# Official Journal C 7E/2011

| | ISSN 1725-2423
  doi:10.3000/17252423.CE2011.007.eng |
| --- | --- |
| Official Journal
  of the European Union | C 7E |
| | |
| English edition | Information and Notices | Volume 5412 January 2011 |

ISSN 1725-2423

doi:10.3000/17252423.CE2011.007.eng

Official Journal

of the European Union

C 7E

English edition

Information and Notices

Volume 5412 January 2011

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| Notice No | Contents | page |
| --- | --- | --- |
| | III   Preparatory acts |
| | COUNCIL |
| 2011/C 007E/01 | Position (EU) No 1/2011 of the Council at first Reading with a view to the adoption of a Regulation of the European Parliament and of the Council amending Council Regulation (EC) No 1934/2006 establishing a financing instrument for cooperation with industrialised and other high-income countries and territoriesAdopted by the Council on 10 December 2010 | 1 |
| 2011/C 007E/02 | Position (EU) No 2/2011 of the Council at first reading with a view to the adoption of a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperationAdopted by the Council on 10 December 2010 | 11 |
| 2011/C 007E/03 | Position (EU) No 3/2011 of the Council at first reading with a view to the adoption of a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1889/2006 on establishing a financing instrument for the promotion of democracy and human rights worldwideAdopted by the Council on 10 December 2010 | 14 |
| 2011/C 007E/04 | Position (EU) No 4/2011 of the Council at first reading with a view to the adoption of a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperationAdopted by the Council on 10 December 2010 | 17 |

Notice No

Contents

page

III   Preparatory acts

COUNCIL

2011/C 007E/01

Position (EU) No 1/2011 of the Council at first Reading with a view to the adoption of a Regulation of the European Parliament and of the Council amending Council Regulation (EC) No 1934/2006 establishing a financing instrument for cooperation with industrialised and other high-income countries and territoriesAdopted by the Council on 10 December 2010

1

2011/C 007E/02

Position (EU) No 2/2011 of the Council at first reading with a view to the adoption of a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperationAdopted by the Council on 10 December 2010

11

2011/C 007E/03

Position (EU) No 3/2011 of the Council at first reading with a view to the adoption of a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1889/2006 on establishing a financing instrument for the promotion of democracy and human rights worldwideAdopted by the Council on 10 December 2010

14

2011/C 007E/04

Position (EU) No 4/2011 of the Council at first reading with a view to the adoption of a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperationAdopted by the Council on 10 December 2010

17

| EN | |
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EN

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III Preparatory acts

COUNCIL

| 12.1.2011 | EN | Official Journal of the European Union | CE 7/1 |
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12.1.2011

EN

Official Journal of the European Union

CE 7/1

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POSITION (EU) No 1/2011 OF THE COUNCIL AT FIRST READING

with a view to the adoption of a Regulation of the European Parliament and of the Council amending Council Regulation (EC) No 1934/2006 establishing a financing instrument for cooperation with industrialised and other high-income countries and territories

Adopted by the Council on 10 December 2010

2011/C 7 E/01

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Articles 207(2) and 209(1) thereof,

Having regard to the proposal from the European Commission,

Acting in accordance with the ordinary legislative procedure (1),

Whereas:

| (1) | Since 2007 the Community has streamlined its geographical cooperation with developing countries in Asia, Central Asia, and Latin America and with Iraq, Iran, Yemen, and South Africa under Regulation (EC) No 1905/2006 of the European Parliament and of the Council of 18 December 2006 establishing a financing instrument for development cooperation (2). |
| --- | --- |

(1)

Since 2007 the Community has streamlined its geographical cooperation with developing countries in Asia, Central Asia, and Latin America and with Iraq, Iran, Yemen, and South Africa under Regulation (EC) No 1905/2006 of the European Parliament and of the Council of 18 December 2006 establishing a financing instrument for development cooperation (2).

| (2) | The primary and overarching objective of Regulation (EC) No 1905/2006 is the eradication of poverty through the pursuit of the Millennium Development Goals. The scope of cooperation for the geographic programmes with developing countries, territories and regions established under that Regulation is furthermore limited materially to financing measures designed to fulfil the criteria for Official Development Assistance (ODA criteria) established by the Development Assistance Committee of the Organisation for Economic Cooperation and Development (OECD/DAC). |
| --- | --- |

(2)

The primary and overarching objective of Regulation (EC) No 1905/2006 is the eradication of poverty through the pursuit of the Millennium Development Goals. The scope of cooperation for the geographic programmes with developing countries, territories and regions established under that Regulation is furthermore limited materially to financing measures designed to fulfil the criteria for Official Development Assistance (ODA criteria) established by the Development Assistance Committee of the Organisation for Economic Cooperation and Development (OECD/DAC).

| (3) | It is in the Union’s interests to further deepen its relations with the developing countries concerned, which are important bilateral partners and players in multilateral fora and in global governance. The Union has a strategic interest in promoting diversified links with those countries, in particular in areas such as economic, commercial, academic, business and scientific exchanges. It therefore needs a financial instrument that allows the financing of such measures which, in principle, do not qualify as ODA under the ODA criteria but which are crucially important in terms of consolidating relations and which make an important contribution to promoting the progress of the developing countries concerned. |
| --- | --- |

(3)

It is in the Union’s interests to further deepen its relations with the developing countries concerned, which are important bilateral partners and players in multilateral fora and in global governance. The Union has a strategic interest in promoting diversified links with those countries, in particular in areas such as economic, commercial, academic, business and scientific exchanges. It therefore needs a financial instrument that allows the financing of such measures which, in principle, do not qualify as ODA under the ODA criteria but which are crucially important in terms of consolidating relations and which make an important contribution to promoting the progress of the developing countries concerned.

| (4) | For that purpose, four Preparatory Actions were set up in the 2007 and 2008 budget procedures to initiate such enhanced cooperation in accordance with point (b) of Article 49(6) of Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities (3). Those four Preparatory Actions are: business and scientific exchanges with India; business and scientific exchanges with China; cooperation with middle-income group countries in Asia; and cooperation with middle-income group countries in Latin America. Under that Article the legislative procedure further to Preparatory Actions must be concluded before the end of the third financial year. |
| --- | --- |

(4)

For that purpose, four Preparatory Actions were set up in the 2007 and 2008 budget procedures to initiate such enhanced cooperation in accordance with point (b) of Article 49(6) of Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities (3). Those four Preparatory Actions are: business and scientific exchanges with India; business and scientific exchanges with China; cooperation with middle-income group countries in Asia; and cooperation with middle-income group countries in Latin America. Under that Article the legislative procedure further to Preparatory Actions must be concluded before the end of the third financial year.

| (5) | The objectives and provisions of Regulation (EC) No 1934/2006 (4) are appropriate to pursue such enhanced cooperation with countries falling under Regulation (EC) No 1905/2006. For that purpose, it is necessary to extend the geographical scope of Regulation (EC) No 1934/2006 and to provide for a financial envelope to cover cooperation with those developing countries. |
| --- | --- |

(5)

The objectives and provisions of Regulation (EC) No 1934/2006 (4) are appropriate to pursue such enhanced cooperation with countries falling under Regulation (EC) No 1905/2006. For that purpose, it is necessary to extend the geographical scope of Regulation (EC) No 1934/2006 and to provide for a financial envelope to cover cooperation with those developing countries.

| (6) | Extending the geographical scope of Regulation (EC) No 1934/2006 brings the developing countries concerned within the scope of two different external action financial instruments. Care should be taken to ensure that these two financial instruments are kept strictly separate from each other. Measures which fulfil the ODA criteria will be financed under Regulation (EC) No 1905/2006, whereas Regulation (EC) No 1934/2006 will apply exclusively to measures which, in principle, do not fulfil those criteria. It is also necessary to ensure that the countries previously falling within the scope of Regulation (EC) No 1934/2006 — industrialised and other high-income countries and territories — are not placed at a disadvantage, particularly in financial terms, by the extension of that Regulation’s geographical scope. |
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(6)

Extending the geographical scope of Regulation (EC) No 1934/2006 brings the developing countries concerned within the scope of two different external action financial instruments. Care should be taken to ensure that these two financial instruments are kept strictly separate from each other. Measures which fulfil the ODA criteria will be financed under Regulation (EC) No 1905/2006, whereas Regulation (EC) No 1934/2006 will apply exclusively to measures which, in principle, do not fulfil those criteria. It is also necessary to ensure that the countries previously falling within the scope of Regulation (EC) No 1934/2006 — industrialised and other high-income countries and territories — are not placed at a disadvantage, particularly in financial terms, by the extension of that Regulation’s geographical scope.

| (7) | Since the economic crisis has placed budgets under extreme strain throughout the Union and the proposed extension embraces countries which sometimes demonstrate a similar level of competitiveness to that of the Union and have attained an average standard of living which approaches that of some Member States, the Union’s cooperation should take into consideration efforts made by the recipient countries to comply with the International Labour Organisation international agreements and to participate in the general objectives of greenhouse gas emissions reduction. |
| --- | --- |

(7)

Since the economic crisis has placed budgets under extreme strain throughout the Union and the proposed extension embraces countries which sometimes demonstrate a similar level of competitiveness to that of the Union and have attained an average standard of living which approaches that of some Member States, the Union’s cooperation should take into consideration efforts made by the recipient countries to comply with the International Labour Organisation international agreements and to participate in the general objectives of greenhouse gas emissions reduction.

| (8) | The review of implementation of the external action financial instruments has identified inconsistencies in the provisions that exclude costs relating to taxes, duties or other charges as ineligible. For the sake of consistency, it is proposed to bring those provisions into line with the other instruments. |
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(8)

The review of implementation of the external action financial instruments has identified inconsistencies in the provisions that exclude costs relating to taxes, duties or other charges as ineligible. For the sake of consistency, it is proposed to bring those provisions into line with the other instruments.

