# EUR-Lex - 52012PC0336 - EN

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# 52012PC0336

**Proposal for a COUNCIL REGULATION establishing a facility for providing financial assistance for Member States whose currency is not the euro /* COM/2012/0336 final - 2012/0164 (APP) */**

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EXPLANATORY
MEMORANDUM

1.           CONTEXT
OF THE PROPOSAL

On 18 February
2002, Regulation (EC) No 332/2002 was adopted establishing a facility providing
Union financial assistance. The Regulation aims at easing the external
financing constraint of Member States that are experiencing or are seriously
threatened by difficulties in their balance of payment. It applies only to
Member States whose currency is not the euro. The unprecedented global crisis
that has hit the world over the last years has seriously damaged economic
growth and financial stability and provoked a deterioration in the government
deficit, balance of payment and debt position of the Member States, leading a
number of them to seek financial assistance.

In the context
of the economic and financial crisis, new assistance tools have been created
with the establishment of the European Financial Stability Facility (EFSF), the
European Financial Stability Mechanism (EFSM) and in the near future also the
European Stability Mechanism (ESM). However, the existing Regulation has not
kept pace with these developments. In particular, these financial stability
mechanisms have established new precautionary instruments to provide financial
assistance to the euro area Member States. The revision of the existing regulation
will allow non-euro Member States to have similar financial instruments at
their disposal. Furthermore, it will allow updating the existing Regulation in
the light of the recent reinforcement of economic governance and strengthening
of economic and budgetary coordination with a view to ensuring a larger level
playing field between euro area and non euro area Member States. Finally, it
should also increase the efficiency of decision-making by simplifying the
procedure for activating the regulation with only one procedural step instead
of two.

2.           LEGAL
ELEMENTS OF THE PROPOSAL

This Regulation
sets up a facility for Union financial assistance that may be granted to a non
euro area Member State which is experiencing or is seriously threatened with
difficulties in its balance of payments (Article 1).The financial assistance
can take the form of a loan, or of a credit line with a total outstanding amount
limited to EUR 50 billion in principle (Article 2). The credit line can take
the form of a precautionary conditioned credit line (PCCL), which is a credit
line based on eligibility conditions, or an enhanced conditions credit line
(ECCL), which is a credit line based on the combination of eligibility
conditions and new policy measures (Article 4).

The Council may decide to grant a loan on a
recommendation from the Commission (Article 3). The granting of a loan is made
conditional upon the Member State adopting a macro-economic adjustment
programme aimed at re-establishing a sustainable balance of payments positions
and at restoring its capacity to finance itself fully on the financial markets.
The Commission, in liaison with the ECB and wherever relevant the IMF, shall
monitor the progress made in the implementation of the macro-economic
adjustment programme via regular review missions.

The revised regulation contains new
provisions in order to enhance the dialogue on the implementation of financial
assistance with the aim of ensuring greater transparency and accountability.
More specifically, the relevant Committee of the European Parliament may offer
the opportunity to the Member State concerned to participate to an exchange of
views on the progress made in the implementation of the adjustment programme.
Representatives of the Commission may be invited by the Parliament of the
Member State concerned to participate in an exchange of views on the progress
made in the implementation of the macro-economic adjustment programme.

The Council
shall decide to grant a PCCL or an ECCL on a recommendation from the European
Commission (Article 5). Access to a PCCL shall be limited to Member States
whose economic and financial situation is still fundamentally sound and which
fulfil an agreed set of eligibility criteria. Access to an ECCL shall be open
to Member States which do not comply with some of the eligibility criteria
required for accessing a PCCL but whose general economic and financial
situation remains sound. In addition, the Member State concerned shall adopt
corrective measures. They should aim at addressing the eligibility criteria
that are considered as not met and at ensuring a sustainable balance of
payments position while ensuring a continuous respect of the eligibility
criteria which were considered met when the credit line was granted.

