# C_2020411EN.01057401.xml

| 27.11.2020 | EN | Official Journal of the European Union | C 411/574 |
| --- | --- | --- | --- |

27.11.2020

EN

Official Journal of the European Union

C 411/574

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P8_TA(2019)0038

Protection of the Union's budget in case of generalised deficiencies as regards the rule of law in the Member States ***I

Amendments adopted by the European Parliament on 17 January 2019 on the proposal for a regulation of the European Parliament and of the Council on the protection of the Union's budget in case of generalised deficiencies as regards the rule of law in the Member States (COM(2018)0324 — C8-0178/2018 — 2018/0136(COD)) (1)

(Ordinary legislative procedure: first reading)

(2020/C 411/49)

Amendment 1

Proposal for a regulation

Recital 1

| Text proposed by the Commission | Amendment |
| --- | --- |
| (1) | The rule of law is one of the essential values upon which
  the Union is founded. As recalled by Article 2 of the Treaty on European Union,
  these
  values are common to the Member States. |

Text proposed by the Commission

Amendment

(1)

The rule of law is one of the essential values upon which
  the Union is founded. As recalled by Article 2 of the Treaty on European Union,
  these
  values are common to the Member States.

| (1) | The Union is founded
  on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities, enshrined in
  Article 2 of the Treaty on European Union
  (TEU) and in the criteria for Union membership.
  As recalled by Article 2
  TEU
  ,
  those
  values are common to the Member States
  in a society in which pluralism, non-discrimination, tolerance, justice, solidarity and equality between women and men prevail
  . |
| --- | --- |

(1)

The Union is founded
  on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities, enshrined in
  Article 2 of the Treaty on European Union
  (TEU) and in the criteria for Union membership.
  As recalled by Article 2
  TEU
  ,
  those
  values are common to the Member States
  in a society in which pluralism, non-discrimination, tolerance, justice, solidarity and equality between women and men prevail
  .

Amendment 2

Proposal for a regulation

Recital 1 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (1a) | Member States should uphold their obligations and set an example by genuinely fulfilling them and move towards a shared culture of the rule of law as a universal value to be applied by all concerned even-handedly. Full respect for and promotion of those principles is an essential prerequisite for the legitimacy of the European project as a whole and a basic condition for building citizens' trust in the Union and ensuring the effective implementation of its policies. |

Text proposed by the Commission

Amendment

(1a)

Member States should uphold their obligations and set an example by genuinely fulfilling them and move towards a shared culture of the rule of law as a universal value to be applied by all concerned even-handedly. Full respect for and promotion of those principles is an essential prerequisite for the legitimacy of the European project as a whole and a basic condition for building citizens' trust in the Union and ensuring the effective implementation of its policies.

Amendment 3

Proposal for a regulation

Recital 1 b (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (1b) | In accordance with Article 2, Article 3(1) and Article 7 TEU, the Union has the possibility to act in order to protect its constitutional core and the common values on which it was founded, including its budgetary principles. Member States, Union institutions, bodies, offices and agencies, and candidate countries are obliged to respect, protect and promote those principles and values, and they have a duty of sincere cooperation. |

Text proposed by the Commission

Amendment

(1b)

In accordance with Article 2, Article 3(1) and Article 7 TEU, the Union has the possibility to act in order to protect its constitutional core and the common values on which it was founded, including its budgetary principles. Member States, Union institutions, bodies, offices and agencies, and candidate countries are obliged to respect, protect and promote those principles and values, and they have a duty of sincere cooperation.

Amendment 4

Proposal for a regulation

Recital 2

| Text proposed by the Commission | Amendment |
| --- | --- |
| (2) | The rule of law requires that all public powers act within the constraints set out by law, in accordance with the values of democracy and fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality (7), legal certainty (8), prohibition of arbitrariness of the executive powers (9), separation of powers (10), and effective judicial protection
  by
  independent courts (11) are respected (12). |

Text proposed by the Commission

Amendment

(2)

The rule of law requires that all public powers act within the constraints set out by law, in accordance with the values of democracy and fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality (7), legal certainty (8), prohibition of arbitrariness of the executive powers (9), separation of powers (10), and effective judicial protection
  by
  independent courts (11) are respected (12).

| (2) | The rule of law requires that all public powers act within the constraints set out by law, in accordance with the values of democracy and
  respect for
  fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality (7)

  , including a transparent, accountable and democratic process for enacting law
  , legal certainty (8), prohibition of arbitrariness of the executive powers (9), separation of powers (10),
  access to justice
  and effective judicial protection
  before
  independent
  and impartial
  courts (11) are respected (12).
  Those principles are reflected inter alia at the level of the Venice Commission of the Council of Europe and also on the basis of the relevant case law of the European Court of Human Rights

   (12a)

  . |
| --- | --- |

(2)

The rule of law requires that all public powers act within the constraints set out by law, in accordance with the values of democracy and
  respect for
  fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality (7)

  , including a transparent, accountable and democratic process for enacting law
  , legal certainty (8), prohibition of arbitrariness of the executive powers (9), separation of powers (10),
  access to justice
  and effective judicial protection
  before
  independent
  and impartial
  courts (11) are respected (12).
  Those principles are reflected inter alia at the level of the Venice Commission of the Council of Europe and also on the basis of the relevant case law of the European Court of Human Rights

   (12a)

  .

Amendment 5

Proposal for a regulation

Recital 2 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (2a) | The accession criteria, or Copenhagen criteria, established by the Copenhagen European Council in 1993 and strengthened by the Madrid European Council in 1995, are the essential conditions that all candidate countries must satisfy to become a Member State. Those criteria include the stability of institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities; a functioning market economy and the capacity to cope with competition and market forces; and the ability to meet the obligations of Union membership. |

Text proposed by the Commission

Amendment

(2a)

The accession criteria, or Copenhagen criteria, established by the Copenhagen European Council in 1993 and strengthened by the Madrid European Council in 1995, are the essential conditions that all candidate countries must satisfy to become a Member State. Those criteria include the stability of institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities; a functioning market economy and the capacity to cope with competition and market forces; and the ability to meet the obligations of Union membership.

Amendment 6

Proposal for a regulation

Recital 2 b (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (2b) | The failure of a candidate country to meet the required standards, values and democratic principles results in that country’s accession to the Union being delayed until it fully meets those standards. The obligations incumbent on candidate countries under the Copenhagen criteria continue to apply to Member States after joining the Union by virtue of Article 2 TEU and the principle of sincere cooperation enshrined in Article 4 TEU. Member States should therefore be assessed on a regular basis in order to verify that their laws and practices continue to comply with those criteria and the common values on which the Union is founded, thereby providing a sound legal and administrative framework for the implementation of Union policies. |

Text proposed by the Commission

Amendment

(2b)

The failure of a candidate country to meet the required standards, values and democratic principles results in that country’s accession to the Union being delayed until it fully meets those standards. The obligations incumbent on candidate countries under the Copenhagen criteria continue to apply to Member States after joining the Union by virtue of Article 2 TEU and the principle of sincere cooperation enshrined in Article 4 TEU. Member States should therefore be assessed on a regular basis in order to verify that their laws and practices continue to comply with those criteria and the common values on which the Union is founded, thereby providing a sound legal and administrative framework for the implementation of Union policies.

Amendment 7

Proposal for a regulation

Recital 3

| Text proposed by the Commission | Amendment |
| --- | --- |
| (3) | The rule of law is
  a prerequisite
  for the protection of the other fundamental values on which the Union is founded, such as freedom, democracy, equality and respect for human rights. Respect for the rule of law is intrinsically linked to respect for democracy and for fundamental rights: there can be no democracy and respect for fundamental rights without respect for the rule of law and vice versa. |

Text proposed by the Commission

Amendment

(3)

The rule of law is
  a prerequisite
  for the protection of the other fundamental values on which the Union is founded, such as freedom, democracy, equality and respect for human rights. Respect for the rule of law is intrinsically linked to respect for democracy and for fundamental rights: there can be no democracy and respect for fundamental rights without respect for the rule of law and vice versa.

| (3) | While there is no hierarchy among Union values, respect for
  the rule of law is
  essential
  for the protection of the other fundamental values on which the Union is founded, such as freedom, democracy, equality and respect for human rights. Respect for the rule of law is intrinsically linked to respect for democracy and for fundamental rights: there can be no democracy and respect for fundamental rights without respect for the rule of law and vice versa.
  Coherence and consistency of internal and external democracy, rule of law and fundamental rights policy is key to the credibility of the Union. |
| --- | --- |

(3)

While there is no hierarchy among Union values, respect for
  the rule of law is
  essential
  for the protection of the other fundamental values on which the Union is founded, such as freedom, democracy, equality and respect for human rights. Respect for the rule of law is intrinsically linked to respect for democracy and for fundamental rights: there can be no democracy and respect for fundamental rights without respect for the rule of law and vice versa.
  Coherence and consistency of internal and external democracy, rule of law and fundamental rights policy is key to the credibility of the Union.

Amendment 8

Proposal for a regulation

Recital 6

| Text proposed by the Commission | Amendment |
| --- | --- |
| (6) | Judicial bodies
  should
  act independently and impartially
  and investigation and prosecution services should be able to properly execute their function.
  They
  should be endowed with sufficient resources and procedures to act effectively and in full respect of the right to a fair trial. These conditions are required as a minimum guarantee against unlawful and arbitrary decisions by public authorities that could harm the financial interests of the Union. |

Text proposed by the Commission

Amendment

(6)

Judicial bodies
  should
  act independently and impartially
  and investigation and prosecution services should be able to properly execute their function.
  They
  should be endowed with sufficient resources and procedures to act effectively and in full respect of the right to a fair trial. These conditions are required as a minimum guarantee against unlawful and arbitrary decisions by public authorities that could harm the financial interests of the Union.

| (6) | Independence and impartiality of the judiciary
  should
  always be guaranteed
  and investigation and prosecution services should be able to properly execute their function. They should be endowed with sufficient resources and procedures to act effectively and in full respect of the right to a fair trial. These conditions are required as a minimum guarantee against unlawful and arbitrary decisions by public authorities that could
  impair these fundamental principles and
  harm the financial interests of the Union. |
| --- | --- |

(6)

Independence and impartiality of the judiciary
  should
  always be guaranteed
  and investigation and prosecution services should be able to properly execute their function. They should be endowed with sufficient resources and procedures to act effectively and in full respect of the right to a fair trial. These conditions are required as a minimum guarantee against unlawful and arbitrary decisions by public authorities that could
  impair these fundamental principles and
  harm the financial interests of the Union.

