This document is meant purely as documentation tool and the institutions do not assume any liability for its contents
"BFINANCIAL REGULATION
of 21 December 1977
applicable to the general budget of the European Communities
(OJ L 356, 31.12.1977, p. 1)
Amended by:
Official Journal
No page date
"M1 Council Regulation (ECSC EEC, Euratom) No 1252/79 of 25 June
1979 L 160 1 28.6.1979
"M2 Financial Regulation of 16 December 1980 (80/1176 EEC
Euratom, ECSC) L 345 23 20.12.1980
"M3 Council Regulation (ECSC EEC, Euratom) No 1600/88 of 7 June
1988 L 143 1 10.6.1988
"M4 Council Regulation (ECSC EEC, Euratom) No 2049/88 of 24 June
1988 L 185 3 15.7.1988
"M5 Council Regulation (Euratom ECSC, EEC) No 610/90 of 13
March 1990 L 70 1 16.3.1990
"M6 Council Regulation (ECSC EC, Euratom) No 1923/94 of 25 July
1994 L 198 4 30.7.1994
"M7 Council Regulation (ECSC EC, Euratom) No 2730/94 of 31
October 1994 L 293 7 12.11.1994
"M8 Council Regulation (EC Euratom, ECSC) No 2333/95 of 18
September 1995 L 240 1 7.10.1995
"M9 Council Regulation (EC Euratom, ECSC) No 2334/95 of 18
September 1995 L 240 9 7.10.1995
"M10 Council Regulation (EC Euratom, ECSC) No 2335/95 of 18
September 1995 L 240 12 7.10.1995
"M11 Council Regulation (EC) No 2444/97 of 22 September 1997 L 340 1 11.12.1997
"M12 Council Regulation (EC ECSC, Euratom) No 2548/98 of 23
November 1998 L 320 1 28.11.1998
"M13 Council Regulation (EC ECSC, Euratom) No 2779/98 of 17
December 1998 L 347 3 23.12.1998
"M14 Council Regulation (EC ECSC, Euratom) No 2673/1999 of 13
December 1999 L 326 1 18.12.1999
"M15 Council Regulation (EC ECSC, Euratom) No 762/2001 of 9 April
2001 L 111 1 20.4.2001
NB: This consolidated version contains references to the European unit of account and/or the ecu, which from 1 January 1999
should be understood as references to the euro — Council Regulation (EEC) No 3308/80 (OJ L 345, 20.12.1980, p. 1) andCouncil Regulation (EC) No 1103/97 (OJ L 162, 19.6.1997, p. 1).1977X1231 — EN — 27.04.2001 — 002.001 — 1
FINANCIAL REGULATION
of 21 December 1977
applicable to the general budget of the European Communities
THE COUNCIL OF THE EUROPEAN COMMUNITIES
Having regard to the Treaty establishing the European Coal and Steel
Community, and in particular Article 78f thereof,
Having regard to the Treaty establishing the European Economic
Community, and in particular Article 209 thereof,
Having regard to the Treaty establishing the European Atomic Energy
Community, and in particular Article 183 thereof,
Having regard to the proposal from the Commission,Having regard to the opinion of the European Parliament (
1),
Whereas the conciliation provided for in the Joint Declaration of 4
March 1975 of the European Parliament, the Council and the
Commission (2) took place in a Conciliation Committee;
Whereas the Court of Auditors delivered an opinion on certain provisions
of this Financial Regulation concerning the presenting and auditing of
accounts; whereas it also stated that it had no objection to the Financial
Regulation being implemented from 1 January 1978, taking into account
the formal undertaking by the Council and the Commission to review the
whole of this Regulation, if necessary, as soon as the supplementary
opinion of the Court of Auditors is available;
Whereas the Treaty of 22 July 1975 amending certain financial
provisions of the Treaties establishing the European Communities and
of the Treaty establishing a single Council and a single Commission of
the European Communities entered into force on 1 June 1977; whereas,
as a result of the amendments introduced, new provisions need to be
adopted regarding the adoption of the budget, the measures to be taken if,
at the beginning of the financial year the budget has not yet been
adopted, and the transfer of appropriations; whereas in particular, with
regard to the latter, the European Parliament, the Council and the
Commission should be empowered to make certain transfers within their
respective budget sections themselves;
Whereas the Treaty of 22 July 1975 established a Court of Auditors
which exercises the powers and jurisdiction previously vested in the
Audit Board and the ECSC Auditor; whereas the Court of Auditors
should have the same status as an Institution as regards the establishment
and implementation of its budget; whereas the provisions relating to the
presenting and auditing of accounts should be adapted to this new
situation; whereas it is essential, however, to stress here and now that
these provisions will be re-examined in the light of a supplementary
opinion to be delivered by the Court of Auditors;
Whereas a distinction should be made between appropriations for
commitment and appropriations for payment in the case of projects
lasting several years and that the projects to which such a distinction
applies should be determined under the budgetary procedure;
Whereas the definition of the unit of account and the methods applicable
for making conversions between the unit of account and the currencies of
the Member States, embodied in the text of Article 10 of the Financial
Regulation of 25 April 1973 applicable to the general budget of the
European Communities, are no longer appropriate to the current
international monetary situation; whereas in its report of 4 March 1975
the Monetary Committee took the view that a unit of account based on a
basket of Community currencies would be best suited to the
requirements of the Community in general;!B
(1) OJ No C 6, 10. 1. 1977, p. 20.
(2) OJ No C 89, 22. 4. 1975, p. 1.1977X1231 — EN — 27.04.2001 — 002.001 — 2
Whereas, by Decision 75/250/EE (1), the Council has already adopted
such a unit of account to express the amounts of aid mentioned in Article
42 of the ACP-EEC Convention of Lomé; whereas, by Decision No
3289/75/ECSC, the Commission adopted the same unit of account for
the implementation of the ECSC Treaty; whereas the same definition
should be adopted for the purposes of implementing the EEC and
Euratom Treaties;
Whereas, to take account of developments in Community activities, it is
advisable that the budgetary nomenclature be decided under the
budgetary procedure;
Whereas the full application of the own resources system from 1 January
1978 necessitates the amendment of certain provisions concerning the
payment of the resources in question;
Whereas account should be taken of the trends in prices since the
Financial Regulation of 25 April 1973 was drawn up, and certain
amounts adjusted accordingly;
Whereas the various budgetary procedures currently used for the Social
Fund, the Regional Fund and the European Agricultural Guidance and
Guarantee Fund, Guidance Section, should be harmonized; whereas it is
essential that these procedures be brought into line with the general
system; whereas, nevertheless, transitional provisions must be introduced
to enable the arrangements used for these funds to be gradually adapted
to the general system;
Whereas, for reasons of budgetary clarity, a breakdown of research and
investment appropriations should be given in a special chapter of the
section of the budget relating to the Commission; whereas, moreover, the
system used for the functional presentation of these appropriations
should be simplified in the light of the experience already acquired in
this area;
Whereas the Office for Official Publications of the European
Communities carries out work for all the Institutions, thus constituting
a joint service, and the presentation and conditions of implementation of
the budget for this Office should consequently be improved; whereas the
appropriations for the Office should consequently be entered in an
Annex to the Commission section in which all these appropriations will
be entered under a specific budget heading; whereas, in order to avoid
unnecessary inflation of the budget, the Institutions should no longer be
required to make payments to the Office,
HAS ADOPTED THIS FINANCIAL REGULATION:
PART I
PROVISIONS APPLICABLE TO THE GENERAL BUDGET OF
THE EUROPEAN COMMUNITIES
TITLE I
GENERAL PRINCIPLES
Article 1
1. The budget of the European Communities (hereinafter called ‘the
budget’) is the instrument which sets out forecasts of, and authorizes in
advance, the expected revenue and expenditure of the Communities for
each year. "M8The budget may also disclose the underwriting of
borrowing and lending operations entered into by the Community. 3
For the purposes of this Financial Regulation, the revenue andexpenditure of the Communities shall comprise:!B
(1) OJ No L 104, 24. 4. 1975, p. 35.!M8
!B1977X1231 — EN — 27.04.2001 — 002.001 — 3
— the administrative expenditure of the European Coal and Steel
Community and the corresponding revenue,
— the revenue and expenditure of the European "M8
3Community,
— the revenue and expenditure of the European Atomic Energy
Community which may be charged to the budget pursuant to the
Euratom Treaty and to the measures taken in implementation
thereof.
The abovementioned expenditure shall comprise that arising from the
activities of the institutions.
2. The appropriations entered in the budget shall be authorized for the
duration of one financial year.
Expenditure may not be authorized for a period extending beyond the
financial year.
3. Administrative expenditure arising from:
— contracts which have been concluded, in accordance with local
usage, or
— contractual provisions relating, in particular, to the supply of
equipment,
for the periods extending beyond the financial year shall be charged to
the budget for the financial year in which it is effected.
4. The budget may include differentiated appropriations and non-dif-
ferentiated appropriations. Differentiated appropriations are those which
give rise to commitment appropriations and payment appropriations.
Multiannual operations give rise to the entry of differentiated appropri-
ations.
Commitment appropriations shall cover, for the current financial year,
the total cost of the legal obligations entered into for operations whose
implementation extends over more than one financial year.
Payment appropriations shall cover expenditure arising from commit-
ments entered into in the current financial year and/or preceding
financial years.
5. Differentiated appropriations shall be shown in the budget as
follows:
— the commitment appropriation authorized for the financial year
concerned and the payment appropriation for the same financial year
shall be entered under the appropriate heading,
— the estimated annual payment appropriations required for the
subsequent financial years shall be set out against the commitment
appropriations in an indicative schedule in the remarks column.
The distinction between commitment appropriations and payment
appropriations shall be made in the framework of the budget procedure.
6. The sum of the non-differentiated appropriations and the commit-
ment appropriations of the differentiated appropriations shall constitute
the appropriations for commitments.
The sum of the non-differentiated appropriations and the payment
appropriations of the differentiated appropriations shall constitute the
appropriations for payments.!B
!M5
!B
!M51977X1231 — EN — 27.04.2001 — 002.001 — 4
!M12
7. The legal commitments entered into for measures extending over
more than one financial year and the corresponding commitment
proposals shall contain a time limit for implementation. This date must
be notified to the recipient in the appropriate legal form. The parts of
those commitments not used six months after this date shall be cancelled
in accordance with Article 7(6). However, the third sentence of this
subparagraph shall apply to neither the Structural Funds nor the
Cohesion Fund.
This time limit shall be determined with due regard to the need for
multiannual implementation of the operations financed and the specific
conditions of implementation in relation to the various spheres of
intervention.
The Commission may, in special circumstances, adjust the time limit for
implementation of these commitments, where appropriate reasons are
given by the recipients.
In this case, the date shall be adjusted in accordance with the same
procedure as that provided for in Articles 36 to 39 for the commitment
proposal and shall be notified to the recipient in the appropriate legal
form.
Article 2
The budget appropriations must be used in accordance with the
principles of sound financial management, and in particular those of
economy and cost-effectiveness. Quantified objectives must be identified
and the progress of their realization monitored. "M8To this end, the
mobilization of Community resources must be preceded by an evaluation
to ensure that the resultant benefits are in proportion to the resources
applied. All operations must be subject to regular review, in particular
within the budgetary procedure, so that their justification may be
verified. 3
Member States and the Commission shall cooperate to ensure theadequacy of systems for decentralized management of Community
funds. Such cooperation shall include the prompt exchange of all
necessary information.
Article 3
1. Any proposal or communication submitted by the Commission to the
Council which may have budgetary consequences, including significant
changes in the number of posts, must include a financial statement.
Where necessary, the financial statement must be updated to take
account of the progress of discussions.
2. For activities of an operational nature, the financial statement shall
include financial and economic data with a view to the assessment by the
legislative authority of the need for Community action in accordance
with the relevant provisions of Article 3b of the EC Treaty. The financial
statement shall, in particular, incorporate the multiannual impact of the
measures proposed. It shall also give details of possible consistency with
other financial instruments; it shall be revised, if necessary, when the
preliminary draft budget is drawn up in the light of progress in
implementing the programme.
3. In the case of multiannual operations, the financial statement shall
contain the estimated schedule of annual requirements in appropriations
and posts. In drawing up this schedule, account shall also be taken of the
‘financial perspective’ annexed to the Interinstitutional Agreement on
budgetary discipline and improvement of the budget procedure
"M8 (1)3.
(1) OJ No C 331, 7. 12. 1993, p. 1.!M5
!M12
!M5
!M8
!M51977X1231 — EN — 27.04.2001 — 002.001 — 5
!M8
4. In order to prevent risk of fraud or irregularity, the Commission shall
record in the financial statement any information regarding existing and
planned fraud prevention and protection measures.
5. At the start of the budget procedure, the Commission shall supply, on
the basis of a cost-effectiveness analysis, appropriate information
enabling a comparison to be made between the development of
appropriation requirements and the original estimates contained in the
financial statements.
Article 4
1. Subject to Article 27, all revenue and expenditure shall be entered in
full in the budget and in the accounts without any adjustment against
each other.
2. Total revenue shall cover total appropriations for payments.
Notwithstanding the first subparagraph, and without prejudice to the
specific provisions of Title XI, certain revenues, on condition that they
are within the limit of the authorized amounts, shall not be used for any
other purpose, notably:
— financial contributions from Member States to certain research
programmes pursuant to the second subparagraph of Article 6 and
Article 11 (2) (c) of Council Decision 88/376/EEC, Euratom of 24
June 1988 on the system of the Communities’ own resources (1),
— interest on the deposits and fines referred to in Section 4 of
Regulation (EC) No 1467/97 (2), in accordance with Article 132a,
— revenue earmarked for a specific purpose, such as income from
foundations, subsidies, gifts and bequests,
— contributions to Community activities from non-member States or
various bodies,
— revenue from third parties in respect of work carried out at their
request.
3. The Commission may accept any donation made to the Commu-
nities, and in particular foundations, subsidies, gifts and bequests.
The Commission may accept donations which may involve some
financial charge only subject to prior authorization from the European
Parliament and the Council, which shall act on the matter within two
months of the date of receipt of the request from the Commission. If no
objection has been made within that period, the Commission shall take a
final decision in respect of acceptance.
Article "M553
1. Subject to Article 28a, no revenue shall be collected and no
expenditure effected unless credited to or charged against an article in
the budget.
2. No expenditure may be committed or authorized in excess of the
authorized appropriations, without prejudice to Article 27 (2).
(1) OJ No L 185, 15. 7. 1988, p. 24.
(2) OJ L 209, 2.8.1997, p. 6 and corrigenda in OJ L 46, 17.2.1998, p. 20 and OJ L
128, 30.4.1998, p. 71.!M5
!M8
!M5
!M13
!M5
!B
!M9
!M51977X1231 — EN — 27.04.2001 — 002.001 — 6
Article 6
The financial year shall run from 1 January to 31 December.The revenue of a financial year shall be entered in the accounts for the
financial year on the basis of the amounts collected during the financial
year, with the exception of the own resources for the month of January of
the next financial year, in respect of which advance payment may be
made pursuant to Article 10 (2) of Council Regulation (EEC, Euratom)
No 1552/89 of 29 May 1989 implementing Decision 88/376/EEC,
Euratom on the system of the Communities’ own resources (
1).
The readjustment of entries in respect of value added tax own resources,
of the supplementary resource based on GNP and, if appropriate, of
financial contributions, shall be carried out in accordance with the third
and fourth subparagraphs of Article 10 (3) of the abovementioned
Regulation.
The allotted appropriations shall be used solely to cover expenditure
properly entered into and paid in the financial year for which they were
granted, save as otherwise provided in Articles 7 and 103, and to cover
the debts regularly contracted relating to preceding financial years for
which no appropriation was carried forward.
The commitments shall be entered in the accounts on the basis of the
commitments contracted up to 31 December.
The expenditure of a financial year shall be entered in the accounts for
that year on the basis of the expenditure for which authorization reached
the financial controller not later than 31 December and the accounting
officer not later than the following 10 January, and for which payment
was effected by the accounting officer not later than 15 January.
Notwithstanding the two preceding subparagraphs, the expenditure of the
EAGGF Guarantee Section shall be taken into account for a financial
year in accordance with the rules laid down in Article 101.
Article "M573
The following rules shall govern the utilization of appropriations:
1. In the case of budget headings where there is no distinction between
commitment appropriations and payment appropriations, appropri-
ations still uncommitted at the end of the financial year for which
they were entered shall, as a rule, lapse.
Appropriations relating to remunerations and allowances of members
and staff of the institutions and provisional appropriations may not
be carried over.