A Member State will
be subject to enhanced surveillance when it is receiving a precautionary
financial assistance, with a view to ensuring its swift return to a normal
situation and to protecting the other Member States against possible negative
spill over effects (Article 6). This enhanced surveillance should include a
wider access for the Commission to the information needed for a close
monitoring of the economic, fiscal and financial situation of the Member State
concerned and a regular reporting by the Commission. A Member State under
enhanced surveillance shall adopt measures aimed at addressing the sources of
potential sources of economic difficulties.

An attempt is also undertaken in the new Regulation to align a
number of important procedural steps with the new upcoming Article 136 Regulation
aimed at Member States in a delicate financial situation. The aim is to ensure
the largest possible level playing field between all the EU programme countries
disregarding whether they belong to the euro area or not. The revised
regulation provides for replacing a number of monitoring steps under the
Excessive Deficit Procedure (EDP) and the European semester by the
macro-economic adjustment programme and its monitoring (Articles 7 and 9). Because
of the comprehensive nature of the macro-economic adjustment programme, it can
replace some processes of economic and fiscal surveillance for the duration of
the adjustment programme with a view to avoiding a duplication of reporting
obligations. In the same way, the revised regulation also ensures the
suspension of the Macro-economic Imbalances Procedure (MIP) when a Member State
is subject to a macro-economic adjustment programme (Article 8) and requires
the establishment of post-assistance surveillance for Member States having
reimbursed less than 75% of the financial assistance received (Article15).

Finally, the
borrowing and lending operations are made slightly more flexible for the
European Commission so as to limit possible difficulties to raise funds in case
of difficult financial market conditions (Article 12).

2012/0164 (APP)

Proposal for a

COUNCIL REGULATION

establishing a facility for providing
financial assistance for Member States whose currency is not the euro

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the
Treaty on the functioning of the European Union and in particular, Article 352
thereof,

Having regard to the
proposal from the Commission,

After transmission
of the draft legislative acts to the national Parliaments,

Having regard to the
consent of the European Parliament,

Having regard to the
opinion of the European Central Bank,

Acting in accordance with a special
legislative procedure,

Whereas:

(1)       In
accordance with Article 143 of the Treaty, the Council, acting on a
recommendation from the Commission made after consulting the Economic and
Financial Committee (EFC) may grant a mutual assistance to a Member State in
difficulties or seriously threatened with difficulties as regards its balance
of payments. It applies only to Member States whose currency is not the euro
(hereafter 'the non-euro area Member States'). However, this provision does not
define the instrument to be used for granting the envisaged mutual assistance
envisaged.

(2)       The
unprecedented global crisis that has hit the world over the last three years
has seriously damaged economic growth and financial stability and provoked a
strong deterioration in the government deficit and debt position of the Member
States, leading a number of them to seek financial assistance.

(3)       The
rules for granting and monitoring financial assistance to non-euro area Member
States should be consistent with the ones applicable to Member States whose
currency is the euro, in particular with those provided for in the 'Regulation
of the European Parliament and of the Council on the strengthening of economic
and budgetary surveillance of Member States experiencing or threatened with
serious difficulties with respect to their financial stability in the euro
area', with some necessary adjustments aimed at taking into account the
differences in the Treaty rules applicable to Member States whose currency is
not the euro and the more limited economic and financial inter-connectedness.
The Commission should for instance not have the possibility to make a Member
State subject to enhanced surveillance if the Member State concerned does not
receive a financial assistance.

(4)       The
granting of financial assistance should be linked to economic and fiscal
surveillance of the Member State concerned. The intensity of this surveillance
should be commensurate to the severity of the financial difficulties
encountered and should take due account of the nature of the financial
assistance received, which may range from a mere precautionary support based on
eligibility conditions up to a full macro-economic adjustment programme
involving strict policy conditionality.

(5)       A
Member State should be subject to enhanced surveillance when it is receiving a
precautionary financial assistance, with a view to ensuring its swift return to
a normal situation and to protecting the other Member States against possible
negative spill over effects. This enhanced surveillance should include a wider
access for the Commission to the information needed for a close monitoring of
the economic, fiscal and financial situation of the Member State concerned and
a regular reporting to the EFC.