Amendment 9

Proposal for a regulation

Recital 7 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (7a) | The independence of the prosecution and the judiciary comprises both the formal (de jure) and actual (de facto) independence of the prosecution and the judiciary and the individual prosecutors and judges. |

Text proposed by the Commission

Amendment

(7a)

The independence of the prosecution and the judiciary comprises both the formal (de jure) and actual (de facto) independence of the prosecution and the judiciary and the individual prosecutors and judges.

Amendment 10

Proposal for a regulation

Recital 8

| Text proposed by the Commission | Amendment |
| --- | --- |
| (8) | Respect for the rule of law is not only
  important
  for citizens of the Union, but also for business initiatives, innovation, investment and the proper functioning of the internal market, which will flourish
  most
  where a solid legal and institutional framework is in place. |

Text proposed by the Commission

Amendment

(8)

Respect for the rule of law is not only
  important
  for citizens of the Union, but also for business initiatives, innovation, investment and the proper functioning of the internal market, which will flourish
  most
  where a solid legal and institutional framework is in place.

| (8) | Respect for the rule of law is not only
  essential
  for citizens of the Union, but also for business initiatives, innovation, investment
  , economic, social and territorial cohesion
  and the proper functioning of the internal market, which will flourish
  sustainably only
  where a solid legal and institutional framework is in place. |
| --- | --- |

(8)

Respect for the rule of law is not only
  essential
  for citizens of the Union, but also for business initiatives, innovation, investment
  , economic, social and territorial cohesion
  and the proper functioning of the internal market, which will flourish
  sustainably only
  where a solid legal and institutional framework is in place.

Amendment 11

Proposal for a regulation

Recital 8 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (8a) | Integrating existing Union monitoring mechanisms, such as the Cooperation and Verification Mechanism, the Justice Scoreboard and the Anti-Corruption reports, into a broader rule of law monitoring framework could provide more efficient and effective control mechanisms for the protection of the financial interest of the Union. |

Text proposed by the Commission

Amendment

(8a)

Integrating existing Union monitoring mechanisms, such as the Cooperation and Verification Mechanism, the Justice Scoreboard and the Anti-Corruption reports, into a broader rule of law monitoring framework could provide more efficient and effective control mechanisms for the protection of the financial interest of the Union.

Amendment 12

Proposal for a regulation

Recital 8 b (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (8b) | Lack of transparency, arbitrary discrimination, distortion of competition and an uneven playing field within and outside the internal market, impact on the integrity of the single market and on the fairness, stability and legitimacy of the tax system, increased economic inequalities, unfair competition between states, social dissatisfaction, mistrust and democratic deficit are some of the negative effects of harmful tax practices. |

Text proposed by the Commission

Amendment

(8b)

Lack of transparency, arbitrary discrimination, distortion of competition and an uneven playing field within and outside the internal market, impact on the integrity of the single market and on the fairness, stability and legitimacy of the tax system, increased economic inequalities, unfair competition between states, social dissatisfaction, mistrust and democratic deficit are some of the negative effects of harmful tax practices.

Amendment 13

Proposal for a regulation

Recital 10 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (10a) | The Union has at its disposal a multitude of instruments and processes for ensuring full and proper application of the principles and values laid down in the TEU, but there is currently no swift, effective response coming from the Union institutions, in particular to ensure sound financial management. The existing instruments should be enforced, evaluated and complemented in the framework of a rule of law mechanism to be adequate and effective. |

Text proposed by the Commission

Amendment

(10a)

The Union has at its disposal a multitude of instruments and processes for ensuring full and proper application of the principles and values laid down in the TEU, but there is currently no swift, effective response coming from the Union institutions, in particular to ensure sound financial management. The existing instruments should be enforced, evaluated and complemented in the framework of a rule of law mechanism to be adequate and effective.

Amendment 14

Proposal for a regulation

Recital 11

| Text proposed by the Commission | Amendment |
| --- | --- |
| (11) | Generalised deficiencies in the Member States as regards the rule of law which affect in particular the proper functioning of public authorities and effective judicial review, can seriously harm the financial interests of the Union. |

Text proposed by the Commission

Amendment

(11)

Generalised deficiencies in the Member States as regards the rule of law which affect in particular the proper functioning of public authorities and effective judicial review, can seriously harm the financial interests of the Union.

| (11) | Generalised deficiencies in the Member States as regards the rule of law which affect in particular the proper functioning of public authorities and effective judicial review, can seriously harm the financial interests of the Union.
  Efficient investigations into such deficiencies, and the application of effective and proportionate measures when a generalised deficiency is established, are needed not only to secure the financial interests of the Union, including the effective collection of revenue, but also to ensure public trust in the Union and its institutions. Only an independent judiciary that upholds the rule of law and legal certainty in all Member States can ultimately guarantee that money from the Union budget is sufficiently protected. |
| --- | --- |

(11)

Generalised deficiencies in the Member States as regards the rule of law which affect in particular the proper functioning of public authorities and effective judicial review, can seriously harm the financial interests of the Union.
  Efficient investigations into such deficiencies, and the application of effective and proportionate measures when a generalised deficiency is established, are needed not only to secure the financial interests of the Union, including the effective collection of revenue, but also to ensure public trust in the Union and its institutions. Only an independent judiciary that upholds the rule of law and legal certainty in all Member States can ultimately guarantee that money from the Union budget is sufficiently protected.

Amendment 15

Proposal for a regulation

Recital 11 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (11a) | The scale of tax evasion and avoidance is estimated by the Commission to be up to EUR 1 trillion a year. The negative impacts of such practices on the Member States' and Union budgets and on citizens are evident and could undermine trust in democracy. |

Text proposed by the Commission

Amendment

(11a)

The scale of tax evasion and avoidance is estimated by the Commission to be up to EUR 1 trillion a year. The negative impacts of such practices on the Member States' and Union budgets and on citizens are evident and could undermine trust in democracy.

Amendment 16

Proposal for a regulation

Recital 11 b (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (11b) | Corporate tax avoidance has a direct impact on Member States’ and Union budgets and on the breakdown of the tax effort between categories of tax payers as well as between economic factors. |

Text proposed by the Commission

Amendment

(11b)

Corporate tax avoidance has a direct impact on Member States’ and Union budgets and on the breakdown of the tax effort between categories of tax payers as well as between economic factors.

Amendment 17

Proposal for a regulation

Recital 11 c (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (11c) | Member States should fully apply the principle of sincere cooperation in matters of tax competition. |

Text proposed by the Commission

Amendment

(11c)

Member States should fully apply the principle of sincere cooperation in matters of tax competition.

Amendment 18

Proposal for a regulation

Recital 11 d (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (11d) | The Commission, as the guardian of the Treaties, should ensure that Union law and the principle of sincere cooperation between Member States are fully complied with. |

Text proposed by the Commission

Amendment

(11d)

Amendment 19

Proposal for a regulation

Recital 11 e (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (11e) | Assessing and monitoring Member States' tax policies at Union level would ensure that no new harmful tax measures are implemented in Member States. Monitoring compliance of Member States, their jurisdictions, regions or other administrative structures with the common Union list of non-cooperative jurisdictions would safeguard the single market and ensure its proper and coherent functioning. |

Text proposed by the Commission

Amendment

(11e)

Assessing and monitoring Member States' tax policies at Union level would ensure that no new harmful tax measures are implemented in Member States. Monitoring compliance of Member States, their jurisdictions, regions or other administrative structures with the common Union list of non-cooperative jurisdictions would safeguard the single market and ensure its proper and coherent functioning.

Amendment 20

Proposal for a regulation

Recital 12

| Text proposed by the Commission | Amendment |
| --- | --- |
| (12) | The identification of a generalised deficiency requires a qualitative assessment by the Commission. That assessment
  could
  be based on
  the
  information from all
  available
  sources and
  recognized
  institutions, including judgments of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations
  and networks
  , such as the bodies of the Council of Europe
  and
  the European networks of supreme courts and councils for the judiciary. |

Text proposed by the Commission

Amendment

(12)

The identification of a generalised deficiency requires a qualitative assessment by the Commission. That assessment
  could
  be based on
  the
  information from all
  available
  sources and
  recognized
  institutions, including judgments of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations
  and networks
  , such as the bodies of the Council of Europe
  and
  the European networks of supreme courts and councils for the judiciary.

| (12) | The identification of a generalised deficiency requires a 
  thorough
  qualitative assessment by the Commission. That assessment
  should be objective, impartial and transparent and
  be based on information from all
  relevant
  sources
  , taking into account the criteria used in the context of Union accession negotiations, in particular the chapters of the acquis on judiciary and fundamental rights, on justice, freedom and security, on financial control and on taxation, as well as the guidelines used in the context of the Cooperation and Verification Mechanism to track the progress of a Member State,
  and
  from recognised
  institutions, including judgments of the Court of Justice of the European Union
  and the European Court of Human Rights, resolutions of the European Parliament
  , reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations, such as the bodies of the Council of Europe
  , including in particular the Venice Commission’s Rule of Law Checklist, and of relevant international networks, such as
  the European networks of supreme courts and councils for the judiciary. |
| --- | --- |

(12)

The identification of a generalised deficiency requires a 
  thorough
  qualitative assessment by the Commission. That assessment
  should be objective, impartial and transparent and
  be based on information from all
  relevant
  sources
  , taking into account the criteria used in the context of Union accession negotiations, in particular the chapters of the acquis on judiciary and fundamental rights, on justice, freedom and security, on financial control and on taxation, as well as the guidelines used in the context of the Cooperation and Verification Mechanism to track the progress of a Member State,
  and
  from recognised
  institutions, including judgments of the Court of Justice of the European Union
  and the European Court of Human Rights, resolutions of the European Parliament
  , reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations, such as the bodies of the Council of Europe
  , including in particular the Venice Commission’s Rule of Law Checklist, and of relevant international networks, such as
  the European networks of supreme courts and councils for the judiciary.

