# EUR-Lex - 52011DC0837 - EN

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# 52011DC0837

**COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Preparation of the multiannual financial framework regarding the financing of EU cooperation for African, Caribbean and Pacific States and Overseas Countries and Territories for the 2014-2020 period (11th European Development Fund) /* COM/2011/0837 final */**

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This Communication and its annex belong to
a package of proposals from the Commission concerning EU external action within
the Multiannual Financial Framework (MFF) for the period 2014-2020.

It is
anticipated that Croatia will have joined the EU by 1 January 2014 and will
contribute to the 11th EDF. If required, the text of the proposed
Internal Agreement will be modified in accordance with its Articles 1.7 and
8.4.

The European Union maintains privileged
relations with the African, Caribbean and Pacific (ACP) group of developing
countries under the ACP-EU Partnership Agreement[1].
25 Overseas Countries and Territories (OCTs) with constitutional links to
Member States are associated to the EU through a regime based on the provisions
of Part IV of the Treaty on the Functioning of the EU (TFEU) and the detailed
rules and procedures laid down in the Overseas Association Decision (OAD) of 27
November 2001[2].

The European Development Fund (EDF) is the main
instrument for delivering EU assistance for development cooperation under the
Cotonou Agreement with ACP States and for financing EU cooperation with the
Overseas Countries and Territories under the Overseas Association Decision. The
EDF is funded outside the EU budget by the EU Member States on the basis of
specific contribution keys. Each EDF is concluded for a multi-annual period.
The 10th EDF Internal Agreement[3],
establishing the resources of the 10th EDF and their share in broad
sub-categories, covers the period 2008-2013, and includes provisions on
implementation and financial monitoring.

In its Communication ‘A budget for Europe
2020’[4],
the Commission underlined that it was not appropriate at the present time to
propose that the EDF be integrated into the EU budget (‘EDF budgetisation’). The
integration of EU development cooperation with ACP States into the EU budget is
foreseen for 2020, at the end of the 2014-2020 multiannual financial framework,
coinciding with the year of expiry of the Cotonou Agreement.

This Communication describes the main
elements that could figure in the Internal Agreement for the 11th European
Development Fund, for the period 2014-2020. The content and wording of the Internal
Agreement will be decided by the Representatives of the Governments of the EU
Member States.

The adoption of this Internal Agreement
would be followed by the adoption by the Council of an Implementing Regulation
and a Financial Regulation for the 11th EDF.

1.           Legal and Policy
Framework

EU Development Cooperation

The main policy objectives of EU external
action are described in the Lisbon Treaty (Article 21 TEU). In addition, the
main objective of EU development cooperation (Article 208 TFEU) is to reduce,
and, in the long term, eradicate poverty. In this context the EU must comply
with its commitments and take account of the objectives approved within the
United Nations and other international organisations.

The policy framework includes the ‘European Consensus’, a Joint Statement on a European Union Development Policy, adopted on
22 December 2005 by the Council and the Representatives of the Governments of
the Member States meeting within the Council, the European Parliament and the
Commission[5], the Communication ‘Increasing the impact
of EU Development Policy: an Agenda for Change’ adopted by the Commission on 13
October 2011[6],
which provides for an updated policy framework for EU development cooperation in
general, as well as any future communication
establishing basic orientations and principles for the Union's development
policy. The policy context also includes the Union's
sectoral policy priorities and strategies with an external dimension and the
integration of cross-sectoral policies such as climate action.

As regards cooperation with ACP States,
this EU legal and policy framework is complemented by the Cotonou Agreement,
concluded between the members of the ACP Group of States on the one hand and
the European Union and its Member States on the other. It runs for a
twenty-year period from March 2000 to February 2020, and entered into force in
April 2003. It was designed to establish a comprehensive partnership, based on
three complementary pillars: development cooperation, economic and trade cooperation,
and the political dimension. The ACP-EU Partnership is centred on the objective
of reducing and eventually eradicating poverty, consistent with the objectives
of sustainable development and the gradual integration of the ACP States into
the world economy (Art. 1 of the Cotonou Agreement).

The Cotonou Agreement provides for a
revision clause which foresees that the agreement is adapted every five years. The second such revision was adopted in June
2010 by the ACP-EU Council of Ministers and has been applied on a provisional
basis since November 2010; the Council will decide on the conclusion of the revised
agreement after having obtained the consent of the European Parliament.

OCT/EU Association

The OCT/EU Association rests on several
legal bases. In EU primary law, it is based on Part IV of the Treaty on the
Functioning of the EU (TFEU). The purpose of the Association is to promote the
social and economic development of the OCTs (Overseas Countries and Territories)
and to establish close economic relations between the OCTs and the EU as a
whole (Article 198 TFEU). The detailed rules and procedures have been laid down
in successive Council Decisions, the last of which is Council Decision
2001/822/EC. It applies to all OCTs listed in Annex II to the Treaty, except
for Bermuda, and is funded from the EDF. This Decision expires on 31 December
2013, and the Commission is preparing a proposal for a new Council Decision
that should enter into force on 1 January 2014, and which will constitute the
political and legal framework for the 11th EDF implementation with regard to
OCTs.