(6)       The
surveillance of the economic and fiscal situation should be even more
reinforced for Member States benefitting from a loan. It should include the
setting up of a macro-economic adjustment programme. Because of the
comprehensive nature of such a programme, the other processes of economic and
fiscal surveillance should be suspended for its duration, with a view to
avoiding a duplication of reporting obligations.

(7)       Rules
should be provided in order to enhance the dialogue on the implementation of
this financial assistance between the Union institutions, in particular the
European Parliament, the Council and the Commission, and to ensure greater
transparency and accountability.

(8)       A
decision regarding the non-compliance of a Member State with its macro-economic
adjustment programme should also entail a suspension of payments or commitments
of Union funds as provided for in Article 21(6) of Regulation (EU) No XXX
laying down common provisions on the European Regional Development Fund, the
European Social Fund, the Cohesion Fund, the European Agricultural Fund for
Rural Development and the European Maritime and Fisheries Fund covered by the
common strategic framework and laying down general provisions on the European
Regional Development Fund, the European Social Fund and the Cohesion Fund and
repealing Regulation (EC) No 1083/2006.

(9)       The
power to adopt individual decisions for the application of this Regulation
should be exercised by the Council as provided for by Article 143(2) of the
Treaty.

(10)     The
scope of activity of the European Supervisory Authorities founded by
Regulations (EC) No 1093/2010, (EC) No 1094/2010 and (EC) No 1095/2010 should
stay within the limits set in Article 1 of each of these Regulations.

(11)     For
the adoption of this Regulation, which provides a framework for the granting of
Union financial assistance for non-euro area Member States, the Treaty provides
no powers other than those of Article 352,

HAS ADOPTED THIS REGULATION:

Article 1
Subject matter and scope

1.           This Regulation sets up a
facility for Union financial assistance that may be granted in accordance with
Article 143 of the Treaty to a Member State which is experiencing or is
seriously threatened with difficulties in its balance of payments.

2.           This Regulation shall
apply to Member States whose currency is not the euro.

Article 2
Union financial assistance

1.           Union financial assistance
shall be provided via:

(a)
a loan;

(b)
a precautionary conditioned credit line (PCCL),
which is a credit line based on eligibility conditions; or

(c)
an enhanced conditions credit line (ECCL), which
is a credit line based on the combination of eligibility conditions and new
policy measures.

2.           To this end, the
Commission shall be empowered on behalf of the European Union to contract
borrowings on the capital markets or with financial institutions.

3.           The outstanding amount of
loans or credit lines to be granted to Member States under this Regulation
shall be limited to EUR 50 billion in principal.

4.           Where financial assistance
outside the Union subject to economic policy conditions is envisaged, the
Member State concerned shall first consult the Commission. The Commission shall
examine the possibilities available under the Union financial assistance
facility and the compatibility of the envisaged economic policy conditions with
the measures adopted on the basis of Articles 121 and 126 of the Treaty and on
the basis of any legislation adopted on the basis of the said Articles. The
Commission shall inform the EFC of its findings.

Article 3
Conditions and procedure
for granting loans

1.           The Member State seeking a
loan shall notify thereof the Commission, the European Central Bank (ECB) and
the EFC.

2.           The Commission shall
assess, in liaison with the ECB and wherever possible, the IMF, the
sustainability of the general Government debt and the current or potential
financial needs of the Member State concerned and forward this assessment to
the EFC.

3.           The Member State concerned
shall prepare in agreement with the Commission, acting in liaison with the ECB
and wherever possible, the IMF, a draft macro-economic adjustment programme
containing policy requirements and aimed at re-establishing a sustainable
balance of payments position and at restoring its capacity to finance itself
fully on the financial markets. The draft macro-economic adjustment programme
shall take due account of the recommendations addressed to the Member State
concerned under Articles 121, 126 and 148 of the Treaty and its actions to
comply with them, while aiming at broadening, strengthening and deepening the
required policy measures.