Amendment 21

Proposal for a regulation

Recital 12 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (12a) | An advisory panel of independent experts in constitutional law and financial and budgetary matters should be established with the objective to assist the Commission in its assessment of generalised deficiencies. That panel should undertake an independent annual assessment of the issues as regards the rule of law in all Member States that affect or risk affecting the sound financial management or the protection of the financial interests of the Union, taking into account information from all relevant sources and recognised institutions. The Commission, when taking a decision about adopting or lifting of possible measures, should take relevant opinions expressed by that panel into account. |

Text proposed by the Commission

Amendment

(12a)

An advisory panel of independent experts in constitutional law and financial and budgetary matters should be established with the objective to assist the Commission in its assessment of generalised deficiencies. That panel should undertake an independent annual assessment of the issues as regards the rule of law in all Member States that affect or risk affecting the sound financial management or the protection of the financial interests of the Union, taking into account information from all relevant sources and recognised institutions. The Commission, when taking a decision about adopting or lifting of possible measures, should take relevant opinions expressed by that panel into account.

Amendment 22

Proposal for a regulation

Recital 13

| Text proposed by the Commission | Amendment |
| --- | --- |
| (13) | The
  possible
  measures to be adopted in the event of generalised deficiencies and the procedure to be followed to adopt them should be determined. Those measures should include the suspension of payments and of commitments, a reduction of funding under existing commitments, and a prohibition to conclude new commitments with recipients. |

Text proposed by the Commission

Amendment

(13)

The
  possible
  measures to be adopted in the event of generalised deficiencies and the procedure to be followed to adopt them should be determined. Those measures should include the suspension of payments and of commitments, a reduction of funding under existing commitments, and a prohibition to conclude new commitments with recipients.

| (13) | The measures to be adopted in the event of generalised deficiencies and the procedure to be followed to adopt them should be determined. Those measures should include the suspension of payments and of commitments, a reduction of funding under existing commitments, and a prohibition to conclude new commitments with recipients. |
| --- | --- |

(13)

The measures to be adopted in the event of generalised deficiencies and the procedure to be followed to adopt them should be determined. Those measures should include the suspension of payments and of commitments, a reduction of funding under existing commitments, and a prohibition to conclude new commitments with recipients.

Amendment 23

Proposal for a regulation

Recital 14 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (14a) | It is essential that the legitimate interests of final recipients and beneficiaries are properly safeguarded when measures are adopted in the event of generalised deficiencies. When considering the adoption of measures, the Commission should take into account their potential impact on final recipients and beneficiaries. To strengthen the protection of the final recipients or beneficiaries, the Commission should provide information and guidance via a website or internet portal, together with adequate tools to inform the Commission about any breach of the legal obligation of government entities and Member States to continue making payments after measures on the basis of this Regulation are adopted. Where necessary, in order to ensure that any amount due by government entities or Member States is effectively paid to final recipients or beneficiaries, the Commission should be able to recover payments made to those entities, or, as appropriate, to make a financial correction by reducing support to a programme, and to transfer an equivalent amount to the Union reserve to be used for the benefit of final recipients or beneficiaries. |

Text proposed by the Commission

Amendment

(14a)

It is essential that the legitimate interests of final recipients and beneficiaries are properly safeguarded when measures are adopted in the event of generalised deficiencies. When considering the adoption of measures, the Commission should take into account their potential impact on final recipients and beneficiaries. To strengthen the protection of the final recipients or beneficiaries, the Commission should provide information and guidance via a website or internet portal, together with adequate tools to inform the Commission about any breach of the legal obligation of government entities and Member States to continue making payments after measures on the basis of this Regulation are adopted. Where necessary, in order to ensure that any amount due by government entities or Member States is effectively paid to final recipients or beneficiaries, the Commission should be able to recover payments made to those entities, or, as appropriate, to make a financial correction by reducing support to a programme, and to transfer an equivalent amount to the Union reserve to be used for the benefit of final recipients or beneficiaries.

Amendment 24

Proposal for a regulation

Recital 15

| Text proposed by the Commission | Amendment |
| --- | --- |
| (15) | In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the
  Council which should act on the basis of a
  Commission
  proposal
  .
  To facilitate the adoption of decisions which are required to protect the financial interests of the Union, reversed qualified majority voting should be used. |

Text proposed by the Commission

Amendment

(15)

In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the
  Council which should act on the basis of a
  Commission
  proposal
  .
  To facilitate the adoption of decisions which are required to protect the financial interests of the Union, reversed qualified majority voting should be used.

| (15) | In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the Commission. |
| --- | --- |

(15)

In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the Commission.

Amendment 25

Proposal for a regulation

Recital 15 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (15a) | In view of their effect on the Union budget, measures imposed pursuant to this Regulation should only enter into force after the European Parliament and the Council have approved a transfer to a budgetary reserve of an amount equivalent to the value of the measures adopted. To facilitate the adoption of decisions which are required to protect the financial interests of the Union, such transfers should be considered to be approved unless, within a set period, the European Parliament or the Council, the latter acting by qualified majority, amend or reject them. |

Text proposed by the Commission

Amendment

(15a)

In view of their effect on the Union budget, measures imposed pursuant to this Regulation should only enter into force after the European Parliament and the Council have approved a transfer to a budgetary reserve of an amount equivalent to the value of the measures adopted. To facilitate the adoption of decisions which are required to protect the financial interests of the Union, such transfers should be considered to be approved unless, within a set period, the European Parliament or the Council, the latter acting by qualified majority, amend or reject them.

Amendment 26

Proposal for a regulation

Recital 16

| Text proposed by the Commission | Amendment |
| --- | --- |
| (16) | Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned why it considers that a generalised deficiency regarding the rule of law might exist in that Member State. The Member State should be allowed to submit its observations. The Commission
  and the Council
  should take those observations into account. |

Text proposed by the Commission

Amendment

(16)

Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned why it considers that a generalised deficiency regarding the rule of law might exist in that Member State. The Member State should be allowed to submit its observations. The Commission
  and the Council
  should take those observations into account.

| (16) | Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned why it considers that a generalised deficiency regarding the rule of law might exist in that Member State.
  The Commission should without delay inform the European Parliament and the Council about any such notification and its contents.
  The Member State
  concerned
  should be allowed to submit its observations. The Commission should take those observations into account. |
| --- | --- |

(16)

Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned why it considers that a generalised deficiency regarding the rule of law might exist in that Member State.
  The Commission should without delay inform the European Parliament and the Council about any such notification and its contents.
  The Member State
  concerned
  should be allowed to submit its observations. The Commission should take those observations into account.

Amendment 27

Proposal for a regulation

Recital 17

| Text proposed by the Commission | Amendment |
| --- | --- |
| (17) | The
  Council
  should lift measures with suspensive effect
  on a proposal from the Commission
  , if the situation leading to the imposition of those measures has been sufficiently remedied. |

Text proposed by the Commission

Amendment

(17)

The
  Council
  should lift measures with suspensive effect
  on a proposal from the Commission
  , if the situation leading to the imposition of those measures has been sufficiently remedied.

| (17) | The
  Commission
  should lift measures with suspensive effect
  and propose to the European Parliament and the Council to lift in full or in part the budgetary reserve of the measures in question
  , if the situation leading to the imposition of those measures has been sufficiently remedied. |
| --- | --- |

(17)

The
  Commission
  should lift measures with suspensive effect
  and propose to the European Parliament and the Council to lift in full or in part the budgetary reserve of the measures in question
  , if the situation leading to the imposition of those measures has been sufficiently remedied.

Amendment 28

Proposal for a regulation

Recital 18

| Text proposed by the Commission | Amendment |
| --- | --- |
| (18) | The Commission should keep the European Parliament informed of any measures proposed and adopted pursuant to this Regulation, |

Text proposed by the Commission

Amendment

(18)

The Commission should keep the European Parliament informed of any measures proposed and adopted pursuant to this Regulation,

deleted

Amendment 29

Proposal for a regulation

Article 2 — paragraph 1 — point a

| Text proposed by the Commission | Amendment |
| --- | --- |
| (a) | ‘the rule of law’
  refers
  to the Union
  value
  enshrined in Article 2
  of the Treaty on European
  Union
  which
  includes the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting
  laws
  ; legal certainty; prohibition of arbitrariness of the executive powers; effective judicial protection
  by
  independent courts, including of fundamental rights; separation of powers and equality before the law; |

Text proposed by the Commission

Amendment

(a)

‘the rule of law’
  refers
  to the Union
  value
  enshrined in Article 2
  of the Treaty on European
  Union
  which
  includes the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting
  laws
  ; legal certainty; prohibition of arbitrariness of the executive powers; effective judicial protection
  by
  independent courts, including of fundamental rights; separation of powers and equality before the law;

| (a) | ‘the rule of law’
  shall be understood having regard
  to the Union
  values
  enshrined in Article 2
  TEU and in the criteria for
  Union
  membership referred to in Article 49 TEU; it
  includes the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting
  law
  ; legal certainty; prohibition of arbitrariness of the executive powers;
  access to justice and
  effective judicial protection
  before
  independent
  and impartial
  courts, including of fundamental rights
  as stipulated in the Charter of Fundamental Rights of the European Union and in international human rights treaties
  ; separation of powers
  ; non-discrimination
  and equality before the law; |
| --- | --- |

(a)

‘the rule of law’
  shall be understood having regard
  to the Union
  values
  enshrined in Article 2
  TEU and in the criteria for
  Union
  membership referred to in Article 49 TEU; it
  includes the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting
  law
  ; legal certainty; prohibition of arbitrariness of the executive powers;
  access to justice and
  effective judicial protection
  before
  independent
  and impartial
  courts, including of fundamental rights
  as stipulated in the Charter of Fundamental Rights of the European Union and in international human rights treaties
  ; separation of powers
  ; non-discrimination
  and equality before the law;

