Conservation agencies within the European Union promote the restoration of traditional land uses as a cost-effective way to preserve biodiversity outside reserves. Although the European Union pursues the integration of the environment into strategic decision-making, it also dictates sectoral policies that may damage farmland biodiversity. We illustrate this point by outlining the socioeconomic factors that allow the persistence of traditional free-ranging horse husbandry in Galicia, northwestern Spain. Free-ranging Galician mountain ponies provide ecological and socioeconomic services including the prevention of forest fires, the maintenance of heathlands and wolves, and the attenuation of wolf-human conflicts. This traditional livestock system may have persisted because it entails negligible costs for farmers. Wolf predation upon Galician mountain ponies does not threaten farmer's economies and seems to be tolerated better than attacks to more valuable stock. Recently, European Union's regulations on animal welfare, carcass management, or meat production put new economic and administrative burdens on farmers, make free-ranging horse rearing economically unsustainable, and incentivize its abandonment. The aim of the European Union to integrate environmental policies may be successful to preserve farmland biodiversity only through careful anticipation of the side effects of apparently unrelated regulations on the fragile equilibrium that sustain traditional land uses.