2            Main changes compared to
the internal agreement for the 10th EDF

No major changes are proposed compared to
the structure of the 10th EDF. The main proposed areas of change are as follows:

2.1 Member States’ contributions

As announced
in the Communication ‘A budget for Europe 2020’, it is proposed to further
align Member States’ contribution keys under the EDF with the keys used for the
EU budget. The proposed keys in Article 1(2)(a) are therefore closer to the
budget contribution keys than they were when the 10th EDF was drawn up.

2.2 Financial envelopes

The overall volumes proposed in Article
1(2)(a) for the 11th EDF for cooperation with ACP countries and OCTs were
announced in the Communication ‘A budget for Europe 2020’ in 2011 prices. In
the proposed draft internal agreement attached to this Communication, EDF
financial envelopes are expressed in current prices to reflect more accurately
inflation throughout the period covered by the Multiannual Financial Framework.

For support
expenditure, the requested funding represents 5% of the EDF credits which will
be managed by the Commission. This reflects the Commission’s wish to take more
fully into account the real support expenditures made for programming and
implementing the EDF, including the costs associated with the devolution of aid
implementation and with enhanced monitoring.

Regarding intra-ACP
and interregional cooperation, Article 2(b) proposes to maintain the same share
from ACP resources as in the 10th EDF. This envelope will be used in part to
finance the new shock-absorbing scheme foreseen by the second revision of the
Cotonou Agreement (see below).

Following
consultation of the European Investment Bank, it appears that there is no need
to replenish the Investment Facility, as sufficient funding is already
available from reflows from the allocations of the 9th and 10th EDF, due to the
'revolving' nature of this Facility. However, this does not concern grants for
financing interest rate subsidies and project-related technical assistance, for
which an increased allocation (compared to the 10th EDF) is proposed in Article
2(d) and 3(1), to address the insufficient level of funding under the 10th EDF,
to increase the scale of current activities and to allow for possible other
types of blending mechanisms.

2.3 Regional B-envelopes and shock-absorbing
scheme

The second
revision of the Cotonou Agreement foresees the creation of regional B-envelopes
to cover unforeseen needs with a regional dimension (Article 9(2) of Annex IV to
the revised Cotonou agreement). It also provides for the creation of shock-absorbing
schemes to replace the current Flex and other ad hoc shock-absorbing schemes.
These new schemes should build upon the experience of V-Flex and the Food Facility
(Articles 60 and 68 of the revised Cotonou Agreement) and focus on exogenous
shocks with a cross-country dimension. Article 2(c) therefore proposes to include
these changes in the internal agreement for the 11th EDF.

2.4 EDF
Committee

A proposed
system of voting weights in the 11th EDF Committee is included in Article 8(2),
based on the proposed contribution keys.

3.           CONCLUSION

Against this background, the Commission
invites the Member States to consider the annexed draft Internal Agreement
governing the implementation of EU aid for the ACP States and OCTs for the
period 2014-2020.

ANNEX:
DRAFT INTERNAL AGREEMENT
between the
Representatives of the Governments of the Member States of the European Union,
meeting within the Council, on the financing
of European Union aid under the multiannual financial framework for the period
2014 to 2020, in accordance with the ACP-EU Partnership Agreement, and on the
allocation of financial assistance for the Overseas Countries and Territories
to which Part Four of the Treaty on the Functioning of the EU applies

THE REPRESENTATIVES OF THE GOVERNMENTS OF THE MEMBER
STATES OF THE EUROPEAN UNION, MEETING WITHIN THE COUNCIL,

Having regard to the Treaty on European Union and to the
Treaty on the Functioning of the EU,

After consulting the Commission,

After consulting the European Investment Bank,

Whereas:

(1)
The Partnership Agreement between the members of
the African, Caribbean and Pacific Group of States, of the one part and the
European Community and its Member States, of the other part, signed in Cotonou
on 23 June 2000[7] (hereinafter referred to as ‘the ACP-EU Partnership Agreement’),
provides for the definition of financial protocols for each five-year period.

(2)
On 17
July 2006, the Representatives of the Governments of the Member States, meeting
within the Council, adopted an Internal Agreement on the financing of Community
Aid under the multiannual financial framework for the period 2008 to 2013, in
accordance with the ACP-EC Partnership Agreement, and on the allocation of
financial assistance for the Overseas Countries and Territories to which Part
Four of the EC Treaty applies[8].

(3)
Council
Decision 2001/822/EC of 27 November 2001 on the association of the Overseas Countries
and Territories with the European Community[9] (hereinafter referred to as the
‘Overseas Association Decision’), as amended by Council Decision 2007/249/EC
(OJ L 109, 26.04.2007, p. 33), is applicable until 31 December 2013. A new
decision should be adopted before that date.

(4)
In
order to implement the ACP-EU Partnership Agreement and the Overseas
Association Decision, an 11th EDF should be established and a procedure should
be laid down for determining the allocation of funds and Member States' contributions
to those funds.

(5)
The Union
and its Member States, in accordance with paragraph 7 of Annex Ib of the ACP-EU
Partnership Agreement, conducted a performance review, together with the ACP
States, assessing such things as the degree of realisation of commitments and
disbursements.

(6)
The administration
rules for financial cooperation should be determined.

(7)
A
Committee of Representatives of the Member States should be set up at the
Commission (hereinafter
referred to as the ‘EDF Committee’), and a similar Committee should be set up
at the EIB.
The work of the Commission and the EIB in applying the ACP-EU Partnership
Agreement and the corresponding provisions of the Association Decision should
be harmonised.

