# EUR-Lex - 52014PC0459 - EN

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# 52014PC0459

**Proposal for a COUNCIL DECISION amending Decision 2007/198/Euratom establishing the European Joint Undertaking for ITER and the Development of Fusion Energy and conferring advantages upon it /* COM/2014/0459 final - 2014/0215 (NLE) */**

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EXPLANATORY MEMORANDUM

1.           CONTEXT OF THE PROPOSAL

In its conclusions of 12 July 2010 on the
Commission's Communication "ITER status and possible way forward",
the Council requested the European Commission to examine and address the way in
which the Commission, the Member States and the Joint Undertaking for ITER and
the Development of Fusion Energy "Fusion for Energy" (F4E) should
implement their responsibilities and tasks on ITER.

A detailed list of actions was identified
in the Commission’s Staff Working Paper "Towards a robust management and
governance of the ITER project" issued on 9 November 2010, which at the
international level were directed mainly to the ITER Organization (IO) and at the
European level mainly to F4E.

With the accession of Croatia to the European Union on 1 July 2013, the Statutes of F4E shall be amended to grant Croatia voting rights in the Governing Board of F4E. Taking the opportunity of this
amendment and in line with the Commission's Staff Working paper of 2010, the
Commission proposes the adoption of additional modifications to improve the
management and the governance of F4E.

These proposals have been extensively discussed
with the Members of F4E’s Governing Board and following these exchanges, the
Governing Board adopted unanimously the proposed amendments at its meeting on
9-10 December 2013. Pursuant to the amendment procedure laid down in Article 21
of the F4E Statutes, once the Governing Board has approved the proposed
amendments, the Commission can submit the proposal to modify the Statutes to
the Council for its adoption.

Therefore, in accordance with Article 50 of
the Euratom Treaty and Article 21 of the F4E Statutes, the Commission is hereby
making a proposal to the Council for the approval of these amendments.

2.           RESULTS OF CONSULTATIONS
WITH THE INTERESTED PARTIES AND IMPACT ASSESSMENTS

The members of the Governing Board of F4E
are the main interested parties in F4E. All Member States, Switzerland and Euratom are represented and their consultation and agreement are required on any
proposal to amend the Statutes of F4E, in line with Article 6(4) of the F4E
Statutes.

For this reason, in June 2013, the
Commission presented a draft proposal to amend the F4E Statutes to the
Governing Board. The Governing Board decided then to set up an ad-hoc group, chaired
by the Chair of the Governing Board, with the mandate to seek consensus among
the members on proposals to amend the Statutes.

The first meeting of this ad hoc group took
place on 21 October 2013 and following this meeting a proposal was drafted and
submitted to the Governing Board of 9-10 December 2013. At that meeting, the
Governing Board adopted unanimously the proposed amendments and now the
Commission can submit the proposal to the Council for approval.

3.           LEGAL ELEMENTS OF THE
PROPOSAL

1. Redefinition of the role of the
Executive Committee, creation of a Procurement and Contracts Committee and a
Bureau.

The tasks currently entrusted to the
Executive Committee would be divided between two Committees, an
"Administration and Management Committee" and a "Procurement and
Contracts Committee". The proposed separation of these tasks allows for a
more appropriate alignment between the composition of these two committees, the
former being composed of representatives of Members and the latter of experts
acting in a personal capacity.

The Administration and Management Committee
would, inter alia, prepare opinions and recommendations to the Governing
Board on the budget, resource estimates plan, annual accounts, the project plan,
the work programme, etc.

The Procurement and Contracts Committee would
give recommendations to the F4E Director on the award of contracts and would have
only an advisory role unlike the current Executive Committee which has an
approval role. This amendment is fully consistent with the prerogatives granted
to the Director of F4E in his capacity of Authorising Officer. The Internal
Audit Service of the Commission has pointed out that the Director is
responsible for awarding the contracts and should not delegate this
responsibility to a Committee where members are appointed ad personam by
the Governing Board.

The "Bureau", a committee not
defined in the initial Council Decision establishing F4E, was set up by a
decision of the Governing Board in 2011, as a subsidiary body, to assist the
Governing Board in the preparation of its decisions. It is now proposed to specifically
introduce this committee in the F4E Statutes as the Governing Board considers
that it has proven to be a useful instrument that allows it to work more
efficiently.