However:(a) a decision may be taken to carry over, to the next financial year
only, appropriations still uncommitted at the close of the
financial year, where the appropriations made to the headings
in question in the budget of the next financial year are not
sufficient to cover requirements, and those committed after 15
December for purchases of stores or equipment, performance of
work or provision of supplies;
(b) appropriations in respect of payments still outstanding by virtue
of commitments duly entered into before the close of the
financial year, with the exception of commitments entered into
after 15 December for purchases of stores or equipment,
performance or work or provision of supplies, shall be carried
over automatically to the next financial year only.!M5
(1) OJ No L 155, 7. 6. 1989, p. 1.!M8
!M5
!B
!M51977X1231 — EN — 27.04.2001 — 002.001 — 7
!M4
2. In the case of budget headings where a distinction is made between
commitment appropriations and payment appropriations, commit-
ment appropriations and payment appropriations which have not
been used at the end of the financial year for which they were
entered shall, as a rule, lapse. However, they may, by decision of the
Commission taken not later than 15 February, be carried over to the
next financial year only, in accordance with the following criteria:
(a) in the case of commitment appropriations:
— amounts "M12 relating 3 to operations for which
preliminaries have been virtually completed at 31 December
but for which accounting commitments have not yet been
made"M12 must3in principle be committed by 31
March of the following year,
— amounts which are necessary when the Council has adopted
a basic instrument towards the end of the financial year and
the Commission has been unable to commit the appropri-
ations provided for this purpose in the budget by 31
December;
(b) in the case of payment appropriations:
— amounts needed to cover existing commitments or relating
to commitment appropriations carried over, when the
appropriations provided for the headings concerned in the
budget for the following financial year do not cover
requirements. In exercising its powers to implement the
budget, the Commission shall, depending on management
requirements, endeavour to use first the appropriations
authorized for the current financial year and not use the
appropriations carried over until the former are exhausted.
The Commission shall inform the budgetary authority by 15 March
at the latest of the decision taken and state, for each budget item,
how the agreed criteria were applied to each carry-over.
Provisional appropriations may not be carried over.
3. In the case of appropriations for which a decision to carry over may
be taken in accordance with point 1 (a), the Commission shall
forward to the budgetary authority, not later than 15 February, the
duly substantiated requests to carry over appropriations made by the
European Parliament, the Council, the Court of Justice, the Court of
Auditors, the Economic and Social Committee, the Committee of the
Regions, "M14 the Ombudsman 3and the Commission itself.
The carry-over of such appropriations can be proposed only for
exceptional reasons in order to cope with compelling needs which
cannot be met by appropriations from the next financial year. In
principle, such carry-overs are intended to cover needs normally
coming under the previous financial year but which, due to delays
for which the authorizing officer was not responsible, could not be
used in due time.
The Council shall consult the European Parliament and shall act by a
qualified majority on the requests to carry over expenditure
necessarily arising from the Treaties or from acts adopted pursuant
thereto.
The European Parliament shall consult the Council and shall act on
the requests to carry-over expenditure other than that necessarily
arising from the Treaties or from acts adopted pursuant thereto.
In the absence of a decision by the budgetary authority within a
period of six weeks, the requests for carry-overs shall be deemed to
be approved.!M5
!M6
!M51977X1231 — EN — 27.04.2001 — 002.001 — 8
4. Unused revenue and appropriations available at 31 December arising
from the specific revenue referred to in Article 4 (2) shall be carried
over automatically.
5. The following appropriations shall lapse at the end of the year:
(a) appropriations from the previous financial year:
— carried over by decision of the budgetary authority under
point 1 (a) which have been neither committed nor paid,
— carried over automatically under point 1 (b) which have not
been paid,
— carried over by the Commission under point 2 and remaining
unused at the end of the financial year;
(b) appropriations of the financial year which have not been carried
over.
6."M12 When commitments in budget headings where there is a
distinction between commitment appropriations and payment
appropriations are cancelled as a result of total or partial
non-implementation of the projects for which they were earmarked
in any financial year after that in which the commitment appropri-
ations were entered in the budget, the appropriations concerned shall,
as a rule, lapse. In addition, any amounts unduly paid shall be
recovered. 3
However, the commitment appropriation corresponding to the
amount of the commitment cancelled may, exceptionally, be made
available again when it is essential to carry out the programme
originally planned, unless the budget for the current financial year
contains funds available for this purpose.
At the beginning of each financial year the Commission shall
therefore examine the cancellations which have taken place in the
previous financial year and assess, in the light of requirements, the
need for making the appropriations available again.
The Commission shall take this decision by 15 February of each
financial year.
The Commission shall inform the budgetary authority by 15 March
of the decision taken and state, for each budget item, the reasons for
making these appropriations available again.
7. Revenue deriving from the repayment of advances by recipients of
Community aid shall be entered in the suspense accounts.
At the start of each financial year, the Commission shall examine the
volume of such revenue and assess the need for re-use in the budget
heading from which the original expenditure was made, in the light
of requirements.
The Commission shall take this decision before 15 February of each
financial year and shall inform the budget authority by 15 March of
the decision taken.
Revenue which has not been re-used shall be shown under
miscellaneous revenue of the financial year in which it has been
entered.
8. The revenue and expenditure account shall show the automatic
carry-overs, the appropriations carried over by decision of the
budgetary authority, those carried over by decision of the Commis-
sion and the appropriations made available again by decision of the
Commission after commitments have been cancelled or repaid.
9. For the purpose of implementing the budget, the use of appropri-
ations carried forward shall be shown separately, for each budget
item, in each article in the accounts for the current financial year.!M5
!M4
!M51977X1231 — EN — 27.04.2001 — 002.001 — 9
!B
Article "M583
"M51.3The appropriations entered in the budget may be
committed with effect from 1 January, once the budget has been finally
adopted.
"M52.3This provision shall not apply to current administrative
expenditure which, as from 15 November of each year, may be charged
as an expected commitment against the appropriations provided for in
respect of the next financial year. Such commitments shall not, however,
exceed one quarter of the total corresponding appropriations for the
current financial year. Such commitments shall not apply to new
expenditure of a kind not yet approved in principle in the last budget duly
adopted.
3. Expenditure relating to rents or certain associated expenditure which
is payable in advance in accordance with provisions laid down by law or
contracts may give rise to payments from 20 December onwards to be
charged to the appropriations for the next financial year.
Article 9
1. If the budget is not finally adopted at the beginning of the financial
year, Article 78b of the ECSC Treaty, Article 204 of the "M8EC
Treaty 3 and Article 178 of the Euratom Treaty shall apply to
commitment and payment of expenditure already approved in principle
in the last budget duly adopted.
An item of expenditure shall be considered as having been approved in
principle in the last budget duly adopted if it could have been charged to
a specific budget heading under the financial year concerned.
2. (a) Commitments may be entered into in respect of any chapter:
— for up to one quarter of the total appropriations entered in
the relevant chapter for the preceding financial year, account
being taken of all transfers, plus one twelfth for each
completed month,
— without exceeding the appropriations provided for in the
draft budget or, in the absence thereof, in the preliminary
draft budget.
The global provisional commitments of the EAGGF
Guarantee Section referred to in Article 99 shall be treated
as commitments for the purposes of these provisions.
(b) Payments may be made monthly in respect of any chapter:
— up to one-twelfth of the total appropriations entered in the
chapter concerned for the preceding financial year, account
being taken of all transfers,
— as long as this measure does not have the effect of placing at
the disposal of the Commission, for any month, appropri-
ations in excess of one-twelfth of those provided for in the
draft budget or, in the absence thereof, in the preliminary
draft budget.
3. If the continuity of Community activities and administrative needs so
require:
(a) for expenditure necessarily resulting from the Treaties or from acts
adopted in accordance therewith, the Council acting by a qualified
majority may at the request of the Commission and after consulting
the European Parliament, authorize simultaneously two or more
provisional twelfths for both commitments and payments in addition
to those automatically made available under paragraphs 2 (a) and
(b);
(b) for expenditure other than that necessarily resulting from the
Treaties, or from acts adopted in accordance therewith, the second!M51977X1231 — EN — 27.04.2001 — 002.001 — 10
subparagraph of Article 78b (2) of the ECSC Treaty, the third
subparagraph of Article 204 of the "M8EC Treaty 3and the
third subparagraph of Article 178 of the Euratom Treaty shall apply.
The additional twelfths shall be authorized in whole.The annual total authorized for each chapter by reason of the twelfths
may not exceed the total for the corresponding chapter of the preceding
year’ s budget, account being taken of transfers, nor may it exceed the
total for the corresponding chapter of the draft budget or, where this is
not available, the preliminary draft budget.
4. If, for a given chapter, the authorization of two or more provisional
twelfths granted in the circumstances provided for in paragraph 3 does
not enable the expenditure necessary to avoid a break in continuity of the
Community’ s activity in the area in question to be met, an overstepping
of the total provided for in the last subparagraph of paragraph 3 may,
exceptionally, be authorized in accordance with the same procedures,
provided that the overall total of the appropriations opened in the budget
of the preceding year is not exceeded.
Article
"M5103
The budget and the supplementary or amending budgets, as finally
adopted, shall be published in the Official Journal of the European
Communities , at the instance of the President of the European
Parliament.
Publication shall normally take place within one month of the date of the
declaration of final adoption of the budget.
Article 11
1. The budget shall be drawn up in euro.2. The euro shall be the single currency as defined in Council
Regulation (EC) No 974/98 of 3 May 1998 on the introduction of the
euro (
1).
3. Without prejudice to specific provisions deriving from the
application of sector-specific rules governing either revenue or
expenditure, the rights and obligations of the Communities shall be
expressed and executed in euro.
4. Conversions between the euro and the currencies of the Member
States which have not adopted the euro shall be made at the exchange
rate applicable on the day of the operation; derogations from this
principle may be permitted in exceptional cases, in accordance with the
implementing rules referred to in Article 139.
5. The daily euro exchange rates for the currencies not participating in
the single currency shall be available each day and shall be published in
theOfficial Journal of the European Communities .!M5
(1) OJ L 139, 11.5.1998, p. 1.!B
!M5
!M131977X1231 — EN — 27.04.2001 — 002.001 — 11
!M5
TITLE II
ESTABLISHMENT AND STRUCTURE OF THE BUDGET
SECTION I
ESTABLISHMENT OF THE BUDGET
Article 12
The European Parliament, the Council, the Court of Justice, the Court of
Auditors, the Economic and Social Committee, the Committee of the
Regions and the Ombudsman shall, each year before 1 July, draw up an
estimate of their revenue and expenditure for the following year.
These estimates shall be forwarded to the Commission and, forinformation, to the European Parliament and the Council, no later than
1 July.
Article 13
1. The Commission shall, in the preliminary draft budget which it
places before the Council not later than 1 September of each year, draw
up a general statement of revenue of the Communities and consolidate
the estimates referred to in Article 12.
It shall at the same time forward the preliminary draft budget to the
European Parliament.
2. The Commission shall prepare a general introduction to the
preliminary draft budget. This introduction shall contain in particular:
(a) financial tables covering the entire budget; and
(b) as regards the Commission subsections:
— a description of the policies for which the appropriations are
requested, taking account of the principles and requirements set
out in Article 2,
— an explanation of the changes in appropriations from one
financial year to the next,
— a detailed statement on borrowing and lending policy.
3. Each of the other sections of the preliminary draft budget shall be
preceded by an introduction prepared by the institution concerned and
covering the points listed in the first and second indents of 2 (b).
4. The preliminary draft budget shall be accompanied by working
documents containing the following information:
(a) in respect of staff of the institutions:
— a statement of the permanent and temporary staff policy
measures taken, listing the measures taken to promote mobility
and giving figures for the staff redeployed by category,
— for each category of staff, a detailed list of budgetary posts and
numbers of persons in post on the date of the submission of the
preliminary draft budget, indicating their distribution by grade
and administrative unit or principal operational unit for the
establishments of the Joint Research Centre,
— where a change in the number of persons in post is proposed, a
statement justifying such changes,!M14
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— a list of posts broken down by area of activity;
(b) in respect of subsidies to the bodies set up pursuant to the Treaties or
Acts adopted in accordance therewith and to the Supply Agency, an
estimate of revenue and expenditure prefaced by an explanatory
statement drawn up by the bodies concerned; for the European
Schools, a statement showing revenue and expenditure prefaced by
an explanatory statement.
5. The Commission shall also attach to the preliminary draft budget:
— an analysis of the financial management for the preceding financial
year, as provided for in Article 80, and a balance sheet of assets and
liabilities of the Communities as at 31 December of the preceding
financial year, as provided for in Article 81, and
— an opinion on the estimates of the other institutions; this opinion
may contain different estimates, accompanied by the reasons
therefor.
Article 14
The Commission may, on its own initiative or if requested by the
European Parliament, the Council, the Court of Justice, the Court of
Auditors, the Economic and Social Committee, the Committee of the
Regions or the Ombudsman, each in respect of its own section, present to
the Council a letter of amendment to the preliminary draft budget on the
basis of new information which was not available at the time the
preliminary draft was established.
However, save in very exceptional circumstances, the Commission must
put such letter of amendment to the Council at least 30 days before the
first reading of the draft budget by the European Parliament, and the
Council must put the letter of amendment to the draft budget to the
European Parliament at least 15 days before the said first reading.
Article 15
1. In the event of unavoidable, exceptional or unforeseen circum-
stances, the Commission may submit preliminary draft supplementary
and/or amending budgets.
Preliminary draft supplementary budget shall mean any proposal which
would either increase the total amount of appropriations for commit-
ments and/or payments, or finance one or more new operations without
increasing the total amount of appropriations.
Preliminary draft amending budget shall mean any proposal which would
involve modifications to the budget of a financial or technical nature,
without causing an increase in the total amount of appropriations and
without providing for new operations.
2. Preliminary draft supplementary and/or amending budgets shall be
subject to the provisions of Article 78 of the ECSC Treaty, Article 203 of
the"M8EC Treaty 3and Article 177 of the Euratom Treaty.
They shall be submitted, examined, established and finally adopted in the
same form and according to the same procedure as the budget whose
estimates they are amending. They must be substantiated by reference to
the latter.
3. All preliminary draft supplementary and / or amending budgets
must, as a general rule, be forwarded to the Council by the date laid
down for the submission of the preliminary draft budget for the following
financial year.
The competent authorities shall discuss them in the light of their urgency.!M8
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4. Requests for amending and/or supplementary budgets from the
European Parliament, the Council, the Court of Justice, the Court of
Auditors, the Economic and Social Committee, the Committee of the
Regions or the Ombudsman shall be forwarded by the Commission to the
budgetary authority. The Commission may attach a dissenting opinion.
5. Where the Council, having received a preliminary draft supplemen-
tary and/or amending budget, considers that it is not necessary to prepare
a draft budget, it shall determine its position after an exchange of views
with the European Parliament.
6. Preliminary draft supplementary and/or amending budgets shall be
accompanied by statements of grounds and the information available on
the implementation of the budget for the preceding and current financial
years at the time of their establishment.
Article "M5163
1. The Council shall establish the draft budget in accordance with the
procedure laid down in Article 78 of the ECSC Treaty, Article 203 of the
"M8EC Treaty 3and Article 177 of the Euratom Treaty.
The draft budget shall be forwarded by the Council to the European
Parliament and placed before it not later than 5 October. The Council
shall attach to that draft budget an explanatory memorandum defining in
particular its reasons for departing from the preliminary draft budget, if
it has done so.
2. Paragraph 1 shall apply mutatis mutandis to draft supplementary or
amending budgets.
Article 17
1. The budget shall be adopted in accordance with Article 78 of the
ECSC Treaty, Article 203 of the "M8EC Treaty 3and Article 177 of
the Euratom Treaty.
2. Once the budget has been declared finally adopted by the President
of the European Parliament, each Member State shall, from 1 January of
the following financial year or from the date of the formal declaration if
it is made after 1 January, be bound to make over to the Community the
payments due as specified in Council Regulation (EEC, Euratom) No
1552/89 of 29 May 1989 implementing Decision 88/376/EEC, Euratom
on the system of the Communities’ own resources (1).
Article 18
The Commission and the budgetary authority may agree to bring forward
certain dates for the transmission of the estimates, and for the adoption
and transmission of the preliminary draft and draft budgets. This
agreement may not, however, have the effect of reducing or delaying the
periods allowed for consideration of these texts under Article 78 of the
ECSC Treaty, Article 203 of the "M8EC Treaty 3and Article 177 of
the Euratom Treaty.
SECTION II
STRUCTURE AND PRESENTATION OF THE BUDGET
Article 19
1. The budget shall consist of:
— a general statement of revenue,
(1) OJ No L 155, 7. 6. 1989, p. 1.!M5
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— separate sections subdivided into statements of revenue and
expenditure of the European Parliament, the Council, the Commis-
sion, the Court of Justice, the Court of Auditors, the Economic and
Social Committee, the Committee of the Regions and the Ombuds-
man.
The Commission section shall consist of:
— ‘Part A’ for the staff and administrative expenditure of that
institution.
The revenue and expenditure of the Office for Official Publications
of the European Communities shall be attached to this part,
— ‘Part B’ for operating expenditure, divided into as many subsections
as are required.