(8)
The Union's policy on development
cooperation is guided by the Millennium Development Goals (MDGs) adopted by the
United Nations General Assembly on 8 September 2000, including any subsequent
modifications.

(9)
The
Council and the Representatives of the Governments of the Member States,
meeting within the Council, adopted the Operational Framework on Aid
Effectiveness[10], reaffirming the
agreements under the Paris Declaration on Aid Effectiveness (2005), the EU Code
of Conduct on Complementarity and Division of Labour in Development Policy
(2007), and the EU Guidelines for the Accra Agenda for Action (2008). The
Council also adopted in 2011 an EU common position for the High Level Forum IV
in Busan, South Korea, on aid effectiveness, and the EU and its Member States
agreed to the Busan Outcome Document.

(10)
The
Official Development Assistance (ODA) targets referred to in the conclusions mentioned above should
be borne in mind. When reporting EDF expenditure to Member States and to the OECD Development Assistance Committee, the Commission
should distinguish between ODA and non-ODA activities.

(11)
On 22
December 2005, the Council and the Representatives of the Governments of the
Member States meeting within the Council, the European Parliament and the Commission adopted a
Joint Statement on a European Union Development
Policy: The European Consensus[11].

(12)
On 13
October 2011, the Commission adopted a Communication ‘Increasing
the impact of EU Development Policy: an Agenda for Change’[12].

(13)
On 22
December 2009, the Council and the Representatives of the Governments of the
Member States meeting within the Council adopted conclusions on the EU’s
relations with Overseas Countries and Territories (OCTs).

(14)
The
organisation and functioning of the European External Action Service are
described in Council Decision 2010/427 EU.

(15)
To
make it easier to integrate cooperation with ACP States into the General EU Budget
in the future and avoid any interruption of funding from March to December
2020, it is appropriate to make the period of application of the EDF multiannual
financial framework the same as for the 2014-2020 General EU Budget. It is
therefore preferable to make 31 December 2020 the final date for commitments of
EDF funds, rather than the 28 February 2020, the final date of application of
the Cotonou Agreement.

(16)
To
strengthen socio-economic cooperation between the EU Outermost Regions and ACP
Countries, as well as Overseas Countries and Territories, in the Caribbean,
Western Africa and Indian Ocean, European Regional Development Fund and
European Territorial Cooperation Regulations include a reinforcement of the
allocations 2014-2020 for cooperation between these Regions and partners
outside the Union.

HAVE AGREED AS FOLLOWS:

CHAPTER
1

FINANCIAL RESOURCES

Article 1

Resources
of the 11th EDF

1.           The Member States hereby
set up an eleventh European Development
Fund, hereinafter referred to as ‘the 11th EDF’.

2.           The 11th EDF shall consist
of:

(a)
An amount of up to EUR 34 275.6 million (in
current prices) contributed by the Member States as follows:

|| Contribution key || Contributions in EUR million

Belgium || 3.23 % || 1 108.55

Bulgaria || 0.22 % || 75.38

Czech Republic || 0.83 % || 284.58

Denmark || 1.97 % || 674.70

Germany || 20.54 % || 7 041.44

Estonia || 0.08 % || 28.82

Ireland || 0.95 % || 324.16

Greece || 1.57 % || 539.79

Spain || 8.06 % || 2 762.43

France || 17.83 % || 6 110.88

Italy || 12.62 % || 4 324.33

Cyprus || 0.12 % || 39.74

Latvia || 0.11 % || 37.52

Lithuania || 0.18 % || 61.42

Luxembourg || 0.26 % || 90.00

Hungary || 0.69 % || 237.42

Malta || 0.04 % || 13.44

The Netherlands || 4.85 % || 1 662.01

Austria || 2.36 % || 810.04

Poland || 2.17 % || 743.24

Portugal || 1.20 % || 410.17

Romania || 0.72 % || 247.40

Slovenia || 0.23 % || 80.05

Slovak republic || 0.38 % || 131.85

Finland || 1.51 % || 516.47

Sweden || 2.94 % || 1 006.82

United Kingdom || 14.33 % || 4 912.95

TOTAL || 100.00 % || 34 275.6

The amount of EUR
34 275.6 million shall be available from the entry into
force of the multiannual financial framework, of which

(i) EUR 32 218.4
million shall be allocated to the ACP Group of States;

(ii) EUR 343.4 million shall be allocated to
the OCTs;

(iii) EUR 1713.8 million shall
be allocated to the Commission for support expenditure
as referred to in Article 6, linked to programming and implementation of the
EDF.

(b)
The funds referred to in Annex I and Ib to the
ACP-EU Partnership Agreement and Annex II A
and Aa of the Overseas Association Decision and allocated under the 9th
and 10th EDF to finance the resources of the Investment
Facility in
accordance with the terms
and conditions set out in Annex II to the ACP-EU Partnership Agreement and in Annex II C of the Overseas Association Decision
(hereinafter referred to as the ‘Investment Facility’) are not affected by Decision 2005/446/EC as amended by Decision
2007/792/EC and paragraph 5 of Annex Ib of the Cotonou Agreement stipulating the
dates beyond which the funds of the 9th and 10th EDF may no longer be
committed. These funds shall be transferred to the 11th EDF and be managed
according to the implementation arrangements for the 11th EDF, from the date of
entry into force of the multiannual
financial framework for the period 2014 to 2020 under the ACP-EU
Partnership Agreement, and from the date of
entry into force of Council decisions
on financial assistance to the OCTs for the period 2014 to 2020,
respectively.

