This document is meant purely as documentation tool and the institutions do not assume any liability for its contents
"B COUNCIL REGULATION (EC) No 1488/96
of 23 July 1996
on financial and technical measures to accompany (MEDA) the reform of economic and social structures in
the framework of the Euro-Mediterranean partnership
(OJ L 189, 30.7.1996, p. 1)
Amended by:
Official Journal
No page date
"M1 Council Regulation (EC) No 780/98 of 7 April 1998 L 113 3 15.4.1998
"M2 Council Regulation (EC) No 2698/2000 of 27 November 2000 L 311 1 12.12.2000
Corrected by:
"C1 Corrigendum, OJ L 187, 1.7.1998, p. 56 (1488/96)
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) and Council Regulation(EC) No 1103/97 (OJ L 162, 19.6.1997, p. 1).1996R1488 — EN — 15.12.2000 — 002.001 — 1
COUNCIL REGULATION (EC) No 1488/96
of 23 July 1996
on financial and technical measures to accompany (MEDA) the reform of
economic and social structures in the framework of the Euro-Medi-
terranean partnership
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty establishing the European Community, and in
particular Article 235 thereof,
Having regard to the proposal from the Commission (1),
Having regard to the opinion of the European Parliament (2),
Whereas the European Council at its meetings in Lisbon, Corfu and Essen
stressed that the Mediterranean constitutes a priority area for the European
Union and adopted the aim of establishing a Euro-Mediterranean partnership;
Whereas the Cannes European Council meeting on 26 and 27 June 1995
reaffirmed the strategic importance it attached to adding a new dimension to
the European Union’ s relations with its Mediterranean partners by building onthe Council report of 12 June 1995 prepared on the basis, in particular, of theCommission communications of 19 October 1994 and 8 March 1995 on
strengthening the Mediterranean policy of the European Union;
Whereas it is necessary to pursue efforts to ensure that the Mediterranean
becomes an area of political stability and security and whereas the
Community’s Mediterranean policy must play a part in achieving the general
objective of the development and strengthening of democracy and the rule oflaw, as well as in achieving the objective of respect of human rights andfundamental freedoms and of the promotion of good-neighbourly relations,
while respecting international law and theterritorial integrity and external
frontiers of the Member States and Mediterranean non-member countries.
Whereas the ultimate establishment of a Euro-Mediterranean free-trade area
is likely to foster stability and prosperity in the Mediterranean region;
Whereas for the Mediterranean partners the establishment of a free-trade area
may involve profound structural reforms;
Whereas it is therefore necessary to support the efforts that have been or will
be undertaken by the Mediterranean partners to reform their economic, socialand administrative structures;
Whereas the dialogue between cultures and between civil societies should be
developed, notably by encouraging training activities, development and
decentralized cooperation;
Whereas intensified regional cooperation and in particular the development of
economic links and trade flows between Mediterranean territories and
partners which are conducive to reform and economic restructuring should beencouraged;
Whereas the bilateral protocols on financial and technical cooperation
concluded by the Community with Mediterranean partners provided a useful
initial basis for cooperation; whereas it is now necessary to build on the
experience which has been acquired and to embark on a new stage ofrelations, in the framework of partnership;
Whereas rules for the administration of such partnership have to be
determined, while ensuring the transparency and overall consistency of actionundertaken using budget appropriations;
Whereas to this end this Regulation will apply to the range of measures which
came under Council Regulation (EEC) No 1762/92 of 29 June 1992 on the
implementation of the protocols on financial and technical cooperation
concluded by the Community with Mediterranean non-member countries (
3)!B
(1) OJ No C 232, 6. 9. 1995, p. 5 and
OJ No C 150, 24. 5. 1996, p. 15.
(2) OJ No C 17, 22. 1. 1996, p. 184 and Opinion delivered on 20 June 1996 (OJ No C
198, 8. 7. 1996).