4.           The Council, acting by a
qualified majority on a recommendation from the Commission may decide to grant
a loan to the Member State concerned and, if so, shall approve the
macro-economic adjustment programme linked to that loan.

5.           The decision to grant a
loan shall contain the amount, the maximum average maturity, the pricing, the
maximum number of instalments, the availability period of the loan, the main
economic policy conditions and the other detailed rules needed for the
implementation of the assistance.

6.           The Commission and the
Member State concerned shall conclude a Memorandum of Understanding (hereafter
'the MoU') detailing the macro-economic adjustment programme. The Commission
shall communicate the MoU to the European Parliament and to the Council.

7.           The Commission, in liaison
with the ECB and wherever relevant the IMF, shall monitor the progress made in
the implementation of the macro-economic adjustment programme via regular
review missions. It shall inform the EFC on a quarterly basis. The Member State
concerned shall cooperate fully with the Commission and the ECB. It shall in
particular provide to the Commission and the ECB all the information that they
deem necessary for the monitoring of the programme. The Member State concerned
shall also have obligations laid down in Article 6(2).

8.           The Commission - in
liaison with the ECB and wherever possible the IMF - shall examine with the
Member State concerned the changes that may be needed to its macro-economic
adjustment programme. The Council, acting by a qualified majority on a
recommendation from the Commission, shall approve any change to be made to that
programme.

9.           Where the monitoring
referred to in paragraph 7 reveals significant deviations from the macro-economic
adjustment programme, the Council, acting by qualified majority on a proposal
from the Commission, may decide that the Member State concerned does not comply
with the agreed terms of the financial assistance. Disbursements of Union
financial assistance under this Regulation shall be suspended.

10.         At the latest within six
months following the decision provided for in paragraph 9, the Council, acting
by qualified majority on a proposal from the Commission, may decide to resume
the disbursements if it considers that the Member State concerned complies with
the agreed terms of the financial assistance. Where such decision has not been
adopted within this deadline, no further disbursements of Union financial
assistance under this Regulation shall be made.

11.         Where the Member State
concerned experiences insufficient administrative capacity or significant
problems in the implementation of its programme, it shall seek technical
assistance from the Commission which may constitute for this purpose groups of
experts with Member States and other European and/or relevant international
institutions. Technical assistance may include the establishment of a resident
representative and support staff to advise authorities on the adjustment
programme implementation.

12.         The relevant Committee of
the European Parliament may offer the opportunity to the Member State concerned
to participate to an exchange of views on the progress made in the implementation
of the adjustment programme.

13.         Representatives of the
Commission may be invited by the Parliament of the Member State concerned to
participate to an exchange of views on the progress made in the implementation
of the macro-economic adjustment programme.

Article 4
Conditions for granting
credit lines

1.           Access to a PCCL shall be
limited to Member States whose economic and financial situation is still
fundamentally sound. A global assessment shall be made on whether a Member
State qualifies for a PCCL, using as a basis the following eligibility
criteria:

(a)
The respect of the Council recommendations and
Council decisions adopted on the basis of Articles 121 and 126 of the Treaty.
Member States under excessive deficit procedure may still access a PCCL,
provided they fully abide by the Council recommendations under Article 126(7)
of the Treaty.

(b)
A sustainable general Government debt.

(c)
The respect of their commitments under the
excessive imbalance procedure (EIP). Countries under EIP could still access
PCCL it is established that they are committed to addressing the imbalances
identified by the Council.

(d)
A track record of access to capital markets on
reasonable terms.

(e)
A sustainable external position.

(f)
The absence of bank solvency problems that would
pose systemic threats to the banking system stability.

2.           Access to an ECCL shall be
open to Member States which do not comply with some of the eligibility criteria
required for accessing a PCCL but whose general economic and financial
situation remains sound. The Member State concerned shall, after consultation
of the Commission and of the ECB, prepare corrective measures aimed at:

(a)
addressing the eligibility criteria set out in
paragraph 1 considered as not met, and

(b)
ensuring a continuous respect of the other eligibility
criteria set out in paragraph 1.

