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The Former Financial Regulation

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The Former Financial Regulation

Outline of the Community (European Union) legislation about The Former Financial Regulation

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Budget

The Former Financial Regulation

1) Objective

To lay down the procedures for drawing up, adopting and implementing the budget of the European Union.

2) Community Measure

Financial Regulation of 21 December 1977 applicable to the general budget of the European Communities.

Amended by:
CouncilRegulation (ECSC, EEC, Euratom) No 1252/79 of 25 June 1979
Financial Regulation of 16 December 1980 (80/1176 /EEC, Euratom, ECSC)
Council Regulation (ECSC, EEC, Euratom) No 1600/88 of 7 June 1988
Council Regulation (ECSC, EEC, Euratom) No 2049/88 of 24 June 1988
Council Regulation (Euratom, ECSC, EEC) No 610/90 of 13 March 1990
Council Regulation (ECSC, EC, Euratom) No 1923/94 of 25 July 1994
Council Regulation (ECSC, EC, Euratom) No 2730/94 of 31 October 1994
Council Regulation (EC, Euratom, ECSC) No 2333/95 of 18 September 1995
Council Regulation (EC, Euratom, ECSC) No 2334/95 of 18 September 1995
Council Regulation (EC, Euratom, ECSC) No 2335/95 of 18 September 1995
Council Regulation (EC) No 2444/97 of 22 September 1997
Council Regulation (EC, ECSC, Euratom) No 2548/98 of 23 November 1998
Council Regulation (EC, ECSC, Euratom) No 2779/98 of 17 December 1998
Council Regulation (EC, ECSC, Euratom) No 2673/1999 of 13 December 1999

3) Contents

“The budget of the European Communities is the instrument which sets out the forecasts of, and authorises in advance, the expected revenue and expenditure of the Communities for each year”. It is on the basis of this definition (given in Article 1) that the Financial Regulation goes on toshape the European Union’s financial architecture step by step. Subsequent articles of the Regulation introduce the key concepts underlying the budget and lay down the procedures and rules for its establishment and implementation. The main features of the Financial Regulation are summarised below. More detailed questions can be answered by referring to the text of the Regulation itself.

I. European budgetary law in 16 definitions

The financial year: The financial year runs for 12 months from 1 January to 31 December. The budget comprises all expenditure and revenue authorised for that year. The appropriations entered in the budget are authorised only for the duration of one financial year. (See point 12 – Carryover of appropriations).

Differentiated appropriations: One of the principles governing the Community’s financial system is annuality. This means that operations relate to a given financial year, making it easier to control the work of the Community executive. However, multiannual operations are often necessary (e.g. research programmes, structural measures, etc), in which case the notion of differentiated appropriations is used. Differentiated appropriations, as opposed to non-differentiated appropriations, are split into commitment appropriations and payment appropriations. Operations extending over more than one financial year have a deadline attached, i.e. a date by which the relevant projects must be completed.

Commitment appropriations: Commitment appropriations cover the total cost, in the current financial year, of the legal obligations entered into for operations to be carried out over more than one financial year. This type of appropriation constitutes the upper limit of expenditure which can be committed during the financial year.

Payment appropriations: Payment appropriations cover expenditure arising from commitments entered into during the current financial year or preceding years.

Appropriations for commitment: This term refers to the sum of commitment appropriations and non-differentiated appropriations.*

Appropriations for payment: This term refers to the sum of payment appropriations and non-differentiated appropriations. *In effect, non-differentiated appropriations authorise an equal amount of commitments and payments, so that both aspects must be fully taken into account.

Principles of sound financial management: Principles underlying the use of budget appropriations, including economy, cost-effectiveness, evaluation prior to mobilisation of Community resources, regular review of operations, etc.

Financial statement: The financial statement sets out the various financial aspects of an operation (financial consequences, links with financial instruments, schedule, etc). Any proposal or communication which may have budgetary consequences must include a financial statement.

No offsetting: According to this principle, all revenue and expenditure must be entered in full with no adjustment against each other, thus ensuring an exhaustive and complete presentation of the budget.

No assignment of revenue: This rule prevents specific revenue from being used to finance specific expenditure. Total revenue covers total expenditure. There are exceptions to this principle: for example Member States’ financial contributions to certain research programmes and contributions from non-member countries to Community activities under the Agreement on the European Economic Area.

Booking of revenue and expenditure to articles: Revenue can be collected and expenditure effected only if it is booked to an article in the budget. This means that all financial operations (revenue or expenditure) must have a budgetary basis, i.e. a specific article in the budget. In addition, no expenditure may exceed the authorised appropriations.

Carryover of appropriations: As a general rule, non-differentiated appropriations lapse if they are not used at the end of the financial year for which they are entered. However, in the case of payments outstanding in respect of commitments entered into before the end of the financial year, appropriations left unused must be transferred to the budget of the following year. Optional carryovers are possible when requirements cannot be met from the budget of the following financial year. Differentiated appropriations (consisting of commitment appropriations and payment appropriations) also lapse if they are not used at the end of the financial year, although a decision may be taken to carry them over in certain instances (e.g. where the basic legislative instrument is adopted at the end of December and the Commission is unable to commit the amounts before 31 December).

Provisional twelfths: If the budget is not finally adopted by the beginning of the financial year, i.e. 1 January, the “provisional twelfths” system comes into operation. In this case, payments may be made monthly up to a limit of one twelfth of the appropriations entered in the budget of the previous financial year.

Adoption of the budget: The adoption of the budget marks the end of the budget procedure. The budget, which is drawn up in euros, is declared adopted by the President of Parliament and then published in the Official Journal. Once the budget has been finally adopted, each Member State is required to make available to the Community its own resources payments with effect from 1 January of the following financial year.

Reserves: Under European budgetary law, there are six types of reserves, of which three are expressly provided for by the Financial Regulation:

  1. provisional appropriations;
  2. The contingency reserve;
  3. The negative reserve: a mechanism whereby new expenditure is financed by anticipating savings which will be made during the financial year, even though it is impossible to tell, when the budget is adopted, which items will generate these savings. A negative amount is therefore entered in the budget and offset during the year by transfers from chapters which are in surplus.

These reserves are designed to facilitate budget management. They can be drawn on – during the financial year – to enter amounts in a budget line for an operation that was not entirely finalised when the budget was adopted, to increase the authorised appropriations in order to deal with unforeseen circumstances or to reduce the authorised appropriations for the sake of economy, taking into account the progress made in implementation. The reserves can be used only by implementing a transfer procedure.

The financial perspective provides for three other reserves designed to create room for manoeuvre, so that expenditure can be covered even where the requirements could not easily have been foreseen when the financial perspective was drawn up:

  1. The monetary reserve is designed to offset the effects on agricultural spending of significant and unexpected movements in the dollar/euro parity, compared with the value used in drawing up the budget.
  2. The reserve for loan guarantees for non-member countries is used to transfer amounts to the budget lines, which cover payments to the guarantee fund and payments in the event of default by debtors.
  3. The emergency aid reserve is designed to enable the Community to react quickly to specific aid requirements in non-member countries, mainly in the form of humanitarian aid.