2. Strengthening the rights of Euratom
as regards the 'reservation on legality'.

Pursuant to Article 6(6) of the current F4E Statutes
Euratom has the right to make a reservation to a decision by the Governing
Board when it considers that that decision may be contrary to Community law. In
this case the decision is suspended and the matter is referred to the
Commission for a review of its legality. However, the Governing Board can adopt
a decision despite a Commission opinion contesting its legality. Strengthening
the rights of the Commission as regards the provision on the 'reservation on
legality' would ensure consistency of the decisions of the Governing Board with
the Community law in line with Article 17 of the Treaty of the European Union
which states that the Commission "shall ensure the application of the
Treaties, and of measures adopted by the institutions pursuant to them".

With this amendment the Governing Board
cannot adopt a decision as long as the Commission has lodged an opinion calling
into question its legality.

3. Privileged partnership with
designated organisations in the field of scientific and technological fusion
research.

This amendment aims at establishing a stable
relationship with the European Fusion Laboratories (EFL).

This relationship is important for the
efficient and effective operation of the European fusion programme, for F4E in
the discharge of its responsibilities and for the European Fusion Laboratories
to optimise their capacity and participation. For the Fusion laboratories, it
would provide a stable framework for a multi-annual plan of activities, while
for F4E it would provide stable and reliable R&D support, based on the
knowledge and know-how developed by the European Fusion programme in the last 30
years of activity and those to be developed in the future.

The benefit to the European fusion programme
would be a better use of resources ensuring among others that bottlenecks and
duplications of effort are mitigated and national funding is optimally combined
with the community funding flowing through F4E.

4. Adaptation deriving from the new
framework financial regulation.

The new framework financial regulation for
the bodies referred to in Article 208 of Regulation (EU, Euratom) No 966/2012
of the European Parliament and of the Council has been recently adopted by the
Commission. This new regulation contains provisions that need to be included in
the constituent act (the Council Decision) or in the basic act (the Statutes)
establishing these bodies which also concerns F4E. The amendments are purely
technical and do not affect the substance of the proposal approved by the
Governing Board. In this regard it is important to note that according to
Article 208(3) the Commission's internal auditor shall exercise the powers of
internal auditor of F4E. Consequently the paragraph 2 of Article 5 of the
Council Decision, which mentions that the Joint Undertaking shall establish its
own internal audit service, needs to be deleted. Accordingly, point 3 of Annex
3 of the Statutes has been amended to indicate that the Joint Undertaking shall
establish an audit capability.

5. Amendment needed to align the
Statutes to the new basic act for the financing of F4E activities approved by
the Council in December 2013.

The Council Decision on the financing of F4E
activities for 2014-2020 entails an amendment to the F4E Statutes. As it stands
now, Article 12(a) of the F4E Statutes provides for the Euratom contribution to
be made available through the Community research and training programmes,
adopted pursuant to Article 7 of the Treaty. This provision needs to be amended
to take into account that the financing of F4E for 2014-2020 will not be made
available through the Euratom Framework Programme but through this new Council Decision based on article 47 of the
Treaty.

In addition, a new Article 5aa is inserted in
the Council Decision establishing Fusion for Energy to reinforce the protection
by the Joint Undertaking of the financial interests of its Members.

6. Voting rights for Croatia.

By decision of the Governing Board during its
meeting of 10-11 June 2013, it is proposed to grant Croatia two votes in the
Governing Board.

4.           BUDGETARY IMPLICATION

This proposal for a Council Decision has no
budgetary implication. The financing of the activities
of F4E for the period 2014-2020 has been set up by Council Decision
2013/791/Euratom of 13 December 2013.