Amendment 30

Proposal for a regulation

Article 2 — paragraph 1 — point b

| Text proposed by the Commission | Amendment |
| --- | --- |
| (b) | ‘generalised deficiency as regards the rule of law’ means a widespread or recurrent practice or omission, or measure by public authorities which affects the rule of law; |

Text proposed by the Commission

Amendment

(b)

‘generalised deficiency as regards the rule of law’ means a widespread or recurrent practice or omission, or measure by public authorities which affects the rule of law;

| (b) | ‘generalised deficiency as regards the rule of law’ means a widespread or recurrent practice or omission, or measure by public authorities which affects the rule of law
  , where it affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union
  ;
  a generalised deficiency as regards the rule of law may also be the consequence of a systemic threat to the Union values enshrined in Article 2 TEU that affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union; |
| --- | --- |

(b)

‘generalised deficiency as regards the rule of law’ means a widespread or recurrent practice or omission, or measure by public authorities which affects the rule of law
  , where it affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union
  ;
  a generalised deficiency as regards the rule of law may also be the consequence of a systemic threat to the Union values enshrined in Article 2 TEU that affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union;

Amendment 31

Proposal for a regulation

Article 2 — paragraph 1 — point c

| Text proposed by the Commission | Amendment |
| --- | --- |
| (c) | ‘government entity’ means
  all public
  authorities at all levels of government, including national, regional and local authorities, as well as Member State organisations within the meaning of [point 42 of Article 2] of Regulation (EU, Euratom)
  No [...]
  (the ‘Financial Regulation’). |

Text proposed by the Commission

Amendment

(c)

‘government entity’ means
  all public
  authorities at all levels of government, including national, regional and local authorities, as well as Member State organisations within the meaning of [point 42 of Article 2] of Regulation (EU, Euratom)
  No [...]
  (the ‘Financial Regulation’).

| (c) | ‘government entity’ means
  any
  public
  authority
  at all levels of government, including national, regional and local authorities, as well as Member State organisations within the meaning of point 42 of Article 2 of Regulation (EU, Euratom)
  2018/1046 of the European Parliament and of the Council

   (1a) (the ‘Financial Regulation’). |
| --- | --- |

(c)

‘government entity’ means
  any
  public
  authority
  at all levels of government, including national, regional and local authorities, as well as Member State organisations within the meaning of point 42 of Article 2 of Regulation (EU, Euratom)
  2018/1046 of the European Parliament and of the Council

   (1a) (the ‘Financial Regulation’).

Amendment 32

Proposal for a regulation

Article 2 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | Article 2 a |
| | Generalised deficiencies |
| | The following shall, in particular, be considered generalised deficiencies as regards the rule of law where they affect or risk affecting the principles of sound financial management or the protection of the financial interests of the Union: |
| | (a) | endangering the independence of judiciary, including setting any limitations on the ability to exercise judicial functions autonomously by externally intervening in guarantees of independence, by constraining judgement under external order, by arbitrarily revising rules on the appointment or terms of service of judicial personnel, by influencing judicial staff in any way that jeopardises their impartiality or by interfering with the independence of attorneyship; |

Text proposed by the Commission

Amendment

Article 2 a

Generalised deficiencies

The following shall, in particular, be considered generalised deficiencies as regards the rule of law where they affect or risk affecting the principles of sound financial management or the protection of the financial interests of the Union:

(a)

endangering the independence of judiciary, including setting any limitations on the ability to exercise judicial functions autonomously by externally intervening in guarantees of independence, by constraining judgement under external order, by arbitrarily revising rules on the appointment or terms of service of judicial personnel, by influencing judicial staff in any way that jeopardises their impartiality or by interfering with the independence of attorneyship;

| (b) | failing to prevent, correct and sanction arbitrary or unlawful decisions by public authorities, including by law enforcement authorities, withholding financial and human resources affecting their proper functioning or failing to ensure the absence of conflicts of interests; |
| --- | --- |

(b)

failing to prevent, correct and sanction arbitrary or unlawful decisions by public authorities, including by law enforcement authorities, withholding financial and human resources affecting their proper functioning or failing to ensure the absence of conflicts of interests;

| (c) | limiting the availability and effectiveness of legal remedies, including through restrictive procedural rules, lack of implementation of judgments, or limiting the effective investigation, prosecution or sanctioning of breaches of law; |
| --- | --- |

(c)

limiting the availability and effectiveness of legal remedies, including through restrictive procedural rules, lack of implementation of judgments, or limiting the effective investigation, prosecution or sanctioning of breaches of law;

| (d) | endangering the administrative capacity of a Member State to respect the obligations of Union membership, including the capacity to effectively implement the rules, standards and policies that make up the body of Union law; |
| --- | --- |

(d)

endangering the administrative capacity of a Member State to respect the obligations of Union membership, including the capacity to effectively implement the rules, standards and policies that make up the body of Union law;

| (e) | measures that weaken the protection of the confidential communication between lawyer and client. |
| --- | --- |

(e)

measures that weaken the protection of the confidential communication between lawyer and client.

Amendment 33

Proposal for a regulation

Article 3 — title

| Text proposed by the Commission | Amendment |
| --- | --- |
| Measures | Risks for the financial interests of the Union |

Text proposed by the Commission

Amendment

Measures

Risks for the financial interests of the Union

Amendment 34

Proposal for a regulation

Article 3 — paragraph 1 — introductory part

| Text proposed by the Commission | Amendment |
| --- | --- |
| 1.   
  Appropriate measures shall be taken where
  a generalised deficiency as regards the rule of law in a Member State
  affects or risks affecting the principles of sound financial management or the protection
  of the
  financial interests of the Union
  , in particular: | 1.   A generalised deficiency as regards the rule of law in a Member State
  may be established when one or more
  of the
  following
  , in particular
  , are affected or risk being affected
  : |

Text proposed by the Commission

Amendment

1.   
  Appropriate measures shall be taken where
  a generalised deficiency as regards the rule of law in a Member State
  affects or risks affecting the principles of sound financial management or the protection
  of the
  financial interests of the Union
  , in particular:

1.   A generalised deficiency as regards the rule of law in a Member State
  may be established when one or more
  of the
  following
  , in particular
  , are affected or risk being affected
  :

Amendment 35

Amendment 35

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 1 — point a

Article 3 — paragraph 1 — point a

| Text proposed by the Commission | Amendment |
| --- | --- |
| (a) | the proper functioning of the authorities of that Member State implementing the Union budget, in particular in the context of public procurement or grant procedures
  , and when carrying out monitoring and controls
  ; |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

(a)

the proper functioning of the authorities of that Member State implementing the Union budget, in particular in the context of public procurement or grant procedures
  , and when carrying out monitoring and controls
  ;

, and when carrying out monitoring and controls

| (a) | the proper functioning of the authorities of that Member State implementing the Union budget, in particular in the context of public procurement or grant procedures; |
| --- | --- |

(a)

the proper functioning of the authorities of that Member State implementing the Union budget, in particular in the context of public procurement or grant procedures;

Amendment 36

Amendment 36

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 1 — point a a (new)

Article 3 — paragraph 1 — point a a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (aa) | the proper functioning of the market economy, thereby respecting competition and market forces in the Union as well as implementing effectively the obligations of membership, including adherence to the aim of political, economic and monetary union; |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

(aa)

(aa)

the proper functioning of the market economy, thereby respecting competition and market forces in the Union as well as implementing effectively the obligations of membership, including adherence to the aim of political, economic and monetary union;

the proper functioning of the market economy, thereby respecting competition and market forces in the Union as well as implementing effectively the obligations of membership, including adherence to the aim of political, economic and monetary union;

Amendment 37

Amendment 37

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 1 — point a b (new)

Article 3 — paragraph 1 — point a b (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (ab) | the proper functioning of the authorities carrying out financial control, monitoring and internal and external audits, and the proper functioning of effective and transparent financial management and accountability systems; |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

(ab)

(ab)

the proper functioning of the authorities carrying out financial control, monitoring and internal and external audits, and the proper functioning of effective and transparent financial management and accountability systems;

the proper functioning of the authorities carrying out financial control, monitoring and internal and external audits, and the proper functioning of effective and transparent financial management and accountability systems;

Amendment 38

Amendment 38

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 1 — point b

Article 3 — paragraph 1 — point b

| Text proposed by the Commission | Amendment |
| --- | --- |
| (b) | the proper functioning of investigation and public prosecution services in relation to the prosecution of fraud, corruption or other breaches of Union law relating to the implementation of the Union budget; |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

(b)

the proper functioning of investigation and public prosecution services in relation to the prosecution of fraud, corruption or other breaches of Union law relating to the implementation of the Union budget;

| (b) | the proper functioning of investigation and public prosecution services in relation to the prosecution of fraud,
  including tax fraud,
  corruption or other breaches of Union law relating to the implementation of the Union budget; |
| --- | --- |

(b)

the proper functioning of investigation and public prosecution services in relation to the prosecution of fraud,
  including tax fraud,
  corruption or other breaches of Union law relating to the implementation of the Union budget;

including tax fraud,

Amendment 39

Amendment 39

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 1 — point c

Article 3 — paragraph 1 — point c

| Text proposed by the Commission | Amendment |
| --- | --- |
| (c) | the effective judicial review by independent courts of actions or omissions by the authorities referred to in points (a) and
  b)
  ; |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

(c)

the effective judicial review by independent courts of actions or omissions by the authorities referred to in points (a) and
  b)
  ;

b)

| (c) | the effective judicial review by independent courts of actions or omissions by the authorities referred to in points (a)
  , (a b)
  and
  (b)
  ; |
| --- | --- |

(c)

the effective judicial review by independent courts of actions or omissions by the authorities referred to in points (a)
  , (a b)
  and
  (b)
  ;

, (a b)

(b)

