A flat-rate calculation of the Single Farm Payment (SFP) will not be possible, EU agriculture commissioner Dacian Ciolos has accepted.
While Mr Ciolos reiterated his opposition to the historical method of calculating farmers' direct payments, he accepted that a flat-rate system would not be introduced.
"The historical references for the distribution of payments have lost their relevance," Mr Ciolos told the Oxford Farming Conference.
"To be credible, direct payments should be fairly divided between member states, regions, different types of agriculture and categories of farmers.
"This does not mean a flat-rate payment across the whole of Europe.
"Most probably, with the application of these criteria, payment will vary -- but the criteria we apply should not."
Mr Ciolos also confirmed that some upper limit on direct payments would feature as part of the CAP reforms.
"We are currently paying large landholders, who may not actually be in need of the same level of income support as small or medium sized farmers. The proposal to establish upper limits for direct payments to individual farms (capping) will address this," he insisted.
Market intervention measures would continue to be part of the future CAP and would remain an important "safety net".
"The dairy crisis showed that we need tools to fight market volatility; we need tools to avoid the collapse of entire sectors," he claimed.
Mr Ciolos accepted that it would not be easy to negotiate and defend the farm budget for the period after 2013. However, he said this underlined the need to secure broad-based support for the continuation of a strong CAP.