detailed good agricultural practices still to be developed. Technical strict coexistence measures include isolation distances between GM and non-GM fields, in some specific cases for crop and seed productions. They are key segregation measures. It is up to MS to provide for flexible measures such

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as buffer zones, which can be additional or substituting isolation distances, temporal isolation measures (cultivation intervals), volunteer control, cleaning of equipment (harvest, transport, storage), etc. In addition, some MS oblige GM crop growers to undergo specific training. Specific information procedures have been established to ensure a flow of information to public authorities, and in many cases, neighbours. The EU coexistence bureau is in charge of elaborating crop specific guidance for coexistence measures. It aims to have EU-wide application while taking into account the diversity of agricultural systems. ELO strongly believes that the coexistence should be left open to the choice of producers and pave the way for more research. The European Commission should ensure that, for biotech products authorized in the EU, Member States do not restrict farmers’ access to such products through the use of arbitrary and illegal bans or through the adoption of discriminatory national or local coexistence rules.

products such as meat, eggs and milk to be labelled « GM free ». This label should appear in a near future in the food department stores. It is crucial to demonstrate to public opinion as well as to the decision makers the difficult situation in which land managers and farmers will be (and to some extent, already are), in a globalized economy not really favourable to EU farmers, if the EU doesn’t get to grips with adopting a more courageous attitude towards biotechnologies. The EU is indeed already far behind its competitors who could increase their yields thanks to biotechs.

In 2008 a study from the ISAA (International Service for the Acquisition of Agri-biotech Applications) showed that in 2007 GM crops increased by 12% i.e. 12.3 millions hectares, hence amounting 114 millions hectares in the world. This increase has been followed by 2 million more GM farmers. However, at EU level, clear political decisions are still expected as regards authorisation of new plants… Some MS are very hostile to GMOs, as illustrated by the brand new German law allowing certain

2007 was a busy year for the ELO in getting ready for the Health Check. In November the European Commission unveiled its Communication on the Health Check of the CAP. The so-called ‘Health Check’ is build on the approach which began with the FISCHLER reforms, and seeks to improve the way rural policy operates, based on the experience gathered since 2003, and to make it fit for the new challenges and opportunities in EU 27. The Communication examined the possibility of further policy adjustments to take account of market and other developments in focusing in particular on the Single Payment Scheme, market support instruments and new challenges. The Communication was designed to kick off a wideranging six-month consultation which took the form of a questionnaire to which ELO responded. Also part of this broad stakeholders’ consultation, the DG AGRI organised on 6 December 2007in Brussels a conference which dealt with all the topics covered by the Health Check. It brought together experts, including ELO, representing the various social and economic interests (producers and cooperatives, trade, industry, workers, con-

III. PROMOTING SUSTAINABLE AND ECONOMICALLY VIABLE AREAS THE SIMPLIFICATION OF THE CAP AND THE HEALTH CHECK

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sumers, environmentalists, animal welfare interests) as well as Members of the European Parliament, the Economic and Social Committee, the Committee of the Regions and the Court of Auditors. Another special Seminar on the future of the dairy sector, which ELO also participated in, took place in Brussels on 11 January 2008.

ELO indicated that it believed in decoupling payments from production and recoupling them to the delivery of environmental and cultural landscape services, and this should apply to all products and in all regions. Retained product-specific coupled payments seemed unfair competition to other producers within the single market.

In its answer to the Health Check questionnaire, ELO constantly recalled that it did not consider that the Health Check should introduce new reforms, stressing the need for stability. It accepted the Health Check could and should bring simplification and streamlining, but not fundamental reform. Both Pillars of the CAP have been radically reformed since 2004 and many of these reforms, including the new Rural Development Programmes, have just been approved by the Commission for implementation, while some remained to be approved. ELO stressed that whilst it was right to discuss the correct balance between the two Pillars and the mechanisms for changing this balance, it was very hard to see how the outcome of such discussions could be implemented before 2013. In responding to the consultation, ELO was willing to insist about the fact that ELO members were expecting more clarity about the way the CAP would evolve in the longer run and particularly on the future financing of measures dealing with long term market failures. The questionnaire was dealing with a couple of issues such as:

-As regards the adjustment of the Members States’ Single Payment Scheme model towards a more flat rate of support, at national or regional level, ELO thought that Member States should be allowed to make these adjustments, but it should be an optional, not compulsory move. Besides, ELO supported a close relationship between the payments and the land, this was the best way to ensure the land was kept in Good Agricultural and Environmental Condition.

-On simplifying the Single Payment Scheme (SPS), ELO answer was that the elimination of the Fruit, Vegetable and Potato authorised entitlements was already a sensible simplification. Provided setasides were abolished for good, the removal of setaside entitlements would be another welcome simplification of the Single Payment System. Likewise the simplification of the 10 months rule already underway was a welcome move. Set-aside have no place in the ‘decoupled’ CAP, however for those Member States who wish to have voluntary set-aside, this should be possible and implemented under an EU-wide voluntary arrangement, paid-for and arranged by amending Pillar 2 agrienvironmental schemes.

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-On cross-compliance, ELO made it clear that if there were to be an enduring case for substantial payments to private land managers for their delivery of public environmental and cultural landscape services, then the real debate was in which form and through which instruments to make these payments. What mix of Pillar 2 payments, for example in Agri-environment and Less Favoured Area schemes, and Pillar 1 payments for respecting tough EU standards would be optimal? ELO had no clarity on this but if tougher EU standards – e.g. for water management – would to be applied then this would provide further justification for farm payment. Simplification may lighten the administrative burden but should not undermine the effectiveness of the Cross-Compliance measures in delivering high standards. -On capping, the Organization firmly said that if the payments are to move towards a flat-rate or Regional Average Payment, then it makes no sense to counter this simplification with a complication to differentiate payments per hectare and digressivity of payments according to farm payment size, and urged the Commission to drop it. -On price intervention, ELO believed that the best way to maintain the safety-net role of intervention was to maintain it as a measure of last resort in ex-