Amendment 40

Amendment 40

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 1 — point d

Article 3 — paragraph 1 — point d

| Text proposed by the Commission | Amendment |
| --- | --- |
| (d) | the prevention and sanctioning of fraud, corruption or other breaches of Union law relating to the implementation of the Union budget, and the imposition of effective and dissuasive penalties on recipients by national courts or by administrative authorities; |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

(d)

the prevention and sanctioning of fraud, corruption or other breaches of Union law relating to the implementation of the Union budget, and the imposition of effective and dissuasive penalties on recipients by national courts or by administrative authorities;

| (d) | the prevention and sanctioning of fraud,
  including tax fraud,
  corruption or other breaches of Union law relating to the implementation of the Union budget, and the imposition of effective and dissuasive penalties on recipients by national courts or by administrative authorities; |
| --- | --- |

(d)

the prevention and sanctioning of fraud,
  including tax fraud,
  corruption or other breaches of Union law relating to the implementation of the Union budget, and the imposition of effective and dissuasive penalties on recipients by national courts or by administrative authorities;

including tax fraud,

Amendment 41

Amendment 41

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 1 — point e a (new)

Article 3 — paragraph 1 — point e a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (ea) | the prevention and sanctioning of tax evasion and tax competition and the proper functioning of authorities contributing to administrative cooperation in tax matters; |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

(ea)

(ea)

the prevention and sanctioning of tax evasion and tax competition and the proper functioning of authorities contributing to administrative cooperation in tax matters;

the prevention and sanctioning of tax evasion and tax competition and the proper functioning of authorities contributing to administrative cooperation in tax matters;

Amendment 42

Amendment 42

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 1 — point f

Article 3 — paragraph 1 — point f

| Text proposed by the Commission | Amendment |
| --- | --- |
| (f) | the effective and timely cooperation with the European Anti-fraud Office and with the European Public Prosecutor’s Office in their investigations or prosecutions pursuant to their respective legal acts and to the principle of loyal cooperation. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

(f)

the effective and timely cooperation with the European Anti-fraud Office and with the European Public Prosecutor’s Office in their investigations or prosecutions pursuant to their respective legal acts and to the principle of loyal cooperation.

| (f) | the effective and timely cooperation with the European Anti-fraud Office and
  , subject to the participation of the Member State concerned,
  with the European Public Prosecutor’s Office in their investigations or prosecutions pursuant to their respective legal acts and to the principle of loyal cooperation; |
| --- | --- |

(f)

the effective and timely cooperation with the European Anti-fraud Office and
  , subject to the participation of the Member State concerned,
  with the European Public Prosecutor’s Office in their investigations or prosecutions pursuant to their respective legal acts and to the principle of loyal cooperation;

, subject to the participation of the Member State concerned,

Amendment 43

Amendment 43

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 1 — point f a (new)

Article 3 — paragraph 1 — point f a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | (fa) | the proper implementation of the Union budget following a systemic violation of fundamental rights. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

(fa)

(fa)

the proper implementation of the Union budget following a systemic violation of fundamental rights.

the proper implementation of the Union budget following a systemic violation of fundamental rights.

Amendment 44

Amendment 44

Proposal for a regulation

Proposal for a regulation

Article 3 — paragraph 2

Article 3 — paragraph 2

| Text proposed by the Commission | Amendment |
| --- | --- |
| 2.
     
  The following may, in particular, be considered generalised deficiencies as regards the rule of law, | deleted |
| (a) | endangering the independence of judiciary; |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

2.
     
  The following may, in particular, be considered generalised deficiencies as regards the rule of law,

deleted

deleted

(a)

(a)

endangering the independence of judiciary;

endangering the independence of judiciary;

| (b) | failing to prevent, correct and sanction arbitrary or unlawful decisions by public authorities, including by law enforcement authorities, withholding financial and human resources affecting their proper functioning or failing to ensure the absence of conflicts of interests; |
| --- | --- |

(b)

(b)

failing to prevent, correct and sanction arbitrary or unlawful decisions by public authorities, including by law enforcement authorities, withholding financial and human resources affecting their proper functioning or failing to ensure the absence of conflicts of interests;

failing to prevent, correct and sanction arbitrary or unlawful decisions by public authorities, including by law enforcement authorities, withholding financial and human resources affecting their proper functioning or failing to ensure the absence of conflicts of interests;

| (c) | limiting the availability and effectiveness of legal remedies, including through restrictive procedural rules, lack of implementation of judgments, or limiting the effective investigation, prosecution or sanctioning of breaches of law. |
| --- | --- |

(c)

(c)

limiting the availability and effectiveness of legal remedies, including through restrictive procedural rules, lack of implementation of judgments, or limiting the effective investigation, prosecution or sanctioning of breaches of law.

limiting the availability and effectiveness of legal remedies, including through restrictive procedural rules, lack of implementation of judgments, or limiting the effective investigation, prosecution or sanctioning of breaches of law.

Amendment 45

Amendment 45

Proposal for a regulation

Proposal for a regulation

Article 3 a (new)

Article 3 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | Article 3 a |
| | Panel of independent experts |
| | 1.
     
  The Commission shall establish a panel of independent experts (‘the Panel’). |
| | The Panel shall be composed of independent experts in constitutional law and financial and budgetary matters. One expert shall be appointed by the national parliament of each Member State and five experts shall be appointed by the European Parliament. The composition of the Panel shall ensure gender balance. |
| | Whenever appropriate, representatives of relevant organisations and networks, such as the European Federation of Academies of Sciences and Humanities, the European Network of National Human Rights Institutions, the bodies of the Council of Europe, the European Commission for the efficiency of justice, the Council of Bars and Law Societies of Europe, the Tax Justice Network, the United Nations, the Organization for Security and Co-operation in Europe and the Organisation for Economic Co-operation and Development, may be invited as observers to the Panel in accordance with the rules of procedures referred to in paragraph 6. |
| | 2.
     
  The advisory tasks of the Panel shall have as their objective to assist the Commission in identifying generalised deficiencies as regards the rule of law in a Member State that affect or risk affecting the principles of sound financial management or the protection of the financial interests of the Union. |
| | The Panel shall assess the situation in all Member States annually on the basis of quantitative and qualitative criteria and information, having due regard to the information and guidance referred to in Article 5(2). |
| | 3.
     
  Each year the Panel shall make public a summary of its findings. |
| | 4.
     
  As part of its advisory task and taking into account the outcome of the considerations under paragraph 2, the Panel may express an opinion about a generalised deficiency as regards the rule of law in a Member State. |
| | When expressing an opinion the Panel shall endeavour to reach a consensus. If no such consensus can be reached, the Panel shall express its opinion by a simple majority of its members. |
| | 5.
     
  When adopting implementing acts pursuant to Article 5(6) and Article 6(2), the Commission shall take into account any relevant opinion expressed by the Panel in accordance with paragraph 4 of this Article. |
| | 6.
     
  The Panel shall elect its chairperson from among its members. The Panel shall establish its rules of procedure. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

Article 3 a

Article 3 a

Panel of independent experts

Panel of independent experts

1.
     
  The Commission shall establish a panel of independent experts (‘the Panel’).

The Panel shall be composed of independent experts in constitutional law and financial and budgetary matters. One expert shall be appointed by the national parliament of each Member State and five experts shall be appointed by the European Parliament. The composition of the Panel shall ensure gender balance.

The Panel shall be composed of independent experts in constitutional law and financial and budgetary matters. One expert shall be appointed by the national parliament of each Member State and five experts shall be appointed by the European Parliament. The composition of the Panel shall ensure gender balance.

Whenever appropriate, representatives of relevant organisations and networks, such as the European Federation of Academies of Sciences and Humanities, the European Network of National Human Rights Institutions, the bodies of the Council of Europe, the European Commission for the efficiency of justice, the Council of Bars and Law Societies of Europe, the Tax Justice Network, the United Nations, the Organization for Security and Co-operation in Europe and the Organisation for Economic Co-operation and Development, may be invited as observers to the Panel in accordance with the rules of procedures referred to in paragraph 6.

Whenever appropriate, representatives of relevant organisations and networks, such as the European Federation of Academies of Sciences and Humanities, the European Network of National Human Rights Institutions, the bodies of the Council of Europe, the European Commission for the efficiency of justice, the Council of Bars and Law Societies of Europe, the Tax Justice Network, the United Nations, the Organization for Security and Co-operation in Europe and the Organisation for Economic Co-operation and Development, may be invited as observers to the Panel in accordance with the rules of procedures referred to in paragraph 6.

2.
     
  The advisory tasks of the Panel shall have as their objective to assist the Commission in identifying generalised deficiencies as regards the rule of law in a Member State that affect or risk affecting the principles of sound financial management or the protection of the financial interests of the Union.

The Panel shall assess the situation in all Member States annually on the basis of quantitative and qualitative criteria and information, having due regard to the information and guidance referred to in Article 5(2).

The Panel shall assess the situation in all Member States annually on the basis of quantitative and qualitative criteria and information, having due regard to the information and guidance referred to in Article 5(2).

3.
     
  Each year the Panel shall make public a summary of its findings.

4.
     
  As part of its advisory task and taking into account the outcome of the considerations under paragraph 2, the Panel may express an opinion about a generalised deficiency as regards the rule of law in a Member State.

When expressing an opinion the Panel shall endeavour to reach a consensus. If no such consensus can be reached, the Panel shall express its opinion by a simple majority of its members.

When expressing an opinion the Panel shall endeavour to reach a consensus. If no such consensus can be reached, the Panel shall express its opinion by a simple majority of its members.

5.
     
  When adopting implementing acts pursuant to Article 5(6) and Article 6(2), the Commission shall take into account any relevant opinion expressed by the Panel in accordance with paragraph 4 of this Article.

6.
     
  The Panel shall elect its chairperson from among its members. The Panel shall establish its rules of procedure.

