- The Common Agricultural Policy (CAP) is an European support system which regulates the production, sale and processing of all agricultural products in the EU. (Photo: www.agriaware.ie)
The EU has a Common Agricultural Policy (CAP). This maintains fixed prices for agricultural products within the EU, usually above those of the world market. The aim is to protect EU farmers from price changes on the world market. In addition to normal custom duties, the EU collects variable import levies on agricultural products.
The CAP is under review. Recent reforms have changed support for products into support based on amount of agricultural land, taking into account previous levels of farm production. Price subsidies are negotiated internationally in WTO.