2. Within each section, the items of revenue and expenditure shall be
classified according to their type or the use to which they are assigned
under titles, chapters, articles and items.
3. The budgetary nomenclature shall be determined as regards the
apportionment of revenue and expenditure under separate titles, chapters
and articles, during the budgetary procedure.
4. Each section of the budget, and Parts A and B of the Commission
section, may include a chapter for ‘provisional appropriations’ and a
‘contingency reserve’ chapter. The appropriations entered in these
chapters may be used only by means of transfer in accordance with the
procedure laid down in Article 26.
5. The Commission section may include a ‘negative reserve’ limited to
a maximum amount of "M13 euro3200 million. This reserve, which
shall be entered in a separate chapter, may comprise both appropriations
for commitments and appropriations for payments.
This reserve must be drawn upon before the end of the financial year by
means of transfer in accordance with the procedure laid down in Article
26.
6. The subsection for EAGGF Guarantee Section expenditure shall
include a monetary reserve, for which the entry, utilization and financing
conditions are determined by "M8Council Decision 94/729/EC of 31
October 1994 3concerning budgetary discipline (1), and"M8Deci-
sion 94/728/EC, Euratom of 31 October 1994 (2)3on the system of the
Communities’ own resources and by the provisions adopted for
implementing the latter.
7. In addition, the document showing all the borrowing and lending
operations referred to in Article 20 (5) shall be annexed to Part B of the
Commission section.
7. The subsection concerning ‘Cooperation with developing countries
and other third countries’ shall include the following two reserves, the
conditions for the entry, utilization and financing of which are laid down
in Council Decision 94/729/EC of 31 October 1994 on budgetary
discipline (1) and in Regulation (EEC, Euratom) No 1552/89:
(a) a reserve for emergency aid for non-member countries;
(b) a reserve relating to Community loans and loan guarantees to
non-member countries and in those countries.
(1) OJ No L 293, 12. 11. 1994, p. 14.
(2) OJ No L 293, 12. 11. 1994, p. 9.!M6
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Article 20
The budget shall show:
1. In the general statement of revenue:
— the estimated revenue of the Communities for the financial year
in question, divided into titles, chapters, articles and items,
— the revenue for the preceding financial year, divided into titles,
chapters, articles and items,
— appropriate remarks on each subdivision.
2. In the section for each institution:
(a) as regards the statement of revenue:
— the estimated revenue for each institution for the financial
year in question, divided into titles, chapters, articles and
items, following a decimal classification system,
— the revenue entered in the budget for the preceding financial
year and the revenue established for the last financial year
for which accounts have been closed, using the same
classification,
— appropriate remarks on each revenue heading;
(b) as regards the statement of expenditure:
(ba) in the case of the various items, articles, chapters and titles:
— the appropriations made available for the financial year
in question, these appropriations being the commitment
appropriations and the payment appropriations for the
budget headings for which this distinction has been
agreed,
— the appropriations made available for the preceding
financial year,
— the actual expenditure in the last financial year for
which the accounts have been closed, determined as
follows:
— for the headings where the distinction between
commitment appropriations and payment appropri-
ations has not been made:
— actual payments in the last financial year for
which the accounts have been closed plus the
carryovers to the next financial year,
— for the headings where the distinction between
commitment appropriations and payment appropri-
ations has been made:
— in commitments: commitments entered into
during the financial year against appropriations
for that financial year and against appropri-
ations carried over from the preceding financial
year;
— in payments: payments made during the finan-
cial year against appropriations for that finan-
cial year and against appropriations carried over
from the preceding financial year;
(bb) appropriate remarks on each subdivision. These remarks
shall include:
— the basic legal instrument, where one exists,
— all such explanations as may be necessary concerning
the nature and purpose of the appropriations,1977X1231 — EN — 27.04.2001 — 002.001 — 16
— in the case of operations covered by commitment
appropriations and payment appropriations: an indica-
tive schedule of the payments for the financial year
concerned and subsequent financial years,
— the amount of any revenue to be re-used. This amount is
mentioned for information only.
3. As regards staff:
— for each section of the budget, an establishment plan setting the
number of permanent and temporary posts for each grade in each
category and in each service authorized within the limits of the
budget appropriations. The staff of the supply agency shall be
shown separately in the Commission’ s establishment plan.
"M14 3;
— an establishment plan for staff paid from the research and
technological development appropriations, classified by cat-
egory and grade and distinguishing between permanent and
non-permanent staff, authorized within the limits of the budget
appropriations.
As regards scientific and technical staff, the classification may
be based on groups of grades, in accordance with the conditions
laid down in each budget. The establishment plan must specify
the number of highly qualified technical or scientific personnel
who are accorded special advantages under the Staff Regulations
applicable to these officials;
— an establishment plan setting the number of posts for each grade
in each category in:
— the Office for Official Publications,— the European Centre for the Development of V ocational
Training,
— the European Foundation for the Improvement of Living and
Working Conditions.
The establishment plan shall show next to the number of posts
authorized for the financial year the number authorized for the
preceding year.
4. The establishment plan shall constitute an absolute limit for each
institution; no appointment may be made in excess of the limit set.
Instances of half-time work authorized by the appointing authority in
accordance with Article 55a of the Staff Regulations of officials of
the European Communities may be compensated for by the
recruitment of other staff within the limits laid down by the budget
authority in the budgetary procedure.
5. As regards borrowing and lending operations:
(a) in the general statement of revenue, the budget headings
corresponding to the relevant operations and intended to record
any reimbursements received from beneficiaries who initially
defaulted, leading to activation of the performance guarantee.
These headings shall carry a token entry and be accompanied by
appropriate remarks;
(b) in the Commission section, Part B:
— the budget headings containing the Community’s perform-
ance guarantees in respect of the operations in question.
These headings shall carry a token entry, so long as no!M5
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effective charge which has to be covered by specific
resources has arisen,
— remarks giving a reference to the legal basis and the volume
of the operations envisaged, the duration and the financial
guarantee given by the Community in respect of these
operations;
(c) in a document annexed to Part B of the Commission section, as
an indication:
— current capital operations and current debt management,— the capital operations and debt management for the financial
year in question.
6. The budget headings under revenue and expenditure necessary for
implementing the reserve relating to Community loans and loan
guarantees to non-member countries and in those countries and also
for implementing the Guarantee Fund established by Council
Regulation (EC, Euratom) No 2728/94.
TITLE III
IMPLEMENTATION OF THE BUDGET
SECTION I
GENERAL PROVISIONS
Article
"M5213
The budget shall be implemented in accordance with the principle that
the authorizing officers and accounting officers are different individuals.
The appropriations shall be administered by the authorizing officer who
alone is empowered to enter into commitments regarding expenditure,
establish entitlements to be collected and issue recovery orders and
payment orders.
The operations of collection or payment shall be carried out by the
accounting officer.
The duties of authorizing officer, financial controller and accounting
officer shall be mutually incompatible.
Article "M5223
1. The Commission shall implement the budget on its own responsi-
bility in accordance with this Financial Regulation and within the limits
of the appropriations allotted.
The implementation of appropriations entered for significant Commu-
nity action shall require a basic act, in accordance with the procedure and
the provisions laid down in paragraph 3 (c) of Section IV of the Joint
Declaration of 30 June 1982 (1).
2. The Commission shall confer upon the European Parliament, the
Council, the Court of Justice, the Court of Auditors, the Economic and
Social Committee, the Committee of the Regions and the Ombudsman
the requisite powers for the implementation of the sections of the budget
relating to them.!M8
(1) OJ No C 194, 28. 7. 1982, p. 1.!M5
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The Commission and other institutions may not, under any form or upon
any basis whatsoever, delegate to outside entities or organisations tasks
of implementing the budget which may give rise to missions on the part
of the European public service, especially where powers to enter into
public contracts are involved.
3. In accordance with Article 2, each institution shall take the
appropriate measures, in terms of both organization and follow-up, to
ensure the achievement of the objectives which it has set for itself.
4. With the exception of the cases provided for in Articles 28, 29, 39,
48 and 52 involving decisions overruling the financial controller, the
Commission and each of the other institutions may delegate their powers
of budgetary implementation in accordance with the conditions laid
down by their internal rules of procedure and within the limits which
they themselves lay down in the act of delegation.
Those so empowered may act only within the limits of the powers
expressly conferred upon them.
All acts implementing the budget which are capable of giving rise to a
confusion of interests between delegator, delegatee and third party
recipient of expenditure shall be prohibited.
The implementing arrangements set out in Article 139 shall govern the
conditions for implementing this Article, in particular the following
aspects:
— causes of the confusion of interests,
— persons between whom the confusion of interests may arise,— consequences of the confusion of interests.The acts of delegation shall be communicated to all the parties concerned
in accordance with the implementing rules provided for in
"M8Article
1393.
Any member of staff who authorises commitments or payments without
having been delegated or subdelegated the necessary powers, or in excess
of the limits of the powers expressly conferred upon him, shall render
himself liable to disciplinary action and, where appropriate, to payment
of compensation in accordance with Title V . Each institution shall adopt
internal rules which shall specify the procedure for issuing acts of
subdelegation. Such acts shall obligatorily specify in detail the powers
conferred.
4a. When the institutions commission an outside person, body or firm to
perform a Community activity, the contracts and subcontracts concluded
for that purpose must contain all appropriate provisions for ensuring the
transparency of the contracted and subcontracted operations in accord-
ance with the implementing rules provided for in Article 139.
If the payments made to the subcontractors generate interest which may
be used to finance the programmes in question, the following procedure
shall be applied:
— periodically, at intervals of no more than six months, recovery orders
shall be issued for the interest generated by these funds, which will
then be booked to the statement of revenue,
— at the same time, appropriations for the corresponding amount, in
both commitments and payments, shall be made available in the
heading of the statement of expenditure to which the initial
expenditure was charged.
5. Save as otherwise provided, the Ombudsman, the Economic and
Social Committee and the Committee of the Regions shall, for the
purposes of this Financial Regulation, be treated as institutions of the
Communities.!M12
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For the common organizational structure of the Economic and Social
Committee and the Committee of the Regions, an accounting system
shall be established with a breakdown of expenditure showing the
proportion of services provided to each of these two institutions.
Article 23
Where revenue and expenditure operations are managed by means of
integrated computer systems, the provisions of Sections II and III and of
Title VI shall apply with due allowance for the possibilities and
requirements deriving from computerized management. To this end:
— the supporting documents may remain with the authorizing officer or
the accounting officer for the purposes of checking,
— signatures and approvals may be added in appropriate computerized
form.
The conditions for implementing this Article shall be determined by the
implementing rules provided for in "M8Article 139 3.
Article 24
Each institution shall appoint a financial controller. "M14
3
He shall carry out his duties in accordance with the principles laid down
in Article 2 and the provisions of Article 22(3). He shall report to his
institution on any problem he uncovers regarding the management of
Community finances. He shall draw up an annual report on his work.
He shall be responsible for monitoring:
— the commitment and authorization of all expenditure,
— the establishment and collection of all revenue.
The financial controller must be consulted on the setting up and
alteration of the accounting systems and inventory systems of the
institution to which he is attached and on the setting up and alteration of
the systems of financial management used by authorising officers. He
shall have access to the data of such systems.
Monitoring shall be carried out by that official by means of inspection of
the files relating to expenditure and revenue and, if necessary, on the
spot.
All documents and information produced or stored on a magnetic
medium which the financial controller considers necessary for the
performance of his duties shall be supplied to him at his request by the
departments concerned in the institution.
The financial controller may be assisted in his duties by one or more
assistant financial controllers.
The special rules applicable to such officials, which shall be laid down in
the implementing rules provided for in "M8Article 139 3, shall be
such as to guarantee that they are independent in the performance of their
duties. Their appointment, their promotion and disciplinary rules or
transfer, and any interruption or termination of appointment by whatever
procedure shall be the subject of reasoned decisions to be forwarded, for
information, to the European Parliament, the Council, the Commission
and the Court of Auditors.!M6
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The persons concerned, and the institutions employing them, may
institute proceedings before the Court of Justice. Where such an action is
concerned with his independence, the financial controller may institute
proceedings against his institution.
Article 24a
1. The Commission shall appoint an internal auditor who is indepen-
dent of the financial controller. He shall be appointed in the same way as
the financial controller and shall, for the purposes of his duties, have
access to the same information as the financial controller and, in order to
maintain his independence, be subject to the same special rules and
measures as are applicable to the financial controller under the second
paragraph, the second sentence of the fourth paragraph, and the fifth,
sixth, eighth and ninth paragraphs of Article 24.
The internal audit shall include, in particular, an evaluation of the
effectiveness of the management and control systems and verification of
the regularity of operations. These duties shall be performed in
accordance with the implementing rules provided for in Article 139.
The internal auditor shall not be either an authorising officer or an
accounting officer.
2. The Commission, under the authority of its President, shall take all
the means necessary to enable the internal auditor to fulfil his functions
in accordance with paragraph 1.
3. Institutions other than the Commission may each appoint an internal
auditor who is independent of the financial controller and shall carry out
his duties in accordance with the conditions and arrangements laid down
in paragraph 1. If no internal auditor is appointed, the financial controller
shall be responsible for internal auditing in accordance with the
conditions and arrangements laid down in paragraph 1.
4. The internal auditor shall submit an annual internal audit report to
his institution showing the number and type of internal audits carried
out, the audit recommendations made and the action taken on those
recommendations.
Article 25
In each institution, the collection of revenue and the payment of
expenditure shall be carried out by an accounting officer.
The accounting officer shall be appointed by the institution.
"M14 3
Without prejudice to the system provided for in Articles 4 and 5 of
Council Regulation (EEC) No 729/70 of 21 April 1970 on the financing
of the common agricultural policy (1) as last amended by Regulation
(EEC) No 2048/88 (2), and subject to the second subparagraph of Article
53 on payments procedures, to Article 54 on imprests and to Article 111
on the financing of external aid of this Financial Regulation, the
accounting officer alone is empowered to manage monies and other
assets. He shall be responsible for their safekeeping.
The accounting officer shall be responsible for preparing the financial
statements provided for in Articles 78, 79, 80 and 81 of this Financial
Regulation.!M5
(1) OJ No L 94, 28. 4. 1970, p. 13.
(2) OJ No L 185, 15. 7. 1988, p. 1.!M15
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The accounting officer shall be consulted on the setting up and alteration
of the accounting systems of financial management used by authorising
officers, where such systems are intended to supply data to the central
accounts. He shall, at his request, have access to the data of such
systems. The accounting officer shall also be consulted on the setting up
and alteration of the inventory systems.
He may be assisted in his duties by one or more assistant accounting
officers, appointed under the same conditions as the accounting officer.
The special rules applicable to the accounting officer and to assistant
accounting officers shall be laid down in the implementing rules
provided for in "M8Article 139 3.
Article 26
1. Appropriations shall be earmarked for specific purposes by chapter
and article.
2. The European Parliament and the Council may transfer appropri-
ations from one chapter to another and from one article to another within
their own sections of the budget.
The Court of Justice, the Court of Auditors, the Economic and Social
Committee, the Committee of the regions and the Ombudsman may,
within their own section of the budget, transfer appropriations from one
article to another within each chapter. They shall inform the budgetary
authority and the Commission three weeks before making such transfers.
3. The Commission may, within its own section of the budget:
(a) transfer appropriations from one article to another within each
chapter;
(b) transfer appropriations from one chapter to another within each of
the titles relating to staff and administrative expenditure. It shall
inform the budgetary authority three weeks before making such
transfers.
4. Without prejudice to the provisions of paragraphs 2 and 3, the
Commission may make proposals to the budgetary authority for transfers
from one chapter to another within each budget section.
Proposals for transfers shall be accompanied by appropriate and detailed
supporting documents showing the implementation of appropriations and
estimates of requirements up to the end of the financial year, both for the
headings to be credited and for those from which the appropriations are
drawn.
Proposals made by the other Institutions, the Economic and Social
Committee, the Committee of the Regions and the Ombudsman for
transfers from one chapter to another shall be automatically forwarded to
the budgetary authority; the Commission may attach its own opinion to
such proposals.
5. The budgetary authority shall take decisions on transfers of
appropriations as follows:
(a) in the case of proposals for transfers relating to expenditure
necessarily resulting from the Treaties or from acts adopted in
accordance therewith, the Council shall, after consulting the
European Parliament, act by a qualified majority within six weeks,
except in urgent cases. The European Parliament shall deliver its
opinion within such time as will permit the Council to be apprised of
it and to act within the time limit indicated. Where the Council does
not act within this time limit, the proposals for transfers shall be
deemed to be approved;
(b) in the case of proposals for transfers relating to expenditure other
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in accordance therewith, the European Parliament shall, after
consulting the Council, act within six weeks, except in urgent cases.
