The Theory of Fiscal Federalism offers a normative framework to evaluate the existing allocation of competences. To derive an actual relevant scope for reforms supporting an efficient Agri-environmental Policy the general theoretical criteria have to be specified. Thus, the parameters defining theoretically the optimal degree of centralisation will be applied to sectoral characteristics. Additional agri-environmental sub-competencies will be differentiated to identify deficits regarding the Principle of Equivalence. Based on this existing infringements with respect to agri-environmental measures are noticeable what requires a changed allocation of competences.