3.           After
31 December 2013, or after the date of entry into force of the multiannual financial framework for the period 2014
to 2020 if this falls later,
balances from the 10th EDF or from previous EDFs shall no longer be committed,
with the exception of the balances and funds decommitted after this date of
entry into force and resulting from the system guaranteeing the stabilisation
of export earnings from primary agricultural products (Stabex) under the EDFs
prior to the 9th EDF, and of those funds referred to in paragraph 2(b).

4.           Funds decommitted from projects under the 10th
EDF or from previous EDFs after 31 December
2013 shall no longer be committed,
unless decided otherwise by the Council unani­mously, on the basis of a proposal by the Commission, with the exception of the funds decommitted after this
date of entry into force resulting from the systems guaranteeing the stabili­sation
of export earnings from primary agricultural products (Stabex) under the EDFs prior to the 9th EDF,
which shall be automatically transferred to the respective national indicative programmes referred to in Article 2(a)(i) and
Article 3(1) and those funds to finance the
resources of the Investment Facility referred to in paragraph 2(b) of the
present Article.

5.           The
total amount of resources of the 11th EDF shall cover the period from 1 January
2014 to 31 December 2020. The funds of the
11th EDF, and in the case of the Investment Facility the funds stemming from
reflows, shall no longer be committed beyond 31 December 2020 unless the
Council decides otherwise unani­mously,
on a proposal from the Commission. However, the funds subscribed by the Member States under the 9th
and 10th EDFs to finance the
Investment Facility shall remain available after 31 December 2020 for
disbursement.

6.           The
revenue from interest arising from operations financed
under commitments made under previous EDFs and on the funds of the 11th EDF managed by the Commission shall be credited to one or more bank accounts opened in
the name of the Commission, and
shall be used in accordance with the terms of Article 6. The use of
revenue from interest generated on the
funds of the 11th EDF managed by the
EIB will be determined in the framework of the Financial Regulation referred to
in Article 10(2).

7.           Should a new
State accede to the EU, the amounts and contribution keys referred to in
paragraph 2(a) shall be amended by a decision of the Council acting unanimously, on the basis of a
proposal from the Commission.

8.           Financial
resources may be adjusted by a decision of the Council acting unanimously, in particular
for acting in accordance with Article 62(2) of the ACP-EU Partnership
Agreement.

9.           Any Member State may,
without prejudice to the decision-making rules and procedures set out in Article
8, provide the Commission
or the EIB with voluntary contributions to support the objectives of the ACP-EU Partnership
Agreement. Member States may also co-finance projects or programmes, e.g. under specific initiatives managed by the Commission or the EIB. The ownership of
such initiatives by the ACP countries at the national level shall be
guaranteed.

The
Implementation and Financial Regulation referred to in Article 10 shall
include the necessary provisions on co-financing
by the EDF, and on co-financing activities implemented by Member States. Member States shall inform the Council in
advance of their voluntary contributions.

10.         The
Union and its
Member States may, together with the ACP
States, and in
accordance with paragraph 7 of the Financial Protocol in Annex Ic to the ACP-EU Partnership
Agreement, decide to conduct a performance
review, assessing the degree of realisation of commitments and disbursements, and the results
and impact of the aid provided. The review would be undertaken on the basis of a proposal by the Commission.

Article 2

Resources allocated for the ACP States

The amount of EUR 32 218.4 million
referred to in Article 1(2)(a)(i) shall be allocated between the instruments of
cooperation as follows:

(a)          EUR 27 658.2
million to finance national and regional indicative programmes. This allocation will be used
to finance

(i) the national indicative programmes of the
ACP States in accordance with Articles 1 to 5 of Annex IV to the ACP-EU
Partnership Agreement;

(ii) the regional indicative programmes of
support for regional and inter-regional cooperation and integration of ACP
States in accordance with Articles 6 to 11 of Annex IV to the ACP-EU
Partnership Agreement;

(b)          EUR
3 960.2 million to finance intra-ACP and inter-regional cooperation involving many
or all of the ACP States, in accordance with Articles 12 to 14 of Annex IV to the ACP-EU Partnership Agreement. This envelope shall include structural support
for the CDE and the CTA referred to in Annex III to the ACP-EU Partnership
Agreement and supervised according to the
rules and procedures set out in that Annex, and for the Joint Parliamentary
Assembly referred to in Article 17 of the ACP-EU Partnership Agreement. This envelope shall also cover assistance for the
operating expen­diture of the ACP
Secretariat referred to in points 1 and 2 of Protocol 1 attached to the
ACP-EU Partnership Agreement;

(c)          Part of the
resources referred to under points (a) and (b) may be used to cover unforeseen
needs and to mitigate adverse short-term effects of exogenous shocks, in accordance with Articles 60, 66, 68, 72, 72a
and 73 of the ACP-EU Partnership Agreement and with Articles 3 and 9 of Annex IV to the
ACP-EU Partnership Agreement, including, as
appropriate, comple­mentary
short-term humanitarian relief and emergency assistance, where such
support cannot be financed from the Union
budget.