Article 5
Procedure for granting credit lines

1.           The Member State seeking a
credit line shall notify thereof the Commission, the ECB and the EFC.

2.           The Commission shall
assess, in liaison with the ECB and wherever possible, the IMF, the
sustainability of the general Government debt and the current or potential
financial needs of the Member State concerned and forward this assessment to
the EFC.

3.           The Commission shall
assess, in liaison with the ECB, whether the Member State concerned meets the
conditions set in Article 4 for accessing a PCCL or an ECCL.

4.           The Council, acting by a
qualified majority on a recommendation from the Commission shall decide to
grant a PCCL or an ECCL for an initial duration of one year. The decision to
grant a credit line shall contain the amount, the fee for the availability of
the credit line, the pricing applicable for the release of funds, the
availability period, the maximum average maturity for the loan to be drawn and
the other provisions needed for the implementation of the assistance. The
decision to grant an ECCL shall also include a description of the corrective
measures to be adopted in accordance with Article 4(2).

5.           The Commission and the
Member State concerned shall conclude a MoU detailing the conditions attached
to the credit line.

6.           On a request from the
Member State concerned, the Commission may decide to renew the credit line
twice, for six months each time, after having informed the EFC of its
evaluation of the respect of the eligibility conditions.

7.           Where a credit line is
granted, the Commission shall monitor the continuous respect of the eligibility
criteria and inform every three months the EFC of its findings. The Commission
shall reassess the adequacy of the credit line if it is drawn. Where this
assessment leads the Commission to conclude that the credit line is no longer
appropriate for addressing the difficulties of the Member State concerned, the
Council, acting on a recommendation from the Commission, may decide to terminate
the availability of the credit line it and to recommend to the Member State
concerned to submit a request for a loan following the procedure established in
Article 3.

8.           Where an ECCL is granted
or a PCCL drawn, the Member State shall be subject to enhanced surveillance in
accordance with Article 6 for the availability period of the credit line.

Article 6
Enhanced Surveillance

1.           A Member State under
enhanced surveillance shall, in consultation and cooperation with the
Commission, acting in liaison with the ECB, the European Supervisory
Authorities (ESA) and the European Systemic Risk Board (ESRB) and where
appropriate the IMF, adopt measures aimed at ensuring a sustainable balance of
payments position and avoiding any future problems with access to market
financing.

2.           Upon request from the
Commission, the Member State under enhanced surveillance shall:

(a)
communicate to the Commission, the ECB, and the
relevant ESA(s) at the requested frequency disaggregated information on
developments in its financial system. The Commission, the ECB, the relevant
ESA(s) shall preserve the confidentiality of the disaggregated data received;

(b)
carry out, under the supervision of the relevant
ESA(s), stress test exercises or sensitivity analyses as necessary to assess
the resilience of the financial sector to various macroeconomic and financial
shocks, as specified by the Commission and the ECB in liaison with the relevant
ESA(s) and the ESRB, and share the detailed results with them;

(c)
be subject to regular assessments of its
supervisory capacities over the banking sector in the framework of a specific
peer review carried out by the relevant ESA(s);

(d)
communicate any information needed for the
monitoring of macro-imbalances established by Regulation No 1176/2011 of the
European Parliament and of the Council on the prevention and correction of
macroeconomic imbalances;

(e)
carry out and report on a comprehensive
independent audit of the accounts of the general government conducted in
coordination with national supreme audit institutions, aiming at assessing the
reliability, completeness and accuracy of these public accounts for the
purposes of the excessive deficit procedure. In this context, the Commission
(Eurostat) shall assess the quality of data reported by the Member State
concerned in accordance with Regulation (EC) No 679/2010;

(f)
provide additional information for the purposes
of monitoring the progress towards the correction of its excessive deficit if
it is subject to a Council decision under Article 126(6) of the Treaty.