Discharge: The European Parliament, acting on a recommendation by the Council, grants the Commission discharge for its implementation of the budget, after examining a series of reports, in particular that of the Court of Auditors. The purpose is to bring the financial year to a close in both formal and political terms. The discharge decision covers the accounts of all Community revenue and expenditure and the situation described in the balance sheet (statement of assets and liabilities). It consists of an appraisal of how the Commission has discharged its responsibility for budget management over the past financial year.

II. Establishment of the budget

The first stage in the process leading to the establishment of the budget is that each institution (Parliament, the Council, the Court of Justice, the Court of Auditors, the Economic and Social Committee and Committee of the Regions and the Ombudsman) draws up estimates of its expenditure and revenue for the following year and sends them to the Commission.

After receiving the various estimates, the Commission draws up the preliminary draft budget, which must be presented by 1 September and contains:

  • a general statement of the revenue of the Communities;
  • a statement of estimates;
  • a general introduction including financial tables covering the entire budget and a description of the policies for which the appropriations are requested;
  • an introduction to each section, drafted by the institution concerned;
  • a working paper on the staff of the institutions (staff policy, variation in staff numbers, etc);
  • a working paper on subsidies to decentralised bodies (agencies, European schools etc);
  • an analysis of financial management over the past year and a balance sheet setting out the Communities’ assets and liabilities;
  • an opinion on the estimates of the other institutions.

During the procedure, the Commission may amend this preliminary draft by sending a letter of amendment to the Council at least 30 days before Parliament’s first reading of the draft budget.

In exceptional circumstances, the Commission may present preliminary draft supplementary and/or amending budgets, which are examined according to the usual budgetary procedure. A preliminary draft supplementary budget either increases the total amount of appropriations or finances new operations without increasing appropriations. A preliminary draft amending budget makes technical changes, without increasing the overall budget or providing for new operations. These preliminary drafts must be accompanied by statements of justification.

The budgetary procedure is laid down in Article 272 of the EC Treaty. After examining the preliminary draft budget, the Council sends Parliament a draft budget, accompanied by an explanatory memorandum explaining why it has departed from the preliminary draft budget, if it has done so.

III. Structure and presentation of the budget

The budget contains a general statement of revenue (estimated revenue of the Communities for the financial year in question and actual revenue in the previous financial year), plus a number of sections subdivided into statements of revenue (revenue for the financial year in question and the previous year, together with the relevant remarks) and expenditure. The various sections cover:

  1. The European Parliament
  2. The Council
  3. The Commission
  4. The Court of Justice
  5. The Court of Auditors
  6. The Economic and Social Committee
  7. The Committee of the Regions
  8. The Ombudsman.

The Commission section contains a Part A (staff and administrative expenditure) and a Part B (operational expenditure). Part B is broken down into several sub-sections, according to requirements. These subsections, which correspond to European Union policies, are shown in the table below. The figures are taken from the 1999 budget.

Policies (sub-sections) Amount in 1999 budget (EUR million) Percentage of the total budget
Common agricultural policy (CAP)
European Agricultural Guidance and Guarantee Fund, Guarantee Section		 40 940.0 42.2
Structural operations
structural and cohesion expenditure		 39 260.0 40.5
Training, youth, culture, audiovisual media, information, social dimension and employment 812.0 0.8
Energy and environment 235.4 0.2
Consumer protection, internal market, industry and trans-European networks 1129.1 1.2
Research and technological development 3450.0 3.6
External action 6223.8 6.4
Common foreign and security policy 30.0 0.0
Guarantees and reserves 346.0 0.4

Each section or subsection is divided into titles, chapters, articles and items. The statement of expenditure in each section (i.e. for each institution) includes, for the various titles, chapters, articles and items (each subdivision being accompanied by remarks):

  • the appropriations made available for the financial year in question;
  • the appropriations made available for the previous financial year;
  • actual expenditure in the last financial year (= actual payments plus carryovers to the following financial year).

IV. Implementation of the budget

The implementation of the budget is based on a fundamental principle – the need for a legislative basis – which has been both the cause and the result of a series of crises between the two arms of the budgetary authority. The implementation of appropriations entered in the budget for “significant” Community action requires the prior adoption of a basic act, i.e. a legal provision such as a regulation, a decision, etc., providing for the expenditure. Pilot schemes and certain kinds of information activities are deemed not to be “significant”, so that they can be put into effect merely on the basis of the relevant line in the Community budget.

The Community budget is implemented by the European Commission, acting under its own responsibility, in accordance with the Financial Regulation and within the limits of the appropriations entered in the budget. But while the Commission’s implementing responsibilities cover its own internal operations and Community policies, the other institutions (Parliament and the Council, etc.) implement the sections of the budget which concern them. This power to implement the budget cannot be delegated to external bodies, at least in relation to the tasks of the European civil service (e.g. public procurement). Implementing powers may be delegated within the European administration so that certain officials act as authorising officers, accounting officers and financial controllers. In practical terms, it is they who implement the budget. This internal delegation of powers is subject to strict conditions in order to avoid conflicts of interest or abuse of power.

Within the European administration the implementation of the Community budget rests on the existence of three different functions, which must be performed separately: authorising officer, accounting officer and financial controller.

The authorising officer administersthe appropriations. He alone has the power to “commit” expenditure, i.e. to give the initial authorisation for expenditure. The authorising officer is liable to disciplinary action and may be held financially liable if he fails to comply with the Financial Regulation or neglects tasks relating to his function.
The accounting officer makes the payments. He is the only person empowered to handle monies and other assets and is also responsible for their safekeeping. The accounting officer is liable to disciplinary action and may be held financially liable for payments in which a procedural error is detected. Officials performing accounting functions receive a special allowance to compensate for their increased responsibility vis-à-vis “ordinary” officials.
The financial controller carries outmonitoring and audit tasks. He checks the commitment and authorisation of all expenditure and ensures that revenue is properly collected. In short, he checks the legality of operations. To carry out this task, the financial controller has access to all the necessary documents and information. In his capacity as auditor, he is also regularly consulted on and evaluates changes to financial management systems. Commission staff exercising this function are governed by special rules guaranteeing their independence (for example, in certain cases they may bring actions before the Court of Justice). The financial controller is liable to disciplinary action and may be held financially liable if he grants his approval to expenditure in excess of the budget appropriations.

In a stricter sense, implementation of the Community budget consists mainly of expenditure, which, under budgetary law, is broken down into various stages: commitment, validation, authorisation and payment:

1 Commitment Prior to any measure which may give rise to expenditure (in particular legal commitments vis-à-vis third parties), the authorising officer must draw up a proposal for a budgetary commitment on which the financial controller must grant his approval. The purpose of the financial controller’s approval is to establish that the appropriations are available and that the expenditure is consistent with the relevant legislation and correctly charged to the budget. If some of these conditions are not met, the financial controller may refuse to grant his approval. The superior authority may overrule such a refusal, informing the Court of Auditors of its decision, but this hypothetical facility is rarely used in practice.
2 Validation Validation is the act whereby the authorising officer checks the claim of the creditor (the recipient of expenditure), the amount of that claim and the conditions under which payment falls due. Validation is subject to presentation of supporting documents.
3 Authorisation Authorisation is the act whereby the authorising officer instructs the accounting officer to pay an item of expenditure which he has validated. Payment orders are sent for prior approval to the financial controller, the purpose being to establish, among other things, that the payment order agrees with the commitment of expenditure and that the amount is correct. After approval, the order is forwarded to the accounting officer.
4 Payment Payment is the final action whereby the institution is discharged of its obligations towards its creditors. It is carried out by the accounting officer.

