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►B COUNCILREGULATION(EC)No3605/93
of22November1993
ontheapplicationoftheProtocol ontheexcessivedeficit procedureannexedtotheTreatyestab-
lishingtheEuropeanCommunity
(OJ L 332, 31.12.1993, p. 7)
Amended by:
Official Journal
No page date
►M1Council Regulation (EC) No 475/2000 of 28 February 2000 L 58 1 3.3.2000
►M2Commission Regulation (EC) No 351/2002 of 25 February 2002 L 55 23 26.2.2002
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COUNCILREGULATION(EC)No3605/93
of22November1993
ontheapplicationoftheProtocolontheexcessivedeficitprocedure
annexedtotheTreaty establishingtheEuropeanCommunity
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty establishing the European Community, andin particular the third subparagraph of Article 104c (14) thereof,
Having regard to the proposal from the Commission(
1),
Having regard to the opinion of the European Parliament(2),
Whereasthe definitionsof ‘government’, ‘deficit’ and ‘inves tment’ are
laid down in the Protocol on the excessive deficit procedure by refer-ence to the European System of Integrated Economic Accounts(ESA)(
3); whereas precise definitions referring to the classification
codes of ESA are required; whereas these definitions may be subject
to revision in the context of the necessary harmonization of national
statistics or for other reasons; whereas any revision of ESA will bedecided by the Council in accordance with the ruleson competenceand procedure laid down in the Treaty;
Whereasthe definition of ‘debt’ laid down in the Protocol on the
excessive deficit procedure needs to be amplified by a reference tothe classification codes of ESA;
WhereasCouncil Directive 89/130/EEC, Euratom of 13 February 1989
on the harmonization of the compilation of gross national product atmarket prices(
4) providesan adequate, detailed definition of gros s
domestic product at market prices;
Whereas, pursuant to the terms of the Protocol on the excessive deficit
procedure, the Commission is required to provide the statistical data tobe used in that procedure;
Whereasdetailed rulesare required to organize the prompt and regular
reporting by the Member States to the Commission of their plannedand actual deficitsand of the levelsof their debt;
Whereas, pursuant to Article 104c (2) and (3) of the Treaty, the
Commission is to monitor the development of the budgetary situationand of the stock of government debt in the Member States and toexamine compliance with budgetary discipline on the basis of criteriarelating to government deficit and government debt; whereas, if aMember State doesnot fulfil the requirementsunder one or both
criteria, the Commission must take into account all relevant factors;
whereas the Commission has to examine whether there is a risk of anexcessive deficit in a Member State,
HAS ADOPTED THIS REGULATION:
SECTION 1
Definitions
Article 1
1. For the purposes of the Protocol on the excessive deficit proce-
dure and of thisRegulation, the termsgiven in the followingparagraphs are defined according to the European system of national1993R3605 — EN — 01.01.2002 — 002.001 — 2
(1) OJ No C 324, 1. 12. 1993, p. 8; and
OJ No C 340, 17. 12. 1993, p. 8.
(2) OJ No C 329, 6. 12. 1993.
(3) Statistical Office of the European Communities, European System of Inte-
grated Economic Accounts (ESA) , second edition.
(4) OJ No L 49, 21. 2. 1989, p. 26.▼M1
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and regional accountsin the Community (hereinafter referred to as
‘ESA 95’), adopted by Regulation (EC) No 2223/96(1). The codesin
bracketsrefer to ESA 95.
2. ‘Government’ meansthe s ector of ‘general government’ (S.13),
that is‘central government’ (S.1311), ‘s tate government’ (S.1312),
‘local government’ (S.1313) and ‘social security funds’ (S.1314), to
the exclusion of commercial operations, as defined in ESA 95.
The exclusion of commercial operations means that the sector of
‘general government’ (S.13) comprises only institutional units produ-
cing non-market services as their main activity.
3. ‘Government deficit (surplus)’ means the net borrowing (net
lending) ( ►M2EDP B.9 ◄) of the sector of ‘general government’
(S.13), as defined in ESA 95. The interest comprised in the governmentdeficit isthe interes t ( ►
M2EDP D.41 ◄), asdefined in ESA 95.
4. ‘Government investment’ means the gross fixed capital formation
(P.51) of the sector of ‘general government’ (S.13), as defined in ESA95.
5. ‘Government debt’ meansthe total gros sdebt at nominal value
outstanding at the end of the year of the sector of ‘general government’(S.13), with the exception of those liabilities the corresponding finan-cial assets of which are held by the sector of ‘general government’(S.13).
Government debt iscons tituted by the liabilitiesof general government
in the following categories: currency and deposits (AF.2); securities
other than shares, excluding financial derivatives (AF.33) and loans
(AF.4), asdefined in ESA 95.
The nominal value of a liability outstanding at the end of the year is
the face value.