Amendment 46

Amendment 46

Proposal for a regulation

Proposal for a regulation

Article 4 — title

Article 4 — title

| Text proposed by the Commission | Amendment |
| --- | --- |
| Content of
  measures | Measures
  for the protection of the Union budget |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

Content of
  measures

Content of

Measures
  for the protection of the Union budget

for the protection of the Union budget

Amendment 47

Amendment 47

Proposal for a regulation

Proposal for a regulation

Article 4 — paragraph 1 — introductory part

Article 4 — paragraph 1 — introductory part

| Text proposed by the Commission | Amendment |
| --- | --- |
| 1.   One or more of the following
  appropriate
  measures may be adopted | 1.   
  When the conditions of Article 3 are fulfilled,
  one or more of the following measures may be adopted: |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

1.   One or more of the following
  appropriate
  measures may be adopted

1.   
  When the conditions of Article 3 are fulfilled,
  one or more of the following measures may be adopted:

Amendment 48

Amendment 48

Proposal for a regulation

Proposal for a regulation

Article 4 — paragraph 3

Article 4 — paragraph 3

| Text proposed by the Commission | Amendment |
| --- | --- |
| 3.   The measures taken shall be proportionate to the nature, gravity and scope of the generalised deficiency as regards the rule of law. They shall, insofar as possible, target the Union actions affected or potentially affected by that deficiency. | 3.   The measures taken shall be proportionate to the nature, gravity
  , duration
   and scope of the generalised deficiency as regards the rule of law. They shall, insofar as possible, target the Union actions affected or potentially affected by that deficiency. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

3.   The measures taken shall be proportionate to the nature, gravity and scope of the generalised deficiency as regards the rule of law. They shall, insofar as possible, target the Union actions affected or potentially affected by that deficiency.

3.   The measures taken shall be proportionate to the nature, gravity
  , duration
   and scope of the generalised deficiency as regards the rule of law. They shall, insofar as possible, target the Union actions affected or potentially affected by that deficiency.

Amendment 49

Amendment 49

Proposal for a regulation

Proposal for a regulation

Article 4 — paragraph 3 a (new)

Article 4 — paragraph 3 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | 3a.
     
  The Commission shall provide information and guidance for the benefit of final recipients or beneficiaries on the obligations by Member States referred to in paragraph 2 via a website or internet portal. |
| | The Commission shall also provide, on the same website or portal, adequate tools for final recipients or beneficiaries to inform the Commission about any breach of these obligations that, in the view of these final recipients or beneficiaries, directly affects them. This paragraph shall be applied in a manner that ensures protection of persons reporting on breaches of Union law, in line with the principles set out in Directive XXX (Directive on the protection of persons reporting on breaches of Union law). Information provided by final recipients or beneficiaries in accordance with this paragraph may only be taken into account by the Commission if accompanied by a proof that the concerned final recipient or beneficiary has lodged a formal complaint to the competent authority. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

3a.
     
  The Commission shall provide information and guidance for the benefit of final recipients or beneficiaries on the obligations by Member States referred to in paragraph 2 via a website or internet portal.

The Commission shall also provide, on the same website or portal, adequate tools for final recipients or beneficiaries to inform the Commission about any breach of these obligations that, in the view of these final recipients or beneficiaries, directly affects them. This paragraph shall be applied in a manner that ensures protection of persons reporting on breaches of Union law, in line with the principles set out in Directive XXX (Directive on the protection of persons reporting on breaches of Union law). Information provided by final recipients or beneficiaries in accordance with this paragraph may only be taken into account by the Commission if accompanied by a proof that the concerned final recipient or beneficiary has lodged a formal complaint to the competent authority.

The Commission shall also provide, on the same website or portal, adequate tools for final recipients or beneficiaries to inform the Commission about any breach of these obligations that, in the view of these final recipients or beneficiaries, directly affects them. This paragraph shall be applied in a manner that ensures protection of persons reporting on breaches of Union law, in line with the principles set out in Directive XXX (Directive on the protection of persons reporting on breaches of Union law). Information provided by final recipients or beneficiaries in accordance with this paragraph may only be taken into account by the Commission if accompanied by a proof that the concerned final recipient or beneficiary has lodged a formal complaint to the competent authority.

Amendment 50

Amendment 50

Proposal for a regulation

Proposal for a regulation

Article 4 — paragraph 3 b (new)

Article 4 — paragraph 3 b (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | 3b.
     
  Based on the information provided by the final recipients or beneficiaries in accordance with paragraph 3 a, the Commission shall ensure that any amount due by government entities or Member States in accordance with paragraph 2 is effectively paid to final recipients or beneficiaries.




  Where necessary: |
| | (a) | with reference to funds from the Union budget managed in accordance with Article 62(1)(c) of the Financial Regulation, the Commission shall: |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

3b.
     
  Based on the information provided by the final recipients or beneficiaries in accordance with paragraph 3 a, the Commission shall ensure that any amount due by government entities or Member States in accordance with paragraph 2 is effectively paid to final recipients or beneficiaries.

Where necessary:

(a)

(a)

with reference to funds from the Union budget managed in accordance with Article 62(1)(c) of the Financial Regulation, the Commission shall:

with reference to funds from the Union budget managed in accordance with Article 62(1)(c) of the Financial Regulation, the Commission shall:

| | (i) | recover the payment made to any of the bodies referred to in points (v) to (vii) of Article 62(1)(c) of the Financial Regulation for an amount equivalent to the amount not paid to final recipients or beneficiaries, in breach of paragraph 2 of this Article; |
| --- | --- | --- |

(i)

(i)

recover the payment made to any of the bodies referred to in points (v) to (vii) of Article 62(1)(c) of the Financial Regulation for an amount equivalent to the amount not paid to final recipients or beneficiaries, in breach of paragraph 2 of this Article;

recover the payment made to any of the bodies referred to in points (v) to (vii) of Article 62(1)(c) of the Financial Regulation for an amount equivalent to the amount not paid to final recipients or beneficiaries, in breach of paragraph 2 of this Article;

| | (ii) | transfer an amount equivalent to the amount referred to in the previous point to the Union reserve referred to in Article 12 of Council Regulation XXX (MFF Regulation). Such amount shall be considered margin left available within the meaning of point (a) of Article 12(1) of Council Regulation XXX (MFF Regulation) and shall be mobilised in accordance with Article 12(2) of Council Regulation XXX (MFF Regulation), for the benefit, to the possible extent, of the final recipients or beneficiaries referred to in paragraph 2 of this Article; |
| --- | --- | --- |

(ii)

(ii)

transfer an amount equivalent to the amount referred to in the previous point to the Union reserve referred to in Article 12 of Council Regulation XXX (MFF Regulation). Such amount shall be considered margin left available within the meaning of point (a) of Article 12(1) of Council Regulation XXX (MFF Regulation) and shall be mobilised in accordance with Article 12(2) of Council Regulation XXX (MFF Regulation), for the benefit, to the possible extent, of the final recipients or beneficiaries referred to in paragraph 2 of this Article;

transfer an amount equivalent to the amount referred to in the previous point to the Union reserve referred to in Article 12 of Council Regulation XXX (MFF Regulation). Such amount shall be considered margin left available within the meaning of point (a) of Article 12(1) of Council Regulation XXX (MFF Regulation) and shall be mobilised in accordance with Article 12(2) of Council Regulation XXX (MFF Regulation), for the benefit, to the possible extent, of the final recipients or beneficiaries referred to in paragraph 2 of this Article;

| (b) | with reference to funds from the Union budget managed in accordance with Article 62(1)(b) of the Financial Regulation: |
| --- | --- |

(b)

(b)

with reference to funds from the Union budget managed in accordance with Article 62(1)(b) of the Financial Regulation:

with reference to funds from the Union budget managed in accordance with Article 62(1)(b) of the Financial Regulation:

| | (i) | the obligation of government authorities or of Member States referred to in paragraph 2 of this Article shall be considered an obligation of Member States within the meaning of [Article 63] of Regulation XXX (CPR Regulation). Any breach of such obligation shall be treated in accordance with [Article 98] of Regulation XXX (CPR Regulation); |
| --- | --- | --- |

(i)

(i)

the obligation of government authorities or of Member States referred to in paragraph 2 of this Article shall be considered an obligation of Member States within the meaning of [Article 63] of Regulation XXX (CPR Regulation). Any breach of such obligation shall be treated in accordance with [Article 98] of Regulation XXX (CPR Regulation);

the obligation of government authorities or of Member States referred to in paragraph 2 of this Article shall be considered an obligation of Member States within the meaning of [Article 63] of Regulation XXX (CPR Regulation). Any breach of such obligation shall be treated in accordance with [Article 98] of Regulation XXX (CPR Regulation);

| | (ii) | The amount resulting from reduced support from the Funds to a programme, in application of [Article 98] of Regulation XXX (CPR Regulation) shall be transferred by the Commission to the Union reserve referred to in Article 12 of Council Regulation XXX (MFF Regulation). Such amount shall be considered margin left available within the meaning of point a) of Article 12(1) of Council Regulation XXX (MFF Regulation) and shall be mobilised in accordance with paragraph 2 of Article 12 of Council Regulation XXC (MFF Regulation), for the benefit, to the possible extent, of the final recipients or beneficiaries referred to in paragraph 2 of this Article. |
| --- | --- | --- |

(ii)

(ii)

The amount resulting from reduced support from the Funds to a programme, in application of [Article 98] of Regulation XXX (CPR Regulation) shall be transferred by the Commission to the Union reserve referred to in Article 12 of Council Regulation XXX (MFF Regulation). Such amount shall be considered margin left available within the meaning of point a) of Article 12(1) of Council Regulation XXX (MFF Regulation) and shall be mobilised in accordance with paragraph 2 of Article 12 of Council Regulation XXC (MFF Regulation), for the benefit, to the possible extent, of the final recipients or beneficiaries referred to in paragraph 2 of this Article.

The amount resulting from reduced support from the Funds to a programme, in application of [Article 98] of Regulation XXX (CPR Regulation) shall be transferred by the Commission to the Union reserve referred to in Article 12 of Council Regulation XXX (MFF Regulation). Such amount shall be considered margin left available within the meaning of point a) of Article 12(1) of Council Regulation XXX (MFF Regulation) and shall be mobilised in accordance with paragraph 2 of Article 12 of Council Regulation XXC (MFF Regulation), for the benefit, to the possible extent, of the final recipients or beneficiaries referred to in paragraph 2 of this Article.