| (9) | Regulation (EC) No 1934/2006 should therefore be amended accordingly, |
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(9)

Regulation (EC) No 1934/2006 should therefore be amended accordingly,

HAVE ADOPTED THIS REGULATION:

Article 1

Regulation (EC) No 1934/2006 is hereby amended as follows:

| 1. | the title of the Regulation is replaced by the following: |
| --- | --- |

1.

the title of the Regulation is replaced by the following:

| 2. | Articles 1 to 4 are replaced by the following:
  ‘Article 1
  Objective
  1.   For the purpose of this Regulation, “industrialised and other high-income countries and territories” shall comprise countries and territories listed in Annex I to this Regulation and “developing countries” shall comprise countries falling under Regulation (EC) No 1905/2006 of the European Parliament and of the Council of 18 December 2006 establishing a financing instrument for development cooperation (5) and listed in Annex II to this Regulation. They are together hereinafter referred to as “partner countries”.
  Union financing under this Regulation shall support economic, financial, technical, cultural and academic cooperation with partner countries in the areas set out in Article 4, falling within its spheres of competence. This Regulation shall serve to finance measures which, in principle, do not fulfil the criteria for Official Development Assistance (ODA criteria) established by the Development Assistance Committee of the Organisation for Economic Cooperation and Development (OECD/DAC).
  2.   The primary objective of cooperation with partner countries shall be to provide a specific response to the need to strengthen links and to engage further with them on a bilateral, regional or multilateral basis in order to create a more favourable and transparent environment for the development of relations between the Union and partner countries in accordance with the principles guiding the Union’s external action as laid down in the Treaty. This refers amongst others to the promotion of democracy, respect for human rights and fundamental freedoms, the rule of law, as well as decent work, good governance, and the preservation of the environment, in order to contribute to progress and sustainable development processes in the partner countries.
  Article 2
  Scope
  1.   Cooperation shall be aimed at engaging with partner countries in order to enhance dialogue and rapprochement and to share and promote similar political, economic and institutional structures and values. The Union shall also aim at increasing cooperation and exchanges with established or increasingly important bilateral partners and players in multilateral fora and in global governance. The cooperation also covers partners with which the Union has a strategic interest in promoting links and its values as laid down in the Treaty.
  2.   In duly justified circumstances and in order to ensure the coherence and effectiveness of Union financing and to foster regional cooperation, the Commission may decide when adopting annual action programmes referred to in Article 6 that countries not listed in the Annexes are eligible for measures under this Regulation, where the project or programme to be implemented is of a regional or cross-border nature. Provisions shall be made for this in the multiannual cooperation programmes referred to in Article 5.
  3.   The Commission shall amend the lists in Annexes I and II following the regular OECD/DAC reviews of its list of developing countries, and shall inform the European Parliament and the Council thereof.
  4.   For Union financing under this Regulation, particular attention shall be paid where appropriate to the compliance of the partner countries with the core labour standards of the International Labour Organisation and to their efforts to pursue reductions of greenhouse gas emissions.
  5.   In relation to countries listed in Annex II to this Regulation, policy coherence with measures financed under Regulation (EC) No 1905/2006 and Regulation (EC) No 1337/2008 of the European Parliament and of the Council of 16 December 2008 establishing a facility for rapid response to soaring food prices in developing countries (6) shall be strictly observed.
  Article 3
  General principles
  1.   The Union is founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms and the rule of law and seeks to promote, develop and consolidate commitment to those principles in partner countries through dialogue and cooperation.
  2.   In the implementation of this Regulation a differentiated approach in designing cooperation with partner countries shall be pursued, where appropriate, to take account of their economic, social and political contexts as well as of the Union’s specific interests, strategies and priorities.
  3.   Measures financed under this Regulation shall be consistent with and cover areas of cooperation set out notably in the instruments, agreements, declarations and action plans between the Union and the partner countries, as well as areas pertaining to the Union’s specific interests and priorities.
  4.   For measures financed under this Regulation, the Union shall aim to ensure coherence with other areas of its external action as well as with other relevant Union policies, in particular development cooperation. This shall be ensured by formulating policy, strategic planning and the programming and implementation of measures.
  5.   Measures financed under this Regulation shall complement and bring added value to the efforts undertaken by Member States and Union public bodies in the area of commercial relations and cultural, academic and scientific exchanges.
  6.   The Commission shall inform and have regular exchanges of views with the European Parliament.
  Article 4
  Areas of cooperation
  Union financing shall support cooperation actions in accordance with Article 1 and shall be consistent with the overall purpose, scope, objectives and general principles of this Regulation. Union financing shall cover actions that, in principle, do not fulfil the ODA criteria, and which may include a regional dimension, in the following areas of cooperation:






  1. | the promotion of cooperation, partnerships and joint undertakings between economic, social, cultural, academic and scientific actors in the Union and partner countries; |
| --- | --- | --- |

2.

Articles 1 to 4 are replaced by the following:

‘Article 1

Objective

1.   For the purpose of this Regulation, “industrialised and other high-income countries and territories” shall comprise countries and territories listed in Annex I to this Regulation and “developing countries” shall comprise countries falling under Regulation (EC) No 1905/2006 of the European Parliament and of the Council of 18 December 2006 establishing a financing instrument for development cooperation (5) and listed in Annex II to this Regulation. They are together hereinafter referred to as “partner countries”.

Union financing under this Regulation shall support economic, financial, technical, cultural and academic cooperation with partner countries in the areas set out in Article 4, falling within its spheres of competence. This Regulation shall serve to finance measures which, in principle, do not fulfil the criteria for Official Development Assistance (ODA criteria) established by the Development Assistance Committee of the Organisation for Economic Cooperation and Development (OECD/DAC).

2.   The primary objective of cooperation with partner countries shall be to provide a specific response to the need to strengthen links and to engage further with them on a bilateral, regional or multilateral basis in order to create a more favourable and transparent environment for the development of relations between the Union and partner countries in accordance with the principles guiding the Union’s external action as laid down in the Treaty. This refers amongst others to the promotion of democracy, respect for human rights and fundamental freedoms, the rule of law, as well as decent work, good governance, and the preservation of the environment, in order to contribute to progress and sustainable development processes in the partner countries.

Article 2

Scope

1.   Cooperation shall be aimed at engaging with partner countries in order to enhance dialogue and rapprochement and to share and promote similar political, economic and institutional structures and values. The Union shall also aim at increasing cooperation and exchanges with established or increasingly important bilateral partners and players in multilateral fora and in global governance. The cooperation also covers partners with which the Union has a strategic interest in promoting links and its values as laid down in the Treaty.

2.   In duly justified circumstances and in order to ensure the coherence and effectiveness of Union financing and to foster regional cooperation, the Commission may decide when adopting annual action programmes referred to in Article 6 that countries not listed in the Annexes are eligible for measures under this Regulation, where the project or programme to be implemented is of a regional or cross-border nature. Provisions shall be made for this in the multiannual cooperation programmes referred to in Article 5.

3.   The Commission shall amend the lists in Annexes I and II following the regular OECD/DAC reviews of its list of developing countries, and shall inform the European Parliament and the Council thereof.

4.   For Union financing under this Regulation, particular attention shall be paid where appropriate to the compliance of the partner countries with the core labour standards of the International Labour Organisation and to their efforts to pursue reductions of greenhouse gas emissions.

5.   In relation to countries listed in Annex II to this Regulation, policy coherence with measures financed under Regulation (EC) No 1905/2006 and Regulation (EC) No 1337/2008 of the European Parliament and of the Council of 16 December 2008 establishing a facility for rapid response to soaring food prices in developing countries (6) shall be strictly observed.

Article 3

General principles

1.   The Union is founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms and the rule of law and seeks to promote, develop and consolidate commitment to those principles in partner countries through dialogue and cooperation.

2.   In the implementation of this Regulation a differentiated approach in designing cooperation with partner countries shall be pursued, where appropriate, to take account of their economic, social and political contexts as well as of the Union’s specific interests, strategies and priorities.

3.   Measures financed under this Regulation shall be consistent with and cover areas of cooperation set out notably in the instruments, agreements, declarations and action plans between the Union and the partner countries, as well as areas pertaining to the Union’s specific interests and priorities.

4.   For measures financed under this Regulation, the Union shall aim to ensure coherence with other areas of its external action as well as with other relevant Union policies, in particular development cooperation. This shall be ensured by formulating policy, strategic planning and the programming and implementation of measures.

5.   Measures financed under this Regulation shall complement and bring added value to the efforts undertaken by Member States and Union public bodies in the area of commercial relations and cultural, academic and scientific exchanges.

