2 The Common Agricultural Policy – Guiding Principles
2.14 The objectives of the EU’s common agricultural policy are set out in Part Three, Title I of the Treaty on the Functioning of the European Union (‘TFEU’).22 The principal measures are now articles 39 and 40 of the TFEU.
The Treaty identifies three principles as paramount to the operation of the CAP: the establishment of common prices for agricultural products, the principle of Community preference, and financial solidarity. Article 39 provides that the objectives of the CAP are to increase agricultural productivity, to ensure a fair standard of living for the agricultural community, to stabilise markets, to assure the availability of supplies and to ensure that products reach the consumer at reasonable prices. The measures introduced within the CAP are financed through two European Guidance Funds.23 Within the CAP the bulk of expenditure is committed to market support (Pillar 1 of the CAP), but an increasing amount of expenditure has since the Agenda 2000 reforms been committed to rural development, which is now (alongside direct payments and market management) the second ‘pillar’ of the CAP.24
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