Appropriations are classified under chapters and articles. Parliament and the Council may transfer appropriations from one chapter to another and from one article to another within their own section of the budget. The Commission may, within its section of the budget, transfer appropriations from one article to another within each chapter and from one chapter to another within each of the titles relating to staff and administrative expenditure. The Commission informs the budgetary authority of these transfers, giving a statement of the grounds.

The balance from each financial year is entered in the budget of the following financial year as revenue or expenditure, depending on whether it represents a surplus or a deficit.

During the financial year, the Commission sends Parliament, the Council and the Court of Auditors figures on the implementation of the budget in the form of:

  • monthly reports on both revenue and expenditure, together with information on the use of appropriations carried over from previous financial years;
  • a report every four months on revenue and expenditure, together with information on the use of appropriations carried over from previous financial years.

In the course of the year, following a given financial year, the Commission produces several documents describing its financial activities in that financial year. By no later than 1 May of the following year, it draws up a consolidated revenue and expenditure account comprising:

  1. a table of revenue;
  2. tables showing movements in appropriations for the financial year, indicating payment appropriations and non-differentiated appropriations;
  3. tables of expenditure showing the use of appropriations allocated for the financial year, indicating payment appropriations and non-differentiated appropriations;
  4. tables showing the use of the appropriations available from previous years;
  5. a document showing capital operations and debt management.

The revenue and expenditure account encompasses all revenue and expenditure operations relating to the past financial year for each institution. It is presented in the same form as the budget. At the same time, the Commission presents a consolidated balance sheet setting out the Communities’assets and liabilities, including borrowing and lending operations, and an analysis of financial management.

The institutions comply with existing European legislation regarding public procurement.

The Communities’ movable and immovable property is recorded in an inventory, which is used in drawing up each institution’s balance sheet.

The Community accounts are kept in euros, using the double entry method, on the basis of the calendar year. The accounts show all revenue and expenditure for the financial year and are supplemented by supporting documents.

The Court of Auditors monitors the implementation of the Community budget. The institutions send it all the supporting documents required for that purpose. The object of the Court’s supervision is to ensure that revenue and expenditure is legal and consistent with the Treaties, the budget and Community legislation. The Court also ensures that sound financial management is practiced. The Court’s comments are set out in its annual report. It may present special reports when it wishes to comment on specific matters. Special reports may also be drawn up at the request of an institution.

V. Special status of certain areas of the Community’s financial activities

The very nature of certain operations or policies means that their financial management receives special treatment:

  1. Research and technological development (R&TD) appropriations

    Appropriations earmarked for projects under the framework programme of R&TD activities are entered separately in a special subsection in Part B of the Commission section of the budget.
  2. European Agricultural Guidance and Guarantee Fund, Guarantee Section (EAGGF)

    One of the peculiarities of the agricultural budget is that provisional overall commitments are made corresponding to the advances to be paid to Member States. There is also an early warning system designed to rein in agricultural spending.
  3. External aid

    External aid is granted as part of the Community’s cooperation policy, either under cooperation agreements or independently. In many cases financing agreements are drawn up between the Commission and the government of the recipient country.
  4. Financial contributions from third parties
    As an exceptionto the principles of specification and non-assignment, contributions to the Community budget from third parties constitute revenue earmarked for specific purposes. This applies in particular to countries which are parties to the Agreement on the European Economic area.
  5. Office for Official Publications of the European Communities
    The budget appropriations relating to the Publications Office are shown in an annex setting out its expenditure and revenue, as it is the only Community body to generate revenue.

4) Deadline For Implementation Of The Legislation In The Member States

Not applicable.

5) Date Of Entry Into Force (If Different From The Above)

  • Financial Regulation of 21 December 1977:
  • Regulation (ECSC, EEC, Euratom) No 1252/79: 01.07.1979
  • Regulation (EEC, Euratom, ECSC) No 80/1176: 12.05.1980
  • Regulation (ECSC, EEC, Euratom) No 1600/88: 13.06.1988
  • Regulation (ECSC, EEC, Euratom) No 2049/88: 18.07.1988
  • Regulation (Euratom, ECSC, EEC) No 610/90: 19.03.1990
  • Regulation (ECSC, EC, Euratom) No 1923/94: 02.08.1994
  • Regulation (ECSC, EC, Euratom) No 2730/94: 19.11.1994
  • Regulation (EC, Euratom, ECSC) No 2333/95: 10.10.1995
  • Regulation (EC, Euratom, ECSC) No 2334/95: 10.10.1995
  • Regulation (EC, Euratom, ECSC) No 2335/95: 10.10.1995
  • Regulation (EC) No 2444/97: 18.12.1997
  • Regulation (EC, ECSC, Euratom) No 2548/98: 05.12.1998
  • Regulation (EC, ECSC, Euratom) No 2779/98: 01.01.1999
  • Regulation (EC, ECSC, Euratom) No 2673/1999: 01.01.2000

6) References

  • Financial Regulation of 21 December 1977: Official Journal L 356, 31.12.1977
  • Regulation (ECSC, EEC, Euratom) No 1252/79: Official Journal L 160, 28.06.1979
  • Regulation (EEC, Euratom, ECSC) No 80/1176: Official Journal L 345, 20.12.1980
  • Regulation (ECSC, EEC, Euratom) No 1600/88: Official Journal L 143, 10.06.1988
  • Regulation (ECSC, EEC, Euratom) No 2049/88: Official Journal L 185, 15.07.1988
  • Regulation (Euratom, ECSC, EEC) No 610/90: Official Journal L 70, 16.03.1990
  • Regulation (ECSC, EC, Euratom) No 1923/94: Official Journal L 198, 30.07.1994
  • Regulation (ECSC, EC, Euratom) No 2730/94: Official Journal L 293, 12.11.1994
  • Regulation (EC, Euratom, ECSC) No 2333/95: Official Journal L 240, 07.10.1995
  • Regulation (EC, Euratom, ECSC) No 2334/95: Official Journal L 240, 07.10.1995
  • Regulation (EC, Euratom, ECSC) No 2335/95: Official Journal L 240, 07.10.1995
  • Regulation (EC) No 2444/97: Official Journal L 340, 11.12.1997
  • Regulation (EC, ECSC, Euratom) No 2548/98: Official Journal L 320, 28.11.1998
  • Regulation (EC, ECSC, Euratom) No 2779/98: Official Journal L347, 23.12.1998
  • Regulation (EC, ECSC, Euratom) No 2673/1999: Official Journal L 326, 18.12.1999

7) Follow-Up Work

8) Commission Implementing Measures

The CAP towards 2020

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The CAP towards 2020

Outline of the Community (European Union) legislation about The CAP towards 2020

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Agriculture > General framework

The CAP towards 2020

Document or Iniciative

Communication from the Commission of 18 November 2010 – The CAP towards 2020: Meeting the food, natural resources and territorial challenges of the future [COM(2010) 672 – Not published in the Official Journal].