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treme conditions, i.e. a as a true safety net. The Commission should not use the current high grain and oilseed prices to remove the legislative basis of intervention. Agricultural markets could collapse as well as boom and in such circumstances it would be wise to have tools at the rural world’s disposal which may be modified to suit the circumstances but do not have to be reinvented from scratch. -On milk quotas, ELO answered that it was a thing of the past, and had no place since the introduction of decoupled payments. There is no need for the EU to decide how much milk should be produced, even though ELO acknowledged that certain marginal regions (e.g. mountainous regions) may face difficulties when the protection offered by milk quotas is removed. If there were environmental and cultural landscape problems in certain regions associated with livestock agriculture, then these would be best dealt with Pillar 2 measures. -On risk management, ELO had been saying for some time that coping with the extra volatility in markets, the international economy (i.e. exchange rates and interest rates), coupled with physical factors affecting food production, animal and plant disease spread and evolving climatic conditions (drought, flood, fire), would require more attention. ELO did not consider the Commission’s current stance that dealing with volatility should be left to the Member States and dealt with in Pillar 2 was an adequate position. Although as an Organisation it did not have a prepared tool-box of measures to offer to deal with this problem, ELO stressed that more discussion was required about the development of crop insurance and revenue insurance and on who would pay for it. -As regards new challenges such as Climate Change, bio-energy, water management and biodiversity, ELO’s position was that as these challenges were relatively new areas, with many policy instruments impacting on these, especially renewable energy; it was hence not clear what specific role the CAP should play. It was too soon to pronounce on the correct adaptation of the CAP to the new challenges but it is not too soon to start

debating on how the major part of the current CAP which is concerned with the delivery of public environmental services should adjust to strong changes in market conditions. -On increased modulation, the answer was that given the challenges already manifest, it may well be necessary to shift more CAP resources to ensure the appropriate delivery of the public goods and services. ELO was currently debating whether this was best done in Pillar 1, for example using a suitably amended Article 69 (now 58) of Regulation (EC) No 1782/2003, or whether it should be done in Pillar 2. There were many questions which had to be answered about the operation of Pillar 2 as many Member States found the co-financing impossible while in some of them the scarcity of resources had forced them to limit the eligibility of Pillar 2 schemes to farms below a certain threshold... This would surely preclude larger farms from delivering the public services society expected form them. ELO nonetheless pointed out that there must be a stronger debate in the context of the Health Check about the problems of moving funds towards dealing with market failures – which was generally accepted as the right way for the CAP to evolve. Many MS were thoroughly disenchanted with Pillar 2. There were concerns that getting the funds through Pillar 2 measures were too bureaucratic and too much was thought to leak out away from private sector land managers.

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Throughout the year, ELO has been thoroughly advocating during various meetings with EU representatives and national senior officials that it was not too soon to start reflecting on the future adaptations which may be required for Pillar 2. Whilst there was a general acceptance that Pillar 2 measures for rural development and for paying for public environmental and cultural landscape services were the right general direction, there were many problems surrounding the present arrangements, such as the financing of Pillar 2, the complexity and administrative costs of some of the schemes, the accessibility of the measures for all farmers and potential beneficiaries, measures to deal with the continuing flight from the land, and the current problem of the rising opportunity cost of environmental delivery as commodity prices rise. These are complex matters that will not be quickly resolved. This is why the Commission should be encouraging debate on these matters during the next two years. The ELO is very keen to participate in this debate and will be submitting its own thoughts in a near future.

The focus of the rural development policy 20072013 is in line with three thematic axes laid down in the new rural development regulation. These axes are: 1. Improving competitiveness for farming and forestry; 2. Environment and countryside; 3. Improving quality of life and diversification of rural economy; 4. and the fourth axis, the LEADER axis, should contribute to the priorities of the other 3 axes and introduces possibilities for locally based bottom-up approaches to rural development. Rural Development 2007-2013

“LEADER” Axis Axis 1 Competitiveness

Axis 2 Environment • Land Management

Axis 3 Economic Divers. • Quality of Life

Single set of programming, financing, monitoring, auditing rules Single Rural Developing Fund

RURAL DEVELOPMENT The strengthening of EU rural development policy is and should remain an overall EU priority. ELO agrees that both traditional farming and forestry together with the multitude of other rural activities remain crucial for land use and management of natural resources in the EU’s rural areas. Rural development plays an increasingly important role in helping rural areas to meet the economic, social and environmental challenges of today’s society. Therefore providing support for the development of rural areas is a key tool for the restructuring of the agricultural sector, and it also encourages diversification and innovation in these areas. During 2007, ELO was actively engaged in efforts to support a rural development policy and participated in the EC’s Rural Development Advisory Committee as well as attending many other meetings in the field of rural development to represent it members.

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After last years budget allocation, the main issues in 2007 were the approval of the Rural Development Programmes presented by the different Member States and/or Regions. The European budget for the period 2007-2013 is €90.8 billion (€67.6 billion as a core fund and the rest under Bulgaria and Romania Accession & (Voluntary) Modulation from Pillar 1). ELO was able to actively contribute to the elaboration of an optimum rural development funding allocation in cooperation with the Commission which would better enable landowners to adjust to a changing market. ELO has also reacted that this is far too little to achieve the increasingly challenging needs of the rural areas. As a result, European areas, including agriculture, forestry and other rural activities, are continuing to come under significant pressure. About 2/3 of the rural development programs were approved at the end of 2007. On average the relative distribution of the funds according to the Axes was:

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Axis 1 (Improving competitiveness for farming and forestry) 34%, Axis 2 (Environment and countryside;) 44%, Axis 3 (Improving quality of life and diversification of rural economy) 13%, Axis 4 (Leader) 6%, Technical Assistance 3%. Within each axes rural programs could choose for a whole set of measures. About two-thirds of the budget under axis one will go to three measures which are: farm modernisation, increase of the added value of production and investments in agricultural and forest infrastructures. Under Axis 2, the majority of the budget (89 %) will be used for the following measures: agro-environmental payments, payments for less-favoured areas and first afforestation of agricultural land. Under Axis 3, 66% of the budget will be used for the following measures: renewal and development of villages, basic services and development of micro-enterprises. Now that national and regional Rural Development Programs are being finalized we continue to emphasize that landowners and managers should be able to touch funds in all 4 axes for the multitude of public services they deliver for the rural areas and the high added value to rural development. Land is the crucial factor in developing rural areas. The Rural Development Regulation enables land managers and rural territories to define activities tailored to their local needs. In 2007, the implementation of the European Network on Rural Development has already been also realized by several MS. The Commission also announced the creation of a Coordination Committee of the European Network on Rural Development with representatives of the national rural networks and 12 organisations (4 among each axis) working in Rural Development at European Level. ELO has submitted a strong candidature to be included in this Coordination Committee. The Commission has started to review the delimitation of areas under Less Favoured Areas (following the Council Regulation EC 1698/2005). The objectives are to avoid depopulation (keeping