2014/0215 (NLE)

Proposal for a

COUNCIL DECISION

amending Decision 2007/198/Euratom
establishing the European Joint Undertaking for ITER and the Development of
Fusion Energy and conferring advantages upon it

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing
the European Atomic Energy Community and in particular the third and fourth
paragraphs of Article 47 and Article 48 thereof,

Having regard to the proposal from the
European Commission,

Whereas:

(1)       Council
Decision 2007/198/Euratom[1] established the European Joint Undertaking for ITER and the
Development of Fusion Energy (hereinafter "Joint Undertaking") to provide
the contribution of the European Atomic Energy Community (hereinafter
"Euratom") to the ITER International Fusion Energy Organisation and
the Broader Approach Activities with Japan as well as to prepare and coordinate
a programme of activities in preparation for the construction of a
demonstration fusion reactor and related facilities.

(2)       Decision 2007/198/Euratom
has been amended by Council Decision 2013/791/Euratom[2] to allow the financing
of the activities carried out by the Joint Undertaking during the period
2014-2020.

(3)       In its conclusions of 12
July 2010 on the Commission's Communication "ITER status and possible way
forward"[3],
the Council requested the Commission to examine and address the way in which
the Commission, the Member States and the Joint Undertaking should implement
their responsibilities and tasks on ITER.

(4)       A detailed list of actions
was identified in the Commission's Staff Working Paper "Towards a robust
management and governance of the ITER project"[4] issued on 9 November
2010, to be undertaken either at the international level, mainly by the ITER Organization,
or at the European level, mainly by the Joint Undertaking.

(5)       Following the accession of
 Croatia to the Union on 1 July 2013, there is a need to amend the Statutes of the
Joint Undertaking to grant Croatia voting rights in the Governing Board of the
Joint Undertaking. It is necessary to make further amendments to those Statutes
in order to improve the management and the governance of the Joint Undertaking.
To take into account amendments to the Treaty establishing the European Atomic
Energy Community by the Treaty of Lisbon, it is also necessary to update the
reference to the provisions on the Court of Justice of the European Union.

(6)       The Governing Board of the
Joint Undertaking approved the amendments proposed by the Commission to
Decision 2007/198/Euratom, in accordance with the Statutes of the Joint
Undertaking.

(7)       An Administration and
Management Committee should be established to prepare opinions and
recommendations for the adoption of key documents by the Governing Board. This Committee
should also provide advice or recommendations on specific administrative and
financial issues upon request of the Director or the Governing Board. The
Governing Board should have the power to delegate tasks to this Committee. Any
Member of the Joint Undertaking should have the right to nominate a
representative to serve on this Committee.

(8)       A Procurement and Contracts
Committee should be established to give recommendations to the Director of the
Joint Undertaking on the award of contracts, grants and related matters.
Members of this Committee should be nominated in a personal capacity by the
Governing Board.

(9)       A Bureau should be
established to assist the Governing Board in the preparation of its decisions. The
Governing Board should have the power to delegate tasks to the Bureau. The members
of the Bureau should be the Chair of the Governing Board, the Chairs of the
Governing Board Committees, a representative of Euratom and a representative of
the ITER Host State (France). The Governing Board should be entitled to appoint
additional persons to the Bureau.

(10)     In accordance with Article
17 of the Treaty on European Union, the Commission is to ensure the application
of the Treaties, and of measures adopted by the institutions pursuant to them.
Therefore, the rights of the Commission should be strengthened to ensure
consistency of the decisions of the Governing Board with Union law.

(11)     It is desirable to
establish a network of designated organisations in the field of scientific and
technological fusion research to provide stable and long-term research and
development support to the Joint Undertaking, based on the knowledge and
know-how developed by the European Fusion programme and those to be developed
in the future.

(12)     It is necessary to take
into account the relevant provisions of Regulation (EU, Euratom) No 966/2012 of
the European Parliament and of the Council[5]
and Commission Delegated Regulation (EU) No 1268/2012[6], in particular the role
of the Commission's internal auditor as internal auditor of the Joint
Undertaking.

(13)     Decision
2007/198/Euratom as amended by Decision 2013/791/Euratom
ensures the financing of the Joint Undertaking activities for 2014-2020.
Article 12 a) of the Statutes of the Joint Undertaking provides for the Euratom
contribution to be made available through the Community research and training
programmes, adopted pursuant to Article 7 of the Treaty. That provision should
be amended to take into account that the financing for 2014-2020 will no longer
be made available through the Euratom Framework Programme.

(14)     It is also appropriate to
update Decision 2007/198/Euratom as regards the provisions on protection of the
financial interests of the Members.