(d)          EUR 600 million allocated to the EIB to finance the Investment
Facility in accordance with the terms and conditions set out in Annex II to the ACP-EU Partnership Agreement, in the form of grants to finance the interest-rate
subsidies and
project-related technical assistance provided for in Articles 1, 2 and 4 of Annex II to the ACP-EU Partnership Agreement over the period of the 11th EDF.

Article 3

Resources
allocated for the OCTs

1.           The amount of EUR 343.4
million referred to in Article 1(2)(a)(ii)
shall be allocated according to a Council Decision to be taken before 31 December 2013 for
implementing the Asso­ciation with the OCTs,
of which EUR 338.4 million to finance
territorial and regional programmes,
and EUR 5 million in the form of an allocation to the EIB to finance interest
subsidies and technical assistance in accordance with the Overseas
Association Decision.

2.           Where
an OCT becomes independent and accedes to the ACP-EU Partnership Agreement, the amount indicated
in paragraph 1 shall be
reduced and the amounts indicated in Article 2(a)(i) correspondingly increased by a decision
of the Council acting
unanimously on a proposal from the Commission.

Article 4

Loans
from the EIB’s
own
resources

1.
To the amount allocated to the Investment
Facility under the 9th EDF referred to in Article 1(2)(b) and the amount referred to in Article 2(d) shall be added an
indicative amount of up to EUR 2 600 million in the form of loans granted by the EIB from its own resources. These resources shall be
allocated for an amount of up to EUR 2 500 million
for the purposes set out in Annex II to the ACP-EU Partnership Agreement and
for an amount of up to EUR 100 million for the purposes set out in
the Overseas Association Decision, in accordance with the conditions specified in its statutes and the relevant terms and conditions for
investment financing as laid down in Annex
II to the ACP-EU Partnership Agreement and the Overseas Association Decision.

2.
The Member States
shall undertake to act as guarantor for the EIB in proportion
to their contributions to its capital, waiving any right to object, in respect of all financial commitments
arising for borrowers under contracts concluded by the EIB for loans from its own resources
pursuant to Article 1(1)
of Annex II to the ACP-EU Partnership Agreement and the corresponding provisions of the Overseas Association Decision.

3.
The guarantee referred to in paragraph 2 shall
be restricted to 75% of the total amount of credits opened by the EIB under all the loan contracts; it shall cover all risks for public
sector projects. For private sector projects, the guarantee shall cover all
political risks, but the EIB will assume the full commercial risk.

4.
The undertakings
referred to in paragraph 2 shall be the subject of guarantee contracts between each
Member State and the EIB.

Article 5

Operations
managed by the EIB

1.
Payments made to the EIB in
respect of special loans granted to the ACP States, the OCTs and the French
overseas departments,
together with the proceeds and income from risk capital operations, under the EDFs prior to the
9th EDF shall be credited to the Member States in
proportion to their contri­butions to the EDF
to which the sums relate, unless the Council decides unanimously, on a proposal
from the Commission, to place them in reserve or allocate them to other
purposes.

2.
Any commission due to the EIB for managing the loans and operations
referred to in paragraph 1 shall be deducted
in advance from the sums to be credited to the Member States.

3.
Proceeds and income received by the EIB from operations under the
Investment Facility under the 9th, 10th and 11th EDF shall be used for further
operations under that Facility, in accordance with Article 3 of Annex II to the
ACP-EU Partnership Agreement and after deduction of exceptional expenses and
liabilities arising in connection with the Investment Facility.

4.
The EIB shall be remunerated on a full indemnity basis for managing the
Investment Facility operations referred to
in paragraph 3, in accordance with Article 3(1a) of Annex II to the
ACP-EU Partnership Agreement and with the relevant provisions of the revised
Overseas Association Decision.

Article 6

Resources
reserved for Commission support expenditure linked to the EDF

1.           The
EDF resources shall cover the costs of support measures.
The resources referred to in Article 1(2)(a)(iii) and Article 1(6) shall cover any
cost linked to the programming and implementation
of the EDF which are not necessarily covered by the strategy papers and
multiannual indicative programmes
referred to in the Implementing Regulation to be adopted pursuant to Article
10(1).

2.           The resources for support measures may cover Commission expenditure associated with:

(a)
the preparation, follow-up, monitoring,
accounting, audit and evaluation activities directly necessary for the
programming and implementation of the EDF resources;

(b)
the achievement of the EDF objectives, by way of
development policy research activities, studies, meetings, information,
awareness-raising, training and publication activities, including provision of information and communication activities on the EDF. Budget allocated to
communication under this Agreement shall also cover the corporate communication
of the political priorities of the European Union in relation to the EDF; and

(c)
computer networks for the exchange of
information, and any other administrative or technical assistance expenditure for the programming and
implementation of the EDF.

They shall also cover
expenditure both at Headquarters and in Delegations on
the administrative support needed to
programme and manage operations financed under the ACP-EU Partnership Agreement and the Overseas Association
Decision.

They shall not be
assigned to core tasks of the European public service.