6.   The Commission shall inform and have regular exchanges of views with the European Parliament.

Article 4

Areas of cooperation

Union financing shall support cooperation actions in accordance with Article 1 and shall be consistent with the overall purpose, scope, objectives and general principles of this Regulation. Union financing shall cover actions that, in principle, do not fulfil the ODA criteria, and which may include a regional dimension, in the following areas of cooperation:

1.

the promotion of cooperation, partnerships and joint undertakings between economic, social, cultural, academic and scientific actors in the Union and partner countries;

| 2. | the stimulation of bilateral trade, investment flows and economic partnerships, including a focus on small and medium-sized enterprises; |
| --- | --- |

2.

the stimulation of bilateral trade, investment flows and economic partnerships, including a focus on small and medium-sized enterprises;

| 3. | the promotion of dialogues between political, economic, social and cultural actors and other non-governmental organisations in relevant sectors in the Union and partner countries; |
| --- | --- |

3.

the promotion of dialogues between political, economic, social and cultural actors and other non-governmental organisations in relevant sectors in the Union and partner countries;

| 4. | the promotion of people-to-people links, education and training programmes and intellectual exchanges and the enhancement of mutual understanding between cultures, particularly at the family level, including measures to ensure and increase Union participation in Erasmus Mundus and participation in European education fairs; |
| --- | --- |

4.

the promotion of people-to-people links, education and training programmes and intellectual exchanges and the enhancement of mutual understanding between cultures, particularly at the family level, including measures to ensure and increase Union participation in Erasmus Mundus and participation in European education fairs;

| 5. | the promotion of cooperative projects in areas such as research, science and technology, sports and culture, energy (in particular renewable energy), transport, environmental matters (including climate change), customs, financial, legal and human rights issues, and any other matter of mutual interest between the Union and the partner countries; |
| --- | --- |

5.

the promotion of cooperative projects in areas such as research, science and technology, sports and culture, energy (in particular renewable energy), transport, environmental matters (including climate change), customs, financial, legal and human rights issues, and any other matter of mutual interest between the Union and the partner countries;

| 6. | the enhancement of awareness about and understanding of the European Union and of its visibility in partner countries; |
| --- | --- |

6.

the enhancement of awareness about and understanding of the European Union and of its visibility in partner countries;

| 7. | support for specific initiatives, including research work, studies, pilot schemes or joint projects destined to respond in an effective and flexible manner to cooperation objectives arising from developments in the Union’s bilateral relationship with the partner countries or aiming to provide impetus to the further deepening and broadening of bilateral relationships with them. |
| --- | --- |

7.

support for specific initiatives, including research work, studies, pilot schemes or joint projects destined to respond in an effective and flexible manner to cooperation objectives arising from developments in the Union’s bilateral relationship with the partner countries or aiming to provide impetus to the further deepening and broadening of bilateral relationships with them.

| 3. | in Article 5, paragraph 2 is replaced by the following:
  ‘2.   Multiannual cooperation programmes shall cover no more than the period of validity of this Regulation. They shall set out the Union’s specific interests and priorities, the general objectives and the expected results. In particular with regard to Erasmus Mundus, programmes shall aim for the most balanced geographical coverage possible. They shall also set out the areas selected for financing by the Union and outline the indicative financial allocation of funds, overall, per priority area and per partner country or group of partner countries for the period concerned. Where appropriate, this may be given in the form of a range. Multiannual cooperation programmes shall be reviewed at mid-term, or ad hoc if necessary.’; |
| --- | --- |

3.

in Article 5, paragraph 2 is replaced by the following:

‘2.   Multiannual cooperation programmes shall cover no more than the period of validity of this Regulation. They shall set out the Union’s specific interests and priorities, the general objectives and the expected results. In particular with regard to Erasmus Mundus, programmes shall aim for the most balanced geographical coverage possible. They shall also set out the areas selected for financing by the Union and outline the indicative financial allocation of funds, overall, per priority area and per partner country or group of partner countries for the period concerned. Where appropriate, this may be given in the form of a range. Multiannual cooperation programmes shall be reviewed at mid-term, or ad hoc if necessary.’;

| 4. | in Article 6, paragraph 1 is replaced by the following:
  ‘1.   The Commission shall adopt annual action programmes based on the multiannual cooperation programmes referred to in Article 5 and shall transmit them simultaneously to the European Parliament and to the Council.’; |
| --- | --- |

4.

in Article 6, paragraph 1 is replaced by the following:

‘1.   The Commission shall adopt annual action programmes based on the multiannual cooperation programmes referred to in Article 5 and shall transmit them simultaneously to the European Parliament and to the Council.’;

| 5. | Article 7 is amended as follows:






  (a) | the first paragraph becomes paragraph 1; |
| --- | --- | --- |

5.

Article 7 is amended as follows:

(a)

the first paragraph becomes paragraph 1;

| (b) | points (e) and (f) of paragraph 1 are replaced by the following:






  ‘(e) | joint bodies set up by the partner countries and regions and the Union; |
| --- | --- | --- |

(b)

points (e) and (f) of paragraph 1 are replaced by the following:

‘(e)

joint bodies set up by the partner countries and regions and the Union;

| (f) | Union institutions and bodies, in so far as they implement support measures specified in Article 9;’; |
| --- | --- |

(f)

Union institutions and bodies, in so far as they implement support measures specified in Article 9;’;

| (c) | the following paragraphs are added:
  ‘2.   Measures covered by Council Regulation (EC) No 1257/96 of 20 June 1996 concerning humanitarian aid (7), Regulation (EC) No 1717/2006 of the European Parliament and of the Council of 15 November 2006 establishing an Instrument for Stability (8) or Regulation (EC) No 1905/2006, and eligible for funding thereunder shall not be funded under this Regulation.
  3.   Union financing under this Regulation shall not be used to finance the procurement of arms or ammunition, nor operations having military or defence implications. |
| --- | --- |

(c)

the following paragraphs are added:

‘2.   Measures covered by Council Regulation (EC) No 1257/96 of 20 June 1996 concerning humanitarian aid (7), Regulation (EC) No 1717/2006 of the European Parliament and of the Council of 15 November 2006 establishing an Instrument for Stability (8) or Regulation (EC) No 1905/2006, and eligible for funding thereunder shall not be funded under this Regulation.

3.   Union financing under this Regulation shall not be used to finance the procurement of arms or ammunition, nor operations having military or defence implications.

| 6. | in Article 8, paragraph 3 is replaced by the following:
  ‘3.   Union financing shall, in principle, not be used for paying taxes, duties or charges in the partner countries.’; |
| --- | --- |

6.

in Article 8, paragraph 3 is replaced by the following:

‘3.   Union financing shall, in principle, not be used for paying taxes, duties or charges in the partner countries.’;

| 7. | Article 9 is amended as follows:






  (a) | paragraph 1 is replaced by the following:
  ‘1.   Union financing may cover expenditure associated with the preparation, follow up, monitoring, audit and evaluation activities directly necessary for the implementation of this Regulation and the achievement of its objectives, and any other administrative or technical assistance expenditure that the Commission, including its Delegations in the partner countries, may incur for the management of operations financed under this Regulation.’; |
| --- | --- | --- |

7.

Article 9 is amended as follows:

(a)

paragraph 1 is replaced by the following:

‘1.   Union financing may cover expenditure associated with the preparation, follow up, monitoring, audit and evaluation activities directly necessary for the implementation of this Regulation and the achievement of its objectives, and any other administrative or technical assistance expenditure that the Commission, including its Delegations in the partner countries, may incur for the management of operations financed under this Regulation.’;

| (b) | paragraph 3 is replaced by the following:
  ‘3.   The Commission shall adopt support measures not covered by the multi-annual cooperation programmes and shall transmit them simultaneously to the European Parliament and to the Council.’; |
| --- | --- |

(b)

paragraph 3 is replaced by the following:

‘3.   The Commission shall adopt support measures not covered by the multi-annual cooperation programmes and shall transmit them simultaneously to the European Parliament and to the Council.’;

| 8. | Article 12 is amended as follows:






  (a) | the title is replaced by the following:
  ‘Protecting the Union’s financial interests’; |
| --- | --- | --- |

8.

Article 12 is amended as follows:

(a)

the title is replaced by the following:

‘Protecting the Union’s financial interests’;

| (b) | paragraphs 1 and 2 are replaced by the following:
  ‘1.   Any agreements resulting from this Regulation shall contain provisions ensuring the protection of the Union’s financial interests, in particular with respect to irregularities, fraud, corruption and any other illegal activity, in accordance with Council Regulations (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European Communities financial interests (9) and (Euratom, EC) No 2185/96 of 11 November 1996 concerning on-the-spot checks and inspections carried out by the Commission in order to protect the European Communities’ financial interests against fraud and other irregularities (10) and Regulation (EC) No 1073/1999 of the European Parliament and of the Council of 25 May 1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) (11).
  2.   Agreements shall expressly entitle the Commission and the Court of Auditors to perform audits, including document audits or on-the-spot audits of any contractor or subcontractor who has received Union funds. They shall also expressly authorise the Commission to carry out on-the-spot checks and inspections in accordance with Regulation (Euratom, EC) No 2185/96. |
| --- | --- |

(b)

paragraphs 1 and 2 are replaced by the following:

‘1.   Any agreements resulting from this Regulation shall contain provisions ensuring the protection of the Union’s financial interests, in particular with respect to irregularities, fraud, corruption and any other illegal activity, in accordance with Council Regulations (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European Communities financial interests (9) and (Euratom, EC) No 2185/96 of 11 November 1996 concerning on-the-spot checks and inspections carried out by the Commission in order to protect the European Communities’ financial interests against fraud and other irregularities (10) and Regulation (EC) No 1073/1999 of the European Parliament and of the Council of 25 May 1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) (11).

2.   Agreements shall expressly entitle the Commission and the Court of Auditors to perform audits, including document audits or on-the-spot audits of any contractor or subcontractor who has received Union funds. They shall also expressly authorise the Commission to carry out on-the-spot checks and inspections in accordance with Regulation (Euratom, EC) No 2185/96.

| 9. | Articles 13 and 14 are replaced by the following:
  ‘Article 13
  Evaluation
  1.   The Commission shall regularly evaluate the actions and programmes financed under this Regulation, where appropriate or at the request of the European Parliament or the Council, by means of independent external evaluations, in order to ascertain whether the objectives have been met and to enable it to formulate recommendations with a view to improving future operations. The results shall feed back into programme design and resource allocation.
  2.   The Commission shall send the evaluation reports referred to in paragraph 1 to the European Parliament and to the Committee referred to in Article 15(1) for information.
  3.   The Commission shall associate relevant stakeholders, including non-State actors, in the evaluation phase of the Union cooperation provided for under this Regulation.
  Article 14
  Annual report
  The Commission shall examine the progress made on implementing the measures taken under this Regulation and shall submit to the European Parliament and the Council a detailed annual report on the implementation of this Regulation. The report shall set out the results of implementation of the budget and present all the actions and programmes financed, and as far as possible, set out the main outcomes and impacts of the cooperation actions and programmes.’; |
| --- | --- |

9.