(15)     Decision 2007/198/Euratom
should therefore be amended accordingly,

HAS ADOPTED THIS DECISION:

Article 1

Decision 2007/198/Euratom is amended as
follows:

(1)          Article 5 is amended as follows:

(a)     in paragraph 1 the following sentence
is added:

"The Joint Undertaking
may award grants and prizes in accordance with the rules of its financial
regulation.";

(b)     paragraph 2 is deleted;

(2)          the following Article 5aa is
inserted:

"Article 5aa

Protection of the
financial interests of the Members

The Joint Undertaking
shall ensure that the financial interests of its Members are adequately
protected by carrying out or commissioning appropriate internal and external
controls.";

(3)          paragraph 3 of Article 9 is
replaced by the following:

"The Court of
Justice shall have jurisdiction in actions brought against the Joint
Undertaking, including decisions of its Governing Board, under the conditions
provided for in Articles 263 and 265 of the Treaty on the Functioning of the
European Union";

(4)          the Annex is amended in accordance
with the Annex to this Decision.

Article 2
Application

This Decision shall enter into force on the
twentieth day following that of its publication in the Official Journal of
the European Union.

Done at Brussels,

For
the Council

The
President

[1]               Council Decision 2007/198/Euratom of 27 March 2007
establishing the European Joint Undertaking for ITER and the Development of
Fusion Energy and conferring advantages upon it (OJ L 90, 30.3.2007, p. 58).

[2]               Council Decision 2013/791/Euratom of 13 December 2013
amending Decision 2007/198/Euratom establishing the European Joint Undertaking
for ITER and the Development of Fusion Energy and conferring advantages upon it
(OJ L 349, 21.12.2013 p 100).

[3]               COM(2010) 226 final of 4 May 2010.

[4]               SEC(2010) 1386 final of 9 November 2010.

[5]               Regulation (EU, Euratom) No 966/2012 of the European
Parliament and of the Council of 25 October 2012 on the financial rules
applicable to the general budget of the Union and repealing Council Regulation
(EC, Euratom) No 1605/2002 (OJ L 298, 26.10.2012, p. 1).

[6]               Commission Delegated Regulation (EU) No 1268/2012 of
29 October 2012 on the rules of application of Regulation (EU, Euratom) No
966/2012 of the European Parliament and of the Council on the financial rules
applicable to the general budget of the Union (OJ L 362, 31.12.2012, p. 1) .

ANNEX

to the

Proposal for a Council Decision

amending Decision 2007/198/Euratom
establishing the European Joint Undertaking for ITER and the Development of
Fusion Energy and conferring advantages upon it

ANNEX

The Annex is amended as follows:

(1) 
Article 5 is amended as follows:

(a) 
the title is replaced by the following:

"Bodies and Committees";

(b) 
paragraph 2 is replaced by the following:

"2.
The Governing Board shall be assisted by the Administration and Management
Committee and by the Bureau in accordance with Articles 8a and 9a.";

(c) 
the following paragraph 2a is inserted:

"2a.
The committees of the Joint Undertaking shall be the Administration and
Management Committee, the Bureau and the Procurement and Contracts Committee
(“hereinafter the Committees”)";

(d) 
paragraph 3 is replaced by the following:

"3.
The Director shall seek advice from the Procurement and Contracts Committee in
accordance with Article 8b.";

(e) 
the following paragraph 4 is added:

"4.
The Governing Board and the Director shall seek advice from the Technical
Advisory Panel in accordance with Article 9.";

(2) 
Article 6 is amended as follows:

(a) 
paragraph 3 is amended as follows:

(i) points (b) and (c) are replaced by the
following:

"(b)
establish subsidiary bodies;

(c)
appoint the chairs and members of the Committees and any subsidiary bodies
established under point (b);

(ii)
in point (d), the words "work programmes" are replaced by the words
"work programme";

(iii)
point (e) is replaced by the following:

"(e)
adopt the annual budget (including the specific parts related to the
administrative and staff costs) and give an opinion on the annual
accounts;";

(iv)
point (n) is replaced by the following:

