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1. The administrative penalties shall be applied by means of reduction or exclusion of the total amount of the payments listed in Article 83(1) granted or to be granted to the beneficiary concerned in respect of aid applications that the beneficiary has submitted or will submit in the course of the calendar year of the finding of the non-compliance. The reductions or exclusions shall be calculated on the basis of the payments granted or to be granted in the calendar year in which the non-compliance occurred. However, where it is not possible to determine the calendar year in which the non-compliance occurred, the reductions or exclusions shall be calculated on the basis of the payments granted or to be granted in the calendar year of the finding of the non-compliance. For the calculation of those reductions and exclusions, account shall be taken of the severity, extent, permanence or reoccurrence and intentionality of the non-compliance determined, in line with the assessment of the authorities or bodies referred to in Article 87(2). The administrative penalties imposed shall be effective, proportionate and dissuasive.

The relevant provisions of Article 85(2), (5) and (6) shall apply mutatis mutandis to the application and calculation of the administrative penalties.

2. In order to ensure a level playing field for Member States and the effectiveness, proportionality and dissuasive effect of the administrative penalties under this Chapter, the Commission is empowered to adopt delegated acts in accordance with Article 102 supplementing this Regulation with detailed rules on the application and calculation of those penalties.