The Council shall deliver its opinion, by a qualified majority, within
such time as will permit the European Parliament to be apprised of it
and to act within the time limit indicated. Where the European
Parliament does not act within this time limit, the proposals for
transfers shall be deemed to be approved;
(c) proposals for transfers relating both to expenditure necessarily
resulting from the Treaties or from acts adopted in accordance
therewith, and to other expenditure shall be deemed to be approved if
neither the Council nor the European Parliament has decided
otherwise within six weeks of the date on which the two institutions
received the proposals. If, in the case of such proposals for transfers,
the European Parliament and the Council reduce the proposal for a
transfer by different amounts, whichever is the smaller of the
amounts accepted by one of the two institutions shall be deemed to
be approved. Where one of the institutions rejects the principle of the
transfer, such transfer shall not be made.
6. Appropriations may also be transferred, by decision of the budgetary
authority, between headings where a distinction is made between
commitment appropriations and payment appropriations and headings
involving non-differentiated appropriations.
7. Every proposal for a transfer within a chapter or from one chapter to
another shall be subject to the approval of the financial controller, who
shall certify that the appropriations are available.
8. Appropriations may be transferred only to budget headings for which
the budget has authorized appropriations or carried a token entry.
9. This Article shall apply to the appropriations corresponding to
revenue earmarked for a specific purpose under Article 4 (2) only as long
as the revenue is not used for any other purpose.
10. Transfers within the titles of the budget devoted to the European
Agricultural Guidance and Guarantee Fund, Guarantee Section, shall be
the subject of special provisions under Article 104.
11. Decisions on transfers to allow the utilization of the reserve relating
to Community loans and loan guarantees to non-member countries and in
those countries and the reserve for emergency aid shall be taken by the
budgetary authority in accordance with paragraph 5 (a) and (b)
respectively.
Article "M5273
1. By way of derogation from "M5Article 4 3, the following
deductions may be made from all bills, invoices or statements, which
shall then be passed for payment of the net amount:
(a) fines imposed on a party to a contract;
(b) adjustments of amounts paid in error, which may be achieved by
means of deduction beforehand when another validation of the same
type is being effected under the chapter, article and financial year in
respect of which the excess payment was made;
(c) the value of apparatus and equipment for scientific and technical
purposes, and the value of vehicles, equipment and installations
taken in part-exchange in accordance with commercial usage upon
purchase of new apparatus, vehicles, equipment and installations of
the same kind.
Discounts, refunds and rebates on invoices and bills shall not be recorded
as separate revenue.!M5
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2. Notwithstanding Articles 4 and 5, the following sums may be re-used
under the heading to which the initial expenditure was charged:
(a) revenue arising from the refund of amounts paid in error against
budget appropriations;
(b) proceeds from the supply of goods and services to other institutions
or bodies, including refunds by such institutions or bodies of mission
allowances paid on their behalf;
(c) insurance payments received;
(d) revenue from payments connected with lettings;
(e) revenue from the sale of publications and films;
(g) revenue from the supply of goods and services against payment;(h) proceeds from the sale of vehicles, equipment and installations and
scientific and technical apparatus, equipment and materials which
are being replaced or scrapped.
Such sums must be re-used before the end of the financial year following
that in which the revenue was collected.
The chart of accounts shall include suspense accounts to record re-use
operations in both revenue and expenditure.
2a. Notwithstanding Article 4, where products or services supplied to
the Commission incorporate taxes which are refunded by Member States
pursuant to the Protocol on Privileges and Immunities, the net price shall
be charged to the budget.
The refund of these taxes shall be monitored separately in the accounts.
Such refund shall be recorded by entry of the definitive amount in the
institution’ s accounts at the latest in the year following the financial year
in which it was collected.
3. Notwithstanding
"M5Article 4 3, repayments made by third
parties may be deducted from expenditure in cases where the institution
has effected a payment for which it is legally liable to its creditors but
where all or part thereof has been paid on behalf of those third parties.
4. Notwithstanding Article 4, adjustments may be made in respect of
exchange differences occurring in budget operations. The final gain or
loss shall be included in the balance for the year.
5. In the cases referred to in paragraphs 1 (c) and 2 (b), (d), (e), (g) and
(h), re-use and deduction shall be possible only if provision is made
therefor in the remarks column in the budget. Estimates of the amounts
earmarked for re-use shall appear in the remarks column for information.
The institutions shall justify discrepancies between those estimates and
the amounts which actually give rise to re-use.
SECTION II
BUDGETARY REVENUE, MANAGEMENT OF A V AILABLE
FUNDS
Article 28
1. All measures or situations which may give rise to or modify a debt
due to Communities must be preceded by a forward estimate by the
competent authorizing officer of the amount due.!M12
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Such forward estimates shall be sent to the financial controller of the
institution for his approval and to the accounting officer for provisional
registration.
They shall mention, in particular, the type of revenue and the budget item
to which it is to be booked and, if possible, the estimated amount and the
description of the debtor. The purpose of the approval of the financial
controller shall be to establish that:
(a) the revenue is booked to the correct budget item;
(b) the forward estimate is in order and conforms to the relevant
provisions, in particular of the budget and of the Regulations and
also of all acts made in implementation of the Treaties and of the
Regulations, and to the principles of sound financial management
referred to in Article 2.
The financial controller may withhold his approval if he considers that
the conditions laid down in (a) and (b) of the third subparagraph are not
met.
The superior authority of the institution may, by a decision stating the
full reasons therefor, and on its sole responsibility, overrule this refusal.
This decision shall have a final and binding character; it shall be
communicated for information to the financial controller. The superior
authority of each institution shall inform the Court of Auditors of all
such decisions within one month.
2. The competent authorizing officer shall draw up, in respect of every
debt identified as being a tangible and valid obligation to pay, a proposal
that the debt be established and a recovery order, which shall be sent with
supporting documents to the financial controller for his prior approval.
Such debts shall, after they have received the approval of the financial
controller, be registered by the accounting officer in accordance with the
implementing measures provided for in Article 139.
Provisional establishments may be made for certain routine revenue
items. Such provisional establishments and any amendments made to
them prior to the closure of the accounts for the year shall be subject to
the approval of the financial controller in accordance with the
implementing measures provided for in Article 135.
The purpose of the approval shall be to establish that:
(a) the revenue is booked to the correct budget item;
(b) the order is in order and conforms to the relevant provisions;
(c) the supporting documents are in order;
(d) the debtor is correctly described;(e) the due date is indicated;(f) the order conforms to the sound financial management referred to in
Article 2;
(g) the amount and currency of the sum to be recovered are correct.
If approval is withheld the fifth subparagraph of paragraph 1 shall apply.
3. Notwithstanding paragraph 1, no forward estimate shall be made for
the own resources defined in Article 2(1) and (2) of Decision 94/728/EC,
Euratom, which are paid at fixed intervals by the Member States, before
the Member States make the amounts available directly to the
Commission. The authorising officer responsible shall issue a recovery
order for them.
The recovery orders for the revenue referred to at Article 2(1)(a) and (b)
of that Decision shall be based on the monthly statements of entitlements
established by the Member States, which they send to the Commission.!M9
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The recovery orders shall be sent to the financial controller for approval.
After they have received his approval, they shall be registered by the
accounting officer in accordance with the implementing rules provided
for in Article 139.
Article 28a
Revenue received by way of fines, periodic penalty payments and other
penalties imposed by the Commission "M13 or the Council 3on the
basis of the relevant rules, and any accrued interest, shall not be finally
recorded as budget revenue as long as the decisions imposing them may
be annulled by the Court of Justice. Amounts collected shall be entered
separately in a cash account set aside solely for any repayment of such
amounts in whole or in part. The Commission report referred to in
Article 34 (2) shall provide information on such revenue.
The appropriate adjustment shall be made by entering the final amount in
the budget:
1. if no appeal is lodged, as soon as the time allowed for appeal has
expired;
2. if an appeal is lodged, as soon as the Court of Justice has given final
judgment.
The revenue and expenditure account and the reports on the
implementation of the budget referred to in Article 34 shall show:
1. Commission decisions in this field with the date of notification; and
2. a summary table showing:
(a) the amounts imposed;
(b) fines paid definitively (not subject to appeal);(c) cases subject to appeal broken down as follows:
— fines not paid but covered by a bank guarantee,— fines paid pending the judgement of the Court of Justice.
Article
"M5293
1. The accounting officer shall assume responsibility for the recovery
orders duly drawn up.
He shall exercise all due diligence to ensure that the resources due to the
Communities are recovered at the due dates indicated in the recovery
orders, and shall ensure that the rights of the Communities are
safeguarded.
The accounting officer shall inform the authorizing officer and the
financial controller of any revenue not recovered within the time limits
laid down. "M5If necessary he shall initiate the recovery procedure.
3
2. If the authorizing officer waives the right to recover an established
debt, he shall send beforehand a proposal for cancellation to the financial
controller for his approval and to the accounting officer for information.
The purpose of the approval of the financial controller shall be to
establish that the waiver is in order and conforms with the principles of
sound financial management referred to in Article 2. The proposal
concerned shall be registered by the accounting officer.!M12
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If approval is withheld, the superior authority of the institution may, by a
decision stating the full reasons therefor, and on its sole responsibility,
overrule this refusal. This decision shall be final and binding; it shall be
communicated for information to the financial controller. The superior
authority of each institution shall inform the Court of Auditors of all
such decisions "M5within one month 3.
3. When the financial controller finds that a document establishing a
debt has not been drawn up, or that a sum due has not been recovered, he
shall inform the institution thereof.
4. The implementing conditions in respect of this Article shall be
determined by the implementing measures provided for in "M8Article
1393.
Article "M5303
A receipt shall be issued in respect of all cash payments made to the
accounting officer.
Article 31
Estimates of the own resources and, if appropriate, of the contributions to
be paid by the Member States referred to in Article 2 (7) of Decision
88/376/EEC, Euratom, of 24 June 1988 on the system of the
Communities’ own resources, shall be entered in the budget, expressed
in"M13 euro3. They shall be made available in accordance with
Council Regulation (EEC, Euratom) No 1552/89.
Article 32
The balance from each financial year shall be entered in the budget for
the following financial year as revenue in the case of a surplus or
expenditure in the case of a deficit.
The relevant estimates of such revenue or expenditure shall be entered in
the budget during the budget procedure and, where appropriate, in a letter
of amendment submitted pursuant to Article 14. They shall be drawn up
in accordance with the principles set out in Article 15 of Regulation
(EEC, Euratom) No 1552/89.
After the close of accounts for each financial year, any discrepancy with
the estimates shall be entered in the budget for the following financial
year through a supplementary or amending budget.
Article "M5333
1. The contributions for the financing of certain supplementary
research programmes provided for in Article 11 (2) (c) of Decision
88/376/EEC, Euratom, of 24 June 1988 shall be paid over as follows:
— seven-twelfths of the amount shown in the budget not later than 31
January,
— the remaining five-twelfths not later than 15 July.2. If the budget is not finally adopted before the start of the financial
year, the contributions provided for in paragraph 1 shall be based on the
amount shown in the budget of the preceding financial year.
"M53.3Any contribution or any additional payment due to the
budget from the Member States must be entered in the account(s) of the
Commission within 30 days from the date on which funds are called for.
4. The payments made shall he entered in the account provided for in
Article 9 (1) of Regulation (EEC, Euratom) No 1552/89, and shall be
subject to the conditions set out in Article 11 of that Regulation.!B
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5. The financial contributions referred to in Article 11 (2) (c) of
Decision 88/376/EEC, Euratom of 24 June 1988 on the system of the
Communities’ own resources (for the completion of supplementary
research programmes) shall be converted at the rate for the "M13 euro
3applying on the last but one working day of the month preceding the
final date for entry in the accounts.
Article 34
1. The Commission shall, once a month, send figures to the European
Parliament and the Council showing the implementation of the budget,
and covering both revenue and expenditure. These figures shall also
show details of the utilization of appropriations carried forward.
These figures shall be sent within 10 working days following the end of
each month.
2. The Commission shall, four times a year, and in principle within the
30 working days following the end of the months of March, June, August
and December, present to the European Parliament and the Council a
report on the implementation of the budget, covering both revenue and
expenditure. This report shall also give details of the utilization of
appropriations carried forward from previous financial years.
The budgetary authority may examine these reports.3. The figures and the quarterly report shall at the same time be sent to
the Court of Auditors.
Article 35
The Commission shall, every three months, send the Member States a
statement of the transfers effected between their currencies.
SECTION III
COMMITMENT, V ALIDATION, AUTHORIZATION AND
P AYMENT OF EXPENDITURE
1. Commitment of expenditure
Article
"M5363
1. In respect of any measure which may give rise to expenditure
chargeable to the budget, the authorizing officer must draw up in
advance a proposal for commitment and may not enter into any legally
binding commitment with third parties until the financial controller has
given approval. A provisional commitment may be entered into in respect
of routine expenditure.
2. Without prejudice to Article 99, the decisions taken by the
Commission in accordance with the provisions authorising it to grant
financial aid from the various funds or similar operations shall constitute
commitments of expenditure. Unless these decisions stipulate a different
time limit for implementation in accordance with the abovementioned
provisions, these commitments shall cover the total cost of the
corresponding individual legal commitments up to 31 December of year
n+1 .
During the period of implementation referred to in the first subpara-
graph, the conclusion of each individual legal commitment shall be
registered by the authorising officer in the central accounts and booked
to the commitment referred to in the first subparagraph.
The unused balance shall be released after the time limit for
implementation is laid down. However, this paragraph shall apply
neither to the Structural Funds nor to the Cohesion Fund.!M5
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3. The procedure for implementing paragraphs 1 and 2 shall ensure that
an exact account is kept of commitments and authorisations in terms of
actual needs and, as regards paragraph 2, that the specific legal
commitments correspond to the overall budget commitment provided for
by the Commission decision. The procedure shall be determined by the
implementing rules provided for in Article 139.
Article 37
Without prejudice to the provisions of Article 23, in each institution,
proposals for commitments, accompanied by the supporting documents,
shall be transmitted to the financial controller and to the accounting
officer: they shall show, in particular, the purpose of the expenditure, the
estimated amount involved, indicating the currency where possible, the
budget item to which it is to be charged and also the name and
description of the creditor; they shall be registered, after approval by the
financial controller, in accordance with the implementing rules provided
for in"M8Article 139 3.
The proposals for commitments referred to in Article 36(1) and the
proposals for individual legal commitments referred to in the second
subparagraph of Article 36(2) may be subject to spot checks. Such
checks shall be carried out under a system which identifies risk sectors,
in which there is a high probability that the conditions set out in Article
38(1) will not be fulfilled. Individual commitments shall be checked
systematically in risk sectors.
Article "M5383
"M51.3The purpose of the approval of proposals for commitments
of expenditure given by the financial controller shall be to establish that:
(a) the proposal for commitment has been presented in compliance with
Article 36 (1);
"M9(b)3the expenditure has been charged to the correct item in the
budget;
"M9(c)3the appropriations are available;
"M9(d)3the expenditure is in order and conforms to the relevant
provisions, in particular of the budget and the Regulations, and of all
Acts made in implementation of the Treaties and of the Regulations;
"M9(e)3the principles of sound financial management referred to
in Article 2 have been applied.
2. Approval may not be conditional.
"M53.3The procedures for implementing this Article shall be
determined by the implementing measures provided for in "M8Article
1393.
Article "M5393
The financial controller may withhold his approval if he considers that
the conditions laid down in "M5Article 38 (1) 3are not met. If he
withholds his approval he shall make a written statement, stating the full
reasons therefor. The authorizing officer shall be notified accordingly.!M12
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Cases where approval is withheld and the authorising officer maintains
his proposal shall be referred for a decision to the superior authority of
the competent institution among those listed in Article 22(1) and (2)
within two months of the date of the decision to withhold approval.
Except where the availability of the appropriations is in doubt, the said
superior authority may, by a decision stating the full reasons therefor,
taken on its sole responsibility, overrule such a refusal. This decision
shall be final and binding with effect from the date on which approval
was withheld. It must be taken by 15 February of year n + 1. It shall be
communicated for information to the financial controller. The superior
authority of each institution shall inform the Court of Auditors of all
such decisions within one month. The Court of Auditors shall report
annually to the Parliament and the Council, within the context of the
discharge procedure, on the consequences of the decision to overrule,
from the point of view of the legality of, or non-compliance with, a
directive as regards public works or service contracts.
2. Validation of expenditure
Article "M5403
Validation of expenditure is the act whereby the authorizing officer shall:
— verify the existence of the creditor’s claim,
— determine or verify the existence and the amount of the sum due,— verify the conditions under which payment falls due.
Article
"M5413
1. Validation of any expenditure shall be subject to the submission of
supporting documents showing the creditor’s claim and the service
rendered or the existence of a document justifying payment. The
implementing measures provided for in "M8Article 139 3shall lay
down the nature and the contents of the supporting documents to be
enclosed with the payment order.
