About association in agriculture
It has become a truism that the agricultural area of Romania is highly fragmented (e.g. 13.3 million ha are being worked by 3,859,000 agricultural enterprises, of which 99.2 per cent are enterprises without legal personality represented by small farmers — individual farms, certified natural persons, sole partnerships — with an average area of 1.95 ha/farm) and that a modern and efficient agriculture requires the association of small farmers and consolidated surfaces.
Moreover, within the public area there are a lot of discussions regarding the necessity of farmers’ association, the benefits of association (e.g. obtaining stronger positions in negotiations with seed and fertiliser suppliers or cereal buyers, in building production delivery chains or in obtaining higher subsidies from European bodies) or the measures of financial stimulus (on national or European level) of these associations.
Also, in terms of a very low degree of association, there are attempts to identify originating factors for these facts (e.g. the laws on restoration of land ownership rights that led to fragmentation, the farmers’ lack of information), of implementing certain punitive measures for those who refuse to enter associations (e.g. decreasing agricultural subsidies) or of financial stimulus for those who would sell the land in view of consolidation…
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Briefings from Popovici Nitu & Asociatii
Andreea Hulub, Alexandra Malea and Vlad Ambrozie of Popovici have contributed a chapter focused on Romania in the seventh edition of The Mergers and Acquisitions Review.