"(n)
approve the conclusion of agreements or arrangements regarding cooperation with
third countries and with institutions, undertakings or persons of third
countries or with international organisations with the exception of the
procurement arrangements for the activities laid down in Article 3(1)(b)-(c)
and 3(2)(a);";

(v)
point (o) is replaced by the following:

"(o)
assess the annual report on the progress of the Joint Undertaking with respect
to its work programme and its resources;";

(vi)
point (q) is deleted;

(b) 
in paragraph 6, the third and the fourth
subparagraphs are replaced by the following:

"The
Commission may come to a view on the legality of the decision of the Governing
Board within one month of the matter being referred to the Commission, failing
which the decision of the Governing Board shall be deemed to have been upheld.

The
Governing Board shall re-examine its decision in the light of the Commission's
views to ensure, as appropriate, compliance with Community law.";

(c) 
paragraphs 9 and 10 are replaced by the
following:

"9.
Unless otherwise decided in particular cases, the Director of the Joint
Undertaking and the Chairs of the Committees shall participate in the meetings
of the Governing Board.

10.
The Governing Board shall adopt its rules of procedure by a two-thirds majority
of the total votes. The Governing Board shall approve the rules of the
procedure of the Committees by a two-thirds majority of the total votes.";

(3) 
Article 7 is deleted.

(4) 
paragraph 4 of Article 8 is amended as follows:

(a) 
the first subparagraph is replaced by the
following:

"The
Director shall implement the work programme and direct the execution of the
activities set out in Article 3. He shall supply the Governing Board and the
Committees and any other subsidiary bodies with all information necessary for
the performance of their functions.";

(b) 
in points (c) and (i) , the words "work
programmes" are replaced by the words "work programme";

(c) 
points (j) and (k)   are replaced by the
following:

"(j)
draw up such other reports as may be requested by the Governing Board or the
Committees;

(k)
assist the Governing Board and the Committees by providing their
secretariats;";

(5) 
the following Articles 8a and 8b are inserted:

"Article 8a
Administration and Management Committee

1.       Upon
request of the Director or the Governing Board, the Administration and
Management Committee shall provide advice or recommendations on specific matters
related to administrative and financial planning of the Joint Undertaking and carry
out any other tasks which the Governing Board may delegate to it.

2.       The
Administration and Management Committee shall in particular prepare opinions
for and recommendations to the Governing Board on the budget, the annual
accounts, the project plan, the work programme, the resources estimate plan,
the staff establishment plan, the staff policy plan and other related matters.

3.       The
Governing Board shall appoint members of the Administration and Management
Committee from amongst representatives nominated by the Members. One member of
the Committee shall be Euratom.

4.       Members
of the Administration and Management Committee shall perform their duties in
the general interest of the Joint Undertaking.

5.       Subject
to the prior approval of the Governing Board, the Administration and Management
Committee shall adopt its rules of procedure.

Article 8b
The Procurement and Contracts Committee

1.       The
Procurement and Contracts Committee shall provide the Director with
recommendations on the strategies in relation to procurement and grant
activities and the award and follow-up of contracts and other related matters.

2.       The
Governing Board shall appoint the members of the Procurement and Contracts
Committee from among persons of recognised standing and professional experience
in contractual and procurement matters. Members of the Governing Board shall
not be members of the Procurement and Contracts Committee.

3.       The
members of the Procurement and Contracts Committee shall not be bound by any
instructions. They shall be independent in the performance of their duties.

4.       Subject
to the prior approval of the Governing Board, the Procurement and Contracts
shall adopt its rules of procedure.";

(6) 
Article 9 is replaced by the following:

"Article 9
Technical Advisory Panel

1.       The
Technical Advisory Panel shall advise the Governing Board and the Director, as
necessary, on the adoption and implementation of the project plan and work
programme.

2.       The
Governing Board shall appoint the members of Technical Advisory Panel from
among persons of recognised standing and professional experience in scientific
and engineering matters concerning fusion and associated activities.

3.       The
members of the Technical Advisory Panel shall not be bound by any instructions.
They shall be independent in the performance of their duties, in the general
interest of the Joint Undertaking.