Summary

This Communication identifies the challenges facing agriculture and the Common Agricultural Policy (CAP) in the coming years. These challenges have been identified based on past experience, the current economic situation and an extensive public debate organised in 2010.

Through this Communication, the Commission is launching themes for consideration, relating to the future of the CAP. It proposes to adapt the current CAP objectives to the new challenges which have been identified. In particular, the emphasis should be on strong, quality agricultural production, on protecting natural resources and on maintaining the agricultural sector in all EU territories.

Lastly, the Commission explains which instruments would enable the fixed objectives to be met. These instruments should enable the CAP to be greener, fairer, more efficient and more effective.

OBJECTIVES

Food security

Global demand will continue to increase in the coming decades. The EU must be in a position to respond. It is essential that the EU maintains and increases its production capacity.

European citizens want high quality and a wide choice of food products, reflecting high safety, quality and animal welfare standards. A strong agricultural sector is vital for the highly competitive food industry to remain an important part of the EU economy and trade (the EU is the leading world exporter of mostly processed and high value added agricultural products).

Natural resources

Agriculture can put pressure on the environment (water pollution, soil depletion, water shortages and loss of wildlife habitats), but it can also have positive effects (climate stability, biodiversity, landscapes and resilience to flooding).

The EU shall endeavour to limit the negative effects of agriculture and to encourage its positive contributions. The future CAP shall promote energy efficiency, carbon sequestration, biomass and renewable energy production and, more generally, innovation.

Balanced territorial development

Agriculture remains an essential driver of the rural economy in the majority of EU countries. It is necessary to maintain a competitive and dynamic agricultural sector which attracts young farmers in order to preserve the vitality and potential of rural Europe.

INSTRUMENTS

Direct payments

In order to achieve the objectives stated above, the Commission plans to adapt the direct payments system to ensure that payments are better distributed and targeted.

It is proposed that future direct payments should support farmers’ basic income through the granting of a basic decoupled direct payment, with an upper ceiling, targeting of ‘active farmers’, a simple support system for small farmers and the consideration of areas with specific natural constraints.

The Commission proposes to improve the grant criteria relating to the environment through a mandatory ‘greening’ component of direct payments targeted at agricultural practices which address climate change and environmental objectives (permanent pasture, green cover, crop rotation, ecological set-aside, etc.).

Market measures

The Commission specifies that the CAP should keep the overall market orientation of agriculture while also maintaining the management tools which have demonstrated the important role they play in times of crisis or disruption. In the coming years, certain agricultural markets must evolve, in particular the regime currently in place in the sugar sector which is due to expire in 2014/2015.

The Commission believes that more general measures must be taken in order to improve the functioning of the food supply chain, which should be more transparent and within which bargaining power should be more balanced.

Rural development policy

Lastly, the Commission highlights the importance of the rural development policy which the EU carries out through the CAP. It proposes to strengthen the environmental element and to improve coordination of this policy with other European policies.

The Commission proposes to focus on the competitiveness of agriculture by encouraging innovation, promoting good management of natural resources and supporting balanced territorial development balance by encouraging local initiatives.

As well as enhancing the promotion and quality optimisation tools, the Commission believes that a risk management toolkit should be included to deal more effectively with income uncertainties and market volatility.

The financial framework of 2000-06

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The financial framework of 2000-06

Outline of the Community (European Union) legislation about The financial framework of 2000-06

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Budget

The financial framework of 2000-06 (Agenda 2000)

The adoption of new financial provisions, which will enable the Union to face the dual challenge of the deepening of Community policies and enlargement of the Union, is a key element of Agenda 2000. It was mainly in response to the request made by the Madrid European Council (1995) that an in-depth analysis be undertaken of the financing system and a new financial framework for the Union proposed with a view to enlargement that the Commission launched “Agenda 2000”.

The financial package which was finally adopted in 1999 includes several decisions, the most important one being the decision on the new financial perspective (2000-06), which is an integral part of the new Inter-institutional Agreement on budgetary discipline and improvement of the budgetary procedure.

The framework for the development of Community expenditure with ceilings for major spending categories covering several years and adopted jointly by the Commission, Parliament and the Council has been a standard feature since 1988 (Delors I package). Since the 1993-99 financial perspective is to expire shortly, the approval of a new financial framework was one of the most urgent matters during the negotiations on Agenda 2000.

Continuing the approach put in place by the 1988 and 1993 Inter-institutional Agreements on budgetary discipline, the three institutions have undertaken, in the new Interinstitutional Agreement, to consider budgetary objectives contained in the financial perspective for each of the major categories of expenditure as strict spending ceilings.

The expenditure available under the financial perspective cannot, of course, exceed the amount of own resources available for the period in question. During the negotiations which led to the adoption of the new financial framework, the institutions were very much aware of the need to ensure sound management of public finances, while making it possible to finance essential requirements. The overall ceiling on own resources has thus been kept at 1.27% of gross national product (GNP) for the entire period 2000-06.

Financial perspectives

The expenditure figures in the financial perspective are well below this overall ceiling. The total for commitments will fall from 92.03 billion in 2000 to 90.66 billion in 2006. The corresponding amounts for payments are 89.60 billion and 89.62 billion i.e. in terms of GNP, a decline from 1.13% to 0.97 %.

This budgetary rigour will be reflected in the various headings of the financial perspective, where the common agricultural policy and structural action will continue to account for the bulk of expenditure.

Other Union priorities which have been allocated funding in the new multiannual financing programming reflect the Union’s higher profile on the international scene, the modernisation of the Community’s administration and the development of certain internal policies (trans-European networks, research and innovation, education and training, application of new environment-friendly technologies, small and medium-sized enterprises).

Budgetary discipline and the expected increase in GNP will suffice to cover the cost of enlargement of the Union within an own resources ceiling of 1.27% of the GNP of the enlarged Union. On the assumption that the first wave of enlargement will take place during the middle of the period covered by the financial perspective, these costs will initially take the form of increased pre-accession aid and will gradually come to be borne by the funds reserved for Community policies.

A table annexed to the Inter-institutional Agreement but separate from the financial perspective gives an estimate of expenditure from 2002 onwards in a Union with 21 Member States (EUR 21). An adjustment of the financial perspective to take into account the budgetary impact of the accession of new States will be made each time a new country joins.

Improvement of the budgetary procedure

Apart from the financial perspective, the new Inter-institutional Agreement on budgetary discipline and improvement of the budgetary procedure includes provisions to promote better cooperation between the institutions during the annual budgetary procedure.