CHAPTER II

IMPLEMENTATION
AND FINAL PROVISIONS

Article 7

Contributions
to the 11th EDF

1.           The Commission shall,
taking into account the EIB's forecasts concerning the management and operation
of the Investment Facility, establish and communicate to the Council by 20
October of each year a statement of the commitments, payments and the annual
amount of the calls for contributions to be made in the current and the next two
budget years. These amounts shall be based on the capacity to effectively deliver
the proposed level of resources.

2.           Upon a proposal from the
Commission, specifying the respective shares for the Commission and for the EIB,
the Council shall decide by qualified majority, as laid down in Article 8, on
the ceiling for the annual contribution for the second year following the
proposal from the Commission (n+2) and, within the ceiling decided the previous
year, on the annual amount of the call for contributions for the first year
following the proposal from the Commission (n+1).

3.           Should the contributions
decided according to paragraph 2 deviate from the EDF’s actual needs during the
financial year in question, the Commission shall submit to the Council proposals
to amend the contribution amounts within the ceiling referred to in paragraph 2;
the Council shall take a decision by qualified majority as laid down in Article
8.

4.           The calls for contributions
may not exceed the ceiling referred to in paragraph 2, nor may the ceiling be
increased except when decided by the Council by qualified majority as laid down
in Article 8 in cases of special needs resulting from exceptional or unforeseen
circumstances, such as post-crisis situations. In this case, the Commission and
the Council shall ensure that contributions correspond to expected payments.

5.           The Commission shall,
taking into account the EIB’s forecasts, communicate to the Council by 20
October of each year its estimates of commitments, disbursements and
contributions for the next three budget years.

6.           As regards funds
transferred from previous EDFs to the 11th EDF in accordance with Article
1(2)(b), the contributions of each Member State shall be calculated in
proportion to the contribution of each Member State to the EDF in question.

As regards any funds of the 10th EDF and the previous EDF that are not transferred
to the 11th EDF, the impact on the contribution of each Member State shall be
calculated in proportion to the contribution of each Member State to the 10th
EDF.

7.           The detailed rules for the
payment of contributions by the Member States shall be determined by the
Financial Regulation referred to in Article 10(2).

Article 8

The
European Development Fund Committee

1.           A Committee (hereinafter ‘the
EDF Committee’) consisting of Representatives of Member States shall be set up
at the Commission for the 11th EDF resources which the Commission administers.
The EDF Committee shall be chaired by a Commission representative, and its
secretariat shall be provided by the Commission. A representative of the EIB
may take part in its work.

2.           Within the EDF Committee,
the votes of the Member States shall be weighted as follows:

Member State || EU-27 Votes

Belgium || 32

Bulgaria || 2

Czech Republic || 8

Denmark || 20

Germany || 205

Estonia || 1

Ireland || 9

Greece || 16

Spain || 80

France || 178

Italy || 126

Cyprus || 1

Latvia || 1

Lithuania || 2

Luxembourg || 3

Hungary || 7

Malta || 1

The Netherlands || 48

Austria || 24

Poland || 22

Portugal || 12

Romania || 7

Slovenia || 2

Slovakia || 4

Finland || 15

Sweden || 29

United Kingdom || 143

Total EU-27 || 998

3.           The
EDF Committee shall act by a qualified majority of 720 votes out of 998,
expressing a vote in favour
by at least 14 Member States. The blocking minority shall consist of 279 votes.

4.           Should
a new State accede to the EU, the weightings laid down in paragraph 2 and the
qualified majority referred to in paragraph 3 shall be amended by a Decision of
the Council, acting unanimously.

5.           The
Committee shall adopt its rules of procedure.

Article 9

The
Investment Facility Committee

1.           A Committee (hereinafter
‘the Investment Facility Committee’) consisting of Representatives of the
Governments of the Member States and of a representative of the Commission
shall be set up under the auspices of the EIB. The EIB shall provide the
Committee’s secretariat and support services. The Chairperson of the Investment
Facility Committee shall be elected by and from among the Committee's members.

2.           The Council shall adopt
the rules of procedure of the Investment Facility Committee, acting
unanimously.

3.           The Investment Facility
Committee shall act by a qualified majority, as laid down in Article 8(2) and
8(3).

Article 10

Implementing
provisions

1.           Without prejudice to
Article 8 of this Agreement and the Member States’ voting rights there under,
all the relevant provisions of the Implementing Regulation for the 10th EDF and
of Commission Regulation No 2304/2002 implementing Council Decision 2001/822/EC
concerning assistance to the OCTs shall remain in force pending the adoption by
the Council of an Implementing Regulation for the 11th EDF and of implementing
rules for the revised Overseas Association Decision. The 11th EDF Implementing
Regulation shall be decided upon by unanimity, based on a proposal by the
Commission and after consulting the EIB. The implementing rules for EU
financial assistance to OCTs shall be adopted following adoption of the revised
Overseas Association Decision by the Council by unanimity and with consultation
of the European Parliament.

The 11th EDF Implementing Regulation and the
implementing rules of the revised Overseas Association Decision shall contain
appropriate modifications and improvements to the programming and
decision-making procedures, further harmonising Union and EDF procedures as far
as possible. The 11th EDF Implementing Regulation shall furthermore maintain
particular management procedures for the Peace Facility. Recalling that
financial and technical assistance for the implementation of Article 11b of the
ACP-EU Partnership Agreement will be financed by specific instruments other than
those intended for the financing of the ACP-EU Cooperation, activities
developed under these provisions need to be approved by prior specified
budgetary management procedures.