3.           The Member State under
enhanced surveillance shall:

(a)
carry out without delay a comprehensive
assessment of in-year budgetary execution for the general government and its
sub-sectors. The financial risks associated to government owned entities and
government contracts shall also be covered by the assessment to the extent that
they may contribute to the existence of an excessive deficit. The result of
this assessment shall be transmitted to the Commission and EFC;

(b)
report regularly to the Commission and to the
EFC for the general government and its sub-sectors, the in-year budgetary
execution, the budgetary impact of discretionary measures taken on both the
expenditure and the revenue side, targets for the government expenditure and
revenues, as well as information on the measures adopted and the nature of
those envisaged to achieve the targets. The report shall be made public.

4.           The Commission shall
conduct, in liaison with the ECB and the ESA(s) as needed and when appropriate
the IMF, regular review missions in the Member State under surveillance to
verify the progresses made in the implementation of the measures mentioned in
paragraph 1, 2 and 3. It shall communicate every three months its findings to
the EFC and assess notably whether further measures are needed. These review
missions shall replace the onsite monitoring provided for in Article 10a(2) of Council
Regulation (EC) No 1467/97.

5.           Where on the basis of the
assessment foreseen in paragraph 4, it is concluded that further measures are
needed and the financial situation of the Member State concerned has
significant adverse effects on the financial stability of the Union, the
Council, acting by a qualified majority on a proposal from the Commission, may
recommend to the Member State concerned to submit a request for a loan
following the procedure established in Article 3. The recommendation and the
preparatory work done in the run-up to its adoption shall be considered as
confidential, unless the Council decides to make it public.

6.           Where a recommendation adopted
in accordance with paragraph 5 is made public:

(a)
the relevant Committee of the European
Parliament may offer the opportunity to the Member State concerned to
participate to an exchange of views;

(b)
representatives of the Commission may be invited
by the parliament of the Member State concerned to participate to an exchange
of views.

Article 7
Consistency with the
excessive deficit procedure

1.           The macro-economic adjustment
programme and the changes thereto provided for by Article 3(4) and (8) of this
Regulation shall be deemed to replace the submission of convergence programmes
provided for by Article 8 of Council Regulation (EC) No 1466/97.

2.           If the Member State
concerned is the subject of a recommendation under Article 126(7) of the Treaty
for the correction of an excessive deficit:

(a)
the macro-economic adjustment programme provided
for by Article 3(4) and (8) of this Regulation shall also be deemed to replace
as appropriate the reports provided for by Article 3(4a) of Council Regulation
(EC) No 1467/97;

(b)
the annual budgetary targets in the
macro-economic adjustment programme provided for by Article 3 of this
Regulation shall be deemed to replace the annual budgetary targets established
in accordance with Article 3(4) of Regulation (EC) No 1467/97 in the
recommendation made in accordance with Article 126(7) of the Treaty;

(c)
the monitoring provided for by Article 3(7) of
this Regulation shall be deemed to replace the monitoring provided for by
Article 10(1) and Article 10a of Council Regulation (EC) No 1467/97 and the
monitoring underlying any decision provided for by Article 4(2) of Regulation
(EC) No 1467/97.

Article 8
Consistency with the
macro-economic imbalances procedure

The implementation of Regulation (EU) No
1176/2011 shall be suspended for the Member States subject to a macro-economic
adjustment programme approved by the Council in accordance with Article 3 of
this Regulation. This suspension shall be applicable for the duration of the
macro-economic adjustment programme.

Article 9
Consistency with the
European Semester for economic policy coordination

The monitoring provided for by Article 3 of
this Regulation shall be deemed to replace the monitoring and assessment of the
European Semester for economic policy coordination provided for by Article 2a
of Regulation (EC) No 1466/97 on the strengthening of the surveillance of
budgetary positions and coordination of economic policies.

Article 10
Disbursement of a loan

1.           The loan shall, as a rule,
be disbursed in instalments.

2.           Without prejudice to
Article 3(9) the Commission shall decide on the release of instalments on the
basis of the monitoring established in Article 3(7).