The conciliation procedure had been broadened and solutions have been found to problems which were left unresolved by the 1993 Agreement, in particular the matter of classification of expenditure and the need for all budget items to have a legal basis. The Commission stated in its report on the implementation of the 1993 Inter-institutional Agreement that it would like to see these problems resolved.

All the Inter-institutional Agreements and Joint Declarations dealing with budgetary matters have been consolidated in the new Inter-institutional Agreement in accordance with the recommendations made by the Commission in its report.

Own resources system

The Inter-institutional Agreement and the financial perspective which it contains relate mainly to the “expenditure” side of the Community budget. The arrangements for financing this expenditure are laid down in the “own resources decision”.

Since the 1988 own resources decision was adopted, the Community has four categories of revenue: customs duties, sugar and isoglucose levies and agricultural duties (traditional own resources), VAT, and the GNP-based resource. Under the 1994 own resources decision, the share of GNP in the financing of the budget increased significantly.

In a report on the operation of the own resources system, the Commission examined the current system and the possibilities of improving it, including the introduction of a new resource.

The Berlin European Council decided to introduce a set of measures which had as one of their objectives the improvement of the budgetary balances of some Member States. The maximum call-in rate for VAT resources will be gradually reduced (from 1.0% to 0.75% in 2002 and 0.50% in 2004) and the percentage of traditional own resources (customs duties, etc.) retained by the Member States by way of collection costs will be increased from 10% to 25% in 2001.
It was agreed to maintain the correction mechanism for the United Kingdom subject to some minor adjustments. For example, the financing scale has been changed, reducing the portion paid by Germany, the Netherlands, Austria and Sweden to one quarter of their normal share.
A new own resources decision incorporating these changes should be adopted shortly.
A decision on whether or not to reform the own resources system more radically was postponed until later.

Guarantee Fund for external action

Apart from these basic decisions, the Agenda 2000 financial package also includes a more specific measure, namely the new regulation on the Guarantee Fund for external action.

The Guarantee Fund for external action was set up in 1994 in order to protect the Community against any budgetary shocks should loans covered by the Community guarantee under its borrowing and lending policy for non-member countries not be repaid. When the Guarantee Fund was evaluated in 1998, it emerged that the quality of the guaranteed loans portfolio and the healthy financial state of the Fund made it possible to lower the parameters it operates with.
That was done by the new regulation amending the rules of the Fund. The new financial perspective also provides for a corresponding reduction in the amount allocated to the guarantee and loan reserve in the general budget.
This Agenda 2000 financial package will enable the Union to meet its major immediate challenges – the reform of its policies and the arrival of new members – within strict financial limits.

 

The ASEM process

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The ASEM process

Outline of the Community (European Union) legislation about The ASEM process

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External relations > Relations with third countries > Asia

The ASEM process (Asia-Europe meeting)

Document or Iniciative

Commission working document, of 18 April 2000: Perspectives and Priorities for the ASEM Process (Asia-Europe Meeting) into the new decade [COM(2000) 241 final – Not published in the Official Journal].

Summary

ASEM is an informal process of dialogue bringing together the Member States, the European Commission and ten Asian countries: Brunei, China, Indonesia, Japan, Malaysia, the Philippines, Singapore, South Korea, Thailand and Vietnam.

The dialogue takes place at several levels: there are Summit-level meetings, which are attended by the Asian and European Heads of State or Government and the President of the Commission, and Ministerial-level meetings on foreign affairs, finance, the economy, the environment, or science and technology. Discussions take place under three pillars: the political pillar, the economic and financial pillar, and the cultural and intellectual pillar. The larger meetings are prepared by the group of Coordinators, made up of four representatives: the Presidency, the European Commission and two Asian countries in rotation. To date, there have been four summits: in Bangkok in 1996, in London in 1998, in Seoul in 2000 and in Copenhagen in 2002. There have been many Ministerial-level meetings in the various fields.

In this document, the Commission emphasises the informal character of the process, which it regards as one of its greatest assets, and its pluralistic dimension. The Commission considers that the main comparative advantage of the process is its ability to stimulate and facilitate work in bilateral and multilateral fora, and to promote dialogue and mutual understanding in areas where a consensus can be reached.

In 2000, the Commission was concerned that the process could run out of steam if it failed to show the public and the world of business that it was still relevant to their concerns and interests. At the same time, it stressed the importance of ASEM’s potential, and called on public opinion to support the process and encourage the participation of civil society.

Priorities

In its working document, the Commission sets out general priorities for the three pillars of ASEM. Their aim is to build on the achievements of the process and deepen relations between the two regions. In the political field, and with a view to focusing on issues of common interest, the Commission proposes:

  • to intensify the high-level dialogue;
  • to strengthen networking and informal dialogue;
  • to provide for an exchange of views in the context of appropriate international institutions;
  • to support human rights, democracy and the rule of law;
  • to make joint efforts in addressing global issues that the partnership could further.

In the economic field: The aim is to strengthen the economic partnership, giving priority to dialogue at different levels: between companies, between the public and private sectors, between Finance and Economic Ministers, as well as maintaining a dialogue on more general socio-economic issues.

The intensification of the dialogue between the Economic Ministers and their Senior Officials should:

  • promote the strengthening of the WTO multilateral trade system;
  • strengthen two-way trade and investment flows;
  • establish an enhanced climate for business cooperation;
  • enhance dialogue and cooperation in key sectors for the future, such as infrastructure, transport, high-technology, services, telecommunications.

In the cultural and intellectual fields, ASEM should focus on promoting enhanced contacts and strengthened mutual awareness between the peoples of the two regions. The Commission calls for enhanced dialogue and cooperation in the fields of science and technology, the environment, social sciences, the arts and humanities, and the promotion of networking and increased contact and exchanges in the field of education. It proposes to continue to lend support to the Asia-Europe Foundation as a catalyst for cultural and intellectual dialogue between the two regions.

The Commission sets five specific priorities for the Seoul Summit:

  • an enhanced exchange of views on regional and global security issues;
  • enhanced dialogue and cooperation on trade, social policy and economic issues;
  • intensified educational exchanges;
  • cooperation in the field of consumer protection;
  • a possible broadening of participation in the ASEM process.

Related Acts

(September 2002)

The Copenhagen Summit approved the Copenhagen Declaration on Cooperation against International Terrorism and the Copenhagen Cooperation Programme on Fighting International Terrorism. The Summit also agreed that ASEM’s priorities would be closer economic cooperation, cooperation in the social, educational and environmental fields and a dialogue on cultures and civilisations. The next summit will take place in Vietnam in 2004.

Seoul Summit (October 2000)

This Summit, which is recognised as a historic milestone in the evolution of the ASEM process, approved the Asia-Europe Cooperation Framework 2000, building on the decisions taken in London. It sets a common vision for the future, as well as the aims, priorities and mechanisms to take the process into the 21st century. The partners agreed to strive for a common goal of maintaining peace and stability, and of promoting conditions conducive to sustainable economic and social development. Other ASEM initiatives were endorsed, relating to globalisation and information technology, the development of human resources, the environment, health, and transnational law enforcement matters.