4.       Subject
to the prior approval of the Governing Board, the Technical Advisory Panel
Committee shall adopt its rules of procedure.";

(7) 
the following Article 9a is inserted:

"Article 9a
Bureau

1.       The
Bureau shall assist the Governing Board in the preparation of its decisions and
shall carry out any other tasks which the Governing Board may delegate to it.

2.       The
membership shall comprise the Chair of the Governing Board, the Chairs of the
Committees, a representative of Euratom and a representative of the ITER host
State. The Governing Board may appoint additional members to the Bureau.

3.       The
Chair of the Bureau shall be the Chair of the Governing Board.

4.       Members
of the Bureau shall perform their duties in the general interest of the Joint
Undertaking.

5.       Subject
to the prior approval of the Governing Board, the Bureau shall adopt its rules
of procedure.";

(8) 
Article 11 is replaced by the following:

"Article 11
Work programme and resource
estimates plan

The
Director shall prepare each year the submission of the project plan to the
Governing Board, the resource estimates plan and the detailed annual work
programme and budget.";

(9) 
in paragraph 1 of Article 12,  point (a) is
replaced by the following:

"(a)    the
Euratom contribution shall be made available through the Community research and
training programmes adopted pursuant to Article 7 of the Treaty or through any
other decision adopted by the Council.";

(10) 
Article 14 is replaced by the following:

"Article 14
Annual report

The
annual report shall record the implementation of the work programme by the
Joint Undertaking. It shall in particular outline the activities conducted by
the Joint Undertaking and evaluate the results with respect to the objectives
and the timetable set, the risks associated with the activities carried out,
the use of resources and the general operation of the Joint Undertaking. The
annual report shall be prepared by the Director, assessed by the Governing
Board and sent by the Governing Board, together with its assessment, to the
Members, the Commission, the European Parliament and the Council.";

(11) 
in the second subparagraph of Article 15(1), the
words "15 June" are replaced by the words "1 June";

(12) 
the following Article 15a is inserted:

"Article 15a
Networking with designated organisations in the field of scientific and
technological fusion research

1.       In
furtherance of its activities, the Joint Undertaking shall draw upon knowledge
and facilities developed by competent public research organisations working in
the field of fusion research and development.

2.       The
Governing Board, acting on a proposal from the Director, shall draw up a list
to be made public of competent organisations designated by the Members which
may carry out research and development activities in furtherance of the tasks
of the Joint Undertaking, either individually or in networks. These activities
may be eligible for financial support by the Joint Undertaking.

3.       The
implementing arrangements for the application of paragraphs 1 and 2 of this
Article shall ensure transparency and competition among public research
organisations and shall be laid down in the financial regulation and its
implementing rules referred to in Article 13 and Annex III.";

(13) 
in Annex I the following row is inserted after
the row for Bulgaria:

"

Croatia || 2

";

(14) 
Annex II is amended as follows:

(a) 
point 2 is replaced by the following:

"2.
The total amount of annual membership contributions for year n shall be
calculated on the basis of the annual resources required for the administration
of the Joint Undertaking in that year, as adopted with the resource estimates
plan by the Governing Board.";

(b) 
in point 4, the following point (c) is added:

"(c)
The Governing Board may levy further payments on a Member when this Member does
not pay its contribution by the due date.";

(15) 
 Annex III is amended as follows:

(a) 
point 3 is replaced by the following:

"3.
The Joint Undertaking shall establish an internal audit capability.";

(b) 
in point (c) of point 5,  the words "work
programmes" are replaced by the words "work programme";

(c) 
 in point 5, point (f) is replaced by the
following:

"(f)
rules and procedures for the internal financial control, including delegated
powers;";

(d) 
in point 5, the following point (k) is added:

"(k)
rules on management of grants.";

(e) 
in point 5, the following paragraph is added:

"For
the purposes of point (d) the budgetary commitments for actions extending over
more than one financial year may be broken down over several years into annual
instalments;";

(f) 
 the following paragraph 10 is added:

"10.
The Joint Undertaking shall adopt provisions and rules for the establishment of
a network with designated organisations referred to in Article 15a of the
Statutes. Those rules shall ensure transparency and competition among European
public research organisations and shall specify, in particular, the criteria
for inclusion of an organisation on the list of competent organisations
designated by the Members.".