"M5 3
"M52.3The authorizing officer empowered to validate expenditure
shall personally check the supporting documents or shall, on his own
responsibility, ascertain that this has been done.
Article "M5423
Remuneration and allowances shall be validated in accordance with
collective statements drawn up by the department in charge of personnel,
except where individual validation is necessary.
3. Authorization of expenditure
Article "M5433
Authorization is the act whereby the authorizing officer, by the issue of a
payment order, instructs the accounting officer to pay an item of
expenditure which he has validated.
Article "M5443
The payment order shall state:
— the financial year against which the payment shall be charged,
— the budget article and any other subdivision that may apply,
— the amount to be paid (in figures and words), expressed in
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payment orders are sent to the banks by means of computerised
procedures, the amount need not be expressed in words 3,
— the name and address of the payee,
— the purpose of the expenditure,
— the method of payment, wherever possible.The payment order shall be dated and signed by the authorizing officer.
Article
"M5453
The payment order shall be accompanied by the original supporting
documents, as determined by the implementing measures provided for in
"M8Article 139 3. Those documents shall be certified in respect of —
or accompanied by a certificate confirming — the correctness of the
amounts to be paid, the receipt of the supplies and the performance of the
service together with, if appropriate, the entry of the goods in the
inventories referred to in "M5Article 65 3.
The payment order shall show the numbers of the relevant approvals of
commitment. Copies of supporting documents, certified as true copies by
the authorizing officer, may, in some cases, be accepted in place of the
originals.
Article "M5463
1. The authorizing officer may make payments by instalment in
accordance with the rules governing the policy concerned or in
accordance with contractual provisions.
Where this occurs, the first payment order shall be accompanied by
documents establishing the creditor’s claim to payment of the instalment
in question. Subsequent payment orders shall refer to the supporting
documents already furnished, and repeat the reference number of the first
payment order.
The decision to authorise the balance shall be adopted within the time
limit laid down in Article 1(7).
"M52.3The authorizing officer may grant advances to personnel if
the Staff Regulations or a provision laid down by Regulation specifically
provide therefor.
The authorizing officer may grant advances to cover disbursements to be
effected by an official or other members of staff on behalf of his
institution. The implementing conditions for this subparagraph shall be
determined by the implementing measures provided for in "M8Article
1393.
Apart from the imprest accounts referred to in "M5Article 54 3,n o
advance may be paid unless it has been approved beforehand by the
financial controller.
Article "M5473
Without prejudice to the provisions of Article 23, payment orders shall
be sent for prior approval to the financial controller.
The purpose of this prior approval shall be to establish that:
(a) the payment order was properly issued;!M5
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(b) the payment order agrees with the commitment of expenditure and
that the amount thereof is correct, taking account of the principles
and requirements of sound financial management referred to in
Article 2;
(c) the expenditure is charged to the correct item in the budget;
(d) the appropriations are available;(e) the supporting documents are in order;
(f) the payee is correctly named and described.
Prior approval may be given on the basis of a spot check; this shall be
carried out under a system which identifies risk sectors, in which there is
a high probability that the conditions set out in the second paragraph will
not be fulfilled. Payment orders shall be checked systematically in risk
sectors.
Article
"M5483
Should approval be refused, "M5Article 39 3shall apply.
Article "M5493
The detailed rules for the payment of any interest owed by recipients of
Community aid in the event of recovery of undue payments to the
Community shall be determined by the implementation provisions laid
down in "M8Article 139 3, without prejudice to any provisions laid
down in the basic sectoral acts relating to Community policies.
Article "M5503
After approval, the original of the payment order, together with all
supporting documents, shall be forwarded to the accounting officer.
4. Payment of expenditure
Article "M5513
Payment is the final action whereby the institution concerned is
discharged of its obligations towards its creditors.
Payment shall be made by the accounting officer within the limits of the
funds available.
In the event of a substantive error or of the validity of the discharge being
contested or of failure to observe the formalities prescribed by this
Financial Regulation, the accounting officer shall suspend payment.
Article "M5523
If payment is suspended, the accounting officer shall give the reasons for
his decision in a written statement which he shall send forthwith to the
authorizing officer and, for information, to the financial controller.
Except where the validity of the discharge is contested, the authorizing
officer may place the matter before the authority appointed by the
institution in the manner laid down in the rules of procedure of that
institution. The said authority may require, in writing, and on its own
responsibility, that payment be effected.
Article "M5533
Payments shall be effected as a general rule through a bank or post office
giro account.!B
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The procedure for opening, administering and using such accounts shall
be determined by the implementing measures provided for in
"M8Article 139 3. These measures shall, in particular, indicate
expenditure the payment of which must necessarily be effected either by
cheque or by post office or bank transfer order, and shall receive the joint
signature on cheques and on post office or bank transfer orders of two
duly authorized officials, one signature necessarily being that of the
accounting officer, an assistant accounting officer, or an administrator of
an imprest account.
5. Imprests
Article "M5543
"M91.3For the payment of certain categories of expenditure,
imprest accounts may be set up in accordance with the implementing
measures provided for in "M8Article 139 3.
Only the accounting officer may replenish the imprest accounts, save in
exceptional cases defined in the implementing rules of this Regulation.
These measures shall contain specific provisions concerning in
particular:
— the appointment of administrators of imprest accounts,— the nature and maximum amount of each item of expenditure to be
incurred,
— the maximum amount of the imprest which may be advanced,— the time within which supporting documents must be produced,— the responsibility of the administrators of imprest accounts.
2. Expenditure involving payments made not later than 31 December
under the imprest accounts may be booked to the accounts for that year
up to 15 February of the following year.
SECTION IV
MANAGEMENT OF POSTS
Article 55
1. Within each institution the following shall be established:(a) a file identifying the posts and containing a job description for each
category A post;
(b) an organization chart showing the organization of the departments
detailing the tasks of each administrative unit.
2. If the note ‘to be abolished’ is placed against a post in the budget, it
may no longer be filled when the next vacancy arises in the same career.!B
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TITLE IV
CONCLUSION OF CONTRACTS, INVENTORIES, ACCOUNT-
ANCY
SECTION I
CONTRACTS FOR THE SUPPLY OF GOODS AND SERVICES;
CONTRACTS FOR PURCHASE, LEASE AND HIRE
Article 56
When concluding contracts for which the amount involved is equal to or
greater than the threshold provided for by the Council directives on the
coordination of procedures for the award of public works, supplies and
services contracts, each institution shall comply with the same
obligations as are imposed upon bodies in the Member States by those
directives.
The implementing measures provided for in Article 139 shall include
appropriate provisions to that end.
Article 57
Articles 58, 59 and 60 shall apply to contracts other than those referred to
in Article 56.
Article "M8583
1. Contracts for the purchase or hiring of buildings or goods, for the
provision of services or for the performance of construction work shall
be in writing. Apart from contracts relating to the purchase of a building
already constructed or to the leasing of a building, all such contracts
shall be concluded after an invitation to tender has been issued
"M8 3.
However, contracts may be made by private treaty in the circumstances
referred to in "M8Article 59 3.
Contracts may be made against invoice or bill of costs in cases provided
for in"M8Article 60 3.
2. Invitations to tender shall, as a general rule, be published throughout
all the Member States, and, where appropriate, in third countries, to the
extent to which this is compatible with development of industries in the
Communities. However, their publication may be restricted where the
goods or services, because of their size or nature, are not fit subjects for a
general invitation to tender.
3. Tendering procedures and selection and award criteria shall be laid
down and governed by the detailed implementing rules provided for in
Article 139, on the understanding that these criteria shall be laid down by
analogy with those provided for in the directives referred to in Article 56.
"M12 The tenderer’s offer must from the outset contain all the essential
elements required in the invitation to tender, subject to being considered
inadmissible. The implementing arrangements set out in Article 139
shall apply for the purpose of establishing the criteria for identifying the
essential elements of the tender. 3
4. The price revision procedures following the conclusion of contractsshall be governed by the implementing measures provided for in Article
139.
Article 59
Contracts may be made by private treaty:!B
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(a) within the limit laid down in the detailed implementing rules
provided for in Article 139 for the purchase or hiring of supplies,
furniture and equipment, for the provision of services or for building
works;
(b) where the purchase or hiring of goods, the provision of services or
the construction works are so urgently needed that it is not possible
to wait for one of the tendering procedures specified in Article 58 to
be carried out;
(c) where the automatic public tendering or discretionary tendering
procedures do not give any result or where the prices quoted are not
acceptable;
(d) where for technical, practical or legal reasons the supply of goods or
services can only be carried out by a particular contractor or
supplier;
(e) for contracts for the supply of goods and services or for ancillary
works which, technically, cannot be separated from the main
contract.
The institution concerned is bound, however, as far as possible and by all
appropriate means, to enable suppliers or contractors who are likely to be
able to supply the goods and services in question to compete, except in
the cases referred to in (d) and (e).
Article "M8603
Contracts may be made against invoice or bill of costs where the
estimated value of the goods, services or works does not exceed the
limits laid down by the implementing rules provided for in "M8Article
139.3
Article 61
Articles 62 to 64a shall apply to the award of contracts for the purchase
or hiring of goods, furniture or equipment, for the provision of services
or for the performance of works.
Article "M8623
In respect of contracts entered into by the Communities, there shall be no
discrimination between nationals of Member States on grounds of
nationality.
Article "M8633
In each institution, before the authorizing officer takes a decision,
contracts involving sums exceeding an amount specified in the
implementing rules provided for in "M8Article 139 3 shall be
submitted for the opinion of an Advisory Committee on procurements
and contracts.
If required, an Advisory Committee on procurements and contracts
common to all the institutions may be set up.
Details of the operation of these committees shall be laid down in the
implementing rules provided for in "M8Article 139 3.!M8
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Article "M8643
The Advisory Committee referred to in "M8Article 63 3 shall
include at least one representative of the department responsible for
overall administration, one representative of the department responsible
for finance and one representative of the department responsible for legal
matters; a representative of the financial controller shall be present as
observer.
The Committee shall deliver an opinion as to whether the procedure
followed is in order, on "M8selection of tenderer 3and, in general,
on the proposed terms of the contract.
Any other problem concerning the matter forming the subject of this
Title may be referred to the said Committee for an opinion.
Article "M864a3
By way of guarantee of the performance of the contracts, suppliers or
contractors may be required by a warranty clause to make a preliminary
deposit in accordance with the implementing measures provided for in
"M8Article 139 3.
The amount of the deposit shall be fixed:
— according to the usual trade terms of contracts for supplies,
— according to the special conditions governing building contracts.
Beyond the limit laid down by the implementing rules provided for in
"M8Article 139 3, the provision of security shall be obligatory
"M8for works contracts 3. A guarantee may be retained until final
acceptance.
Where a contract has not been carried out or completion has been late,
the institution shall ensure that it is adequately compensated in respect of
all damages, interest and costs by the deduction of the amount from the
deposit, whether this has been lodged directly by the supplier or
contractor, or by a third party.
SECTION II
INVENTORIES OF MOV ABLE AND IMMOV ABLE PROPERTY
Article 65
Permanent inventories showing the quantity and value of all movable and
immovable property belonging to the Communities shall be kept in
accordance with a model drawn up by the Commission. Only movable
property exceeding a specific value laid down in the implementing rules
provided for in "M8Article 139 3 shall be entered in those
inventories.
Each institution shall carry out its own inspection to ascertain that entries
in the inventory correspond to the facts, in accordance with the
implementing rules provided for in "M8Article 139 3.
The inventory system shall be established by the authorising officer with
the technical assistance of the accounting officer. This inventory system,
which shall be administered by the authorising officer, shall provide the
central system of accounts with all the appropriate information needed to
draw up the institution’s balance sheet.
The institutions shall each adopt, for their own purposes, provisions
relating to the keeping of the equipment recorded in their respective
balance sheets and shall determine the departments responsible for this
task.!B
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Article "M5663
The sale of movable property shall be suitably advertised in accordance
with the implementing measures provided for in "M8Article 139 3.
Apart from sales by public auction, officials and other servants of the
institutions may not acquire any movable property resold by the said
institutions.
Article "M5673
A statement or record shall be drawn up by the authorizing officer and
authenticated by the financial controller whenever any property in the
inventory is "M5sold, given away free of charge 3, scrapped, hired
out, or missing on account of loss, theft or any other reason.
The statement or record shall refer in particular to any obligation that
may devolve on an official or other servant of the Communities or any
other person to replace the item in question.
Immovable property or large installations, which are made available
without charge, shall give rise to the conclusion of contracts submitted to
the financial controller for approval and shall be the subject of an annual
communication to the European Parliament and the Council when the
preliminary draft budget is submitted.
Article "M5683
All acquisitions of movable or immovable property as defined in
"M5Article 65 3shall, before payment, be entered in the permanent
inventories.
That entry shall be recorded in the corresponding invoice or annexed
document drawn up with a view to payment of the expenditure.
SECTION III
ACCOUNTS
Article "M5693
The accounts shall be kept in "M13 euro3by the double entry
method, on the basis of the calendar year. They shall show all revenue
and expenditure for the financial year. They shall be authenticated by
supporting documents. The revenue and expenditure account and the
balance sheet shall be drawn up "M5in"M13 euro33 .
Article 70
The chart of accounts shall make a clear distinction between
"M12 expenditure and revenue 3accounts and cash accounts.
It shall comprise of two parts:
(a) accounts of expenditure and revenue, subdivided into two separate
subcategories:
— accounts of budgetary expenditure and revenue, which allow
implementation of the budget to be monitored and the balance
for the financial year to be determined,
— accounts of non-budgetary expenditure and revenue, which
complement the previous accounts and can be used to produce a
broader accounting result;
(b) the balance sheet accounts, which disclose the assets of the
institutions. These accounts shall show the expected effect of the
Communities’ legal obligations.!B
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The detailed conditions for the establishment and operation of the chart
of accounts for transactions relating both to assets and to the
implementation of the budget shall be determined by the implementing
rules provided for in "M8Article 139 3.
The accounts shall make it possible to draw up an annual balance of
assets and a monthly statement of revenue and expenditure by chapter
and article.
These statements shall be forwarded to the financial controller, the
authorizing officer and the Court of Auditors.
Article 70a
The rules for the entry in the accounts of the depreciation of assets and
the rules for writing down the value of assets and for constituting
provisions shall be determined by the implementing rules provided for in
Article 139.
Article "M5713
Except for the advances referred to in "M5Article 99 3, any advance,
other than regular advances which are periodically re-examined, shall be
entered in a suspense account and settled at the latest during the financial
year which follows the payment of this advance.
However, the advances referred to in "M5the second subparagraph of
Article 46 (2) 3shall be settled as a general rule within six weeks
following completion of the project for which they were granted.
Article "M5723
"M91.3The accounts shall be closed at the end of the financial
year to enable a balance sheet of the Communities and the revenue and
expenditure account referred to in Title VI to be drawn up. The revenue
and expenditure account shall be submitted to the financial controller.
2. Any operation after the end of the financial year which, without
affecting the Community’s financial position, is necessary for a full, true
and fair presentation of the financial statements may be effected up to the
date of closure of the accounts, without prejudice to Article 6.
TITLE V
RESPONSIBILITIES OF AUTHORIZING OFFICERS,
FINANCIAL CONTROLLERS, ACCOUNTING OFFICERS AND
ADMINISTRATORS OF ADV ANCE FUNDS
Article "M5733
Authorizing officers who, when establishing entitlements to be recovered
or issuing recovery orders, entering into a commitment of expenditure or
signing a payment order do so without complying with this Financial
Regulation and the rules for its implementation, shall render themselves
liable to disciplinary action and, where appropriate, to payment of
compensation. The same shall apply if they omit to draw up a document
establishing a debt or if they neglect to issue recovery orders or are,
without justification, late in issuing them. "M5The same shall apply if
they neglect to issue the payment orders or are, without justification, late
in issuing them, thereby rendering the institution liable to civil action by
third parties. 3!M5
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Article "M5743
Financial controllers shall render themselves liable to disciplinary action
and, where appropriate, to payment of compensation for any action taken
during their term of office; in particular, by granting their approval in
excess of the budgetary appropriations.
Article "M5753
1. Accounting officers and assistant accounting officers shall render
themselves liable to disciplinary action and, where appropriate, to
payment of compensation as regards payments made by them in
disregard of the "M5third subparagraph of Article 51 3.
They shall render themselves liable to disciplinary action and to payment
of compensation as regards any loss or deterioration of the monies, assets
and documents in their charge where such loss or deterioration result
from an intentional mistake or serious negligence on their part.
Under the same conditions, they shall be responsible for the correct
execution of orders received by them in respect of the use and the
administration of bank and post office giro accounts, and in particular:
(a) where the recoveries or payments made by them do not agree with
the amounts on the corresponding recovery or payment orders;
(b) where they effect payment to a party other than the payee entitled.