In addition to coordination mechanisms, the Framework proposes that the Economy, Finance and Foreign Affairs Ministers meet regularly, at least once a year. A group of ASEM contact officials will facilitate exchanges of information.

London Summit (April 1998)

The London Summit adopted an Asia-Europe Cooperation Framework and established an Asia-Europe Vision Group to examine medium and long term perspectives for relations between the two regions. The Heads of State or Government also endorsed an action plan on trade facilitation and another on promoting investment. In response to the economic and financial crisis in Asia, they also agreed to create an ASEM Trust Fund and a European financial expertise network to overcome the effects of the crisis and avert new crises.

The process must be conducted on a basis of equal partnership, mutual respect and mutual benefits. It need not be institutionalised and should be an open and evolutionary process, managing the three pillars in parallel. The priorities set form the basis of those taken up by the Commission in 2000. The summit also refers to the need for increased cooperation in the fields of science and technology, culture, human resources, development, the fight against drug trafficking, money laundering, terrorism and international organised crime.

The Cooperation Framework provides that the Foreign Affairs Ministers and their Senior Officials are responsible for the overall coordination of ASEM activities. Any proposals for new activities must be beneficial to both parties, contribute to the general objectives, propose well-defined goals and actors, avoid duplicating activities and involve a sufficient number of partners.

Bangkok Summit (March 1996)

At the inaugural ASEM in Bangkok, the Heads of State or Government decided to establish an Asia-Europe Environmental Technology Centre in Bangkok. They also decided to set up an Asia-Europe Foundation with headquarters in Singapore, an Asia-Europe university programme and youth exchange programmes to strengthen cultural ties. They also agreed to conduct a study on the integration of the trans-Asian rail network and its possible integration into the trans-European network.

The protection of pigs

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The protection of pigs

Outline of the Community (European Union) legislation about The protection of pigs

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These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Food safety > Animal welfare

The protection of pigs

Document or Iniciative

Council Directive 2008/120/EC of 18 December 2008 laying down minimum standards for the protection of pigs.

Summary

This Directive lays down minimum standards for the protection of pigs. The text provides a framework in particular for painful operations: castration, caudal amputation, the elimination of corner teeth, etc.

Scope

Minimum standards apply to all categories of pigs kept for rearing and fattening: piglets (from birth to weaning), weaned piglets (from weaning to 10 weeks old), fatteners (more than 10 weeks old), sows and gilts *, boars *, etc.

These animals are, apart from some exceptions (farrowing sows, boar), to be raised in groups. Farmers must implement measures aimed at fulfilling basic needs and preventing aggression within the group. In particular, pigs must have permanent access to a sufficient quantity of enrichment material in order to enable proper investigation and manipulation activities.

Sows and gilts

Pregnant sows and gilts must, if necessary, be treated against external and internal parasites. Tethering sows and gilts has been prohibited since 1 January 2006.

One week before farrowing, sows and gilts can be isolated. An unobstructed area must be available for natural or assisted farrowing. Boxes must be equipped with piglet protection systems.

Piglets (unweaned)

No piglets shall be weaned from the sow at less than 28 days of age unless the welfare or health of the dam or the piglet would otherwise be adversely affected.

Weaned piglets and rearing pigs

Measures shall be taken to ensure that the animals do not fight. Pigs are to be kept in groups and must not be mixed (except if necessary before weaning or during the week following weaning). Aggressive animals are to be kept away from the group (as are injured animals). Tranquilising medicaments are only to be used to facilitate mixing in exceptional conditions and after consultation with a veterinarian.

Painful operations on animals

A veterinarian or “carer”, trained in aspects relating to animal welfare is authorised to carry out the following:

  • reduction of piglets’ corner teeth,
  • docking of tails (before the seventh day of life or after this age if carried out by a veterinarian and under anaesthesia and with additional prolonged analgesia),
  • castration of males (before the seventh day of life or after this age if carried out by a veterinarian and under anaesthesia and with additional prolonged analgesia),
  • nose-ringing in outdoor husbandry systems.

Neither tail-docking nor reduction of corner teeth must be carried out routinely but only where there is evidence that injuries to sows’ teats or to other pigs’ ears or tails have occurred. Before carrying out these procedures, other measures shall be taken to prevent tail-biting and other vices, taking into account environment and stocking densities. For this reason inadequate environmental conditions or management systems must be changed.

Health

Sick or injured pigs are to be placed in individual enclosures.

Feed

The Directive also provides for standards concerning feeding in “sufficient quality” and “permanent” access to drinking water. All pigs must have access to food at the same time as other animals in the group. Animals must be fed at least once a day.

Accommodation

Standards concerning floor area are set according to the weight of the animal: between 0.15 m2 for pigs weighing less than 10 kg and 1 m2 per animal over 110 kg, 1.64 m2 per gilt, 2.25 m2 per sow, 6 m2 for a boar (10 m2 if the boar is used for natural service).

Some accommodation standards will only apply after 1 January 2013 (for buildings constructed before 2003 or after the date of accession to the EU).

Floors must be smooth but not slippery so as to prevent injury to the animals.

The lying area must be comfortable, clean and dry.

Environment

Continuous noise as loud as 85 dB is to be avoided. Light intensity is to be at least 40 lux for eight hours.

Inspections

Member States must carry out inspections each year on a statistically representative sample.

The Commission may send veterinary experts to make on-the-spot checks in the farms with the assistance of national inspectors.

Specific provisions

Member States may apply stricter provisions on their own territory than those laid down in this Directive. In this case, they shall inform the Commission of any such measures beforehand.

Context

This Directive codifies and replaces Directive 91/630/EEC and its subsequent amendments.

Key terms of the Act
  • Gilt: a female pig after puberty and before farrowing.
  • Boar: a male pig after puberty, intended for breeding.

References

Act Entry into force Deadline for transposition in the Member States Official Journal
Directive 2008/120/EC

10.3.2009

1.1.2008

OJ L 47 of 18.2.2009

The Court of Auditors of the European Union

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The Court of Auditors of the European Union

Outline of the Community (European Union) legislation about The Court of Auditors of the European Union

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Fight against fraud > Anti-fraud offices

The Court of Auditors of the European Union

Document or Iniciative

Rules of Procedure of the Court of Auditors of the European Union [Official Journal L 103 of 23.04.2010].

Summary

These Rules of Procedure, which entered into force on 1 June 2010, lay down the internal workings of the Court, the rules on nominating the President and the decision-making procedure. It is the Court itself that establishes its own Rules of Procedure, subject to the approval of the Council acting by qualified majority.

Role

Article 287 of the Treaty of the Functioning of the European Union (TFEU) defines the role and prerogatives of the Court of Auditors.

The Court therefore audits the legality of the revenue and expenditure of the EU and its bodies. The audit completed by the Court is carried out with the aim of both improving financial management, as well as making European citizens aware of how public funds are used.

The audit carried out by the Court shall be:

  • based on records and, if necessary, performed on the spot in the other European institutions;
  • performed on the premises of any body which manages revenue or expenditure on behalf of the EU;
  • performed in the Member States, including on the premises of any natural or legal person in receipt of payments from the European budget.

