The Farmers' Union of Wales today welcomed Defra's victory on sheep EID in Brussels that has delayed for three years a requirement for individual movement recording of the "historic flock".
"The EU's decision makes a lot of sense and could save the Welsh sheep farming industry millions of pounds," said FUW hill farming committee chairman Derek Morgan.
Individual recording movements of sheep born before December 31, 2009, known as the "historic flock", due to come into force on January 1 2012, would have led to many farmers having to electronically tag these animals next year.
But Defra's proposal to delay the requirement until the end of 2014 has been accepted - just three weeks before it was due to come into force.
The EC's Standing Committee on the Food Chain and Animal Health (SCoFCAH) narrowly voted in favour of the derogation at a meeting in Brussels on Tuesday.
"We welcome this derogation as the FUW has long objected to the compulsory electronic identification and recording of sheep based upon evidence gathered during numerous trials which identified major shortcomings with EID technology," said Mr Morgan, of Llangurig, Powys.
"The experience of our members since EID was made compulsory has confirmed that these concerns were well founded.
"Nevertheless, the FUW recognises Member States, such as the UK, that object to EID represent a minority within the EU and efforts must be made to ensure the impact of the current Regulations are minimised, particularly in terms of penalties which may be incurred as a result of circumstances beyond the reasonable control of farmers.
"Therefore, we welcome this latest EU decision," Mr Morgan added.