farmers and managers in the areas) and prevention of land abandonment and sustainable land management. ELO welcomes the revision to provide a solution which will fit the new objectives and tackle the problems in areas with an excess of criteria or those without-of-data criteria and maybe not describing handicaps to production. In 2008 a consultation will be held in which ELO will react to position the importance of landowners and rural businesses in LFA areas and the handicaps they have in these areas. We will also emphasize the crucial role land owners and managers play in avoiding land abandonment and sustainable land management. Within the CAP Health check debates ELO will emphasize the new challenges in Rural Development including renewable energy, effects on environment, water management and risk management and the problems of having to adapt to these new landowners and managers challenges in the future. ELO continues to emphasize that land management and ownership contribute to the economic, ecological and social dimension representing the overall viability and development of the rural areas (all 3 axes of RD). Rural landscapes, which are highly valued in the EU today, are the result of agricultural activities. Besides producing marketable products, land owners and land managers have to face changing contexts and their impacts (globalisation, climate change, competition, food safety, - quality and availability, society’s demand for non-marketable goods like landscape, biodiversity and other rural amenities). All these factors confront rural communities with threats and opportunities as well. Rural areas also remain crucial in the renewable energy debate whether this is from biomass (including bioenergy) or other sources (water, wind, sun,…). Regional biomass programs are important assets for land and forest owners and managers. It remains clear that much more needs to be done to improve rural development in the future and the start of the new programming period should be the right moment to turn policies into actions on the ground.

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IV. FORESTRY In 2007, ELO focussed on one of the hottest international topics: climate change and wood-energy. ELO performed outstanding work in this domain being the project leader of the European Forest Energy Network (EUROFORENET), an action supported by the European Commission, Directorate General of the Environment. EUROFORENET is an experts’ platform aimed at supporting and promoting the production and use of wood, coming from private forests in Europe, for energy generation. Alongside the creation of the wood-energy platform, ELO continued to work to represent the interests of private land and forest owners and producers at the International, pan-European and European level. ELO organised and attended a series of meetings and conferences, such as the 5th Ministerial Conference for the Protection of Forest in Europe, the Forests Dialogue (an international platform of exchange) and the Forestry and Cork’s Advisory Group. The ELO also joined the Forest Technological Platform created in 2005.

SPECIFIC ACTION  EUROPEAN FOREST ENERGY NETWORK  EUROFORENET – www.euroforenet.eu From November 2006 onwards ELO was the project leader of a 1-year action called EUROFORENET (European Forest Energy Network). This work was done in collaboration with the FECOF (European Federation of Forestry Communes) the IFFC (Institut de Formation Forestière Communale) and the EOMF (European Observatory on Mountain Forests). EUROFORENET is a direct application of the European Forest Action Plan Key action n°4: “Promoting the use of forest biomass for energy generation”. (www.euroforenet.eu)

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The EUROFORENET’s mission was to stimulate cooperation between both private and public stakeholders, in order to improve the local level efficiency of forest-wood-energy supply chains in various Member States of the European Union. EUROFORENET’s two main objectives were: • To propose a set of recommendations, tools and guidelines for local private and public decision-makers, aimed at promoting energy-oriented sustainable forest management • To promote the benefits of bioenergy, in relation to the environmental conservation, economic viability, social capital and cultural respects. In order to achieve these objectives, EUROFORENET used two tools: • A communication campaign and awareness raising campaign, developed on the one hand by means of a dedicated website and on the other hand by means of monthly thematic articles aimed both at experts and non specialists. • A platform for study and analysis of the wood-energy supply chain, composed of 4 distinct working groups that engage professionals and specialists from France, Belgium, Italy and Slovenia, with the intention of developing a practical guide to be downloaded on the website. Experiences, practices and principles within the EUROFORENET action have been selected based on three criteria: sustainable forest management, local and rural development and reduction of GHGs Moreover, the action created the opportunity for an important extension of the ELO network in Europe by creating and consolidating links from the local to the international level. ELO strengthened its image and its recognition as a major player on the European and international scene in the field of forestry and energy.

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INTERNATIONAL, PANEUROPEAN ANDEUROPEAN PROCESSES

in charge of forest affairs, or their representatives, from 46 signatory countries, international and European observers, and observer countries in favour of two Resolutions:

A/ International Process ELO continued to work with the UNECE (United Nations Economic Commission for Europe- and the FAO in the field of land & forest tenure and forest & energy. Land and forest tenure is an important issue for which a clear understanding needs to be developed in Europe. ELO is thus a major partner for the FAO and the UNECE in bringing together sound experience and efficient analysis. For this reason, • In 2006 and 2007, ELO participated in the European enquiry led by the UNECE, the FAO and the MCPFE on: “Private Forest Ownership in Europe”. • ELO presented the results of its own study at the FAO Technical Meeting: « Understanding Forest Tenure: toward supporting forest tenure diversification » in Rome in February 2007 and at the 18th Session of the FAO Committee on Forestry (COFO) in Rome in March 2007. • Outcomes of this enquiry were presented at the EUROFORENET final conference in November 2007.

• Resolution I, “Forests, Wood and Energy”: recognizing that forestry biomass and woodbased products are important sources of renewable energy and contribute to the fight against climate change. It focuses on enhancing the role of the forestry sector in the production of energy and on the conditions for harvesting wood to that end. • Resolution II, “Forests and Water”: recognizes the importance of forests for protecting the quality and quantity of water. It focuses on sustainable management of our forests and its positive impact on water resources, on the need to coordinate policies on forests and aquatic resources, on the importance of climate change for forest and water resources and finally on the economic benefits of forest services related to water.

In the field of wood and energy, the UNECE organised two major international conferences; “Workshop on the mobilization of Wood” in January 2007 and “Opportunities and Impacts of bioenergy policies and targets on the forest and other sectors“ in October 2007. ELO participated in both events to provide inputs from the EUROFORENET and to integrate outcomes in the ELO daily work to increase the efficiency of the EUROFORENET.

B/ Pan-European Process - www.mcpfe.org/ ELO contributed to the preparation of and participated in the 5th MCPFE - The Pan-European conference took place in Warsaw during 2 days in early November. 76 statements were given by Ministers

C/ European Processes ELO continued to participate in the Forestry and Cork Advisory Group. Major topics discussed this year were the ongoing European Forest Action Plan, the wood-energy, Forest Fires, Green Public Procurement, and Climate Change. In order to analyse in details some forest issues, such as the mobilization of wood-energy and the valorisation of forest non-wood market products, 2

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ad hoc working groups were set up. ELO is represented within the one on the mobilization of wood-energy. A third ad hoc working group, on forests and climate change, was proposed to the European Commission, DG Agriculture. ELO also participated in the Forests Dialogue. On June 26th –27th, The Forests Dialogue (TFD) convened for a scoping dialogue entitled “Small forest owners and Sustainable Forest Management in Europe”. The primary objective was to share and discuss strategies and tools currently available for enhancing small/family forest owner’s practice and recognition of sustainable forest management on their lands and to improve access to markets. The dialogue brought together 35 leading actors working in this area representing government, forest products companies, environmental NGOs, forest certification schemes, customers, academics, European forest owners European organizations.