The nominal value of an index-linked liability corresponds to its face
value adjusted by the index-related change in the value of the principal
accrued to the end of the year.
Liabilitiesdenominated in a foreign currency, or exchanged from one
foreign currency through contractual agreementsto one or more other
foreign currenciess hall be converted into the other foreign currencies
at the rate agreed on in those contracts and shall be converted into thenational currency on the basis of the representative market exchangerate prevailing on the last working day of each year.
Liabilitiesdenominated in the national currency and exchanged through
contractual agreementsto a foreign currency s hall be converted into theforeign currency at the rate agreed on in those contracts and shall beconverted into the national currency on the basis of the representative
market exchange rate prevailing on the last working day of each year.
Liabilitiesdenominated in a foreign currency and exchanged through
contractual agreementsto the national currency s hall be converted into
the national currency at the rate agreed on in those contracts.
Article 2
For the purposes of the Protocol on the excessive deficit procedure and
of this Regulation, gross domestic product means gross domesticproduct at current market prices(GDP mp) (B.1*g), asdefined inESA 95.1993R3605 — EN — 01.01.2002 — 002.001 — 3
(1) Council Regulation (EC) No 2223/96 of 25 June 1996 on the European
system of national and regional accounts in the Community (OJ L 310,
30.11.1996, p. 1).
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Article 3
1. Planned government deficit figures mean the figures established
for the current year by the Member States consistent with the mostrecent decisions of their budgetary authorities.
2. Actual government deficit and government debt level figures
mean estimated, provisional, half-finalized or final results for a pastyear.
SECTION 2
Rulesandcoverage ofreporting
Article 4
1. Asfrom the beginning of 1994, Member Statess hall report to the
Commission their planned and actual government deficits and levels ofgovernment debt twice a year, the first time before 1 March of thecurrent year (year n) and the second time before 1 September of year n.
2. Before 1 March of year n, Member States:
— shall report to the Commission their planned government deficit for
year n, an up-to-date estimate of their actual government deficit foryear n-1 and their actual government deficitsfor yearsn-2, n-3 and
n-4,
— shall simultaneously provide the Commission for years n, n-1 and
n-2 with their corresponding public accounts budget deficitsaccording to the definition which isgiven mos t prominence nation-
ally and with the figureswhich explain the trans ition between this
public accountsbudget deficit and their government deficit. Thefiguresexplaining thistrans ition which are provided to theCommission shall include, in particular, the figures for netborrowing of the ►
M1subsectors S.1311, S.1312, S.1313 and
S.1314◄,
— shall report to the Commission their estimate of the level of actual
government debt at the end of year n-1 and their levelsof actualgovernment debt for yearsn-2, n-3 and n-4,
— shall simultaneously provide the Commission for years n-1 and n-2
with the figureswhich explain the contributionsof their govern-ment deficit and the other relevant factorscontributing to thevariation in the level of their government debt.
3. Before 1 September of year n, Member Statess hall report to the
Commission:
— their updated planned government deficit for year n and their actual
government deficitsfor yearsn-1, n-2, n-3 and n-4 and s hall
comply with the requirementsof the s econd indent of paragraph 2,
— their actual level of government debt for yearsn-1, n-2, n-3 and n-
4, and shall comply with the requirements of the fourth indent ofparagraph 2.
4. The figuresfor the planned government deficit reported to the
Commission in accordance with paragraphs 2 and 3 shall be expressedin national currency and in budget years.
The figuresfor actual government deficit and actual government debt
level reported to the Commission in accordance with paragraphs 2 and3 shall be expressed in national currency and in calendar years, with
the exception of the up-to-date estimates for year n-1, which may be
expressed in budget years.
Where the budget year differsfrom the calendar year, Member States
shall also report to the Commission their figures for actual governmentdeficit and actual government debt level in budget yearsfor the twobudget yearspreceding the current budget year.
Article 5
Member Statess hall, in accordance with the procedure laid down in
Article 4 (1), (2) and (3), provide the Commission with the figures for1993R3605 — EN — 01.01.2002 — 002.001 — 4
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their government investment expenditure ►M1and interest expendi-
ture (consolidated) ◄.
Article 6
Member States shall provide the Commission with a forecast of their
gross domestic product for year n and the actual amount of their gross
domestic product for years n-1, n-2, n-3 and n-4, under the same timing
conditionsasthos e indicated in Article 4 (1).
Article 7
In the event of a revision of ESA 95 or of an amendment to its meth-
odology to be decided on by the Council or the Commission inaccordance with the ruleson competence and procedure laid down inthe Treaty and in Regulation (EC) No 2223/96, the Commission shallintroduce the new referencesto ESA 95 into Articles1, 2 and 4.
Article 8
ThisRegulation s hall enter into force on 1 January 1994.
ThisRegulation s hall be binding in itsentirety and directly applicable
in all Member States.1993R3605 — EN — 01.01.2002 — 002.001 — 5
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