Brussels, Aug 5 - Europe's farm chief has extended by two months a deadline for France to explain how it will retrieve hefty subsidies paid to its fruit and vegetable farmers that are now deemed illegal, an EU official said on Wednesday.
The European Union ruled in January that the state aid of around 338 million euros ($486.4 million) paid between 1992 and 2002 to support producer prices and incomes had contravened European farm and state aid policy.
"The French minister spoke to the (EU Agriculture) Commissioner and an extension has been given ... although there's no formal decision yet," one Commission official said.
"They had asked for an extension until July 29 and now they have asked for the end of September," he said.
The Commission's demands have sparked anger in France, whose agriculture minister has said he will negotiate the sum of cash to be paid back to Brussels. [ID:nL4687628] The French fruit and vegetable sector is the third largest in Europe.
In the Commission's original decision taken earlier this year, it said France would have to recover all cash paid out, plus interest. It also has to provide full details of beneficiaries and cash amounts, as well as proof that the beneficiaries have been ordered to repay.
Those details, to be set out on a case-by-case basis, will be one of the main areas where France is likely to negotiate a reduction in the total sum it needs to recover, officials say.
"Normally, a country ... would provide a full dossier, explaining how they will proceed with the recovery, with a timetable," the official said.
"If that report convinces us that part of the aid does not have to be repaid ... then these are elements that can be taken into account," he said.
In its decision, the Commission said France's payments had favoured its fruit and vegetable production to the detriment of that of other EU countries, so creating a national market policy superimposed over the EU's own policy, and interfering with it.