EUROPEAN FORESTBASED SECTOR TECHNOLOGY PLATFORM FTP www.forestplatform.org/ ELO recently joined the “European Forest-Based Sector Technology Platform”. This platform aims at defining and implementing the sector’s R&D roadmap for the future and is supported by a wide range of stakeholders. The FTP is an industry-driven process, embedded in industry reality, and supporting the sector’s strategy The FTP’s vision for the year 2030 is: “The European forest-based sector plays a key role in a sustainable society. It comprises a competitive, knowledge-based industry that fosters the extended use of renewable resources. It strives to ensure its societal contribution in the context of a bio-based, customer-driven and globally competitive European economy.” ELO will contribute its expertise and knowledge to the working group on Research and Development and will participate in the Advisory Committee as an observer.

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ILLEGAL LOGGING ELO strongly believes that SFM (Sustainable Forest Management) should also be supported by protecting the European wood market from illegally logged wood and supports SFM in regions and countries where forest management and related laws are less developed by participating in the Forest Law Enforcement, Governance and Trade Action Plan (FLEGT). To make the FLEGT Action Plan a success, ELO supports the Voluntary Partnership Agreement (VPA) and the measures to increase the demand of legally sourced timber. In this way, public procurement is a mechanism for support. In addition, ELO supports the actions undertaken by the private sector and the wood and carton beverage industry in particular. In this field, Tetra Pak and several ACE partners have committed to work on a voluntary basis involving a third-party Certified Traceability System.

CERTIFICATIONS ELO strongly supports SFM and related efforts, including the concept of certification as a means to promote the use of wood from forests managed in a sustainable way and to improve competitiveness on the global market. ELO is supporting the certifications systems in Europe; the Programme for Endorsement of Forest Certification Schemes (PEFC) and the Forest Stewardship Council (FSC). Forest owners have to make their own choice and identify market opportunities.

BIODIVERSITY  STREAMLINING THE EUROPEAN BIODIVERSITY INDICATORS  SEBI 2010 biodiversity-chm.eea.europa.eu/information/indicator/F1090245995 Experts from the 6 SEBI groups have worked on the preparation of a first set of indicators, to mon-

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itor the biodiversity in Europe by 2010. It is expected now that this set will be recognised within the European Union and at the Pan-European level by the end of 2007. As the first step is now over, 3 new working groups are supposed to be established. They will be focused on the interlinkages between the indicators, climate change and biodiversity and communication. ELO has been selected to be a member of the Climate Change and Biodiversity Working Group that starts in 2008. Therefore, ELO will continue to support the European Environment Agency’s work and contribute to the biodiversity indicator working groups.

LIFE+ - ec.europa.eu/environment/life/funding/lifeplus.htm The new European funding instrument for the Environment LIFE+ was adopted in May 2007. It provides specific support for developing and implementing EU environmental policy and legislation and in particular the priorities of the 6th Environment Action Programme which are climate change, to halt the decline of the biodiversity, to minimise negative environmental effects on human health, and to deal with natural resources and waste in sustainable ways. It comprises three components: LIFE+ Nature & Biodiversity, LIFE+ Environment Policy & Governance and LIFE+ Information & Communication. At least 78% of LIFE+ (€2.143 billion for the period 2007-2013) will be for the co-financing of project action grants, of which at least 50% will be for nature and biodiversity projects. ELO follows this funding instrument very closely in order to support initiatives from local stakeholders and its members which meet the environmental interests of the European Union.

FOREST FIRES 2007 has once again been a dramatic year for southern European countries (Greece in particular). For this a two-fold action is needed: on the one hand, the prevention of forest fires is requested. Urgent measures must be taken at national and local levels, and by the European authorities. Raised by the EUROFORENET and the ENERSILVA actions, the use of forest biomass in the most threatened countries should be considered as an effective prevention measure. Forest biomass is a local source of renewable energy for rural areas and the entire society. The use of this biomass can help Europe in reaching its energy objectives and in creating local added value from the forest. ELO strongly supports national, regional and local programmes and actions developed and managed on the initiative of land and forest owners’ associations, in managing woodfuel to prevent fires and raising awareness of land and forest owners and users. ELO supports a new Resolution on forest fires proposed to the European Commission, through the Forestry and Cork Advisory Group. The requests are: • The re-establishment of independent financing for forest fire prevention to protect the environment • The consultation of the advisory group on forestry and cork prior to taking any initiatives in the field of forest disasters in general and forest fires in particular • The reform of the European Union Solidarity Fund in order to allow for direct compensation to victims of natural disasters

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FINAL REMARKS  CONCLUSION 2007 has certainly been a crucial year for ELO with the success of EUROFORENET, thanks to which ELO has consolidated its recognition by the international and European community and has provided a framework for linking the scientific community with the local forest stakeholders. As climate change and related issues (e.g. woodenergy) remain high on the political agenda, priorities in 2008 will be to consolidate the policy work in Brussels. ELO will maintain existing successes such as EUROFORENET through a long-term experts’ platform - focusing on climate change and highlighting the business and biodiversity challenges for the future- and start NEW projects in the fields of forestry, biomass and climate change.

helping them to prepare for enlargement and assisting them on daily basis in the implementation of the Acquis Communautaire. Welcoming new members and partners in our organization, ELO continues to recruit in advance, as the EU considers further expansions. To help raise awareness of European legislation in the enlarged EU, as well as to strengthen and extend the synergies between various rural actors of EU 27 and CC, ELO organised a series of conferences in 2007. Feedback from those programmes is widely published through printed and electronic media at local, regional, national and European levels. More information is available on the ELO website www.elo.org under the heading “conferences” or “newsletter”.