Articles 13 and 14 are replaced by the following:

‘Article 13

Evaluation

1.   The Commission shall regularly evaluate the actions and programmes financed under this Regulation, where appropriate or at the request of the European Parliament or the Council, by means of independent external evaluations, in order to ascertain whether the objectives have been met and to enable it to formulate recommendations with a view to improving future operations. The results shall feed back into programme design and resource allocation.

2.   The Commission shall send the evaluation reports referred to in paragraph 1 to the European Parliament and to the Committee referred to in Article 15(1) for information.

3.   The Commission shall associate relevant stakeholders, including non-State actors, in the evaluation phase of the Union cooperation provided for under this Regulation.

Article 14

Annual report

The Commission shall examine the progress made on implementing the measures taken under this Regulation and shall submit to the European Parliament and the Council a detailed annual report on the implementation of this Regulation. The report shall set out the results of implementation of the budget and present all the actions and programmes financed, and as far as possible, set out the main outcomes and impacts of the cooperation actions and programmes.’;

| 10. | Article 16 is replaced by the following:
  ‘Article 16
  Financial provisions
  The financial reference amount for the implementation of this Regulation for the period from 2007 to 2013 shall be EUR 172 million for countries listed in Annex I and EUR 176 million for countries listed in Annex II. The annual appropriations shall be authorised by the budgetary authority within the limits of the financial framework.’; |
| --- | --- |

10.

Article 16 is replaced by the following:

‘Article 16

Financial provisions

The financial reference amount for the implementation of this Regulation for the period from 2007 to 2013 shall be EUR 172 million for countries listed in Annex I and EUR 176 million for countries listed in Annex II. The annual appropriations shall be authorised by the budgetary authority within the limits of the financial framework.’;

| 11. | in the Annex, the title is replaced by the following:

  List of industrialised and other high-income countries and territories covered by this Regulation’; |
| --- | --- |

11.

in the Annex, the title is replaced by the following:

List of industrialised and other high-income countries and territories covered by this Regulation’;

| 12. | a new Annex II, the text of which is set out in the Annex to this Regulation, is added. |
| --- | --- |

12.

a new Annex II, the text of which is set out in the Annex to this Regulation, is added.

Article 2

Entry into force

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

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

Done at ... .

For the European Parliament

The President

...

For the Council

The President

...

---

(1)  Position of the European Parliament of 21 October 2010 (not yet published in the Official Journal) and position of the Council at first reading of 10 December 2010.

1

(2)  OJ L 378, 27.12.2006, p. 41.

2

(3)  OJ L 248, 16.9.2002, p. 1.

3

(4)  OJ L 405, 30.12.2006, p. 41.

4

(5)  OJ L 378, 27.12.2006, p. 41.

5

(6)  OJ L 354, 31.12.2008, p. 62.’;

6

(7)  OJ L 163, 2.7.1996. p. 1.

7

(8)  OJ L 327, 24.11.2006, p. 1.’;

8

(9)  OJ L 312, 23.12.1995, p. 1.

9

(10)  OJ L 292, 15.11.1996, p. 2.

10

(11)  OJ L 136, 31.5.1999, p. 1.’;

11

---

ANNEX

‘ANNEX II

List of developing countries covered by this Regulation

Latin America

| 1. | Argentina |
| --- | --- |

1.

Argentina

| 2. | Bolivia |
| --- | --- |

2.

Bolivia

| 3. | Brazil |
| --- | --- |

3.

Brazil

| 4. | Chile |
| --- | --- |

4.

Chile

| 5. | Colombia |
| --- | --- |

5.

Colombia

| 6. | Costa Rica |
| --- | --- |

6.

Costa Rica

| 7. | Cuba |
| --- | --- |

7.

Cuba

| 8. | Ecuador |
| --- | --- |

8.

Ecuador

| 9. | El Salvador |
| --- | --- |

9.

El Salvador

| 10. | Guatemala |
| --- | --- |

10.

Guatemala

| 11. | Honduras |
| --- | --- |

11.

Honduras

| 12. | Mexico |
| --- | --- |

12.

Mexico

| 13. | Nicaragua |
| --- | --- |

13.

Nicaragua

| 14. | Panama |
| --- | --- |

14.

Panama

| 15. | Paraguay |
| --- | --- |

15.

Paraguay

| 16. | Peru |
| --- | --- |

16.

Peru

| 17. | Uruguay |
| --- | --- |

17.

Uruguay

| 18. | Venezuela |
| --- | --- |

18.

Venezuela

Asia

| 19. | Afghanistan |
| --- | --- |

19.

Afghanistan

| 20. | Bangladesh |
| --- | --- |

20.

Bangladesh

| 21. | Bhutan |
| --- | --- |

21.

Bhutan

| 22. | Burma/Myanmar |
| --- | --- |

22.

Burma/Myanmar

| 23. | Cambodia |
| --- | --- |

23.

Cambodia

| 24. | China |
| --- | --- |

24.

China

| 25. | India |
| --- | --- |

25.

India

| 26. | Indonesia |
| --- | --- |

26.

Indonesia

| 27. | Democratic People’s Republic of Korea |
| --- | --- |

27.

Democratic People’s Republic of Korea

| 28. | Laos |
| --- | --- |

28.

Laos

| 29. | Malaysia |
| --- | --- |

29.

Malaysia

| 30. | Maldives |
| --- | --- |

30.

Maldives

| 31. | Mongolia |
| --- | --- |

31.

Mongolia

| 32. | Nepal |
| --- | --- |

32.

Nepal

| 33. | Pakistan |
| --- | --- |

33.

Pakistan

| 34. | Philippines |
| --- | --- |

34.

Philippines

| 35. | Sri Lanka |
| --- | --- |

35.

Sri Lanka

| 36. | Thailand |
| --- | --- |

36.

Thailand

| 37. | Vietnam |
| --- | --- |

37.

Vietnam

Central Asia

| 38. | Kazakhstan |
| --- | --- |

38.

Kazakhstan

| 39. | Kyrgyz Republic |
| --- | --- |

39.

Kyrgyz Republic

| 40. | Tajikistan |
| --- | --- |

40.

Tajikistan

| 41. | Turkmenistan |
| --- | --- |

41.

Turkmenistan

| 42. | Uzbekistan |
| --- | --- |

42.

Uzbekistan

Middle East

| 43. | Iran |
| --- | --- |

43.

Iran

| 44. | Iraq |
| --- | --- |

44.

Iraq

| 45. | Yemen |
| --- | --- |

45.

Yemen

South Africa

| 46. | South Africa’ |
| --- | --- |

46.

South Africa’

---

STATEMENT OF THE COUNCIL’S REASONS

I.   INTRODUCTION

On 21 April 2009, the Commission adopted its proposal (1) for a Regulation amending Regulation (EC) No 1934/2006 establishing a financing instrument for cooperation with industrialised and other high-income countries and territories (ICI).

The European Parliament adopted its first reading opinion on 21 October 2010.

The Council adopted its position at first reading on 10 December 2010.

II.   OBJECTIVE

The proposal was presented as part of the mid-term review of the external action financial instruments. The main objective is to extend the scope of the initial Regulation to a number of countries covered by Regulation (EC) No 1905/2006 of 18 December 2006 establishing the Development Cooperation Instrument (DCI) and to provide a proper legislative basis to activities which, since they do not constitute Official Development Assistance as defined by the OECD, are excluded by the scope of the DCI Regulation. The amended ICI Regulation will thus allow strengthening links and engaging further with important global emerging partners with whom the European Union has a strategic interest in promoting diversified links and creating a more favourable environment for the development of the relations. It will also provide the basis for activities with middle-income countries interested in engaging in economic, commercial, academic, business and scientific exchanges with the European Union.

III.   ANALYSIS OF THE COUNCIL'S POSITION AT FIRST READING

General observations

The proposal was presented by the Commission under the provisions of the Nice Treaty, requiring the European Parliament to be consulted. With the entry into force of the Lisbon Treaty on 1st December 2009, the legal basis implied application of the ordinary legislative procedure. With these changes in mind the Council reached out to the European Parliament at an early stage of the legislative process and engaged into substantial negotiations between the institutions. This resulted in a large degree of convergence on many amendments put forward by the European Parliament in its first reading, enabling the Council to incorporate a large number of the European Parliament’s first-reading amendments into its first reading position.

However, the Council cannot follow the European Parliament in two points: the application of the procedure of the delegated acts (Article 290 TFEU) and the amendments to Article 16 regarding the financial provisions.

Specific comments

(1)   Delegated acts (Article 290 TFEU)

The European Parliament adopted several amendments which introduce the application of the procedure of the delegated acts for the adoption of multiannual cooperation programmes (multiannual strategy papers). This is not acceptable for the Council. The Council believes that the multiannual cooperation programmes, not being legally binding acts, do not constitute acts of general application, supplementing or amending the basic act. They constitute implementing measures within the meaning of Article 291 TFEU.

(2)   Article 16 on the financial provisions

The amendments adopted by the European Parliament in Article 16 are not acceptable for the Council. While similar concerns were voiced in the Council regarding the programming of financial appropriations and possible transfers between budget lines, the Council is of the opinion that these matters are to be decided by the two budgetary branches — the Council and the European Parliament — in the framework of the annual budgetary procedure and should not be part of the legislative text. The Council thus prefers the text as proposed initially by the Commission, assorted with a declaration by the Commission in which it provides reassurances as to the usage of funds. The declaration is annexed to the Council’s position in first reading.

IV.   CONCLUSION

With a view to reaching an early agreement on the amended Regulation, the Council has engaged in substantial negotiations with the European Parliament, facilitated by the European Commission. The negotiations have led to a large degree of consensus on the text. While the proposal of the Commission did not present substantial difficulties to the Council, the Council made a special effort to meet a number of concerns of the European Parliament related to the application of the amended Regulation.