2. Administrators of advance funds shall render themselves liable to
disciplinary action and, where appropriate, to payment of compensation
in the following cases:
(a) where they cannot show due warrant with proper documents for
payments made by them;
(b) where they effect payments to parties other than entitled payees.
They shall be liable to disciplinary action and to payment of
compensation in respect of any loss or deterioration of the monies,
assets and documents in their charge where such loss or deterioration
results from an intentional mistake or serious negligence on their part.
3. The accounting officer, assistant accounting officers and adminis-
trators of advance funds shall insure themselves against the risks arising
under this Article.
The institution shall cover the insurance costs relating thereto in
accordance with the implementing measures provided for in "M8Ar-
ticle 139 3.
"M54.3A special allowance is granted in each of the institutions to
the accounting officer, assistant accounting officers and administrators
of advance funds. The sums corresponding to this allowance shall be
credited each month to an account opened by the institution on behalf of
each official in order to establish a guarantee fund for the purpose of
covering any cash or bank shortage for which the person concerned
might render himself liable, in so far as such shortages have not been
covered by refunds from insurance companies.
The credit balance in these guarantee accounts shall be paid over to the
persons concerned when they terminate their appointment as accounting
officer, assistant accounting officer or administrator of advance funds.
"M55.3The implementing measures provided for in "M8Article
1393 shall specify the categories of officials or other servants
qualified to be appointed accounting officers or administrators of
advance funds.!B1977X1231 — EN — 27.04.2001 — 002.001 — 39
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Article 76
The liability of authorising officers, financial controllers, accounting
officers, assistant accounting officers and administrators of advance
funds to disciplinary action and, if necessary, payment of compensation
may be determined in accordance with the provisions of Articles 22 and
86 to 89 of the Staff Regulations of officials of the European
Communities.
All relevant data or information, including any reports and withholdings
of approval by the financial controller, shall be communicated to the
authority empowered to initiate the procedure concerning disciplinary
and financial responsibility.
Article "M5773
Each institution shall be allowed a period of two years from the date
when the account for revenue and expenditure is submitted, to take a
decision on the final discharge to be given to accounting officers for the
transactions relating thereto.
TITLE VI
PRESENTING AND AUDITING ACCOUNTS
Article "M5783
The Commission shall draw up, not later than 1 May of the following
year, a consolidated revenue and expenditure account of the general
budget of the European Communities for the financial year ended 31
December. The consolidated revenue and expenditure account shall
include:
1. a table of revenue comprising:
— estimated revenue for the financial year,
— amendments to the revenue estimates as a result of supplemen-
tary or amending budgets and additional revenue as specified in
the second subparagraph of Article 4 (2),
— entitlements established in the course of the financial year,
— entitlements still to be collected from the preceding financial
year,
— revenue collected during the financial year and revenue carried
over pursuant to Article 7 (4),
— amounts still to be collected at the end of the financial year,
— the cancellation of established entitlements.
Statements shall be attached to this table showing revenue carried
over pursuant to Article 7 (4) and, where appropriate, the balances
and gross amounts of the operations referred to in Article 27 (2).
A statement should also be attached giving a breakdown, by a
Member State, of the amounts still to be collected at the end of the
financial year corresponding to own resources covered by a recovery
order;
2. tables showing the movement in appropriations for the financial year
and, by distinguishing between commitment appropriations, payment
appropriations and non-differentiated appropriations, indicating:
— the initial appropriations,— any amendments introduced by means of supplementary or
amending budgets,!B
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— any amendments to appropriations introduced by means of
transfer,
— the final appropriations for the financial year,
— appropriations carried over under "M5Article 7 3;
3. tables showing the use of the appropriations allocated for the
financial year and, by distinguishing between appropriation com-
mitments, payment commitments and non-differentiated appropri-
ations, indicating:
— the commitments entered into and chargeable to the financial
year,
— the payments made and chargeable to the financial year,
— the settlement of the commitments of the financial year and the
calculation of the sums still to be paid at the close of that
financial year,
— the commitment appropriations and payment appropriations
carried over under "M5Article 7 3,
— the non-dissociated appropriations carried over in accordance
with"M5Article 7 3,
— cancelled appropriations.Where appropriate, a statement shall be attached to this table
showing the balances and gross payments arising from the
transactions referred to in
"M5Article 27 (2) 3;
4. tables showing the use of the appropriations available from previous
financial years and indicating:
— the amount of appropriations carried over, a distinction being
made between commitment appropriations, payment appropri-
ations and non-differentiated appropriations,
— the commitments entered into and chargeable to available
commitment appropriations,
— the payments made from payment appropriations and non-dif-
ferentiated appropriations which have been carried over,
— the settlement of sums still to be paid at the close of the previous
financial year and the calculation of the sums still to be paid at
the end of the current financial year,
— the amount unused and maintained for the following financial
year,
— for each financial year for which the accounts have been closed,
a breakdown, by item and by Member State, showing the impact
of clearance decisions during the financial year and using the
budgetary nomenclature of the relevant financial year;
5. annexed shall be a document showing capital operations and debt
management, indicating:
— the total amount of loans approved,— the total amount of the repayments made on borrowings
contracted and of the charges on such borrowings,
— the amount of borrowings contracted,!B
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— the total amount of repayments of capital and payments of
interest made on loans granted.
Article 79
Each institution shall, not later than 1 March, transmit to the
Commission, after submitting them to its financial controller, the
information required for drawing up the revenue and expenditure account
and the balance sheet and a contribution to the analysis of the financial
management referred to in Article 80.
Article 80
1. The revenue and expenditure account shall cover all revenue and
expenditure transactions relating to the preceding financial year for each
institution. It shall be submitted in the same form and following the same
subdivision as the budget.
2. The revenue and expenditure account shall be preceded by an
analysis of the financial management in respect of the year in question.
For the drawing up of this analysis, each institution shall supply details
on the realization of the principles and objectives as referred to in Article
2.
Article 81
1. The Commission shall draw up, not later than 1 May, a consolidated
balance sheet of assets and liabilities of the Communities as at 31
December of the preceding financial year. A statement showing the
movements and balances of the accounts at the same date shall be
attached thereto.
The balance sheet shall include, on the assets side, the amount of revenue
to be collected and, on the liabilities side, the amount of expenditure
chargeable to the financial year, which have not yet been entered in the
accounts.
2. These documents shall be submitted to the financial controller.
Article "M5823
The Commission shall forward the revenue and expenditure account, the
financial analysis and the balance sheet to the European Parliament, the
Council and the Court of Auditors by "M51M a y3at the latest.
Article 83
1. The Court of Auditors and its members may, in carrying out the task
of the Court, be assisted by officers of the Court. The Court itself or one
of its members shall notify the authorities with which the delegated
office is to work on the tasks delegated to him.
2. The European Parliament, the Council and the Commission shall
inform the Court of Auditors, as soon as possible, of all decisions and
rules taken pursuant to Articles 4 (3), 7 (2), (3) and (6), 9, 17 (1) and 26.
3. The institutions shall transmit to the Court of Auditors any rules of
procedure they adopt in respect of financial matters.
4. The Court of Auditors shall be informed of the appointment of
authorizing officers, financial controllers, accounting officers and
administrators of imprest accounts and of the acts of delegation or
appointment under Articles 22, 24, 25 and 54.!B
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Article "M5843
Each institution shall forward to the Court of Auditors every three
months and at the latest within the month which follows the end of the
quarter, and, in the case of the fourth quarter, at the latest within the
month which follows the close of the financial year, the documents
supporting the accounts, in particular the documents and certificates in
respect of the correct application of the provisions which govern the
implementation of the budget and relating to commitments and
payments, to the establishment and collection of revenue, subject to
"M5Article 18 of Council Regulation (EEC, Euratom) No 1552/89 and
to Article 85 of this Financial Regulation. 3The Court of Auditors may
question each institution on the subject of the said supporting documents.
Article 85
The audit carried out by the Court of Auditors shall be based on records
and, if necessary, performed on the spot. Its purpose shall be to establish
that all revenue has been received and all expenditure incurred in a
lawful and proper manner having regard to the provisions of the Treaties,
the budget, the Financial Regulations and all other Acts adopted pursuant
to the Treaties, and that the financial management has been sound.
For the performance of its task, the Court of Auditors shall be entitled to
consult, in the manner provided for in Article 87, all documents and
information relating to the financial management of the departments or
bodies subject to its inspection; it has the power to make enquiries of any
official responsible for a revenue or expenditure operation, and to use
any of the auditing procedures appropriate to those departments or
bodies.
The Court of Auditors, in order to obtain all the necessary information
for the performance of the task entrusted to it by the Treaties and the
Acts taken to implement them, may be present, at its request, during the
operations carried out by the Commission in implementation of Articles
8 and 9 of Regulation (EEC) No 729/70 and Articles 17 and 18 of
Regulation (EEC, Euratom) No 1552/89. This measure shall also apply
to the inspection of any fund set up by the Communities.
At the request of the Court of Auditors, each institution shall authorize
finance organizations holding Community deposits to enable the Court
to ensure that external data tally with the accounts.
Article "M5863
The Court of Auditors shall ensure that all securities and cash on deposit
or in hand are checked against vouchers signed by the depositaries or
against official memoranda of cash and securities held. The Court may
carry out such checks itself.
Article "M5873
The Commission and the other institutions shall afford the Court of
Auditors all the facilities and give it all the information which the Court
may consider necessary for the performance of its task, and shall in
particular provide all the information obtained as a result of the checks
which they have carried out, as required by the rules laid down by the
Community, within the departments responsible for the management of
the Communities’ finances and for effecting expenditure on their behalf.
In particular, they shall place at the disposal of the Court of Auditors all
documents concerning the conclusion and implementation of contracts
and all accounts of cash or materials, all accounting records or
supporting documents, and also administrative documents pertaining
thereto, all documents relating to revenue and expenditure, all inven-
tories, all lists of posts in the departments, which the Court of Auditors
may consider necessary for auditing the revenue and expenditure account
on the basis of records or on the spot "M5and all documents and data
created or sorted on a magnetic medium 3.!B
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To this end, the officials whose operations are checked by the Court of
Auditors shall in particular:
(a) show their records of cash in hand, any other cash, securities and
materials of all kinds, and also the supporting documents in respect
of their stewardship of the funds with which they are entrusted, and
also any books, registers and other documents relating thereto;
(b) present the correspondence and any other document required for the
full implementation of the audit referred to in "M5the first
subparagraph of Article 85 3.
The information supplied under (b) may be requested only by the Court
of Auditors.
The Court of Auditors shall be empowered to audit the documents in
respect of the revenue and expenditure of the Communities which are
held by the departments of the institutions and, in particular, by the
departments responsible for decisions in respect of such revenue and
expenditure.
The task of establishing that the revenue has been received and the
expenditure incurred in a lawful and proper manner and that the financial
management has been sound, includes the utilization by bodies outside
the institutions of Community funds received by way of aid.
The grant of Community funds to beneficiaries outside the institutions
shall be subject to the agreement in writing by the recipients to an audit
being carried out by the Court of Auditors on the utilization of the
amounts granted.
Article 88
The annual report of the Court of Auditors provided for "M8in Article
45c of the ECSC Treaty, Article 188c of the EC Treaty and Article 160c
of the Euratom Treaty 3shall be governed by the following provisions:
1. The Court of Auditors shall transmit to the Commission and the
institution concerned, by 15 July at the latest, any comments which
are, in its opinion, of such a nature that they should appear in the
annual reports. These comments must remain confidential. Each
institution shall address its reply to the Court of Auditors by 31
October at the latest. The replies of the institution other than the
Commission shall be sent simultaneously to the Commission.
2. The annual report shall contain an assessment of the soundness of
financial management.
3. Without prejudice to any summary report or general comments
which the Court of Auditors may see fit to make, the annual report
shall include a section for each institution.
The Court shall take all necessary steps to ensure that the replies of
each institution to its comments are published immediately following
those comments.
4. The Court of Auditors shall transmit to the authorities responsible
for giving discharge and to the other institutions, by 30 November at
the latest, its annual report accompanied by the replies and it shall
ensure publication thereof in the Official Journal of the European
Communities .
Article 88a
At the same time as the annual report referred to in Article 88, the Court
of Auditors shall provide the European Parliament and the Council with a
statement of assurance as to the reliability of the accounts and the
legality and regularity of the underlying transactions.!B
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Article 89
1. The European Parliament, upon a recommendation from the Council
acting by a qualified majority, shall, before 30 April of the following
year, give a discharge to the Commission in respect of the
implementation of the budget.
2. To this end the European Parliament shall, after the Council has done
so, examine the accounts and financial statements mentioned in Article
78d of the ECSC Treaty, Article 205a of the EC Treaty and Article 179a
of the Euratom Treaty, the annual report made by the Court of Auditors
together with the replies of the institutions under audit to the
observations of the Court of Auditors, any relevant special reports by
the Court of Auditors and the Court of Auditors’ statement of assurance
as to the reliability of the accounts and the legality and regularity of the
underlying transactions.
3. Before giving a discharge to the Commission, the European
Parliament may question the Commission on the implementation of
expenditure or the operation of financial control systems. The
Commission shall submit any necessary information to the European
Parliament at the latter’s request.
4. If the date provided for in paragraph 1 cannot be met, the European
Parliament or the Council shall inform the Commission of the reasons for
the postponement.
lf the European Parliament postpones the decision giving a discharge, the
Commission shall make every effort to take measures, as soon as
possible, to facilitate removal of the obstacles to that decision.
5. The discharge decision shall cover the accounts of all the
Community’ s revenue and expenditure, the resulting balance and the
assets and liabilities of the Community shown in the financial statement.
It shall include an assessment of the responsibility of the Commission’ s
budgetary management over the past financial year.
6. The financial controller shall take account of the comments in the
decisions giving discharge taken by the European Parliament; he shall
also take account of the comments accompanying the recommendations
for discharge adopted by the Council.
7. In accordance with Article 78g of the ECSC Treaty, Article 206 of
the EC Treaty and Article 180b of the Euratom Treaty, the Commission
and the other institutions shall take all appropriate steps to act on the
observations by the European Parliament relating to the implementation
of expenditure, and on the comments accompanying the recommen-
dations for discharge adopted by the Council.
8. At the request of the European Parliament or the Council, the
institutions shall report on the measures taken in the light of these
observations and comments, and, in particular, on the instructions given
to those of their departments which are responsible for the implemen-
tation of the budget. Such reports shall also be transmitted to the Court of
Auditors.
9. The institutions shall also give an account, in an annex to the revenue
and expenditure account for the financial year following that of the
discharge decision, of the measures taken in the light of the comments
appearing in the decisions giving discharge.
10. Supporting documents pertaining to the accounts and the preparation
of the revenue and expenditure accounts and the balance sheet shall be
kept for a period of five years following the date of the decision giving
discharge in respect of the implementation of the budget.
However, the documents relating to transactions not finally closed shall
be kept for longer than the said period, until the end of the year following
the year in which such transactions are finally closed.
Each institution shall decide which department will keep the supporting
documents.!M8
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Article 90
1. In addition to the annual report, the Court of Auditors may also, at
any time, submit observations, in the form of special reports, on specific
questions and deliver opinions at the request of one of the institutions of
the Communities.
2. The special reports shall be transmitted to the institution or body
concerned.
The institution concerned shall have two and a half months in which to
inform the Court of Auditors of any comments it wishes to make on the
observations in question.
Should the Court of Auditors decide to have such observations published
in the Official Journal of the European Communities , it shall include
after them any comments submitted by the institution or institutions
concerned.
The special reports shall be transmitted to the European Parliament and
the Council, each of which shall decide in conjunction with the
Commission what action, if any, is to be taken in response.
3. If the opinions referred to in paragraph 1 do not relate to proposals
for legislation or draft legislation on which it has been consulted, they
may be published by the Court of Auditors in the Official Journal. The
Court shall take its decision on publication after consulting the institution
which requested the opinion or the institution concerned by the Court’ s
analysis. Opinions published in the Official Journal shall be accom-
panied by the replies of the institution or institutions concerned.
TITLE VII
SPECIAL PROVISIONS APPLICABLE TO RESEARCH AND
TECHNOLOGICAL DEVELOPMENT APPROPRIATION
Article 91
The provisions of Titles I to VI, "M8Title XI and Part III 3shall
apply to the research and technological development appropriations
entered in the special subsection provided for in Article 92, save as
otherwise provided in this Title.
Article 92
1. The appropriations relating to the activities covered by this Title
shall be entered in a special subsection of Part B of the Commission
section.