V. ENLARGEMENT On 1st January 2007 Bulgaria and Romania became full members of the European Union, which now has 27 Member States. Their accession after seven years of preparation closes the Union’s sixth enlargement. However this is not an end in itself but a stage, albeit a decisive one, part of a long process launched after the transformations of 1989. “This enlargement has strengthened peace and has brought greater prosperity to Europe. This is the right decision for Bulgaria and Romania and the right decision for Europe”, declared José Manuel BARROSO. The European Parliament also welcomed the new Members of Parliament, which has increased the number of MEPs from 732 to 785. At present, the share of rural territories in the EU increased to 90%; and sustainable development as well as the implementation of environmental legislation, including NATURA 2000 became one of the main issues of the EU agenda to ensure a balanced development of EU 27. For a long time ELO has been developing its network of member organisations in the New Members States (NMS) and Candidate Countries (CC)

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VI. STATUS OF PRIVATE PROPERTY ELO and its sister organisations - GEFI and UEHHA - are clearly promoting the property rights and its uses as the basis or our modern societies. ELO believes that not only the fundamental right itself is to be promoted, but also its concrete applications, in order to avoid having an empty shell at the end of the day. It therefore focuses on all the issues which could have an impact on its member’s activities. The situation differs from one Member State to another, despite the fact that most of the national constitutions refer to property rights as

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stated in the European Charter of Fundamental Rights. The question of repossession is dealt with at national level and while some Member States have solved the issue via legislation, such as Poland hopefully in the near future, some other Member States have opted for a case by case approach, leading to delays and lots of difficulties, such as Romania. From an ELO perspective, it is fundamental that each Member States solves the difficult issue of repossession as this is the only way forward, and as there is a societal demand to solve this issue. A proper legal framework that safeguards the principles of private ownership can help to achieve sustainable development of EU cities and rural areas, representing 90% of the territory, as well as contributing to the competitiveness of EU rural economy, while protecting social cultural and historical heritage.

DEBATE ON THE CONSTITUTIONAL TREATY ELO actively lobbied during the period of elaboration of the Constitutional Treaty especially on property rights issues. The inclusion of the European Charter of Fundamental Rights in the Treaty was a key element of ELO’s support for the Constitution. Since the end of 2006, after the ratification process was blocked by the French and Dutch referenda, were some attempts to relaunch the debate on the Treaty without success. The discussions were mainly at intergovernmental level. On the 12th December 2007 in Strasbourg, the 3 institutions jointly proclaimed the European Charter of Fundamental Rights. The “Union recognize the rights, freedoms and principles of the Charter”, with a special exception for UK and Poland. As a consequence, their citizens will not have direct access to the European Court of Justice – ECJ on the basis of a breach of their fundamental rights (the option of the ECHR remains for them). The Lisbon Treaty was signed on the 13th of December 2007.

From an ELO and GEFI perspective, this is not a “mini treaty” as the Charter is part of it and the core question of better functioning of the Union is solved. The ratifications should intervene before the 1st January 2009 and most of the Member States have this time opted for a parliamentary ratification.

EUROPEAN COURT OF HUMAN RIGHTS – ECHR ELO is closely following the ECHR court cases and it is to be underlined that a large part of the cases remains related to property rights. Since 2005, one case particularly interested ELO and its sister organisation GEFI (Groupement Européen des Féderations intervenant dans l’Immobilier – Real Estate Private Owners): the court case HUTTEN-CZAPSKA vs. Poland, (35014/97 – 22.02.2005) on rent blockage. Poland was condemned (violation of Article 1 of Protocol 1 – protection of property) as the rent was too low to even enable the maintenance of the building by the owner. Poland appealed and in 2006 the Grand Chamber upheld the decision. This pilot case is particularly interesting as it clearly condemned the rent blockage. On the 24th of April 2008, the ECHR notified the friendly settlement which promises both to resolve fundamental problems with Polish housing legislation – affecting some 100,000 property owners and to provide redress for the applicant.

FISCAL AND FINANCIAL ISSUES – REDUCED VAT AND EU REITS Reduced VAT is an important issue for ELO and its sister organisations for housing and repairs. A seminar was organized for our French members in Brussels the 26th February 2007 on the need to maintain reduced VAT applied to housing repairs. The issue is regularly raised on many occasions, notably in the context of the European Parliament Intergroup on Urban Housing, and reduced VAT is recognised as an important element for the operators, should they be private or public. The inde-

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pendent evaluation published on the 21st June 2007 by the Danish consultancy Copenhagen Economics Aps, favourable to reduced VAT applied to repairs, was followed by a Communication of the Commission on the 5th of July 2007 and by a proposal of a Directive modifying the 2006 Directive. 2007 was a crucial year for VAT and ELO is hopeful to see its members viewpoints taken into account in the new text to ease the VAT process and its concrete implementation when undertaking repairs on real estate in cities, rural areas and historic houses or places of worship. The ELO and its sister organisations joined a coalition lead by European Property Federation on the need of an EU REIT – real estate investment trust. Our European real estate industry organisations in 2007 lobbied the European Union to consider plans for an EU REIT, a cross-border real estate investment company structure that would have similar tax advantages to those in national jurisdictions. The EU is already consulting on proposals for cross-border open-ended real estate funds, and should also consider a similar closeended investment alternative. Most large EU members already have some form of REIT legislation, although considerable differences between Member States exist, particularly concerning operational and leverage restrictions and whether stock market listing is mandatory. This REIT vehicle could enable fairer competition across Europe and enhance market security and stability. The coalition viewpoints were elaborated on the basis of the results of a study made by Maastricht University (available on the ELO website). ELO will pursue its work on this issue in 2008 aiming at a favourable scheme for real estate investment.

SUSTAINABLE ENERGY WEEK AND REVISION OF THE ENERGY PERFORMANCE OF BUILDINGS DIRECTIVE - EPBD ELO and its sister organisations participated in the Sustainable energy week organized at the beginning of January 2008 under the auspice of the Com-

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mission. This was the occasion notably to debate on the contribution of the real estate sector to the objectives of reduction of our environmental footprint. The core discussion was on the revision of the Energy Performance of Buildings Directive. Several elements of the proposal are of high importance for our members and we are notably focusing on the 1000 m² threshold abandonment, the need of a special attention to buildings which are not listed and which are likely not to perform the same as modern buildings, but are nevertheless highly contributing to the historical and socio cultural link of rural and urban communities, the need for adequate incentives, the need for professional training and the need for a clear process of the energy labelling of buildings (A, B, C etc) as it could adversely hamper the market. ELO welcomes the Commission’s initiative and works towards inclusion of its members viewpoints in the future text.