The Council calls on the European Parliament to go along with this text which reflects the compromises reached in the negotiations in order to allow for the entry into force of the Regulation in 2010. This would permit that the funds already inscribed in the 2010 budget are not lost for the projects intended.

---

(1)  COM(2009) 197 final/2.

---

Commission declaration concerning Article 16

The Regulation addresses the issue of support for a number of specific non-Official Development Assistance (ODA) activities in countries covered by the Development Cooperation Instrument (DCI Regulation (EC) No 1905/2006). The Regulation is intended to be a one-off solution to this issue.

The Commission reaffirms that the eradication of poverty, including the pursuit of the Millennium Development Goals, is the primary objective of its development cooperation and remains a priority.

It recalls that the financial reference amount fixed in Article 16 for countries listed in Annex II will be implemented using dedicated budget lines which are intended for activities other than Official Development Assistance.

Furthermore, the Commission confirms its intention to respect the financial reference amount fixed in Article 38 of the Development Cooperation Instrument (Regulation (EC) No 1905/2006) for the period 2007-2013 as well as the provisions in the same Regulation regarding the fulfilment of the criteria for ODA. It recalls that on the basis of its current financial planning, this reference amount will be exceeded in 2013.

In this context, the Commission intends to propose draft budgets which ensure a progression in development assistance for Asia and Latin America under the DCI Regulation (EC) No 1905/2006 over the period until 2013 so that the currently projected ODA amounts under the DCI and the EU budget generally are not affected.

---

| 12.1.2011 | EN | Official Journal of the European Union | CE 7/11 |
| --- | --- | --- | --- |

12.1.2011

EN

Official Journal of the European Union

CE 7/11

---

POSITION (EU) No 2/2011 OF THE COUNCIL AT FIRST READING

with a view to the adoption of a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperation

Adopted by the Council on 10 December 2010

2011/C 7 E/02

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 209(1) thereof,

Having regard to the proposal from the European Commission,

Acting in accordance with the ordinary legislative procedure (1),

Whereas:

| (1) | A new framework for planning and delivering assistance was established in 2006 in order to make the Community’s external assistance more effective and transparent. It contains Council Regulation (EC) No 1085/2006 of 17 July 2006 establishing an Instrument for Pre-Accession Assistance (IPA) (2), Regulation (EC) No 1638/2006 of the European Parliament and of the Council of 24 October 2006 laying down general provisions establishing a European Neighbourhood and Partnership Instrument (3), Council Regulation (EC) No 1934/2006 of 21 December 2006 establishing a financing instrument for cooperation with industrialised and other high-income countries and territories (4), Regulation (EC) No 1717/2006 of the European Parliament and of the Council of 15 November 2006 establishing an Instrument for Stability (5), Council Regulation (Euratom) No 300/2007 of 19 February 2007 establishing an Instrument for Nuclear Safety Cooperation (6), Regulation (EC) No 1889/2006 of the European Parliament and of the Council of 20 December 2006 establishing a financing instrument for the promotion of democracy and human rights worldwide (7), and Regulation (EC) No 1905/2006 of the European Parliament and of the Council (8). |
| --- | --- |

(1)

A new framework for planning and delivering assistance was established in 2006 in order to make the Community’s external assistance more effective and transparent. It contains Council Regulation (EC) No 1085/2006 of 17 July 2006 establishing an Instrument for Pre-Accession Assistance (IPA) (2), Regulation (EC) No 1638/2006 of the European Parliament and of the Council of 24 October 2006 laying down general provisions establishing a European Neighbourhood and Partnership Instrument (3), Council Regulation (EC) No 1934/2006 of 21 December 2006 establishing a financing instrument for cooperation with industrialised and other high-income countries and territories (4), Regulation (EC) No 1717/2006 of the European Parliament and of the Council of 15 November 2006 establishing an Instrument for Stability (5), Council Regulation (Euratom) No 300/2007 of 19 February 2007 establishing an Instrument for Nuclear Safety Cooperation (6), Regulation (EC) No 1889/2006 of the European Parliament and of the Council of 20 December 2006 establishing a financing instrument for the promotion of democracy and human rights worldwide (7), and Regulation (EC) No 1905/2006 of the European Parliament and of the Council (8).

| (2) | In implementing Regulation (EC) No 1905/2006 inconsistencies have emerged regarding exceptions to the principle of non-eligibility for Union financing of costs related to taxes, duties and other charges. It is therefore proposed to amend the relevant provisions of that Regulation in order to align it with the other instruments. |
| --- | --- |

(2)

In implementing Regulation (EC) No 1905/2006 inconsistencies have emerged regarding exceptions to the principle of non-eligibility for Union financing of costs related to taxes, duties and other charges. It is therefore proposed to amend the relevant provisions of that Regulation in order to align it with the other instruments.

| (3) | This Regulation does not go beyond what is necessary in order to achieve the objective pursued, in accordance with Article 5(4) of the Treaty on European Union. |
| --- | --- |

(3)

This Regulation does not go beyond what is necessary in order to achieve the objective pursued, in accordance with Article 5(4) of the Treaty on European Union.

| (4) | Regulation (EC) No 1905/2006 should therefore be amended accordingly, |
| --- | --- |

(4)

Regulation (EC) No 1905/2006 should therefore be amended accordingly,

HAVE ADOPTED THIS REGULATION:

Article 1

In Article 25 of Regulation (EC) No 1905/2006, paragraph 2 is replaced by the following:

‘2.   Union assistance shall not in principle be used for paying taxes, duties or charges in beneficiary countries.’.

Article 2

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

Official Journal of the European Union

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

Done at ... .

For the European Parliament

The President

...

For the Council

The President

...

---

(1)  Position of the European Parliament of 21 October 2010 (not yet published in the Official Journal) and position of the Council at first reading of 10 December 2010. Position of the European Parliament of ... (not yet published in the Official Journal).

1

(2)  OJ L 210, 31.7.2006, p. 82.

2

(3)  OJ L 310, 9.11.2006, p. 1.

3

(4)  OJ L 405, 30.12.2006, p. 41.

4

(5)  OJ L 327, 24.11.2006, p. 1.

5

(6)  OJ L 81, 22.3.2007, p. 1.

6

(7)  OJ L 386, 29.12.2006, p. 1.

7

(8)  OJ L 378, 27.12.2006, p. 41.

8

---

STATEMENT OF THE COUNCIL’S REASONS

I.   INTRODUCTION

On 21 April 2009, the Commission adopted its proposal for a Regulation amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperation and Regulation (EC) No 1889/2006 on establishing a financing instrument for the promotion of democracy and human rights worldwide.

The European Parliament adopted its first reading opinion on 21 October 2010.

The Council adopted its position at first reading on 10 December 2010.

II.   OBJECTIVE

The Development Cooperation Instrument (DCI) is one of only two EU financial instruments for external action not providing for an exception to the principle of the non-eligibility for EU funding of costs related to taxes, duties and other charges. The instrument for the promotion of democracy and human rights worldwide (EIDHR) is the other case in point.

All the other EU financial instruments for external action lay down that EU support may not be used to finance such costs in principle, thus allowing for flexibility on a case-by-case basis, where appropriate, in the interests of proper implementation of programmes and projects.

The objective of the Commission proposal is to align the relevant provision of this instrument on the other instruments, by adding the words ‘in principle’ in Article 25, paragraph 2 of the Regulation.

III.   ANALYSIS OF THE COUNCIL’S POSITION AT FIRST READING

The Council had no difficulties whatsoever with the single change suggested by the Commission in its initial proposal with a view to harmonise relevant provisions in existing financial instruments.

The Council also accepted three rather technical amendments adopted by the European Parliament, for the sake of clarity and accuracy. In particular, the Council agreed to the splitting of the initial proposal into two in order to reflect that two distinct instruments were concerned, the DCI and the EIDHR.

The Council has not been able, however, to accept those amendments adopted by the European Parliament which introduce the application of the delegated acts procedure (Article 290 TFEU) for the adoption of multiannual cooperation programmes and strategy papers. The Council believes that the multiannual cooperation programmes, not being legally binding acts, do not constitute acts of general application, supplementing or amending the basic act. They constitute implementing measures within the meaning of Article 291 TFEU.

IV.   CONCLUSION

While the proposal of the Commission did not present any difficulty to the Council, the Council accepted a number of amendments adopted by the European Parliament.

The Council considers that its position at first reading is a balanced compromise and calls on the European Parliament to go along with this text in order to preserve the spirit and objective of the initial proposal, i.e. to ensure the consistency of the EU financial instruments for external action and to allow minimal but necessary flexibility in their implementation.