In its role as auditor, the Court shall cooperate with the national services and the European institutions. Moreover, it is able to request any information required to successfully complete its task from the EU institutions and bodies, organisations in receipt of payments from the European budget or from national audit institutions.

In respect of the European Investment Bank’s activity in managing expenditure and revenue, the Court’s rights of access to information held by the Bank shall be governed by an agreement between the Court, the Bank and the Commission.

The Court of Auditors must notify the relevant authorities of any irregularity. To this end, it shall work closely together with the European Anti-Fraud Office (OLAF).

Despite its name, the European Court of Auditors has no judicial powers and therefore no power to impose sanctions. After the close of each financial year it shall draw up an annual report to be published in the Official Journal. This report concerns the management of the European budget by the competent institutions. It is a fundamental part of the European Parliament’s decision-making process regarding the granting of the budget discharge to the Commission.

The Court of Auditors also provides the Council and the Parliament with a statement of assurance concerning the reliability of the accounts and attesting that the European budget has been used well. In addition, the Court may also, at any time, submit observations, particularly in the form of special reports, on specific questions and deliver opinions at the request of one of the other European institutions.

Composition of the Court

Articles 285 and 286 of the Treaty on the Functioning of the EU establish rules regarding the composition of the Court of Auditors.

The College shall be the main decision-making body of the Court. It shall comprise one Member from each Member State of the EU. Members shall be appointed by the Council acting by qualified majority following consultation of the European Parliament, on the basis of proposals from the Member States. Members eligible for appointment by the Member States must belong to an external audit body in their own country or possess a specific qualification for this post. They shall carry out their duties at the Court of Auditors entirely independently. Their term of office is six years and may be renewed.

The Members of the Court shall elect the President of the Court by secret ballot. The candidate who, in the first round of voting, obtains a two-thirds majority of the Members’ votes shall be elected President. If this majority is not reached, the candidate must obtain the majority of votes in the second round of voting. The term of office is three years and may be renewed. The President’s duties shall be to:

  • draw up the agenda;
  • call and chair meetings of the Court;
  • ensure that discussions run smoothly;
  • ensure that the Court’s decisions are implemented;
  • ensure that the departments of the Court operate properly and that its various activities are managed soundly;
  • appoint an agent to represent the Court in litigation;
  • represent the Court in its external relations and in its relations with the other European institutions, etc.

The Court shall appoint the Secretary-General of the Court, who shall be responsible for the Court’s Secretariat, by secret ballot. In addition, chambers and committees shall be set up. The chambers have the task of preparing opinions and reports adopted by the Court. The committees shall deal with matters not covered by the chambers.

The Court shall decide in formal session, by the majority of its Members, on the adoption of the annual report, special reports and opinions. The Court’s meetings shall not be public, unless the Court decides otherwise. The Court may also decide, on a case-by-case basis, to adopt decisions by the written procedure.

Origins of the Court

The Court of Auditors was founded by the Treaty of Brussels, which was signed on 22 July 1975 and entered into force in October 1977. The Treaty of Maastricht (1992) gave the Court the status of a full institution. The seat of the Court is in Luxembourg.

References

Act Entry into force Deadline for transposition in the Member States Official Journal

Rules of Procedure of the Court of Auditors of the European Union

1.6.2010

–

OJ L 103 of 23.4.2010

Transparency, simplification of the Treaties and quality of Community legislation

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Transparency, simplification of the Treaties and quality of Community legislation

Outline of the Community (European Union) legislation about Transparency, simplification of the Treaties and quality of Community legislation

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Institutional affairs > Building europe through the treaties > The Amsterdam treaty: a comprehensive guide

Transparency, simplification of the Treaties and quality of Community legislation

The European Union often deals with complex technical matters, whilst its institutional arrangements are unique and difficult to understand on first acquaintance. Frequent misunderstandings have thus arisen between the European institutions, national political and economic interests and the European public at large. To promote a better understanding of the European integration process, the institutions are gradually adopting more transparent ways of working and taking decisions.

The concept of “transparency” applies mainly to the question of access to Union information and documents but it also has to do with the production of clearly understandable legislative texts. It involves not only producing a single consolidated version of each text which has undergone amendments (such consolidation may be done formally or informally) but also laying down drafting rules so that any piece of legislation adopted in each of the Community’s official languages (of which there are currently eleven) is as clear as possible.

The Treaty of Amsterdam confers certain rights on the public and makes recommendations to the institutions with a view to ensuring that the fullest possible information is available and thus improving the democratic workings of the European Union.

TRANSPARENCY

To clarify the concept of “transparency” some amendments have been made to the EC Treaty.

A new Article 255 has been inserted, giving any Union citizen and any natural or legal person residing or having a registered office in a member state the right of access to European Parliament, Council and Commission documents.

The general principles governing the right of access and any restrictions on the grounds of public or private interest are to be fixed by the Council, acting under the codecision procedure with Parliament, within two years after the Treaty of Amsterdam enters into force. The three institutions concerned must include specific rules on access to documents in their Rules of Procedure.

A third paragraph has been added to Article 207 (ex Article 151), requiring the Council to grant access to documents relating to its legislative activities. As a minimum requirement, the results of votes, explanations of votes, and statements in the minutes must be made public.

These provisions clarify the rights of the public regarding access to documents and apply to all areas covered by the first and third pillars. However, they do not cover the common foreign and security policy, since that involves diplomatic rather than legislative activities. Access to certain national documents may also be restricted if the member state concerned so requests (Declaration adopted by the intergovernmental conference on Article 255).

SIMPLIFICATION AND CONSOLIDATION OF THE TREATIES

It has become difficult to read the original Treaties because of all the deletions, additions and amendments made by the Single European Act and the Treaties of Maastricht and Amsterdam. To make the EU Treaty and the EC Treaty easier to follow, all their articles have been renumbered.

In a Declaration adopted by the Intergovernmental Conference, the Member States also agreed to produce consolidated versions of all the Treaties. This consolidation will have no legal status but will provide more legible texts from which any lapsed provisions will have been deleted.

QUALITY OF THE DRAFTING OF COMMUNITY LEGISLATION

The Intergovernmental Conference adopted a Declaration incorporating the conclusions of the Edinburgh European Council (11-12 December 1992) and the Council Resolution of 8 June1993. This Declaration stresses that Community legislation must be clearly drafted if it is to be properly implemented by the competent national authorities and better understood by the general public.

In particular, the Conference calls on the three main institutions responsible for drafting Community legislation (the European Parliament, the Council and the Commission) to establish guidelines for improving the quality of the texts which they draft, amend or adopt.

The Conference also called for the codification of legislative texts to be speeded up.

The Court of Justice

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The Court of Justice

Outline of the Community (European Union) legislation about The Court of Justice

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Institutional affairs > Building europe through the treaties > The Amsterdam treaty: a comprehensive guide

The Court of Justice

Conferring greater democratic legitimacy on the European institutions is one of the chief aims of the reform of the European Union. The role of the Court of Justice is important in this context since it has the task of ensuring that the law is observed in the interpretation and application of the Treaties, an essential requirement if the European Union is to work along democratic lines.