Amendment 51

Amendment 51

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 1

Article 5 — paragraph 1

| Text proposed by the Commission | Amendment |
| --- | --- |
| 1.   Where the Commission finds that it has reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding | 1.   Where the Commission
  , taking into account any opinions of the Panel,
  finds that it has reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding
  . The Commission shall without delay inform the European Parliament and the Council of such notification and its contents. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

1.   Where the Commission finds that it has reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding

1.   Where the Commission
  , taking into account any opinions of the Panel,
  finds that it has reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding
  . The Commission shall without delay inform the European Parliament and the Council of such notification and its contents.

Amendment 52

Amendment 52

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 2

Article 5 — paragraph 2

| Text proposed by the Commission | Amendment |
| --- | --- |
| 2.   The Commission
  may
  take into account all relevant information, including decisions of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations. | 2.   
  When assessing whether the conditions of Article 3 are fulfilled,
  the Commission
  shall
  take into account all relevant information, including
  opinions of the Panel,
  decisions of the Court of Justice of the European Union,
  resolutions of the European Parliament,
  reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations
  and networks
  .
  The Commission shall also take into account the criteria used in the context of Union accession negotiations, in particular the chapters of the acquis on judiciary and fundamental rights, justice, freedom and security, financial control and taxation, as well as the guidelines used in the context of the Cooperation and Verification Mechanism to track the progress of a Member State. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

2.   The Commission
  may
  take into account all relevant information, including decisions of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations.

2.   
  When assessing whether the conditions of Article 3 are fulfilled,
  the Commission
  shall
  take into account all relevant information, including
  opinions of the Panel,
  decisions of the Court of Justice of the European Union,
  resolutions of the European Parliament,
  reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations
  and networks
  .
  The Commission shall also take into account the criteria used in the context of Union accession negotiations, in particular the chapters of the acquis on judiciary and fundamental rights, justice, freedom and security, financial control and taxation, as well as the guidelines used in the context of the Cooperation and Verification Mechanism to track the progress of a Member State.

Amendment 53

Amendment 53

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 4

Article 5 — paragraph 4

| Text proposed by the Commission | Amendment |
| --- | --- |
| 4.   The Member State concerned shall provide
  all
  required information and may make observations within a time limit specified by the Commission, which shall not be less than
  1
  month from the date of notification of the finding. In its observations, the Member State may propose the adoption of remedial measures. | 4.   The Member State concerned shall provide
  the
  required information and may make observations within a time limit specified by the Commission, which shall not be less than
  one
  month
  nor more than three months
  from the date of notification of the finding. In its observations, the Member State may propose the adoption of remedial measures. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

4.   The Member State concerned shall provide
  all
  required information and may make observations within a time limit specified by the Commission, which shall not be less than
  1
  month from the date of notification of the finding. In its observations, the Member State may propose the adoption of remedial measures.

4.   The Member State concerned shall provide
  the
  required information and may make observations within a time limit specified by the Commission, which shall not be less than
  one
  month
  nor more than three months
  from the date of notification of the finding. In its observations, the Member State may propose the adoption of remedial measures.

Amendment 54

Amendment 54

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 5

Article 5 — paragraph 5

| Text proposed by the Commission | Amendment |
| --- | --- |
| 5.   The Commission shall take into account the information received and any observations made by the Member State concerned, as well as the adequacy of any proposed remedial measures, when deciding whether or not to
  submit a proposal for
  a decision on
  the appropriate
  measures. | 5.   The Commission shall take into account the information received and any observations made by the Member State concerned, as well as the adequacy of any proposed remedial measures, when deciding whether or not to
  adopt
  a decision on
  any
  measures
  referred to in Article 4
  .
  The Commission shall decide on the follow-up to be given to the information received within an indicative time limit of one month, and in any case within a reasonable timeframe from the date of receipt of that information. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

5.   The Commission shall take into account the information received and any observations made by the Member State concerned, as well as the adequacy of any proposed remedial measures, when deciding whether or not to
  submit a proposal for
  a decision on
  the appropriate
  measures.

5.   The Commission shall take into account the information received and any observations made by the Member State concerned, as well as the adequacy of any proposed remedial measures, when deciding whether or not to
  adopt
  a decision on
  any
  measures
  referred to in Article 4
  .
  The Commission shall decide on the follow-up to be given to the information received within an indicative time limit of one month, and in any case within a reasonable timeframe from the date of receipt of that information.

Amendment 55

Amendment 55

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 5 a (new)

Article 5 — paragraph 5 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | 5a.
     
  When assessing the proportionality of the measures to be imposed, the Commission shall have due regard to the information and guidance referred to in paragraph 2. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

5a.
     
  When assessing the proportionality of the measures to be imposed, the Commission shall have due regard to the information and guidance referred to in paragraph 2.

Amendment 56

Amendment 56

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 6

Article 5 — paragraph 6

| Text proposed by the Commission | Amendment |
| --- | --- |
| 6.   Where the Commission considers that the generalised deficiency as regards the rule of law is established, it shall
  submit a proposal for an implementing act
  on the
  appropriate
  measures
  to the Council
  . | 6.   Where the Commission considers that the generalised deficiency as regards the rule of law is established, it shall
  adopt a decision
  on the measures
  referred to in Article 4 by means of an implementing act
  . |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

6.   Where the Commission considers that the generalised deficiency as regards the rule of law is established, it shall
  submit a proposal for an implementing act
  on the
  appropriate
  measures
  to the Council
  .

6.   Where the Commission considers that the generalised deficiency as regards the rule of law is established, it shall
  adopt a decision
  on the measures
  referred to in Article 4 by means of an implementing act
  .

Amendment 57

Amendment 57

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 6 a (new)

Article 5 — paragraph 6 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | 6a.
     
  At the same time as it adopts its decision, the Commission shall simultaneously submit to the European Parliament and to the Council a proposal to transfer to a budgetary reserve an amount equivalent to the value of the measures adopted. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

6a.
     
  At the same time as it adopts its decision, the Commission shall simultaneously submit to the European Parliament and to the Council a proposal to transfer to a budgetary reserve an amount equivalent to the value of the measures adopted.

Amendment 58

Amendment 58

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 6 b (new)

Article 5 — paragraph 6 b (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | 6b.
     
  By way of derogation from Article 31(4) and (6) of the Financial Regulation, the European Parliament and the Council shall deliberate upon the transfer proposal within four weeks of its receipt by both institutions. The transfer proposal shall be considered to be approved unless, within the four-week period, the European Parliament, acting by majority of the votes cast, or the Council, acting by qualified majority, amend or reject it. If the European Parliament or the Council amend the transfer proposal, Article 31(8) of the Financial Regulation shall apply. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

6b.
     
  By way of derogation from Article 31(4) and (6) of the Financial Regulation, the European Parliament and the Council shall deliberate upon the transfer proposal within four weeks of its receipt by both institutions. The transfer proposal shall be considered to be approved unless, within the four-week period, the European Parliament, acting by majority of the votes cast, or the Council, acting by qualified majority, amend or reject it. If the European Parliament or the Council amend the transfer proposal, Article 31(8) of the Financial Regulation shall apply.

Amendment 59

Amendment 59

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 6 c (new)

Article 5 — paragraph 6 c (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | 6c.
     
  The decision referred to in paragraph 6 shall enter into force if neither the European Parliament nor the Council reject the transfer proposal within the period referred to in paragraph 6b. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

6c.
     
  The decision referred to in paragraph 6 shall enter into force if neither the European Parliament nor the Council reject the transfer proposal within the period referred to in paragraph 6b.

Amendment 60

Amendment 60

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 7

Article 5 — paragraph 7

| Text proposed by the Commission | Amendment |
| --- | --- |
| 7.
     
  The decision shall be deemed to have been adopted by the Council, unless it decides, by qualified majority, to reject the Commission proposal within one month of its adoption by the Commission. | Deleted |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

7.
     
  The decision shall be deemed to have been adopted by the Council, unless it decides, by qualified majority, to reject the Commission proposal within one month of its adoption by the Commission.

Deleted

Deleted

Amendment 61

Amendment 61

Proposal for a regulation

Proposal for a regulation

Article 5 — paragraph 8

Article 5 — paragraph 8

| Text proposed by the Commission | Amendment |
| --- | --- |
| 8.
     
  The Council, acting by a qualified majority, may amend the Commission’s proposal and adopt the amended text as a Council decision. | deleted |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

8.
     
  The Council, acting by a qualified majority, may amend the Commission’s proposal and adopt the amended text as a Council decision.

deleted

deleted

Amendment 62

Amendment 62

Proposal for a regulation

Proposal for a regulation

Article 6 — paragraph 1

Article 6 — paragraph 1

| Text proposed by the Commission | Amendment |
| --- | --- |
| 1.   The Member State concerned may, at any time, submit to the Commission evidence to show that the generalised deficiency as regards the rule of law has been remedied or has ceased to exist. | 1.   The Member State concerned may, at any time, submit to the Commission
  a formal notification including
  evidence to show that the generalised deficiency as regards the rule of law has been remedied or has ceased to exist. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

1.   The Member State concerned may, at any time, submit to the Commission evidence to show that the generalised deficiency as regards the rule of law has been remedied or has ceased to exist.

1.   The Member State concerned may, at any time, submit to the Commission
  a formal notification including
  evidence to show that the generalised deficiency as regards the rule of law has been remedied or has ceased to exist.