---

| 12.1.2011 | EN | Official Journal of the European Union | CE 7/14 |
| --- | --- | --- | --- |

12.1.2011

EN

Official Journal of the European Union

CE 7/14

---

POSITION (EU) No 3/2011 OF THE COUNCIL AT FIRST READING

with a view to the adoption of a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1889/2006 on establishing a financing instrument for the promotion of democracy and human rights worldwide

Adopted by the Council on 10 December 2010

2011/C 7 E/03

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 209(1) and Article 212 thereof,

Having regard to the proposal from the European Commission,

Acting in accordance with the ordinary legislative procedure (1),

Whereas:

| (1) | A new framework for planning and delivering assistance was established in 2006 in order to make the Community’s external assistance more effective and transparent. It contains Council Regulation (EC) No 1085/2006 of 17 July 2006 establishing an Instrument for Pre-Accession Assistance (IPA) (2), Regulation (EC) No 1638/2006 of the European Parliament and of the Council of 24 October 2006 laying down general provisions establishing a European Neighbourhood and Partnership Instrument (3), Council Regulation (EC) No 1934/2006 of 21 December 2006 establishing a financing instrument for cooperation with industrialised and other high-income countries and territories (4), Regulation (EC) No 1717/2006 of the European Parliament and of the Council of 15 November 2006 establishing an Instrument for Stability (5), Council Regulation (Euratom) No 300/2007 of 19 February 2007 establishing an Instrument for Nuclear Safety Cooperation (6), Regulation (EC) No 1889/2006 of the European Parliament and of the Council (7), and Regulation (EC) No 1905/2006 of the European Parliament and of the Council of 18 December 2006 establishing a financing instrument for development cooperation (8). |
| --- | --- |

(1)

A new framework for planning and delivering assistance was established in 2006 in order to make the Community’s external assistance more effective and transparent. It contains Council Regulation (EC) No 1085/2006 of 17 July 2006 establishing an Instrument for Pre-Accession Assistance (IPA) (2), Regulation (EC) No 1638/2006 of the European Parliament and of the Council of 24 October 2006 laying down general provisions establishing a European Neighbourhood and Partnership Instrument (3), Council Regulation (EC) No 1934/2006 of 21 December 2006 establishing a financing instrument for cooperation with industrialised and other high-income countries and territories (4), Regulation (EC) No 1717/2006 of the European Parliament and of the Council of 15 November 2006 establishing an Instrument for Stability (5), Council Regulation (Euratom) No 300/2007 of 19 February 2007 establishing an Instrument for Nuclear Safety Cooperation (6), Regulation (EC) No 1889/2006 of the European Parliament and of the Council (7), and Regulation (EC) No 1905/2006 of the European Parliament and of the Council of 18 December 2006 establishing a financing instrument for development cooperation (8).

| (2) | In implementing those Regulations inconsistencies have emerged regarding exceptions to the principle of non-eligibility for Union financing of costs related to taxes, duties and other charges. It is therefore proposed to amend the relevant provisions of Regulation (EC) No 1889/2006 in order to align it with the other instruments. |
| --- | --- |

(2)

In implementing those Regulations inconsistencies have emerged regarding exceptions to the principle of non-eligibility for Union financing of costs related to taxes, duties and other charges. It is therefore proposed to amend the relevant provisions of Regulation (EC) No 1889/2006 in order to align it with the other instruments.

| (3) | This Regulation does not go beyond what is necessary in order to achieve the objective pursued, in accordance with Article 5(4) of the Treaty on European Union. |
| --- | --- |

(3)

This Regulation does not go beyond what is necessary in order to achieve the objective pursued, in accordance with Article 5(4) of the Treaty on European Union.

| (4) | Regulation (EC) No 1889/2006 should therefore be amended accordingly, |
| --- | --- |

(4)

Regulation (EC) No 1889/2006 should therefore be amended accordingly,

HAVE ADOPTED THIS REGULATION:

Article 1

In Article 13 of Regulation (EC) No 1889/2006, paragraph 6 is replaced by the following:

‘6.   Union assistance shall not in principle be used for paying taxes, duties or charges in beneficiary countries.’.

Article 2

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

Official Journal of the European Union

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

Done at ... .

For the European Parliament

The President

...

For the Council

The President

...

---

(1)  Position of the European Parliament of 21 October 2010 (not yet published in the Official Journal) and position of the Council at first reading of 10 December 2010. Position of the European Parliament of ... (not yet published in the Official Journal).

1

(2)  OJ L 210, 31.7.2006, p. 82.

2

(3)  OJ L 310, 9.11.2006, p. 1.

3

(4)  OJ L 405, 30.12.2006, p. 41.

4

(5)  OJ L 327, 24.11.2006, p. 1.

5

(6)  OJ L 81, 22.3.2007, p. 1.

6

(7)  OJ L 386, 29.12.2006, p. 1.

7

(8)  OJ L 378, 27.12.2006, p. 41.

8

---

STATEMENT OF THE COUNCIL'S REASONS

I.   INTRODUCTION

On 21 April 2009, the Commission adopted its proposal for a Regulation amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperation and Regulation (EC) No 1889/2006 on establishing a financing instrument for the promotion of democracy and human rights worldwide.

The European Parliament adopted its first reading opinion on 21 October 2010.

The Council adopted its position at first reading on 10 December 2010.

II.   OBJECTIVE

The instrument for the promotion of democracy and human rights worldwide (EIDHR) is one of only two EU financial instruments for external action not providing for an exception to the principle of the non-eligibility for EU funding of costs related to taxes, duties and other charges. The Development Cooperation Instrument (DCI) is the other case in point.

All the other EU financial instruments for external action lay down that EU support may not be used to finance such costs in principle, thus allowing for flexibility on a case-by-case basis, where appropriate, in the interests of proper implementation of programmes and projects.

The objective of the Commission proposal is to align the relevant provision of this instrument on the other instruments, by adding the words ‘in principle’ in Article 13, paragraph 6.

III.   ANALYSIS OF THE COUNCIL'S POSITION AT FIRST READING

The Council had no difficulties whatsoever with the single change suggested by the Commission in its initial proposal with a view to harmonise relevant provisions in existing financial instruments.

The Council also accepted three rather technical amendments adopted by the European Parliament, for the sake of clarity and accuracy. In particular, the Council agreed to the splitting of the initial proposal into two in order to reflect that two distinct instruments were concerned: the DCI and the EIDHR.

The Council has not been able, however, to accept those amendments adopted by the European Parliament which introduce the application of the delegated acts procedure (Article 290 TFEU) for the adoption of multiannual cooperation programmes and strategy papers. The Council believes that the multiannual cooperation programmes, not being legally binding acts, do not constitute acts of general application, supplementing or amending the basic act. They constitute implementing measures within the meaning of Article 291 TFEU.

IV.   CONCLUSION

While the proposal of the Commission did not present any difficulty to the Council, the Council accepted a number of amendments adopted by the European Parliament.

The Council considers that its position at first reading is a balanced compromise and calls on the European Parliament to go along with this text in order to preserve the spirit and objective of the initial proposal, i.e. to ensure the consistency of the EU financial instruments for external action and to allow minimal but necessary flexibility in their implementation.

---

| 12.1.2011 | EN | Official Journal of the European Union | CE 7/17 |
| --- | --- | --- | --- |

12.1.2011

EN

Official Journal of the European Union

CE 7/17

---

POSITION (EU) No 4/2011 OF THE COUNCIL AT FIRST READING

with a view to the adoption of a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperation

Adopted by the Council on 10 December 2010

2011/C 7 E/04

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 209(1) thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Acting in accordance with the ordinary legislative procedure (1),

Whereas:

| (1) | The Union’s development policy aims to reduce and ultimately eradicate poverty. |
| --- | --- |

(1)

The Union’s development policy aims to reduce and ultimately eradicate poverty.

| (2) | The Union, as a member of the World Trade Organisation (WTO), is committed to mainstreaming trade in development strategies and to promoting international trade in order to advance development and reduce — and, in the long term, eradicate — poverty worldwide. |
| --- | --- |

(2)

The Union, as a member of the World Trade Organisation (WTO), is committed to mainstreaming trade in development strategies and to promoting international trade in order to advance development and reduce — and, in the long term, eradicate — poverty worldwide.

| (3) | The Union supports the African, Caribbean and Pacific (ACP) Group of States on their path to poverty reduction and to sustainable economic and social development, and recognises the importance of their commodity sectors. |
| --- | --- |

(3)

The Union supports the African, Caribbean and Pacific (ACP) Group of States on their path to poverty reduction and to sustainable economic and social development, and recognises the importance of their commodity sectors.

| (4) | The Union is committed to supporting the smooth and gradual integration of developing countries into the world economy with a view to sustainable development. The main ACP banana-exporting countries may face challenges in the context of changing trade arrangements, notably liberalisation of the Most Favoured Nation (MFN) tariff in the framework of the WTO and the bilateral and regional agreements concluded, or in the process of being concluded, between the Union and Latin American countries. Therefore, an ACP Banana Accompanying Measures programme (the programme) should be added to Regulation (EC) No 1905/2006 of the European Parliament and of the Council (2). |
| --- | --- |

(4)

The Union is committed to supporting the smooth and gradual integration of developing countries into the world economy with a view to sustainable development. The main ACP banana-exporting countries may face challenges in the context of changing trade arrangements, notably liberalisation of the Most Favoured Nation (MFN) tariff in the framework of the WTO and the bilateral and regional agreements concluded, or in the process of being concluded, between the Union and Latin American countries. Therefore, an ACP Banana Accompanying Measures programme (the programme) should be added to Regulation (EC) No 1905/2006 of the European Parliament and of the Council (2).

| (5) | The financial assistance measures to be adopted under the programme should aim at improving the living standards and living conditions of people in banana-growing areas and in banana value chains, specifically small farmers and small entities, as well as ensuring compliance with labour and occupational health and safety standards, and environmental standards, notably those regarding the use of and exposure to pesticides. The measures should also support the adaptation and including, when relevant, the reorganisation, of areas dependent upon banana exports through sector-specific budget support or project-specific interventions. The measures should aim to provide for social resilience policies, economic diversification or investment to improve competitiveness, where this is viable, taking into account the results of and experiences gained through the Special System of Assistance to traditional ACP suppliers of bananas established in accordance with Council Regulation (EC) No 2686/94 (3) and the Special Framework of Assistance (SFA) for traditional ACP suppliers of bananas established in accordance with Council Regulation (EC) No 856/1999 (4) and Commission Regulation (EC) No 1609/1999 (5). The Union acknowledges the importance of promoting a more equitable distribution of banana revenues. |
| --- | --- |

(5)