This subsection shall contain the appropriations intended for the
realization of research and technological development objectives through
the implementation of the following:
(a) direct action carried out in the establishments of the Joint Research
Centre (JRC), in principle entirely financed from the general budget
of the European Communities, and consisting of:
— research programmes,
— exploratory research activities,— scientific and technical support activities of an institutional
nature;
(b) indirect action consisting of programmes carried out under contracts
to be concluded with third parties. The JRC may participate in these
activities on the same basis as third parties. These activities shall in
principle be partially financed from the general budget of the
European Communities (shared cost action projects);
(c) concerted action consisting of work undertaken by the Community to
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States, in respect of which the administrative expenditure alone is
financed from the general budget of the European Communities;
(d) possible financial contributions by the Community to supplementary
programmes in accordance with "M8Article 130k of the EC
Treaty3, or to research and development programmes undertaken
by several Member States, including participation in the structures
created for the execution of those programmes, in accordance with
"M8Article 130l of the EC Treaty 3, or cooperation with third
countries or international organizations as provided for in "M8Ar-
ticle 130m of the EC Treaty 3, or participation in the joint
undertakings provided for in "M8Article 130n of the EC Treaty
3;
(e) as regards other activities of a competitive nature carried out by the
JRC:
— scientific and technical support activities under the R&TD
framework programmes in principle entirely financed from the
general budget,
— services for third parties.
2. The appropriations for projects under the framework programme of
activities in the field of research and technological development shall be
entered separately in this subsection.
3. Notwithstanding paragraph 1, the JRC may receive funding covered
by appropriations entered elsewhere than in the subsection referred to in
that paragraph in respect of its participation on a competitive basis in
activities implemented under Community policies financed, in principle,
entirely from the general budget.
4. The provisions of Title IV on the conclusion of contracts shall apply
to the cases referred to in the first indent of paragraph 1 (e) and in
paragraph 3 of this Article.
Article 93
1. The nomenclature of the special subsection provided for in Article
92 shall be based on the purpose of the expenditure in achieving research
and technological development objectives or in the other activities
referred to in that Article.
The remarks for each subdivision shall also show:— the number of staff authorized for the current year,— details of supplementary programmes, programmes undertaken by
several Member States and cooperation with third countries or
international organizations, with an indication of the amount of any
financial contribution from the Community.
2. However, for the Joint Research Centre, appropriations for staff and
appropriations for resources shall be entered in two separate chapters.
Article 94
The following shall be annexed to the special subsection referred to in
Article 92:
— a table of equivalence giving the breakdown by purpose and type of
expenditure of the appropriations made available in the subsection,
as specified in the implementing rules provided for in
"M8Article
139.3
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— a provisional schedule of commitments and payments showing the
planned utilization of the commitment appropriations and the
corresponding payment appropriations. The schedule shall be
reviewed annually.
In order to permit full comparison between forecasts and out-turn, the
table of equivalence of commitments and payments shall be presented
with the same subdivisions and headings in the budget and in the revenue
and expenditure account.
In the working document accompanying the preliminary draft budget, the
Commission shall provide the necessary information concerning the
foreseeable distribution and utilization of the commitment appropriations
and the payment appropriations for the various budget headings for the
duration of the action and also concerning development of the revenue
originating from financing by third parties (public or private) and
revenue from services for third parties.
Article 95
Notwithstanding Article 26 and without prejudice to paragraph 7 thereof,
the Commission may, within the subsection referred to in Article 92,
transfer appropriations from one title to another and from one chapter to
another in respect of the activities referred to in Article 92 (1) (a).
These transfers may not have the effect of increasing or decreasing by
more than 15 % in commitment appropriations and in payment
appropriations the initial allocation entered in the budget for each of
the programmes referred to in Article 92 (1) (a), excluding exploratory
research. They may not have the effect of increasing the appropriations
earmarked for exploratory research by more than 6 % in commitment
appropriations and in payment appropriations of the initial allocation for
the total of the programmes referred to above.
This special provision does not concern staff appropriations for the JRC.For the purposes of the application of Article 26, the budget headings
relating to the activities referred to in Article 92 (1) (b) (excluding JRC
participation), (c) and (d) shall be regarded as chapters.
Article 96
1. The Commission may provide services for outside bodies or
individuals, in accordance with the remarks in the budget for the
chapters and articles in question.
Notwithstanding Article 5, the resulting revenue may give rise to
additional appropriations:
— in commitments, equal to the amount of the repayments provided for
in the contracts concluded with the outside bodies or individuals,
— in payments, equal to the entitlements established from these
repayments.
2. Notwithstanding Article 7 (2), additional appropriations shall be
maintained until they are cancelled by means of the revenue and
expenditure account.
3. Where provision is made in the remarks column for certain
categories of expenditure to be repaid to the general budget, such
repayments shall be booked to the statement of revenue, in accordance
with the implementing rules, under headings entered specifically for this
purpose.
4. The appropriations relating to the activities referred to in Article 92
(1) (b), as regards the participation of the JRC on a competitive basis,
and (e) and (3) shall be treated as revenue from services to third parties
provided for in paragraphs 1 and 2 of this Article.!M5
!M10
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!M101977X1231 — EN — 27.04.2001 — 002.001 — 48
The utilization of these appropriations shall be shown in a set of
analytical accounts in the revenue and expenditure accounts for each
category of action to which it relates; it shall be separate from revenue
originating from financing by third parties (public or private) and from
revenue from services provided for third parties in connection with the
activities referred to in paragraphs 1 and 2 or activities of a different
nature.
Article 97
1. With regard to the award of contracts in the fields falling under this
Title, the implementing rules provided for in "M8Article 139 3may
lay down special provisions on:
— the limit values determining the conditions for concluding contracts,
— the operation and the determination of the powers of the Advisory
Committee on procurements and contracts.
2. By way of derogation from the first subparagraph of Article 66, the
sale of scientific and technical equipment shall be permitted without
prior notice, on the basis of a decision by the authorizing officer taken
after the Advisory Committee on procurements and contracts has
delivered its opinion.
TITLE VIII
SPECIAL PROVISIONS APPLICABLE TO THE EUROPEAN
AGRICULTURAL GUIDANCE AND GUARANTEE FUND,
GUARANTEE SECTION
Article 98
The provisions of Titles I to VI "M8and Part III 3shall apply to
expenditure financed by the EAGGF Guarantee Section, in accordance
with Regulation (EEC) No 729/70, effected through the authorities or
bodies referred to in Article 4 (1) of that Regulation and under the
implementing provisions adopted pursuant to Article 5 (3) of that
Regulation, save as otherwise provided in this Title.
Special operations which the Commission manages directly, shall be
implemented in accordance with the rules laid down in Title III of this
Regulation.
Article "M5993
"M51.3Provisional global commitments shall be entered into,
corresponding to the advances to be made to the Member States, in
respect of the appropriations for the Guarantee Section of the European
Agricultural Guidance and Guarantee Fund.
The Commission decisions fixing the amounts of these advances in
accordance with Article 5 (2) (a) of Regulation (EEC) No 729/70 shall
constitute provisional global commitments. The approval of the financial
controller shall have the sole purpose of establishing that these
commitments correspond to the amount of the advances decided by
the Commission after consultation with the EAGGF Committee, and that
they are within the limits of the total amount of appropriations entered in
the Guarantee Section of the European Agricultural Guidance and
Guarantee Fund.!M10
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!B1977X1231 — EN — 27.04.2001 — 002.001 — 49
!M5
2. The Commission shall make a monthly report to the Parliament and
the Council; the report shall be forwarded within 30 working days of the
end of the month of implementation of the actual expenditure by the
Member States. The report shall include data permitting an assessment
of:
— the trend in expenditure, taking account of the early warning system
provided for in Article 6 of Council Decision 88/377/EEC of 24 June
1988 concerning budgetary discipline,
— the projected trend in expenditure during the financial year in
relation to market trends.
Article "M51003
1. Expenditure effected by authorities and bodies under Article 4 of
Regulation (EEC) No 729/70 shall be the subject of a commitment by
chapter, article and item, and shall also be charged as a payment, after
examination of the statements forwarded by the Member States in
accordance with the provisions laid down pursuant to Article 5 (3) of the
said Regulation, and after the approval of the financial controller.
The commitment shall be entered into within two months following
receipt of the statements forwarded by the Member States. The charging
as a payment shall, in general, be carried out within the same period.
This Article shall apply without prejudice to the clearance of accounts
provided for in Article 5 (2) (b) of Regulation (EEC) No 729/70.
2. The commitments provided for in this Article shall be deducted from
the provisional global commitments referred to in "M5Article 99 3.
Article "M51013
Expenditure shall be booked to the accounts for a financial year on the
basis of the advances paid by the Commission to the Member States
during that year in accordance with Article 5 of Regulation (EEC) No
729/70, provided that notification of their commitment and authorization
have reached the accounting officer not later than 31 January of the
following year.
Article 102
1. The object of the clearance of accounts decision, provided for in
Article 5 (2) (b) of Regulation (EEC) No 729/70, shall be to determine
the amount of expenditure effected in each Member State during the
financial year in question which must be recognized as being chargeable
to the EAGGF , without prejudice to decisions taken subsequently in
accordance with paragraph 2 (c) of that Article.
2. The object of the decisions referred to in Article 5 (2) (c) of
Regulation (EEC) No 729/70 shall be to determine the expenditure
which, because the relevant measures were not implemented in
compliance with Community rules, shall be deducted from the
Community financing referred to in Articles 2 and 3 of that Regulation.
3. The schedule for the clearance of the accounts is set out in
Regulation (EEC) No 729/70.
4. The outcome of the decision referred to in paragraph 1, namely and
discrepancy which may exist between the total expenditure booked to the
accounts for a financial year pursuant to Articles 100 and 101 and the
total expenditure recognized as allowable by the Commission when
clearing the accounts, shall be booked, under a single article, as
additional expenditure or a reduction in expenditure.
5. The outcome of the decisions referred to in paragraph 2 shall be
booked under a single article as a reduction in expenditure.!B
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!M5
Article 103
Global provisional commitments which have been made for a financial
year in accordance with Article 99 and which have not been specifically
committed under the budget nomenclature in accordance with Article
100 by 1 February of the following financial year, shall be released under
the original financial year.
Article 104
1. Transfers from one article to another within each chapter shall be
made by decision of the Commission, to be taken not later than 31
January in accordance with the procedure provided for in Article 13 of
Regulation (EEC) No 729/70.
The Commission shall inform the budgetary authority of such transfers.
2. Not later than "M12 10 January 3of the following financial
year, the Commission may submit proposals to the budgetary authority
for transfers of appropriations from one chapter to another. Acting by a
qualified majority, the Council, after consulting the European Parlia-
ment, shall take a decision within three weeks. The European Parliament
shall deliver its opinion in sufficient time to enable the Council to take
note of it and act within the stipulated period. Failing a decision by the
Council within that period, the transfer proposals shall be deemed to be
approved.
3. Decisions on transfers relating to the monetary reserve referred to in
Article 19 (6) shall be taken in accordance with Article 26 (5) (a).
TITLE IX
SPECIAL PROVISIONS APPLICABLE TO EXTERNAL AID
SECTION I
GENERAL PROVISIONS
Article 105
1. The provisions of Titles I to VI, "M8Title XI and Part III 3shall
apply to external aid financed from the Community budget, save as
otherwise provided in this Title.
2. The appropriations assigned by the Community to its cooperation
policy shall be used either under cooperation agreements with a financial
protocol (‘preferential agreements’) or as aid granted unilaterally.
3. The appropriations may be earmarked in particular for grant aid,
special loans, risk capital or interest-rate subsidies, and shall be used by
the Commission, which may confer authority on behalf of the
Community to administer a part thereof, either on the European
Investment Bank or, under its responsibility, on other organizations.
This provision shall not prejudice the audit powers of the Court of
Auditors under "M8Article 188c of the EC Treaty 3.
4. The following provisions shall govern the use of appropriations by
the Commission.
5. The amount of special loans and risk capital granted shall be shown
in the balance sheet provided for in Article 81.
Article 106
1. Any cooperation project adopted by the Commission may be covered
by:
— a financing agreement drawn up between the Commission, acting for
the Community, and the Government of the recipient State or the
governing bodies of the recipient organization or institutions,
hereinafter referred to as the recipient,1977X1231 — EN — 27.04.2001 — 002.001 — 51
— or a contract with international organizations, or natural or legal
persons responsible for carrying out the project.
2. The financing agreement or contract shall determine the financial
commitment of the Community for the measure concerned. No
expenditure in excess of this amount may be charged to the budget
without an additional commitment.
3. In addition, a loan contract shall be drawn up between the
Commission, acting for the Community, and the borrower in respect of
any investment project financed by a special loan.
SECTION II
IMPLEMENTATION
Article 107
Projects covered by a financing agreement shall be implemented by the
recipient in close collaboration with the Commission, which shall retain
responsibility for the utilization of appropriations.
Article 108
1. These functions performed by the Commission may be referred to in
the preferential agreements or the financing agreements as those of chief
authorizing officer.
2. The Commission, in close cooperation with the recipient, shall
ensure that participants in tendering procedures can compete on an equal
footing, that there is no discrimination and that the tender selected is
economically the most advantageous. In particular, it shall approve the
terms of the invitation to tender before it is issued, be apprised of the
results of the examination of the tenders, and approve the proposal for
the award of the contract.
Article 109
1. In the case of preferential agreements in particular, the recipient may
appoint a national authorizing officer to represent the national authorities
in all operations relating to projects financed by the Community which
are the subject of an agreement between the recipient State and the
Community.
2. The recipient shall submit invitations to tender to the Commission
for agreement before issuing them. On the basis of the decisions thus
endorsed and in close cooperation with the Commission, the recipient
shall issue invitations to tender, receive tenders, preside over the
examination of tenders and establish the results of the tendering
procedure.
The Commission shall normally be represented when tenders are being
examined, where the basic price of the invitation to tender exceeds the
limit fixed in the financing agreement or contract.
3. It shall transmit to the Commission for agreement the results of the
examination of the tendering procedure and a proposal for the award of
the contract. It shall sign contracts, additions to contracts and estimates
and shall notify the Commission thereof. For contracts, additions to
contracts, and estimates, the Commission, where appropriate, shall enter
into individual commitments in accordance with the procedures laid
down in Articles 36 to 39. Individual commitments shall count towards
the commitments under the financing agreements provided for in Article
106(2), in accordance with the second subparagraph of Article 36(2).!M5
!M121977X1231 — EN — 27.04.2001 — 002.001 — 52
4. Where appropriate, the recipient shall validate and authorize any
expenditure which is the subject of an agreement between the recipient
and the Community against appropriations committed by the Commis-
sion. It shall remain financially liable to the Commission until the
Commission clears the operations for the execution of which the
recipient is responsible.
Article 110
1. For the purposes of applying the preferential agreement or financing
agreement between the Community and the recipient State, and in
respect of the appropriations for which it is the authorizing officer, the
Commission may be represented in the recipient State by a representative
approved by that State.
2. While operations are in progress, the Commission’ s representative
shall verify, on the basis of documents and on the spot, that the work or
services comply with their description in the financing agreements,
contracts or estimates.
Article 111
1. For payments in a currency other than that of the recipient State, the
Commission shall make payment direct for services provided in
connection with projects financed with grant aid.
2. For payments in the currency of the recipient State, accounts
denominated in "M13 euro3 or in the currency of one of the
Member States may be opened with a financial institution in the recipient
State in the name of the Commission or, by common agreement, of the
recipient.
In the case of preferential agreements, the tasks referred to in paragraphs
5 and 6 may be entrusted to a financial institution, referred to as the
paying agent.
3. The accounts referred to in paragraph 2 shall be replenished to meet
actual cash requirements. Transfers shall be made in "M13 euro3or,
exceptionally, in the currency of a Member State, and converted into the
currency of the recipient State as payments fall due, at the exchange rate
ruling on the day of payment.
4. Interest on the deposits in the accounts referred to in paragraph 2
shall be used exclusively for the projects concerned, unless agreed
otherwise when the functions of paying agent are being exercised by a
public financial institution.
The paying agent shall not be remunerated for his services.5. Within the limits of the funds available, the paying agent, after
obtaining the approval of the Commission’ s representative, shall make
the payments authorized after verifying that the supporting documents
provided are substantively accurate and in order.
6. At regular intervals, and at least once a quarter, the paying agent
shall send the Commission a statement of actual expenditure and
revenue, together with supporting documents.
7. Payments made and revenue received in the currency of the recipient
State shall be subject to a clearance procedure before they are finally
booked to the budget appropriations. Clearance shall consist of an
examination by the Commission to establish that validation, auth-
orization and payment and the collection of revenue have been properly
effected, in accordance with this Financial Regulation.!M51977X1231 — EN — 27.04.2001 — 002.001 — 53
SECTION III
AW ARD OF CONTRACTS
Article 112
The provisions of this section shall apply instead of those under Title IV
to cases in which the Commission, in connection with external aid
financed from the general budget of the European Communities, acts as
contracting authority in the award of works, supply or service contracts
not covered:
— by the Council Directives coordinating the award of public works,
supply or service contracts, or
— by the Plurilateral Agreement on Government Procurement con-
cluded within the World Trade Organisation.