The Court’s powers have been widened by the Treaty of Amsterdam. It now has jurisdiction in areas that previously lay outside its field of competence, but where there is an urgent need to protect individual rights:

  • fundamental rights;
  • asylum, immigration, free movement of persons and judicial cooperation in civil matters;
  • police and judicial cooperation in criminal matters.

FUNDAMENTAL RIGHTS

Article 46 (ex Article L) of the EU Treaty has been amended to extend the powers of the Court of Justice to cover Article 6(2) (ex Article F.2) of the Treaty, as far as action by the European institutions is concerned.

Article 6 requires the Union to respect fundamental rights, as guaranteed by the European Convention on Human Rights. The amendment is important since it formally gives the Court the power to rule on how the Convention is being applied by the Community institutions. This should spur the Court to greater vigilance.

ASYLUM, IMMIGRATION, FREE MOVEMENT OF PERSONS AND JUDICIAL COOPERATION IN CIVIL MATTERS

A new Title (“Visas, asylum, immigration and other policies related to free movement of persons”) has been inserted in the EC Treaty. The Treaty already contained provisions relating to visas (ex Article 100c, which has been repealed). The main changes therefore relate to the new Community framework for questions regarding asylum, immigration, free movement of persons, and judicial cooperation in civil matters.

Under Article 68 the Court now has jurisdiction in the following cases:

  • a national court against whose decisions there is no judicial remedy under national law may ask the Court of Justice to give a ruling on a question concerning the interpretation of the new Title or the validity or interpretation of Community acts based on it, if a ruling by the Court is necessary so that the national court can give judgment;
  • the Council, the Commission or a Member State may request the Court of Justice to give a ruling on a question of interpretation of the Title or Community acts based on it.

POLICE AND JUDICIAL COOPERATION IN CRIMINAL MATTERS

Title VI of the EU Treaty has been renamed “Provisions on police and judicial cooperation in criminal matters”.

Article 35 (ex Article K.7) lays down two restrictions on the Court’s powers to rule on matters covered by Title VI:

  • preliminary rulings apply only to those Member States which have made a declaration accepting the jurisdiction of the Court (paragraph 2);
  • actions for annulment may be brought only by Member States or the Commission (paragraph 6).

The Court also has jurisdiction to rule on any dispute between Member States over the interpretation or application of the measures adopted and on any dispute between Member States and the Commission about the interpretation or application of conventions established under the third pillar.

The Court of Auditors, the Economic and Social Committee and the Committee of the Regions

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The Court of Auditors, the Economic and Social Committee and the Committee of the Regions

Outline of the Community (European Union) legislation about The Court of Auditors, the Economic and Social Committee and the Committee of the Regions

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Institutional affairs > Building europe through the treaties > The Amsterdam treaty: a comprehensive guide

The Court of Auditors, the Economic and Social Committee and the Committee of the Regions

The role of the Court of Auditors as a Community institution has been enhanced:

  • it is now included in Article 5 (ex Article E) of the EU Treaty;
  • it has been given the right to bring actions before the Court of Justice for the purpose of protecting its prerogatives, under Article 230 of the EC Treaty (ex Article 173).

Its powers as a watchdog and investigator have been increased so that more effective steps can be taken to combat fraud to the detriment of the Community budget. It must notify any irregularity in Community revenue or expenditure to the European Parliament and the Council. For this purpose it has been given powers to audit the accounts of external bodies managing Community funds, including the European Investment Bank (EIB).

In the performance of its duties the Court of Auditors may require any relevant documents or information to be produced and may conduct audits “on the spot in the other institutions of the Community, on the premises of any body which manages revenue or expenditure on behalf of the Community and in the Member States, including on the premises of any natural or legal person in receipt of payments from the budget” (Article 248(3)).

In the case of the EIB the Court of Auditors has access to the information needed for the audit of Community expenditure and revenue managed by the Bank. Its rights of access will be governed by an agreement between the Court, the Bank and the Commission (such an agreement already existed, and a Declaration invites the three institutions concerned to maintain it in force).

In addition to this increase in the powers of the Court of Auditors, Article 248 (ex Article 188c) calls for close cooperation between the Court and national audit bodies.

Furthermore, the statement of assurance provided by the Court as to the reliability of accounts and the legality and regularity of the underlying transactions is to be published in the Official Journal of the European Communities.

THE ECONOMIC AND SOCIAL COMMITTEE

Consultation of the Economic and Social Committee is mandatory on a wider range of topics. The new areas of the EC Treaty on which the Economic and Social Committee must first be consulted are:

  • the guidelines and incentives for employment (Articles 128 and 129);
  • the social legislation resulting from the agreements reached by management and labour (Articles 136 to 143);
  • implementation of the principle of equal opportunities (Article 141);
  • public health (Article 152).

The Economic and Social Committee may also be consulted by the European Parliament if the latter deems such consultation appropriate.

The administrative structure of the Economic and Social Committee is now separate from that of the Committee of the Regions. The Protocol to the EC Treaty providing for a common organisational structure has been repealed.

THE COMMITTEE OF THE REGIONS

The Committee of the Regions must be consulted in the following additional areas:

  • the areas listed above for the Economic and Social Committee;
  • the environment (Article 175);
  • the Social Fund (Article 148);
  • vocational training (Article 150) ;
  • cross-border cooperation (first paragraph of Article 265);
  • transport (Articles 71 and 80).

The Committee may also be consulted by the European Parliament on other matters.

Like the Economic and Social Committee, the Committee of the Regions now has its own separate administrative structure. Similarly, it may draw up its own rules of procedure without requiring the unanimous approval of the Council, as was required before.

The Amsterdam treaty: a comprehensive guide

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The Amsterdam treaty: a comprehensive guide

Outline of the Community (European Union) legislation about The Amsterdam treaty: a comprehensive guide

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Institutional affairs > Building europe through the treaties > The Amsterdam treaty: a comprehensive guide

The Amsterdam treaty: a comprehensive guide

The factsheets here summarise the main changes brought about by the Treaty of Amsterdam. We have tried to present them as straightforwardly as possible.

Please note, however, that the factsheets are intended solely for your information. The European Commission accepts no legal responsibility. The factsheets make no claim to be exhaustive and cannot be regarded as an official interpretation of the Treaty text.

Freedom, security and justice

  • Fundamental rights and non-discrimination.
  • The gradual establishment of an area of freedom, security and justice

The Union and the citizen

  • Citizenship of the European Union
  • Employment
  • Social policy
  • Environment
  • Public health
  • Consumer protection
  • Transparency, simplification of the Treaties and quality of Community legislation

Effective and coherent external policy

  • Common Foreign and Security Policy
  • Common commercial policy

Institutional questions

  • The European Parliament
  • The Council of the European Union
  • European Commission
  • The Court of Justice
  • The Court of Auditors, the Economic and Social Committee and the Committee of the Regions
  • National parliaments
  • Subsidiarity
  • Closer cooperation
  • Decision-making procedures