The financial assistance measures to be adopted under the programme should aim at improving the living standards and living conditions of people in banana-growing areas and in banana value chains, specifically small farmers and small entities, as well as ensuring compliance with labour and occupational health and safety standards, and environmental standards, notably those regarding the use of and exposure to pesticides. The measures should also support the adaptation and including, when relevant, the reorganisation, of areas dependent upon banana exports through sector-specific budget support or project-specific interventions. The measures should aim to provide for social resilience policies, economic diversification or investment to improve competitiveness, where this is viable, taking into account the results of and experiences gained through the Special System of Assistance to traditional ACP suppliers of bananas established in accordance with Council Regulation (EC) No 2686/94 (3) and the Special Framework of Assistance (SFA) for traditional ACP suppliers of bananas established in accordance with Council Regulation (EC) No 856/1999 (4) and Commission Regulation (EC) No 1609/1999 (5). The Union acknowledges the importance of promoting a more equitable distribution of banana revenues.

| (6) | The programme should accompany the adaptation process in ACP countries which have exported significant volumes of bananas to the Union in recent years and which will be affected by liberalisation in the framework of the Geneva Agreement on Trade in Bananas (6) and by the bilateral and regional agreements concluded, or in the process of being concluded, between the Union and Latin American countries. The programme builds on the SFA for traditional ACP suppliers of bananas. It is in conformity with the Union’s international obligations in the framework of the WTO, focuses on restructuring and boosting competitiveness, and is consequently temporary in nature, with a duration of 4 years (2010-2013). |
| --- | --- |

(6)

The programme should accompany the adaptation process in ACP countries which have exported significant volumes of bananas to the Union in recent years and which will be affected by liberalisation in the framework of the Geneva Agreement on Trade in Bananas (6) and by the bilateral and regional agreements concluded, or in the process of being concluded, between the Union and Latin American countries. The programme builds on the SFA for traditional ACP suppliers of bananas. It is in conformity with the Union’s international obligations in the framework of the WTO, focuses on restructuring and boosting competitiveness, and is consequently temporary in nature, with a duration of 4 years (2010-2013).

| (7) | The conclusions of the Commission Communication of 17 March 2010 entitled ‘Biennial Report on the Special Framework of Assistance for Traditional ACP Suppliers of Bananas’ indicate that past assistance programmes made substantial contributions to achieving improved capacity for successful economic diversification, although the full impact cannot be quantified, and that the sustainability of ACP banana exports remains fragile. |
| --- | --- |

(7)

The conclusions of the Commission Communication of 17 March 2010 entitled ‘Biennial Report on the Special Framework of Assistance for Traditional ACP Suppliers of Bananas’ indicate that past assistance programmes made substantial contributions to achieving improved capacity for successful economic diversification, although the full impact cannot be quantified, and that the sustainability of ACP banana exports remains fragile.

| (8) | The Commission has carried out an evaluation of the SFA programme and has not carried out an impact assessment of the banana accompanying measures. |
| --- | --- |

(8)

The Commission has carried out an evaluation of the SFA programme and has not carried out an impact assessment of the banana accompanying measures.

| (9) | The Commission should ensure proper coordination of this programme with the regional and national indicative programmes operating in the beneficiary countries, in particular as regards the achievement of economic, agricultural, social and environmental objectives. |
| --- | --- |

(9)

The Commission should ensure proper coordination of this programme with the regional and national indicative programmes operating in the beneficiary countries, in particular as regards the achievement of economic, agricultural, social and environmental objectives.

| (10) | Almost 2 % of the world’s trade in bananas is endorsed by fair trade producers’ organisations. The minimum fair trade prices are set on the basis of a calculation of the ‘sustainable production costs’, established following consultations with stakeholders, with a view to internalising the costs of meeting decent social and environmental standards and generating a reasonable profit, enabling producers to safeguard their livelihoods in the long term. |
| --- | --- |

(10)

Almost 2 % of the world’s trade in bananas is endorsed by fair trade producers’ organisations. The minimum fair trade prices are set on the basis of a calculation of the ‘sustainable production costs’, established following consultations with stakeholders, with a view to internalising the costs of meeting decent social and environmental standards and generating a reasonable profit, enabling producers to safeguard their livelihoods in the long term.

| (11) | To prevent the exploitation of local workers, actors in the production chain in the banana industry should agree to ensure that the revenue generated by the industry is allocated fairly. |
| --- | --- |

(11)

To prevent the exploitation of local workers, actors in the production chain in the banana industry should agree to ensure that the revenue generated by the industry is allocated fairly.

| (12) | Regulation (EC) No 1905/2006 should therefore be amended accordingly, |
| --- | --- |

(12)

Regulation (EC) No 1905/2006 should therefore be amended accordingly,

HAVE ADOPTED THIS REGULATION:

Article 1

Regulation (EC) No 1905/2006 is hereby amended as follows:

| 1. | Article 4 is replaced by the following:
  ‘Article 4
  Implementation of Union assistance
  Consistent with the overall purpose and scope, objectives and general principles of this Regulation, Union assistance shall be implemented through the geographic and thematic programmes set out in Articles 5 to 16 and the programmes set out in Articles 17 and 17a.’; |
| --- | --- |

1.

Article 4 is replaced by the following:

‘Article 4

Implementation of Union assistance

Consistent with the overall purpose and scope, objectives and general principles of this Regulation, Union assistance shall be implemented through the geographic and thematic programmes set out in Articles 5 to 16 and the programmes set out in Articles 17 and 17a.’;

| 2. | the following Article is inserted:
  ‘Article 17a
  Main ACP banana-supplying countries
  1.   ACP banana-supplying countries listed in Annex IIIa shall benefit from banana accompanying measures. Union assistance shall aim at supporting their adjustment process following liberalisation of the Union market for bananas in the framework of the WTO. Union assistance shall in particular be used to combat poverty by improving the living standards and conditions of farmers and persons concerned, where relevant small entities, including by means of compliance with labour and safety standards, as well as with environmental standards, including the use of and exposure to pesticides. Union assistance shall take into account the countries policies and adaptation strategies, as well as their regional environment (in terms of proximity to outermost regions of the Union and overseas countries and territories) and shall pay specific attention to the following areas of cooperation:






  (a) | enhancing the competitiveness of the banana export sector, where this is sustainable, taking into account the situation of different stakeholders in the chain; |
| --- | --- | --- |

2.

the following Article is inserted:

‘Article 17a

Main ACP banana-supplying countries

1.   ACP banana-supplying countries listed in Annex IIIa shall benefit from banana accompanying measures. Union assistance shall aim at supporting their adjustment process following liberalisation of the Union market for bananas in the framework of the WTO. Union assistance shall in particular be used to combat poverty by improving the living standards and conditions of farmers and persons concerned, where relevant small entities, including by means of compliance with labour and safety standards, as well as with environmental standards, including the use of and exposure to pesticides. Union assistance shall take into account the countries policies and adaptation strategies, as well as their regional environment (in terms of proximity to outermost regions of the Union and overseas countries and territories) and shall pay specific attention to the following areas of cooperation:

(a)

enhancing the competitiveness of the banana export sector, where this is sustainable, taking into account the situation of different stakeholders in the chain;

| (b) | promoting the economic diversification of banana-dependent areas, where such a strategy is viable; |
| --- | --- |

(b)

promoting the economic diversification of banana-dependent areas, where such a strategy is viable;

| (c) | addressing broader impacts generated by the adaptation process, possibly related but not restricted to employment and social services, land use and environmental restoration, and macroeconomic stability. |
| --- | --- |

(c)

addressing broader impacts generated by the adaptation process, possibly related but not restricted to employment and social services, land use and environmental restoration, and macroeconomic stability.

2.   Within the amount referred to in Annex IV, the Commission shall fix the maximum amount available to each eligible ACP banana-supplying country referred to in paragraph 1 of this Article on the basis of the following objective, weighted indicators:

| (a) | trade in bananas with the Union; |
| --- | --- |

(a)

trade in bananas with the Union;

| (b) | the importance of banana exports to the economy in the ACP country concerned, along with the country’s level of development. |
| --- | --- |

(b)

the importance of banana exports to the economy in the ACP country concerned, along with the country’s level of development.

The measurement of the allocation criteria shall be based on representative data preceding 2010 and covering a period not longer than 5 years, and on a Commission study assessing the impact on the ACP countries of the agreement reached within the WTO and the bilateral and regional agreements concluded, or in the process of being concluded, between the Union and Latin American countries, which are the leading exporters of bananas.

3.   The Commission shall adopt multiannual support strategies by analogy to Article 19, and in accordance with Article 21. It shall ensure that such strategies complement the geographic strategy papers of the countries concerned, and the temporary nature of these banana accompanying measures.

The multiannual support strategies for banana accompanying measures shall include:

| (a) | an updated environmental profile paying due attention to the country’s banana sector, inter alia focusing on pesticides; |
| --- | --- |

(a)

an updated environmental profile paying due attention to the country’s banana sector, inter alia focusing on pesticides;

| (b) | information on the achievements of past banana support programmes; |
| --- | --- |

(b)

information on the achievements of past banana support programmes;

| (c) | indicators to assess progress in relation to disbursement conditions, when budget support will be chosen as the form of financing; |
| --- | --- |

(c)

indicators to assess progress in relation to disbursement conditions, when budget support will be chosen as the form of financing;

| (d) | the expected results of the assistance; |
| --- | --- |

(d)

the expected results of the assistance;

| (e) | a time schedule of support activities and of expected disbursements for each recipient country; |
| --- | --- |

(e)

a time schedule of support activities and of expected disbursements for each recipient country;

| (f) | the ways in which progress will be achieved and monitored in meeting internationally agreed ILO core labour standards and appropriate occupational safety and health conventions as well as relevant internationally agreed core environmental standards. |
| --- | --- |

(f)

the ways in which progress will be achieved and monitored in meeting internationally agreed ILO core labour standards and appropriate occupational safety and health conventions as well as relevant internationally agreed core environmental standards.

