On September 30th 2003 the European Commission
 put forward proposals for the reform of the EU hop regime. The Commission
 is proposing a substantial delinking of hop support from production
 by transferring it to the decoupled single farm payment scheme.
 Member states, however, will be able to opt for total or partial
 decoupling, with the possibility of maintaining a maximum of 25%
 of aid linked to production, so as to accommodate the needs of particular
 regions.
The Commission's proposals for reform are based
 on the report of an assessment of the situation in the hop sector
 which maintained that future policy should meet three key criteria:
 it should maintain the viability of production, ensure economic
 conditions favourable to production and accommodate the market trend.
 As in other sectors the reform will provide 'aid equivalent to the
 present aid' but through 'a more efficient and direct transfer of
 the support'.
The Commission's assessment outlines the current
 system, which is based on:

• a certification procedure;
• a forward contract system;
• rules for recognition and promotion of producer
   groups;
• rules for trade with third countries.

The hop sector accounts for only €12.5
 million of EU agricultural expenditures, with hops being cultivated
 on 22,000 hectares of land. Production is concentrated in Germany
 (80%), with the hop sector shrinking as yields improve, beer-making
 technology changes, and consumer tastes evolve. The EU is the world's
 leading hop producer, accounting for 40% of production, and is a
 major exporter of hops, with imports around half the level of exports.