HISTORIC HOUSES ELO works in close cooperation with the Union of European Historic Houses Associations (UEHHA), to identify common problems and solutions for private owners, particularly regarding the fiscal and legal framework for the conservation and restoration of buildings with a historic, architectural and natural importance. UEHHA positioned itself on a number of policy issues that have a direct impact on historic houses. As regards the cultural dimension of heritage, UEHHA has been selected to be a partner to the European Commission’s European Year of Intercultural Dialogue 2008. The UEHHA General Assembly this year focused on education as a means to contribute to a better society by exploring the possibilities of social integration by heritage and intercultural dialogue. ELO and UEHHA also published their position as regards the EU policy on Plant Protection Products which affect historic gardens and surroundings. Whilst acknowledging the need to reach a high level of health and environmental protection,

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UEHHA warned of the lack of alternative products which can harm biodiversity by altering ecosystems and questioned the economic feasibility of the policy implementation. In addition, in the context of the EU’s sustainable energy policy and the fight against climate change, ELO and UEHHA have also been reflecting on the Energy Performance of Buildings Directive as regards the role of Historic Houses in creating a more energy efficient built stock. Indeed, it claimed that financial and tax incentives would be useful to reach the energy efficiency goals in order for owners to be able to reduce CO2 emissions. Also it pointed out that policies need a higher level of coherence by conciliating for instance the need to keep the Historic character whilst implementing energy efficiency requirements. ELO and UEHHA have together been fostering the integration of energy efficient methods and technologies into private historic monuments with the aim of achieving sustainable energetic profiles as an answer to the upcoming clean energy challenges. Finally ELO and UEHHA have been examining the state of play regarding the VAT policies across Europe so that they correspond to the expectations of society as regards the services rendered by private owners to the society as a whole. The conservation of heritage needs regulatory and taxation support without which the sector cannot fulfil its aims.

democracy and transparency and enhanced efficiency in the decision-making process. In this context, the European Parliament sees its powers reinforced notably through the extension of the scope of the codecision procedure, which puts it on equal footing with the Council in policy-making. One can hence measure the significance of advising the European Parliament elected members on all policy areas covered by ELO.

URBAN AND HOUSING INTERGROUP ELO, via its sister organization GEFI (Groupement Européen des Fédérations intervenant dans l’Immobilier) actively participated in the intergroup Urban and Housing chaired and cochaired by Jean-Marie BEAUPUY (ADLE) and Alain HUTCHINSON (PSE) respectively. The intergroup firmly established itself as part of the Parliament stakeholder scene, bringing together various associations involved in urban planning and restructuring, as well as representatives of public housing groups, service-providers and private property managers. The various meetings of the intergroup and subgroup lead to the elaboration of a European Charter for Housing. ELO has consistently emphasized the role of private owners in a sustainable and affordable property mix but we fear that the current text is mainly focusing on public housing and not addressing the housing issue on an holistic basis. A series of side events co organized by or under the auspices of the Intergroup took place in rela-

VII. CONTACT WITH THE EUROPEAN PARLIAMENT ELO dedicates substantial attention to Parliamentary affairs. It is expanding its contacts within the Parliament but also participates in official meetings such as Intergroups. The participation in the EP process is of increasing importance as the Parliament gains power. Indeed, the Lisbon Treaty signed on 13 December 2007 and which needs to be ratified by the 27 EU Members States, is expected to give Europe more

J.M. BEAUPUY, J.P. GAUZES, J. DEVERGNE

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tion to housing, reduced VAT, sustainable development of cities and urban areas, raising also the issue of urban sprawling, social cohesion funding, and the contribution of housing to the energy targets. GEFI organized a workshop on taxation and reduced VAT in collaboration with the intergroup in February 2007 for its French member’s delegation of 100 representatives lead by its President Jean PERRIN. The Members of the European Parliament Jean-Marie BEAUPUY (President of the Intergroup, ADLE), Jean-Paul GAUZES (EPP), the Commission DG TAXUD and the French representation had an opportunity to exchange views on housing related taxation issues.

SUSTAINABLE HUNTING, BIODIVERSITY AND COUNTRYSIDE ACTIVITIES INTERGROUP The ELO is particularly involved in this Intergroup founded in 1985, reconstituted in 2004 and chaired by MEP Michl EBNER (EPP-IT) and cochaired by Véronique MATHIEU (EPP-FR). ELO continues to run the secretariat of the Intergroup jointly with FACE – the Federation of European Hunters. The Intergroup is very active in addressing issues related to the countryside, sustainable hunting and biodiversity. With regular meetings usually held six times a year often interpellates the European Commission and gives the necessary political impulse to take action. The Intergroup is a recognised forum for a variety of land users who are given the opportunity to share experiences and develop joint actions with ELO’s support. The sessions are essential to be able to maintain a genuine connection with the rural reality and to raise the awareness of the EU political and technocratic circles but also to stimulate the interest of the other members of the European Parliament. Indeed, the Intergroup often adopts declarations or recommendations with significant political weight and this year, the Intergroup met Commissioner DIMAS to discuss important biodiversity matters. The Intergroup is undoubtedly a key link to EU rural policy and contributes to en-

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hance the European Parliament concrete democratic value. Thanks to this activity, ELO expands its networks and confirms its reputation as an essential actor of the countryside. The aims of the Intergroup are, among others, to • promote the sustainable management and use of wildlife and ecosystems, • defend the interests of countryside citizens, • maintain discussions in the European Parliament on national, regional and local issues relating to biodiversity and countryside activities, • stress the socio-economic, cultural and environmental value of rural activities. In 2007, important topical matters have been raised such as the EU rules on game meat and animal by-products, the balance of ecosystems in relation to predation, the methodology for sustainability assessment, the relations between hunting, public opinion and education, the management of wildlife diseases or the call to set up a European Green Day. Case studies are presented by experts to illustrate interesting experiences and highlight the needs and concerns in the regions and localities of Europe. The Intergroup also often joins forces with other Intergroups such as the joint meeting with the “Sustainable Development” Intergroup to discuss the role of sustainable use of wildlife and CITES convention (international trade in endangered species of wild fauna and flora).

VIII. PUBLICATIONS AND TOOLS EU FRAMEWORK FOR REAL ESTATE INVESTMENT TRUSTS  EU REIT Executive summary The coalition of the European real estate industry asks the Commission for an EU framework for real estate investment trusts – EU REIT would overcome obstacles to cross-border

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property investment and enhance market security and stability The leaders of the European Landowners Organization, the European Property Federation, the Royal Institution of Chartered Surveyors, The European Group of Valuers’ Associations and the Urban Land Institute Europe have asked the European Commission to take an initiative to overcome obstacles to cross-border property investment in the EU and enhance market security and stability: an EU Real Estate Investment Trust or EU REIT. The REIT is a vehicle under which investment can be directed in a tax efficient manner into the real estate sector. A Maastricht University study highlights five main drivers for an EU framework: 1. the need to address increasing distortions of competition as national REITs multiply; 2. the opportunity to buttress market safety and security. Simply by ensuring a properly functioning Internal Market for real estate investment, the EU can make a major contribution to the control and stabilisation of property markets;

the EU REIT Coalition, said: “Creating an EU REIT would turn the current fragmented EU market for property companies into the largest and likely most efficient property market in the world. Investors, small and large, private and institutional, would greatly benefit from that.” Piet EICHHOLTZ, Professor of Real Estate Finance at Maastricht University and leader of the research team said: “The academic literature and additional empirical evidence presented in our report highlight the very arbitrary nature of differences in national REIT structures in Europe and provide strong and fundamental arguments for the creation of an EU REIT. The EU REIT does not have to be created from scratch. Both in the EU and outside of it, there is a lot of experience with these regimes, and careful analysis of this experience provides direction towards an optimal pan-EU structure.”