By 18 months before the expiry date, the banana accompanying measures programme and the progress made by the countries concerned shall be the subject of an assessment, which shall include recommendations on any measures to be taken and the nature thereof.’;

| 3. | Article 21 is replaced by the following:
  ‘Article 21
  Adoption of strategy papers and multiannual indicative programmes
  Strategy papers and multiannual indicative programmes referred to in Articles 19 and 20, and any reviews thereof referred to in Article 19(2) and Article 20(1), as well as accompanying measures referred to in Articles 17 and 17a respectively, shall be adopted by the Commission in accordance with Article 35(2).’; |
| --- | --- |

3.

Article 21 is replaced by the following:

‘Article 21

Adoption of strategy papers and multiannual indicative programmes

Strategy papers and multiannual indicative programmes referred to in Articles 19 and 20, and any reviews thereof referred to in Article 19(2) and Article 20(1), as well as accompanying measures referred to in Articles 17 and 17a respectively, shall be adopted by the Commission in accordance with Article 35(2).’;

| 4. | Article 25(2) is replaced by the following:
  ‘2.   Union assistance shall not in principle be used for paying taxes, duties or charges in beneficiary countries.’; |
| --- | --- |

4.

Article 25(2) is replaced by the following:

‘2.   Union assistance shall not in principle be used for paying taxes, duties or charges in beneficiary countries.’;

| 5. | Article 29(1) is replaced by the following:
  ‘1.   Budget commitments shall be made on the basis of decisions taken by the Commission in accordance with Articles 17a(3), 22(1), 23(1) and 26(1).’; |
| --- | --- |

5.

Article 29(1) is replaced by the following:

‘1.   Budget commitments shall be made on the basis of decisions taken by the Commission in accordance with Articles 17a(3), 22(1), 23(1) and 26(1).’;

| 6. | in Article 31(1), the third subparagraph is replaced by the following:
  ‘Participation in the award of procurement or grant contracts financed under a thematic programme as defined in Articles 11 to 16, and the programmes set out in Articles 17 and 17a, shall be open to all natural persons who are nationals of, or legal persons who are established in, a developing country, as specified by the OECD/DAC and in Annex II, in addition to natural or legal persons eligible by virtue of the thematic programme or the programmes set out in Articles 17 and 17a. The Commission shall publish and update Annex II in accordance with regular reviews of the list of aid recipients of the OECD/DAC, and inform the Council thereof.’; |
| --- | --- |

6.

in Article 31(1), the third subparagraph is replaced by the following:

‘Participation in the award of procurement or grant contracts financed under a thematic programme as defined in Articles 11 to 16, and the programmes set out in Articles 17 and 17a, shall be open to all natural persons who are nationals of, or legal persons who are established in, a developing country, as specified by the OECD/DAC and in Annex II, in addition to natural or legal persons eligible by virtue of the thematic programme or the programmes set out in Articles 17 and 17a. The Commission shall publish and update Annex II in accordance with regular reviews of the list of aid recipients of the OECD/DAC, and inform the Council thereof.’;

| 7. | in Article 38, paragraphs 1 and 2 are replaced by the following:
  ‘1.   The financial reference amount for the implementation of this Regulation over the period 2007-2013 is EUR 17 087 million.
  2.   The indicative amounts allocated to each programme referred to in Articles 5 to 10, 11 to 16 and 17 to 17a are laid down in Annex IV. These amounts are established for the period 2007-2013.’; |
| --- | --- |

7.

in Article 38, paragraphs 1 and 2 are replaced by the following:

‘1.   The financial reference amount for the implementation of this Regulation over the period 2007-2013 is EUR 17 087 million.

2.   The indicative amounts allocated to each programme referred to in Articles 5 to 10, 11 to 16 and 17 to 17a are laid down in Annex IV. These amounts are established for the period 2007-2013.’;

| 8. | Annex IIIa, as contained in Annex I to this Regulation, is inserted; |
| --- | --- |

8.

Annex IIIa, as contained in Annex I to this Regulation, is inserted;

| 9. | Annex IV is replaced by the contents of Annex II to this Regulation. |
| --- | --- |

9.

Annex IV is replaced by the contents of Annex II to this Regulation.

Article 2

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

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

Done at ... .

For the European Parliament

The President

...

For the Council

The President

...

---

(1)  Position of the European Parliament of 21 October 2010 (not yet published in the Official Journal) and position of the Council at first reading of 10 December 2010. Position of the European Parliament of ... (not yet published in the Official Journal).

1

(2)  OJ L 378, 27.12.2006, p. 41.

2

(3)  OJ L 286, 5.11.1994, p. 1.

3

(4)  OJ L 108, 27.4.1999, p. 2.

4

(5)  OJ L 190, 23.7.1999, p. 14.

5

(6)  OJ L 141, 9.6.2010, p. 3.

6

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ANNEX I

‘ANNEX IIIa

Main ACP banana-supplying countries

| 1. | Belize |
| --- | --- |

1.

Belize

| 2. | Cameroon |
| --- | --- |

2.

Cameroon

| 3. | Côte d’Ivoire |
| --- | --- |

3.

Côte d’Ivoire

| 4. | Dominica |
| --- | --- |

4.

Dominica

| 5. | Dominican Republic |
| --- | --- |

5.

Dominican Republic

| 6. | Ghana |
| --- | --- |

6.

Ghana

| 7. | Jamaica |
| --- | --- |

7.

Jamaica

| 8. | Saint Lucia |
| --- | --- |

8.

Saint Lucia

| 9. | Saint Vincent and the Grenadines |
| --- | --- |

9.

Saint Vincent and the Grenadines

| 10. | Suriname’. |
| --- | --- |

10.

Suriname’.

---

ANNEX II

‘ANNEX IV

Indicative financial allocations for the period 2007-2013 (in EUR million)

| Total | 17 087 |
| --- | --- |
| Geographic programmes: | 10 057 |
| Latin America | 2 690 |
| Asia | 5 187 |
| Central Asia | 719 |
| Middle East | 481 |
| South Africa | 980 |
| Thematic programmes: | 5 596 |
| Investing in people | 1 060 |
| Environment and sustainable management of natural resources | 804 |
| Non-State actors and local authorities in development | 1 639 |
| Food security | 1 709 |
| Migration and asylum | 384 |
| ACP Sugar Protocol countries | 1 244 |
| Main ACP banana-supplying countries | 190’ |

Total

17 087

Geographic programmes:

10 057

Latin America

2 690

Asia

5 187

Central Asia

719

Middle East

481

South Africa

980

Thematic programmes:

5 596

Investing in people

1 060

Environment and sustainable management of natural resources

804

Non-State actors and local authorities in development

1 639

Food security

1 709

Migration and asylum

384

ACP Sugar Protocol countries

1 244

Main ACP banana-supplying countries

190’

---

STATEMENT OF THE COUNCIL'S REASONS

I.   INTRODUCTION

On 17 March 2010, the Commission adopted its proposal for a Regulation amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperation.

The European Parliament adopted its first reading opinion on 21 October 2010.

The Council adopted its position at first reading on 10 December 2010.

II.   OBJECTIVE

This ACP Banana Accompanying Measures (BAM) programme is proposed as an amendment to Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperation (DCI). The aim of the BAM programme is to assist the restructuring of the banana sectors in the 10 main ACP banana-exporting countries.

The EU's Common Market Organisation (CMO) for bananas has been challenged repeatedly in the World Trade Organisation (WTO). Consequently, the EU has negotiated in the WTO framework a trade agreement on bananas which supports the completion of the Doha Development Agenda's (DDA) agricultural modalities and the full Doha Round.

This will lead to a reduction of the ACPs’ preference margin that will require adjustments. The proposed BAM programme for the main ACP banana-supplying countries aims to support the adjustment of areas dependent upon banana exports through budget support or specific interventions. The measures will support the adaptation to broader impacts (e.g. social and environmental), economic diversification policies, or investments in improving competitiveness, where this is a viable strategy.

The measures are proposed as a temporary programme with a maximum duration of 4 years (2010-2013). They would have a budget of EUR 190 million and would be introduced through an amendment to the DCI.

III.   ANALYSIS OF THE COUNCIL'S POSITION AT FIRST READING

Following early and constructive discussions between the three institutions, the Council accepted 15 amendments adopted by the European Parliament at first reading. The Council considers that these amendments improve the initial proposal either by fleshing it out, mainly its preamble, or by clarifying some substantial aspects of the BAM programme.

In particular, the EU’s assistance now has an explicit focus on poverty eradication and the improvement of living and working conditions of small farmers and other persons concerned.

Furthermore, the Regulation now refers to the regional environment of eligible countries under the BAM programme, specifically the proximity to outermost regions of the EU and OCTs.

The Council also welcomed EP amendments regarding environmental protection requirements as well as social requirements based on ILO standards to be included in country support strategies.

Finally it is worth noting that the text now provides for an assessment of the BAM programme 18 months before its end, when appropriate recommendations can be made.

The Council has not been able, however, to accept those amendments adopted by the European Parliament which introduce the application of the delegated acts procedure (Article 290 TFEU) for the adoption of multiannual cooperation programmes and strategy papers. The Council believes that the multiannual cooperation programmes, not being legally binding acts, do not constitute acts of general application, supplementing or amending the basic act. They constitute implementing measures within the meaning of Article 291 TFEU.

IV.   CONCLUSION

With a view to reaching an early agreement on the amended Regulation, the Council has engaged in substantial negotiations with the European Parliament, facilitated by the European Commission. The negotiations have led to a large degree of consensus on the substantial elements of text which relate to the BAM programme as such.

While the proposal of the Commission did not present substantial difficulties to the Council, the Council made a special effort to meet a number of concerns of the European Parliament related to the application of the amended Regulation.

The Council considers that its position at first reading is a balanced compromise and calls on the European Parliament to go along with this text to allow for the entry into force of the Regulation in 2010. This would permit that the funds already inscribed in the 2010 budget are not lost. The Council has expressed serious concern that failure to reach agreement before the end of 2010 might jeopardise the long awaited trade agreement on bananas in the WTO.

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