Amendment 63

Amendment 63

Proposal for a regulation

Proposal for a regulation

Article 6 — paragraph 2

Article 6 — paragraph 2

| Text proposed by the Commission | Amendment |
| --- | --- |
| 2.   The Commission shall assess the situation in the Member State concerned. Once the generalised deficiencies as regards the rule of law which on the grounds of which the
  appropriate
  measures were adopted cease to exist in full or in part, the Commission shall
  submit to the Council a proposal for
  a decision lifting those measures in full or in part. The procedure set out in paragraphs 2, 4, 5, 6
  and 7
  of Article 5 shall apply. | 2.   
  At the request of the Member State concerned or on its own initiative,
  the Commission
  , taking into account any opinions of the Panel,
  shall assess the situation in the Member State concerned
  within an indicative time limit of one month, and in any case within a reasonable timeframe from the date of receipt of the formal notification
  . Once the generalised deficiencies as regards the rule of law which on the grounds of which the measures
  referred to in Article 4
  were adopted cease to exist in full or in part, the Commission shall
  , without delay, adopt
  a decision lifting those measures in full or in part.
  At the same time as it adopts its decision, the Commission shall simultaneously submit to the European Parliament and to the Council a proposal to lift, in full or in part, the budgetary reserve referred to in Article 5(6a).
  The procedure set out in paragraphs 2, 4, 5, 6
  , 6b and 6c
  of Article 5 shall apply. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

2.   The Commission shall assess the situation in the Member State concerned. Once the generalised deficiencies as regards the rule of law which on the grounds of which the
  appropriate
  measures were adopted cease to exist in full or in part, the Commission shall
  submit to the Council a proposal for
  a decision lifting those measures in full or in part. The procedure set out in paragraphs 2, 4, 5, 6
  and 7
  of Article 5 shall apply.

2.   
  At the request of the Member State concerned or on its own initiative,
  the Commission
  , taking into account any opinions of the Panel,
  shall assess the situation in the Member State concerned
  within an indicative time limit of one month, and in any case within a reasonable timeframe from the date of receipt of the formal notification
  . Once the generalised deficiencies as regards the rule of law which on the grounds of which the measures
  referred to in Article 4
  were adopted cease to exist in full or in part, the Commission shall
  , without delay, adopt
  a decision lifting those measures in full or in part.
  At the same time as it adopts its decision, the Commission shall simultaneously submit to the European Parliament and to the Council a proposal to lift, in full or in part, the budgetary reserve referred to in Article 5(6a).
  The procedure set out in paragraphs 2, 4, 5, 6
  , 6b and 6c
  of Article 5 shall apply.

Amendment 64

Amendment 64

Proposal for a regulation

Proposal for a regulation

Article 6 — paragraph 3

Article 6 — paragraph 3

| Text proposed by the Commission | Amendment |
| --- | --- |
| 3.   Where measures concerning the suspension of the approval of one or more programmes or amendments thereof referred to in point (i) of Article 4(2)(b) or the suspension of commitments referred to in point (ii) of Article 4(2)(b) are lifted, amounts corresponding to the suspended commitments shall be entered in the budget subject to Article 7 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation). Suspended commitments of year n may not be entered in the budget beyond year n+2. | 3.   Where measures concerning the suspension of the approval of one or more programmes or amendments thereof referred to in point (i) of Article 4(2)(b) or the suspension of commitments referred to in point (ii) of Article 4(2)(b) are lifted, amounts corresponding to the suspended commitments shall be entered in the budget subject to Article 7 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation). Suspended commitments of year n may not be entered in the budget beyond year n+2.
  As from year n+3, an amount equivalent to the suspended commitments shall be entered in the Union Reserve for Commitments provided for in Article 12 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation). |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

3.   Where measures concerning the suspension of the approval of one or more programmes or amendments thereof referred to in point (i) of Article 4(2)(b) or the suspension of commitments referred to in point (ii) of Article 4(2)(b) are lifted, amounts corresponding to the suspended commitments shall be entered in the budget subject to Article 7 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation). Suspended commitments of year n may not be entered in the budget beyond year n+2.

3.   Where measures concerning the suspension of the approval of one or more programmes or amendments thereof referred to in point (i) of Article 4(2)(b) or the suspension of commitments referred to in point (ii) of Article 4(2)(b) are lifted, amounts corresponding to the suspended commitments shall be entered in the budget subject to Article 7 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation). Suspended commitments of year n may not be entered in the budget beyond year n+2.
  As from year n+3, an amount equivalent to the suspended commitments shall be entered in the Union Reserve for Commitments provided for in Article 12 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation).

Amendment 65

Amendment 65

Proposal for a regulation

Proposal for a regulation

Article 7

Article 7

| Text proposed by the Commission | Amendment |
| --- | --- |
| Article 7 | deleted |
| Information of the European Parliament | |
| The Commission shall immediately inform the European Parliament of any measures proposed or adopted pursuant to Articles 4 and 5 | |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

Article 7

Article 7

deleted

deleted

Information of the European Parliament

Information of the European Parliament

The Commission shall immediately inform the European Parliament of any measures proposed or adopted pursuant to Articles 4 and 5

The Commission shall immediately inform the European Parliament of any measures proposed or adopted pursuant to Articles 4 and 5

Amendment 66

Amendment 66

Proposal for a regulation

Proposal for a regulation

Article 7 a (new)

Article 7 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | Article 7a




  Reporting




  The Commission shall report to the European Parliament and the Council on the application of this Regulation, in particular on the effectiveness of the measures adopted, if any, at the latest five years after its entry into force.




  The report shall be accompanied where necessary by appropriate proposals. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

Article 7a

Reporting

The Commission shall report to the European Parliament and the Council on the application of this Regulation, in particular on the effectiveness of the measures adopted, if any, at the latest five years after its entry into force.

The report shall be accompanied where necessary by appropriate proposals.

Amendment 67

Amendment 67

Proposal for a regulation

Proposal for a regulation

Article 8 — paragraph 1

Article 8 — paragraph 1

| Text proposed by the Commission | Amendment |
| --- | --- |
| This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
  It shall apply from 1 January 2021. | This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
  It shall apply from 1 January 2021.

It shall apply from 1 January 2021.

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

Amendment 68

Amendment 68

Proposal for a regulation

Proposal for a regulation

Article 8 a (new)

Article 8 a (new)

| Text proposed by the Commission | Amendment |
| --- | --- |
| | Article 8 a




  Inclusion in the Financial Regulation




  The contents of this Regulation shall be inserted into the Financial Regulation upon its next revision. |

Text proposed by the Commission

Text proposed by the Commission

Amendment

Amendment

Article 8 a

Inclusion in the Financial Regulation

The contents of this Regulation shall be inserted into the Financial Regulation upon its next revision.

---

(1)  The matter was referred back for interinstitutional negotiations to the committees responsible, pursuant to Rule 59(4), fourth subparagraph (A8-0469/2018).

1

(7)  Judgment of the Court of Justice of 29 April 2004, CAS Succhi di Frutta, C-496/99 PECLI:EU:C:2004:236, paragraph 63.

7

(8)  Judgment of the Court of Justice of 12 November 1981, Amministrazione delle finanze dello Stato v Srl Meridionale Industria Salumi and others Ditta Italo Orlandi & Figlio and Ditta Vincenzo Divella v Amministrazione delle finanze dello Stato. Joined cases 212 to 217/80, ECLI:EU:C:1981:270, paragraph 10.

8

(9)  Judgment of the Court of Justice of 21 September 1989, Hoechst, Joined cases 46/87 and 227/88, ECLI:EU:C:1989:337, paragraph 19.

9

(10)  Judgment of the Court of Justice of 10 November 2016, Kovalkovas, C-477/16, ECLI:EU:C:2016:861, paragraph 36; Judgment of the Court of Justice of 10 November 2016, PPU Poltorak, C-452/16, ECLI:EU:C:2016:858, paragraph 35; and Judgment of the Court of Justice of 22 December 2010, DEB, C-279/09, ECLI:EU:C:2010:811, paragraph 58.

10

(11)  Judgment of the Court of Justice of 27 February 2018, Associação Sindical dos Juízes Portugueses v Tribunal de Contas C-64/16, ECLI:EU:C:2018:117, paragraphs 31, 40-41.

11

(12)  Communication from the Commission ‘A new EU Framework to strengthen the Rule of Law’, COM(2014)0158, Annex I.

12

(7)  Judgment of the Court of Justice of 29 April 2004, CAS Succhi di Frutta, C-496/99 PECLI:EU:C:2004:236, paragraph 63.

7

(8)  Judgment of the Court of Justice of 12 November 1981, Amministrazione delle finanze dello Stato v Srl Meridionale Industria Salumi and others Ditta Italo Orlandi & Figlio and Ditta Vincenzo Divella v Amministrazione delle finanze dello Stato. Joined cases 212 to 217/80, ECLI:EU:C:1981:270, paragraph 10.

8

(9)  Judgment of the Court of Justice of 21 September 1989, Hoechst, Joined cases 46/87 and 227/88, ECLI:EU:C:1989:337, paragraph 19.

9

(10)  Judgment of the Court of Justice of 10 November 2016, Kovalkovas, C-477/16, ECLI:EU:C:2016:861, paragraph 36; Judgment of the Court of Justice of 10 November 2016, PPU Poltorak, C-452/16, ECLI:EU:C:2016:858, paragraph 35; and Judgment of the Court of Justice of 22 December 2010, DEB, C-279/09, ECLI:EU:C:2010:811, paragraph 58.

10

(11)  Judgment of the Court of Justice of 27 February 2018, Associação Sindical dos Juízes Portugueses v Tribunal de Contas C-64/16, ECLI:EU:C:2018:117, paragraphs 31, 40-41
  ; judgment of the Court of Justice of 25 July 2018, LM, C-216/18 PPU, ECLI:EU:C:2018:586, paragraphs 63-67
  .

11

; judgment of the Court of Justice of 25 July 2018, LM, C-216/18 PPU, ECLI:EU:C:2018:586, paragraphs 63-67

(12)  Communication from the Commission ‘A new EU Framework to strengthen the Rule of Law’, COM(2014)0158, Annex I.

12

(12a)  
  Report of the Venice Commission of 4 April 2011 Study No. 512/2009 (CDL-AD(2011)003rev).

12a

Report of the Venice Commission of 4 April 2011 Study No. 512/2009 (CDL-AD(2011)003rev).

(1a)  
  Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012 (OJ L 193, 30.7.2018, p. 1).

1a

Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012 (OJ L 193, 30.7.2018, p. 1).

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