Set-aside was an incentive scheme introduced by the European Economic Community (EEC) in 1988 (Regulation (EEC) 1272/88), to (i) help reduce the large and costly surpluses produced in Europe under the guaranteed price system of the Common Agricultural Policy (CAP); and (ii) to deliver some environmental benefits following considerable damage to agricultural ecosystems and wildlife as a result of the intensification of agriculture.
It sought to achieve this by requiring that farmers leave a proportion of their land out of intensive production. Such land is said to be 'set-aside'.
Set-aside became compulsory in 1992 for large arable farmers as part of the MacSharry reform of the Common Agricultural Policy. It was originally set at 15% and reduced to 10% in 1996. Following the introduction of decoupled payments in 2005, farmers who had historically claimed set-aside were awarded a number of set-aside 'entitlements' equivalent to the area they had previously set-aside. In order to receive payment on these set-aside entitlements, an equivalent number of hectares had to be removed from agricultural production.
Set-aside land was shown to be an effective way to improve soil chemistry and increase biodiversity on arable farmland, especially on 5-year non-rotational set-aside. 
On 16 July 2007, the European Commission (EC) announced its intention to publish a proposal to reduce the set-aside requirement to 0% in 2008, and the proposal was adopted on 26 September 2007. This was to help mitigate current shortages in the EU cereals market, increase cereals supply to the market and therefore reduce prices following two consecutive lower EU harvests.
- "Commission Regulation (EEC) No 1272/88 of 29 April 1988 laying down detailed rules for applying the set-aside incentive scheme for arable land". EUR-Lex. European Commission. 29 April 1988. Retrieved 2 August 2012.
- "Set-aside". Environmental Challenges in Farm Management. University of Reading. Retrieved 5 June 2019.
- Dinan, Desmond (20 Feb 2014). Origins and Evolution of the European Union. OUP Oxford. p. 210. ISBN 978-0199570829. Retrieved 30 April 2014.
The reform therefore expanded the set-aside scheme, making it compulsory for large-scale arable producers, who would receive compensations in return for lost production on set-aside land.
- "A study of vegetation composition and soil chemistry on five year non-rotational set-aside under four management regimes, Essex, UK". Jonathan Wade. April 1997. Retrieved 3 February 2014.
- "EU proposes scrapping fallow land". BBC News. 13 September 2007. Retrieved 1 August 2012.
- Waterfield, Bruno; Charles Clover (26 September 2007). "Set aside suspended by European Union". The Telegraph. Retrieved 1 August 2012.
- ""Health Check" of the Common Agricultural Policy". European Commission. Retrieved 1 August 2012.
On 20 November 2008 the EU agriculture ministers reached a political agreement on the Health Check of the Common Agricultural Policy. Among a range of measures, the agreement abolishes arable set-aside....
- Kanter, James (20 November 2008). "EU governments to overhaul farm subsidies". The New York Times. Retrieved 1 August 2012.
In addition, EU governments agreed formally to abolish the so-called set-aside, which required some farmland to be kept out of production over the past two decades.