3. the need to correct a situation where savers in small Member States cannot access good quality property investment in other Member States or even the prime property investments in their own countries; 4. the opportunity to reverse the current trend of initiators of property companies to resort to tax havens; 5. the chance to boost specialisation in cutting edge real estate and investment in social property that both require development on a European scale. The report goes further, outlining a preferred structure for an EU REIT with no need for invasive tax harmonisation as no approximation of tax rates on shareholder dividends is required. Commenting on the initiative, Joaquim RIBEIRO, Head of Finance at Sonae Sierra and Chairman of

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EUROFORENET Executive summary The EUROFORENET programme was entered into in order to identify and analyse the various trends within the wood energy sector, based on a bottom-up approach and concrete practical cases around Europe.

the meaning, in terms of energy content, of 1 cubic metre of woodchips? These kinds of issues need clarifying in order to create better understanding of the viability of the sector. Various scenarios could be proposed to support the wood energy sector and mobilization of wood but the question of subventions and/or market-based approach are to be answered because this could lead to a distortion of competition.

Where does the wood energy sector stand? • Wood energy is an important means of achieving the Kyoto Protocol 2020 target of 20% of the total energy consumption in the EU and beyond, coming from renewable sources. However the question in this context is how can this be done whilst also addressing the important issues of maintaining/enhancing biodiversity and not competing with other industries such has the paper industry? Sustainability is a fundamental parameter in this equation. The importance of developing partnerships with businesses to create awareness and finding ‘tailor made’ solutions is clearly relevant here. • A key concern for the wood energy industry lies in its fragmentation, which in the EU lobbying sector is the enemy of influence. • Wood energy systems are complex in that they are inter-sectoral, inter-disciplinary, locationspecific, there are heterogeneous supply sources and there is a lack of recognition, i.e. a lack of reliable statistics. There have been a number of detailed studies, but that the broader picture is missing. • The absence of workable statistics. Potential players within the industry need access to clear facts and figures representing the viability of the industry in terms of investment and business plans. For example the total amount of biomass in Europe is an unknown. The way in which the energy created is measured in terms of volume of wood used and energy output seems to vary from project to project and country to country. For example, what is

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• For the future the main concerns will be economic, environmental, national and political security of energy production and supply. Clearly in the future the demand on all energy resources will increase, and with that, the competition. As a result, bio-energy will be priced on its energy content. Consequently the efficiency in terms of resource, energy, environment and cost need to be increased. Operational conclusions • The sustainable removal of forest biomass to produce bio-energy, can bring benefits by reducing forest fires risk and valorising forest byproducts and residues. Intensification and aforestation are not favoured when they lead to increased pressure on biodiversity. Small scale local developments ensure best overall environmental performance. In any case environmental safeguards are needed to avoid increases in bio-energy production resulting in additional environmental pressures on agricultural and forest land, which are a scarce resource in Europe. Wood energy is not seen as a threat to other forest functions, such as fibre production. • The discussion during the conference made clear that some ‘homework’ needs to be done, i.e. better statistics are required in order to be more transparent and provide an improved overview of the market, in reference to mobilizing wood and supplying woodchips. There needs to be standardization of final product throughout the chain so that the consumer can rely on access to the best information.

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• Toolkits available to private or public bodies were presented during the final conference and are represented in more detail in the Guidelines on Local Forest Energy Networks for better mobilization and supply of wood. Woodfuel Integrated Supply/Demand Overview Mapping – WISDOM - methodology was one such method, which identifies two main planning levels: strategic and operational. Strategic aims are: Identify and outline woodfuel surplus and deficit areas, i.e. areas with positive or negative woodfuel supply/demand balance, for the entire country. Identify administrative units and forest districts with high bio-energy potential (surplus areas) Outline the potential sustainable supply zones of selected location in consideration of urban/rural woodfuel consumption and suitable/accessible production capacities

• The platform of exchange of knowledge and case studies showed great results. For instance the 4 main case studies led to additional examples which were presented and can be found on the website platform - www.euroforenet.eu. • The importance of being able to project the industry, to be transparent was a clear response during discussions. The industry needs a representative structure in Brussels. EUROFORENET is currently a network. It should be the beginning of something more. To constitute a ‘roadmap’ for the future, i.e. to build a vision for the sector with industrial choices balance and arbitration for the uses of wood. There is also a need to follow technological developments – and ways of promotion (like the solar industry has done so successfully).

Support strategic planning and policy formulation aiming at the establishment of sustainable wood energy systems Objectively define priority areas of intervention within which in-depth studies and operational planning should be carried out with precedence. Operational aims Guiding policy and decision makers to address bio-energy demand and woodfuel production chains in relation to sustainable management of landscapes and forests Support the sustainable management of private and public forests within defined supply zones, and beyond bio-district boundaries in response to woodfuel demand. Other tools were also identified, such as Unified Wood Energy terminology (UWET) , Interactive Wood Energy Statistics (I-WESTAT), Wood Energy Information Systems (WEIS), and the SWOT analysis.

There is clearly space for the evolution of EUROFORENET as a platform to go further in the representation of interests. It could become a forum for equipment/buyers/resources etc. In this vain ELO welcomes any contributions to the platform in order to raise the profile of this vital sector.

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COUNTRYSIDE CountrySide Magazine is a European newsletter for entrepreneurs and political decision makers working for the future of the EU rural world. Issued in five different languages, English, French, German, Italian and Spanish, it informs its readers about the latest developments of European policies, and is a platform for ELO members and partners to present their local, regional and national viewpoints. Numerous experts contribute to its articles and give the magazine a sharper perspective. The CountrySide is read throughout the EU and beyond, by members of European Institutions as well as national decision makers, landowners and land managers.

