An important determinant of ecosystem services provision from European farmland is the amount and spatial arrangement of trees, shrubs, and woodlands that are integrated into the respective land use systems. Farm trees are considered ‘keystone structures’ of agroecosystems because of their disproportionally large ecological value (relative to their low abundance), but are threatened by agricultural intensification, land abandonment, and urbanization. While the preservation of farm trees is a component of several command-and control approaches and while numerous payment schemes for ecosystem services (PES schemes) provided through agricultural practices do in general exist, there are few incentive-based policies that specifically target the conservation of farm trees. This paper uses an institutional economics framework for the analysis of PES schemes that enhance the establishment, protection, and management of farm trees. Using the German state of Saxony as a case, it elaborates on the reasons for the very reluctant participation of farmers in these schemes. The obstacles identified include high production and opportunity costs, contractual uncertainties, and land tenure implications. Further, since scheme adoption has been low compared with the total area covered by the respective farm tree types, the PES schemes alone cannot explain the substantial increase in number and size of some farm-tree types. Options to improve participation comprise regionalised premiums, result-oriented remuneration, and cooperative approaches. The example of PES schemes for farm trees highlights one of the major challenges for the protection and preservation of cultural landscapes : they are man-made and thus need to be preserved, managed, and maintained continuously.