Article 11
Release of funds under a
credit line

1.           The Member State concerned
shall inform the Commission in advance of its intention to draw down funds from
its credit line at least 45 calendar days in advance. Detailed rules shall be
laid down in the decision referred to in Article 5(5).

2.           On the basis of the monitoring
established in Articles 5(7) and 6(4), the Commission shall decide on the
release of the funds.

Article 12
Borrowing and lending
operations

1.           The borrowing and lending
operations referred to in Article 2 shall be carried out in euro.

2.           The characteristics of the
successive instalments released by the Union under the financial assistance
facility shall be negotiated between the Member State concerned and the
Commission.

3.           Once the decision on a
loan has been made by the Council, the Commission shall be authorised to borrow
on the capital markets or from financial institutions at the most appropriate
time in between planned disbursements so as to optimise the cost of funding and
preserve its reputation as the Union's issuer in the markets. Funds raised but
not yet disbursed shall be kept at all times on dedicated cash or securities
account which are handled in accordance with rules applying to off-budget
operations and cannot be used for any other goal than to provide financial
assistance to Member States under the present mechanism.

4.           Where a Member State
receives a loan carrying an early repayment clause and decides to exercise this
option, the Commission shall take the necessary steps.

5.           At the request of the
Member State concerned and where circumstances and borrowing contracts permit
an improvement in the interest rate on the loan, the Commission may refinance
all or part of its initial borrowing or restructure the corresponding financial
conditions.

6.           The EFC shall be kept
informed by the Commission of the developments in the operations referred to in
paragraph 5.

Article 13
Costs

The costs incurred by the Union in
concluding and carrying out each operation shall be borne by the Member State
concerned.

Article 14
Administration of the
loans

1.           The Commission shall
establish the necessary arrangements for the administration of the loans with
the ECB.

2.           The Member State concerned
shall open a special account with its National Central Bank for the management
of the Union financial assistance received. It shall also transfer the
principal and the interest due under the loan to an account with the ECB
fourteen TARGET2 business days prior to the corresponding due date.

3.           Without prejudice to
Article 27 of the Statute of the European System of Central Banks and of the
European Central Bank, the European Court of Auditors shall have the right to
carry out in the Member State concerned any financial controls or audits that
it considers necessary in relation to the management of that assistance. The
Commission, including the European Anti-Fraud office, shall in particular have
the right to send its officials or duly authorised representatives to carry out
in the Member State concerned any technical or financial controls or audits
that it considers necessary in relation to that assistance.

Article 15
Post-assistance
surveillance

1.           A Member State which has
received Union financial assistance under this Regulation shall be under
post-assistance surveillance as long as a minimum of 75% of the principal of
the financial assistance has not been repaid. The Council, acting on a
qualified majority on a proposal from the Commission, may extend the duration
of the post assistance surveillance.

2.           The Member State under post-assistance
surveillance shall also have obligations laid down in Article 6(2).

3.           The Commission shall
conduct, in liaison with the ECB, regular review missions in the Member State
under post assistance surveillance to assess its economic, fiscal and financial
situation. It shall communicate every semester its findings to the EFC and
assess notably whether corrective measures are needed.

4.           The Council, acting by
qualified majority on a proposal from the Commission, may recommend to the
Member State under post assistance surveillance to adopt corrective measures.

Article
16
Repeal

Regulation (EC) No 332/2002 is hereby
repealed. Assistance granted on the basis of that Regulation remain subject to
it as long as the availability period is not exhausted and any amounts are
outstanding.

Article 17
Transitional provision

Article 15 shall not apply to Member States
already under post-programme surveillance after having received a financial
assistance under Regulation (EC) No 332/2002 at the date of entering into force
of this Regulation.

Article 18
Entry into force

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

This Regulation shall be binding
in its entirety and directly applicable in all Member States.

Done at Brussels,

For
the Council

The
President