The 11th EDF Implementing Regulation
shall contain appropriate measure to allow for matching of funding of credits
from the EDF and the European Regional Development Fund to finance cooperation
projects between EU Outermost Regions and ACP Countries as well as Overseas
Countries and Territories in the Caribbean, Western Africa and Indian Ocean, in
particular simplified mechanisms for joint management of such projects.

2.           A Financial Regulation
shall be adopted by the Council, acting by a qualified majority as laid down in
Article 8, on the basis of a proposal from the Commission and after an opinion has
been delivered by the EIB on those provisions concerning it, and by the Court
of Auditors.

3.           The Commission will
present its proposals for the regu­lations referred to in paragraphs (1) and
(2) making provision, inter alia, for
the possibility of delegating the
implementation of tasks to third parties.

Article 11

Financial
implementation, accounting, audit and discharge

1.           The Commission shall
undertake the financial implementation of the envelopes it manages and in
particular the financial execution of projects and programmes, in accordance
with the Financial Regulation referred to in Article 10(2). For the recovery of
sums unduly paid, decisions of the Commission shall be enforceable within the
jurisdiction of the EU in accordance with Article 299 of the Treaty on the
Functioning of the EU.

2.           The EIB shall manage the
Investment Facility and conduct operations there under on behalf of the Union,
in accordance with the rules set out in the Financial Regulation referred to in
Article 10(2). In so doing, the EIB shall act at the risk of the Member States.
Any rights resulting from such operations, in particular rights as creditor or
owner, shall be vested in the Member States.

3.           The EIB shall undertake,
according to its statutes and best banking practice, the financial
implementation of operations by means of loans from its own resources as
referred to in Article 4, where applicable combined with interest-rate
subsidies drawn from the EDF’s grant resources.

4.           For each financial year,
the Commission shall draw up and approve the accounts of the EDF and send them
to the European Parliament, the Council and the Court of Auditors.

5.           The Commission shall make
the information referred to in Article 10 available to the Court of Auditors so
that the latter may, on the basis of the documentary evidence, carry out checks
on the aid provided from EDF resources.

6.           Each year, the EIB shall
send to the Commission and the Council its Annual Report on the implementation
of operations financed from the EDF resources it manages.

7.           Subject to paragraph 9 of
this Article, the Court of Auditors shall exercise the powers conferred on it
by Article 287 of the Treaty on the Functioning of the EU in respect of EDF
operations. The conditions under which the Court of Auditors exercises its powers
shall be laid down in the Financial Regulation referred to in Article 10(2).

8.           Discharge for the
financial management of the EDF, excluding operations managed by the EIB, shall
be given to the Commission by the European Parliament on the recommen­dation of
the Council, acting by a qualified majority as laid down in Article 8.

9.           The operations financed
from the EDF resources managed by the EIB shall be subject to the control and
discharge procedure laid down by the Statute of the EIB for all its operations.

Article
12

Revision
clause

Article 1(3)
and the Articles contained in Chapter II, with the exception of Article 8, may
be amended by the Council, acting unanimously and on a
proposal from the Commission. The EIB shall be associated with the Commission’s proposal on matters relating to its
activities and those of the Investment Facility.

Article 13

European
External Action Service

The
application of this Regulation shall be in accordance with Council Decision
2010/427 EU, establishing the organisation and functioning of the European
External Action Service.

Article 14

Ratification,
entry into force and duration

1.           Each Member State shall
approve this Agreement in accordance with its own constitutional requirements.
The Government of each Member State shall notify the General Secretariat of the
Council of the European Union when the procedures required for the entry into
force of this Agreement have been completed.

2.           This Agreement shall enter
into force on the first day of the second month following the notification of
the approval of this Agreement by the last Member State.

3.           This Agreement is
concluded for the same duration as the multiannual financial framework for
2014-2020 annexed to the ACP-EU Partnership Agreement and the duration of the
Overseas Association Decision (2014-2020). However, notwithstanding Article
1(4), this Agreement shall remain in force for as long as is necessary for all
the operations financed under the ACP-EU Partnership Agreement and the Overseas
Association Decision and the multi-annual financial framework to be fully
executed.

Article 15

Authentic
languages

This Agreement, drawn up in a single
original in the Bulgarian, Czech, Danish,
Dutch, English, Estonian, Finnish, French, German, Greek, Hungarian, Italian, Latvian, Lithuanian,
Maltese, Polish, Portuguese, Romanian, Slovak, Slovenian, Spanish and Swedish
languages, each of these texts being
equally authentic, shall be deposited in the archives of the General
Secretariat of the Council of the European
Union, which shall transmit a certified copy to each of the governments
of the signatory States.

[1]               OJ L 317, 15.12.2000,
p. 3. Agreement as amended by the Agreements signed in Luxembourg on 25 June
2005
(OJ L 287, 28.10.2005, p. 4) and in Ouagadougou on 22 June 2010 (OJ L 287,
4.11.2010, p. 3).

[2]               OJ L 314, 30.11.2001, p. 1. Decision as amended by Decision
2007/249/EC (OJ L 109, 26.4.2007, p. 33).