The Rural Investment Support for Europe (RISE) Foundation 2007 has been a successful year for RISE, one devoted to spreading its message whilst getting the Foundation up and running. In March 2007, Franz FISCHLER presented the RISE Foundation before a packed audience in Madrid, organized by the Grupo de Empresas Agrarias – ELO’s Spanish Member, and sponsored by the BNP Paribas. His presentation on “The Changing Climate for Rural Development and its Financing in Europe: The RISE Foundation” led one present to claim that FISCHLER was the Al GORE of Europe! The speech was focussed on the double food and environment challenge. Reworked and updated, it has since been used on various occasions, notably before the Centre for European Policy Studies, at a working dinner at the European Parliament, and at a dinner speech at Westminster, and has been published in Politica Agricola Internazionale and in Countryside magazine. RISE was also instrumental in organising and leading the conference ‘Food, Feed and Bio-energy; Priorities and Dilemmas’, which was held at the Renewable Energy House, Brussels in January 2008. Since then both debates, on food and energy security on the one hand, and on bio-fuels on the other, have been hard to miss thanks to good (and lucky) timing for these two subjects. RISE Chairman FISCHLER as well as its CEO have thus been in great demand on the conference circuit. Preparation for the input to the 1st Forum for the Future of Agriculture, which was devoted to food and environmental security, formed a substantial part of the Foundation’s work at the end of 2007. A contract had been signed by RISE with Factary Consultants for the first phase of a capital campaign. Accordingly, 106 priority prospects have been identified, and a number of requests have been made for advice regarding our capital objective. A capital objective over a five-year period of €15m by 2012 has been set, devoting 50% of annual donations to projects, 35% to capital and up to 15% to administration. For larger donations, RISE will benefit from negotiated fees under the

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Transnational Giving Europe Network. The amount kept for the service will be only 5% for gifts up to €50,000; for the next €100,000 only 2% is charged; for the next €500,000 another 1% is withheld, with an overall ceiling beyond that of €9,500, whatever the size of the gift. RISE has obtained seed money from the BNP PARIBAS for €100.000 and private contributions amounting to a quarter as much. It has invested €10.000 for a land reclamation project north of Madrid. It has indications that it may obtain further donations totalling €1.2 million, and possibly €2.1 million, and has raised interest with a number of companies with whom the possibilities of partnerships are being assessed. Work has been hampered by lack of staff time, but the CEO is now assisted by one junior staff and is about to obtain the free part-time collaboration of a senior staff. A letter has been sent to friends to be contacted with a request to help the take off of a small regular team to manage the foundation and pursue the capital campaign. This should markedly improve its capacity for action on all fronts. A Task Force for a study on rural development priorities has been launched in order to produce a paper on the public goods farmers can provide and their remuneration, as well as the priorities for a foundation such as RISE for the 2nd Forum on Agriculture to be scheduled for Spring 2009. Work has restarted on the creation of a Rural Investment Fund to be placed in Luxemburg, which would provide a regular inflow of money to the Foundation. The market is being tested in order to assess prospects for success. With its impressive Board of Directors who share the sentiment of the Founders there is confidence that RISE will not only obtain the necessary philanthropic funding, but also select the most meaningful projects and encourage exciting new initiatives through which it can operate. As the only pan-European independent foundation devoted to sustainable rural development, this initiative is particularly timely as public funds for the sector diminish. The neglect of rural interests has huge negative effects on rural life. Rural

depopulation leads to decreased voter power and economic globalisation marginalizes rural interests in the public decision making process. Capital collection is so far developing nicely. The exposure of RISE in the public debate has been quite beyond expectations and should be of help in future funding. Therefore, we look forward to 2008 with the belief that there will be sufficient funding for our first projects, and that the profile of RISE will continue to grow.

Corrado PIRZIO-BIROLI CEO

PERSPECTIVES 2007 has not only been a consolidation year, but even more than expected, a year of progression. It would be naïve to say now that 2008 will be the time for full consolidation. Instead, it would be more truthful to say that the many challenges that lie ahead of us leave none of us time to rest. We have been supportive but also carefully sceptical on the biofuels issue, today we could say, rightly so, as there is a need for considerable research in order to prepare the policy field. We have been challenging the future of agriculture through food and environmental security for over a year now. In March 2008 we organised a major conference aimed at promoting this double challenge, which was called “First Forum for the Future of Agriculture” as it is the first of a long series of conferences in the same vein that will take place annually. Besides this, there are several working meetings with Ministers in the pipeline.

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By reconciling food, fibre and environment, we are focusing the scope of ELO’s action on the essential role of landowners managing their land. Mitigating climate change and halting the loss of biodiversity are core concerns for 2008. This is why we will place a link on our website to the carbon calculator system, described previously. Rural actors have a unique role to play in mitigating climate change through good land management practices. ELO, together with Friends of the Countryside, our partner organisation representing rural and family businesses, provides a platform for exchanging

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views and experiences. Also, with the support of Franz FISCHLER’s RISE Foundation and Corrado PIRZIO-BIROLI’S Consultative Committee, the ELO is apt to develop a vision on how to meet the challenges the future has in store for us. As usual, the ELO will promote truly sustainable land management , and thus will defend property rights against the inadequate use of legislation which threatens to undermine the economic viability of rural businesses, upon which the conservation of the countryside we cherish, along with its rich biodiversity and wealthy economy all depend.

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ABBREVATIONS & ACRONYMS

CAP : CC : CDM : CIS : CMO: DG: EC: ECCP: EFSA: EISA: ELO: ENA: EP: ETS: EU: EUROFORENET: FAO: FLEGT: FCS: FSC: GHG: GMO: IFM: LULUCF: MCPFE: MS: NMS: NNi: NNP: OECD: PEFC: PPP: RDR: SEBI: SFM: SPS: UNECE: WFD: WTO:

Common Agricultural Policy Candidate Country Clean Development Mechanism Common Implementation Strategy Common Market Organisation Directorate General European Commission European Climate Change Programme European Food and Safety Agency European Initiative for Sustainable development in Agriculture European Landowners’ Organization Europe and North Asia European Parliament Emission Trading Scheme European Union European Forest Energy Network Food and Agriculture Organisation Forest Law Enforcement Governance and Trade Friends of the Countryside Forestry Stewardship Council Green House Gas Genetically Modified Organism Integrated Farm Management Land-Use Change & Forestry Mechanisms Ministerial Conference on the Protection of Forests in Europe Members Sates New Member State Natura Networking initiative Natura Networking Programme Organization for Economic Cooperation and Development Program for Endorsement of Forest Certification Schemes Plant Protection Products Rural Development Regulation Streamlining European Biodiversity Indicators Sustainable Forest Management Single Payment Scheme United Nations Economic Commission for Europe Water Framework Directive World Trade Organization

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