Article 113
The procedure to be followed for the award of works, supply or service
contracts financed from the general budget of the European Commu-
nities for recipients of external aid shall be specified in the financing
agreement or the contract, subject to the following principles.
Article 114
1. Participation in tendering procedures shall be open on equal terms to
all natural and legal persons coming within the scope of application of
the Treaties and to all natural and legal persons in the recipient State.
The specifications shall therefore require tenderers to state their
nationality and to present the supporting evidence normally acceptable
under their own law.
2. In exceptional cases and with proper justification, it may be decided,
on the basis of the specific conditions laid down in the basic instruments
governing cooperation and in accordance with the appropriate auth-
orization procedures, to allow nationals of third countries to tender for
contracts financed by the Community.
Article 115
The Commission and the recipient shall take the necessary implementing
measures to guarantee as wide a participation as possible, on equal terms
in tendering procedures and other procedures for the award of contracts
financed by the Community.
To this end, without prejudice to Articles 116 to 118, care shall be taken
in particular to:
(a) ensure advance publication in reasonable time of invitations to
tender in the Official Journal of the European Communities and the
official gazette of the recipient State;
(b) eliminate any discriminatory practice or technical specifications
liable to hamper wide participation on equal terms by all natural or
legal persons of the Member States and of the recipient State.
Article 116
In urgent cases or where the nature, small scale or particular
characteristics of certain works or supplies so warrant, the Commission
or the recipient may, by agreement with the Commission stating the
reasons therefor, exceptionally authorize;
— the award of contracts after open invitations to tender, confined to a
specific geographical area,
— the award of contracts after restricted invitations to tender,!M5
!M12
!M51977X1231 — EN — 27.04.2001 — 002.001 — 54
— the conclusions of contracts by private treaty,
— the performance of contracts through public works departments.
Article 117
The Commission and the recipient shall ensure that Articles 115, 116 and
118 are observed for each operation and that the tender selected is
economically the most advantageous, with due regard notably to the cost
of performance, running costs involved, technical merit, the qualifi-
cations of and the guarantees offered by the tenderers, the nature and
conditions of execution of the works or supplies.
The Commission and the recipient shall ensure that all the selection
criteria are specified in the invitation to tender.
The result of invitations to tender shall be published at the earliest
possible date in the Official Journal of the European Communities .
Where appropriate, it should also be possible to publish the result of
invitations to tender in the official gazette of the recipient State.
Article 118
1. Contracts for services and technical cooperation shall be awarded
after restricted invitations to tender.
For contracts for services and technical cooperation, the Commission
shall — if need be after a process of preselection — draw up a restricted
list of candidates, using criteria which guarantee that they have the
requisite qualifications, professional experience and independence, and
taking account of their availability for the project in question.
The Commission shall publish in the Official Journal of the European
Communities :
(a) the content and the value of each contract planned, indicating the
purpose:
— forecasts of the services contracts and technical cooperation
actions to be awarded after calls for tenders during the 12
months following publication once a year, and
— the amendments to the forecasts provided for under the first
indent once every three months;
(b) the outcome of the calls for tenders as soon as possible.
2. However, some contracts may be awarded by private treaty,
particularly in the following cases:
— short or small projects,
— projects being carried out by non-profit-making institutions or
associations,
— extensions to projects already under way,— where the invitation to tender has been unsuccessful.
3. Contracts for services and technical cooperation shall, as a general
rule, be prepared, negotiated and concluded by the Commission.
4. In the case of preferential agreements, or in cases where express
provision is made therefore in the financing agreements, the tasks
referred to in paragraph 3 shall be delegated to the recipient, in
agreement and in collaboration with the Commission’ s representative.!M5
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!M51977X1231 — EN — 27.04.2001 — 002.001 — 55
Article 119
Only service contracts awarded in the interests of the Commission shall
he governed by the provisions of "M8Articles 56 to 64a 3of the
Financial Regulation.
SECTION IV
AUDITING OF ACCOUNTS
Article 120
1. Each agreement to finance an investment project shall make express
provision for the Court’ s power of audit.
2. Should the Court of Auditors wish to carry out audits on the territory
of recipient States, or States in which recipients are located, it shall do so
by agreement with the relevant authorities of the State concerned.
Such audits shall be limited to the inspection agreements implemented
pursuant to the provisions governing Community aid and shall not apply
in respect of the execution arrangements which are the responsibility of
the national authorizing officer.
TITLE X
SPECIAL PROVISIONS APPLICABLE TO THE MANAGEMENT
OF APPROPRIATIONS RELATING TO STAFF SERVING IN
OFFICES AND SUBOFFICES IN THE COMMUNITY AND IN
DELEGATIONS OUTSIDE THE COMMUNITY AND TO THEIR
ADMINISTRATION
Article 121
The provisions of Titles I to VI "M8and Part III 3shall apply to
activities in this field, save as otherwise provided in this Title.
Article 123
In accordance with "M8Article 139 3the Commission shall adopt
implementing rules relating, in particular, to:
— the award of contracts,
— the keeping of inventories,— the system of accounts,— imprest accounts.
TITLE XI
SPECIAL PROVISIONS APPLICABLE TO FINANCIAL P AR-
TICIP ATION BY THIRD P ARTIES AND OUTSIDE BODIES IN
COMMUNITY ACTIVITIES
SECTION I
GENERAL PROVISIONS
Article 124
Financial participation by a third party or outside body in a Community
activity shall require the prior authorization of the budgetary authority,
given according to one of the following procedures:!M5
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!M81977X1231 — EN — 27.04.2001 — 002.001 — 56
(a) in the course of the budgetary procedure if already provided for. In
such cases, the Commission shall, in the preliminary draft budget,
propose the appropriate budgetary structure and the headings to
which the contribution shall be charged in the statement of revenue
and under which the corresponding appropriations shall be made
available in the statement of expenditure, in accordance with Article
125. The amount of the contribution and the manner of its
calculation shall be shown separately, for information;
(b) where the request for participation is made in the course of a
financial year, the Commission may, if it considers it to be in the
interest of the Community, and if an appropriate structure to cover it
is provided in the budget, propose that it be authorized by the
budgetary authority. Such authorization shall be given if the Council,
acting by a qualified majority, and the European Parliament agree.
All relevant intervention expenditure shall be covered by the amount
of the third party’ s contribution.
Article 125
For the purposes of implementing the budget, the contributions referred
to in Article 124 shall lead to additional appropriations being made
available as follows:
— commitment appropriations equivalent to the entitlement due to the
Community,
— payment appropriations equivalent to the amounts received.
Article 126
The contributions referred to in Article 124 shall constitute earmarked
revenue in accordance with the second subparagraph of Article 4 (2).
All necessary accounting measures shall be taken to ensure the separate
monitoring of the use both of the revenue from these contributions and of
the appropriations made available under Article 125.
SECTION II
PROVISIONS APPLICABLE TO P ARTICIP ATION PROVIDED
FOR PURSUANT TO THE AGREEMENT ON THE EUROPEAN
ECONOMIC AREA
Article 127
The budgetary structure to cover participation by the EFTA States shall
be as follows:
(a) in the statement of revenue there shall be a heading to cover the full
amount of the contribution of the EFTA States for the relevant
financial year. The amount shall be entered separately ‘for
information’;
(b) in the statement of expenditure:
— the remark relating to each heading covering Community
activities involving the participation of the EFTA States shall
indicate the amount of their contribution ‘for information’,
— an annex, constituting an integral part of the budget, shall
contain all headings relating to Community activities involving
the participation of the EFTA States.
The annex shall serve as and supplement the budgetary structure
for making available the appropriations corresponding to such
contributions by virtue of Article 128 and for implementing
expenditure.!M81977X1231 — EN — 27.04.2001 — 002.001 — 57
Article 128
By virtue of Article 82 of the Agreement on the European Economic
Area, amounts relating to the annual participation of EFTA States - as
confirmed to the Commission by the Joint Committee in conformity with
Article 1 (5) of Protocol 32- shall, at the beginning of the financial year,
give rise to the full entry of the corresponding appropriations for
commitment and appropriations for payment.
Article 129
1. If in the course of a financial year the appropriations for budget
headings involving the participation of the EFTA States are increased by
amending or supplementary budgets or by transfers, without it being
possible for the EFTA States, in the course of that financial year, to
adjust their contribution accordingly in line with the proportionality
factor provided for in Article 82 of the Agreement on the European
Economic Area, the Commission shall be authorized to provide
provisional, exceptional advance financing from its cash resources for
the share of the EFTA States in order to permit balanced implementation
of expenditure relating to the relevant activity. Following any such
increase the Commission shall as soon as possible call for corresponding
contributions from the EFTA States save in cases of overriding necessity.
Each year the Commission shall inform the budgetary authority of the
measures it has had to take in accordance with the foregoing provisions.
2. The advance financing shall be regularized as soon as possible in the
budget for the following financial year.
Article 130
By way of derogation from Article 58 (2), as regards the rules governing
tendering procedures, invitations to tender shall be published throughout
all the Member States and all the EFTA States whenever the contract
entails expenditure form a budget heading involving participation of the
EFTA States.
Article 131
1. The financial contributions of EFTA States shall constitute
earmarked revenue within the meaning of the third indent of the second
subparagraph of Article 4 (2). All appropriate accounting measures shall
accordingly be taken to ensure the separate monitoring both of revenue
flowing from such contributions and of the corresponding appropriations.
2. Point 4 of Article 7 and Article 26 (9) shall apply to the contributions
referred to in paragraph 1.
3. In the quarterly reports provided for in Article 34 the Commission
shall give clear details of the state of execution of both the revenue and
the expenditure corresponding to participation by the EFTA States.
Article 132
The revenue and expenditure corresponding to participation by the EFTA
States shall be verified in compliance with the provisions of the EC
Treaty, of this Regulation and of regulations applicable to matters
covered by Article 78 of the Agreement on the European Economic Area
and Protocol 31 thereto.!M81977X1231 — EN — 27.04.2001 — 002.001 — 58
!M13
TITLE XIa
SPECIAL PROVISIONS APPLICABLE TO THE SANCTIONS
REFERRED TO IN SECTION 4 OF REGULATION (EC) No
1467/97
Article 132a
The budgetary structure for the proceeds of the sanctions referred to in
Section 4 of Regulation (EC) No 1467/97 shall be as follows:
(a) the statement of revenue shall carry a budget heading to receive the
amounts of the fines and the interest on the deposits and the fines
imposed by the Council on a Member State in accordance with
Section 4 of Regulation (EC) No 1467/97;
(b) in parallel, and without prejudice to Article 28a, commitment and
payment appropriations shall be entered in a heading in the statement
of expenditure to match these amounts in the statement of revenue.
These appropriations shall be executed in accordance with Article 16
of Regulation (EC) No 1467/97.
TITLE "M8XII3
SPECIAL PROVISIONS RELATING TO THE OFFICE FOR
OFFICIAL PUBLICATIONS OF THE EUROPEAN COMMU-
NITIES
Article "M81333
1. Without prejudice to the other provisions of this Financial
Regulation, the following special provisions shall apply to the
functioning of the Office for Official Publications of the European
Communities.
2. The appropriations for the Office, the total amount of which shall be
entered under a special budget heading within Part A of the section of the
budget relating to the Commission, shall be set out in detail in an Annex
to that part. The appropriations shown under this specific budget heading
may be transferred in accordance with the conditions set out in Article
26.
The Annex shall take the form of a statement of revenue and expenditure,
subdivided in the same way as the sections of the budget.
The appropriations entered in that Annex shall cover all the financial
requirements of the Office in the performance of its duties in the service
of the Communities’ institutions.
3. Where necessary, the estimates may be adjusted during the financial
year by the Management Committee of the Office, which shall take
decisions on the transfers required within the Annex as a result of such
adjustments. It shall inform the budgetary authority three weeks before
effecting transfers form one chapter to another.
"M54.3The remarks concerning the specific budget heading under
which is entered the total appropriation for the Office shall show an
estimate of the cost of services rendered by the Office to each of the
institutions. This shall be based on the forecasts of the analytical
accounts provided for in paragraph 5.
The total costs of these services shall correspond to the total expenditure
shown in its statement of expenditure.!B
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!B
!M51977X1231 — EN — 27.04.2001 — 002.001 — 59
5. The Office shall draw up analytical accounts of its expenditure,
enabling the proportion of its services rendered to each of the institutions
to be determined. The Management Committee shall lay down the
criteria on which the accounting system shall be based.
The Office shall notify the institutions concerned of the results of the
analytical accounts.
6. On a proposal from the Management Committee the Commission
shall, for the appropriations entered in the Annex for the Office, delegate
the powers of authorization to the Director of the Office and shall fix the
limits and conditions of such act of delegation.
Each institution shall retain the powers of authorization for expenditure
charged to the appropriations for the publication of all work entrusted to
outside bodies by the Office. The net proceeds from the sale of the
publications shall be re-used by the institution which drew up these
publications, in accordance with "M5Article 27 (2) 3.
7. The financial controller shall delegate powers to an official who
shall be responsible for monitoring the commitment and authorization of
expenditure and also for monitoring the revenue of the Office.
The Commission, acting on a proposal from the Management Committee
of the Office, shall appoint an assistant accounting officer with special
responsibility for collecting revenue and settling expenditure effected
directly by the Office.
8. To meet the cash requirements of the Office, bank accounts or post
office giro accounts may be opened on its behalf by the Commission,
acting on a proposal from the Management Committee.
The accounts shall be financed regularly by payments effected by the
Commission upon receipt of calls for funds from the Office. Such
payments may not exceed the total amount of the appropriations entered
for this purpose in the Commission budget.
The final cash position for each year shall be adjusted between the Office
and the Commission at the end of the financial year.
9. The revenue and expenditure account and the balance sheet in
respect of the Office shall form an integral part of the revenue and
expenditure account and of the balance sheet of the Communities
referred to in "M5Articles 78 and 81 3.
10. The Management Committee of the Office shall determine the
detailed rules for the implementation of the preceding provisions, and
also specific rules governing the terms of sale of publications and the
corresponding accounting system.
PART II
PROVISIONS APPLICABLE TO BORROWING AND LENDING
OPERATIONS BY THE EUROPEAN COMMUNITIES
Article 134
The Commission shall report to the Council and the European Parliament
twice a year on the position regarding budget guarantees and risks
relating thereto.
This information shall be sent at the same time to the Court of Auditors.
Article 135
The financial balance sheet provided for in Article 81 shall give details
of capital operations and debt management indicating:
— the amount of loans granted,
— the amount of the repayments made on borrowings contracted and of
the charges on such borrowings,!B
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— the amount of borrowings contracted,
— the amount of repayments of capital and payments of interest made
on loans granted.
Article 136
Within the powers conferred on the Commission in relation to each
instrument, the financial controller of the Commission shall check the
regularity of the execution of borrowing and lending operations.
To this end, he shall check:
— that operations are in conformity with the basic rules,
— the assessment of risks,
— where appropriate, the calculation of interest-rate subsidies where
they are covered by the budget,
— compliance with the principle of sound financial management.
To enable him to exercise these functions to the full, the financial
controller of the Commission:
— shall have access either manually or by computer to all data,
documents, ledgers, registers, correspondence, statements of account
or computer files relating to borrowing and lending operations,
— shall be authorized to conduct or take part in on-the-spot checks.
Article 137
The Commission shall provide the Court of Auditors, at its request, with
any information on borrowing and lending operations.
"M8PART III 3
TRANSITIONAL AND FINAL PROVISIONS
Article "M81383
The European Parliament and the Council shall be empowered to require
any information or explanations regarding budgetary matters within their
competence.
The Council may be assisted in its task by a committee set up within the
framework of the Permanent Representatives Committee.
Article "M81393
In consultation with the European Parliament and the Council and after
the other institutions have delivered their opinions, the Commission shall
adopt implementing measures for this Financial Regulation.
Article "M81403
At three-year intervals, the European Parliament and the Council shall
examine this Financial Regulation in the light of a proposal from the
Commission. Any financial regulations amending this Financial
Regulation shall be adopted by the Council after recourse to the
conciliation procedure if the European Parliament so requests.
Article "M81413
The following shall be repealed:!M8
!B
!M5
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— the Financial Regulation of 25 April 1973 applicable to the general
budget of the European Communities (1), and the Financial
Regulation of 18 March 1975 amending it (2),
— all other provisions contrary to this Financial Regulation.
Article "M81423
The financial rules of Community bodies having legal personality and
receiving subsidies from the general budget must, as far as possible,
correspond to the provisions of this Financial Regulation and depart from
them only when the specific requirements of their individual operation so
dictate.
Article "M81433
This Financial Regulation shall enter into force on 1 January 1978.
This Financial Regulation shall be binding in its entirety and directly
applicable in all Member States.!B
(1) OJ No L 116, 1. 5. 1973, p. 1.
(2) OJ No L 73, 21. 3. 1975, p. 45.!M5
!B
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