[3]               The 10th EDF Internal Agreement (OJ L 247, 9.9.2006, p. 32) was
signed in July 2006 by the Representatives of the Member States meeting within
the Council. The 10th EDF Implementing Regulation (Council Regulation No 617/2007)
and the 10th EDF Financial Regulation (Council Regulation No 215/2008) were
adopted in May 2007 and in February 2008 respectively. The 10th EDF entered
into force on 1.7.2008 with the entry into force of the first revision of the
Cotonou agreement.

[4]               COM (2011) 500.

[5]               OJ C 46,
24.2.2006, p. 1.

[6]               COM
(2011) 637.

[7]               OJ L 317, 15.12.2000, p. 3. Agreement as amended by the Agreement signed in Luxembourg on 25 June 2005
(OJ L 287,
28.10.2005, p. 4)
and by the Agreement signed in Ouagadougou on 22 June 2010 (OJ L 287,
4.11.2010, p. 3).

[8]               OJ L 247, 9.9.2006, p. 32.

[9]               OJ L 314, 30.11.2001, p. 1.

[10]             Council
document 18239/10 of 11 January 2011

[11]             OJ C
46, 24.2.2006, p. 1

[12]             COM(2011) 637.

SIMPLIFIED FINANCIAL STATEMENT: ASSESSMENT OF THE IMPACT OF THE 11TH
EDF ON HEADING V

Title of the
proposal/initiative

Communication from the
Commission to the European Parliament and the Council: Preparation of the
multiannual financial framework regarding the financing of EU cooperation for
ACPs and OCTs for the 2014-2020 period (11th European Development
Fund)

1.
ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE
Estimated impact
on expenditure of Heading V

Heading of multiannual financial framework: || 5 || " Administrative expenditure "

EUR million (to 3 decimal places)

|| || || Year N 2014 || Year N+1 2015 || Year N+2 2016 || Year N+3 2017 || Year N+4 2018 || Year N+5 2019 || Year N+6 2020 || TOTAL

DG: DEVCO ||

Ÿ Human resources || 83,352 || 82,507 || 81,664 || 80,824 || 80,824 || 80,824 || 80,824 || 570,821

Ÿ Other administrative expenditure || 4,657 || 4,558 || 4,513 || 4,480 || 4,480 || 4,479 || 4,480 || 31,646

TOTAL DG DEVCO || || 88,009 || 87,065 || 86,178 || 85,304 || 85,304 || 85,304 || 85,304 || 602,468

TOTAL appropriations under HEADING 5 of the multiannual financial framework || (Total commitments = Total payments) || 88,009 || 87,065 || 86,178 || 85,304 || 85,304 || 85,304 || 85,304 || 602,468

Remark: The draft Internal Agreement of the 11th European
Development Fund foresees that the EDF shall cover some support expenditures linked to the programming and implementation of the EDF.

2.
Estimated requirements of human resources

. -  ̈    The
proposal/initiative does not require the use of human resources

–
X  The proposal/initiative requires the use of
human resources, as explained below:

Estimate to be expressed in full amounts
(or at most to one decimal place)

|| || Year N || Year N+1 || Year N+2 || Year N+3 || Year N+4 2018 || Year N+5 2019 || Year N+6 2020

Ÿ Establishment plan posts (officials and temporary agents) ||

|| XX 01 01 01 (Headquarters and Commission’s Representation Offices) || 199,0 || 197,0 || 195,1 || 193,1 || 193,1 || 193,1 || 193,1

|| XX 01 01 02 (Delegations) ||                 237,16  ||                 234,74  ||                 232,32  ||                 229,90  ||                    229,90  ||                 229,90  ||                   229,90

|| XX 01 05 01 (Indirect research) || || || || || || ||

|| 10 01 05 01 (Direct research) || || || || || || ||

|| Ÿ External personnel (in Full Time Equivalent unit: FTE)[1] ||

|| XX 01 02 01 (CA, INT, SNE from the "global envelope") || 13,4 || 13,3 || 13,2 || 13,0 || 13,0 || 13,0 || 13,0

|| XX 01 02 02 (CA, INT, JED, LA and SNE in the delegations) || || || || || || ||

|| XX 01 04 yy [2] || - at Headquarters[3] || || || || || || ||

|| - in delegations || || || || || || ||

|| XX 01 05 02 (CA, INT, SNE - Indirect research) || || || || || || ||

|| 10 01 05 02 (CA, INT, SNE - Direct research) || || || || || || ||

|| Other budget lines (specify) || || || || || || ||

|| TOTAL ||                449,62  ||               445,08  ||                440,55  ||                436,05  ||                  436,05  ||                436,05  ||                  436,05

XX is the
policy area or budget title concerned.

The human resources required
will be met by staff from the DG who are already assigned to management of the action
and/or have been redeployed within the DG, together if necessary with any
additional allocation which may be granted to the managing DG under the annual
allocation procedure and in the light of budgetary constraints.

[1]               CA= Contract Agent; INT= agency staff ("Intérimaire");
JED= "Jeune Expert en Délégation" (Young Experts in
Delegations); LA= Local Agent; SNE= Seconded National Expert;

[2]               Under
the ceiling for external personnel from operational
appropriations (former "BA" lines).

[3]               Essentially for Structural Funds, European Agricultural
Fund for Rural Development (EAFRD) and European Fisheries Fund (EFF).