(3) OJ No L 181, 1. 7. 1992, p. 1.!C1
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and Council Regulation (EEC) No 1763/92 of 29 June 1992 concerning
financial cooperation in respect of all Mediterranean non-member coun-tries (
1) for measures whose scope extended beyond the scope of a single
country;
Whereas, therefore, this Regulation replaces the abovementioned Regulations
as from 1 January 1997, while it is, however, necessary to maintainRegulation (EEC) No 1762/92 in force for the management of financialprotocols still applicable at that date and for the commitment of funds
remaining under the expired financial protocols;
Whereas a financial reference amount, within the meaning of point 2 of the
Declaration by the European Parliament, the Council and the Commission of6 March 1995, is included in this Regulation for the period 1995 to 1999,
without thereby affecting the powers of the budgetary authority as they are
defined by the Treaty;
Whereas in respect of environmental projects the loans granted by the
European Investment Bank, hereinafter referred to as ‘the Bank’, from its ownresources under conditions laid down by it, in accordance with its Statute, may
receive an interest-rate subsidy;
Whereas in loan operations involving interest-rate subsidies, the granting of a
loan by the Bank from its own resources and the granting of an interest-ratesubsidy financed by the budgetary resources of the Community must be
linked and are conditional on each other; whereas the Bank may, in
accordance with its Statute and in particular by a unanimous decision of itsBoard of Directors in the presence of an unfavourable opinion by theCommission, decide to grant a loan from its own resources, subject to
granting of the interest-rate subsidy; whereas, on account of this aspect, it is
necessary to ensure that the procedure adopted for granting interest-ratesubsidies results in every case in an express decision, whether to grant the
subsidy or to refuse it, where appropriate;
Whereas it is necessary to make provision for a Committee composed of
representatives of the Member States to assist the Bank in the tasks attributedto it to implement this Regulation;
Whereas to ensure effective management of the measures provided for in this
Regulation and to facilitate relations with the beneficiary countries a
multiannual approach is required;
Whereas the measures under this Regulation go beyond the framework of
development assistance and are intended to apply to countries only in part
classifiable as developing countries; whereas, therefore, this Regulation
cannot be adopted other than on the basis of the powers provided for in Article235 of the Treaty,
HAS ADOPTED THIS REGULATION:
Article 1
1. The Community shall implement measures in the framework of the
principles and priorities of the Euro-Mediterranean partnership to support the
efforts that Mediterranean non-member countries and territories listed inAnnex I (hereinafter referred to as ‘Mediterranean partners’) will undertake toreform their economic and social structures, improve conditions for the
underprivileged and mitigate any social or environmental consequences which
may result from economic development.
2. The beneficiaries of support measures may include not only States and
regions but also local authorities, regional organizations, public agencies,
local or traditional communities, organizations supporting business, private
operators, cooperatives, mutual societies, associations, foundations andnon-governmental organizations.
3. The financial reference amount for the implementation of this
programme for the period 2000 to 2006 shall be EUR 5 350 000 000.
The annual appropriations shall be authorized by the budgetary authority
within the limits of the financial perspective.!B
(1) OJ No L 181, 1. 7. 1992, p. 5.!M2
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Article 2
1. The purpose of this Regulation is to contribute, through the measures
provided for in paragraph 2, to initiatives of joint interest in the three sectorsof the Euro-Mediterranean partnership: the reinforcement of political stabilityand of democracy, the creation of a Euro-Mediterranean free-trade area, and
the development of economic and social cooperation, taking due account of
the human and cultural dimension.
2. These support measures shall be implemented taking account of the
objective of achieving sustainable development leading to long-term stability
and prosperity. Particular attention shall be paid to the economic, social and
environmental impact of economic transition, to regional and subregionalcooperation and to building the capacity of the Mediterranean partners to
integrate into the world economy. The objectives and details of the relevant
procedures shall be as set out in Annex II.
Article 3
This Regulation is based on respect for democratic principles and the rule of
law and also for human rights and fundamental freedoms, which constitute an
essential element thereof, the violation of which element will justify the
adoption of appropriate measures.
Article 4
1. The Commission shall, in liaison with the Member States and on the basis
of a reciprocal and regular exchange of information, including exchange ofinformation on the spot, especially with regard to strategy papers, the nationalindicative programmes (NIP), annual financing plans, and the preparation of
projects and monitoring of their implementation, ensure the effective
coordination of the assistance efforts undertaken by the Community, includingthe European Investment Bank (hereinafter referred to as ‘the Bank’), andindividual Member States, in order to increase the coherence and
complementarity of their cooperation programmes. In addition, the Commis-
sion shall promote coordination and cooperation with international financialinstitutions, the United Nations cooperation programmes and other donors.
The specific arrangements for on-the-spot coordination shall be the subject of
guidelines to be approved by the Committee provided for in Article 11.
2. The measures referred to in this Regulation may be adopted by the
Community either independently or in the form of co-financing with the
Mediterranean partners themselves or with public or private bodies of the
Member States and the Bank, on the one hand, or multilateral bodies or thirdcountries, on the other. The Commission shall, where appropriate, promote
such co-financing on the basis of a reciprocal and early exchange of
information with the Member States.
Article 5
1. Measures to be financed under this Regulation shall be selected taking
account, inter alia , of the beneficiaries’ priorities, evolving needs, absorption
capacity and progress towards structural reform.
Selection shall also be based on an assessment of the effectiveness of those
measures in achieving the objectives aimed at by Community support, in line,where appropriate, with the provisions of Association or CooperationAgreements.
2. Strategy papers covering the period 2000 to 2006 shall be established at
national and regional level, in liaison with the Bank. These strategy papersshall have the purpose of defining the long-term objectives of cooperation andof identifying priority areas of intervention. To this end, due account shall be
taken of all relevant evaluations, a problem-oriented analysis shall be used
and cross-cutting issues shall be integrated. As far as possible, implemen-tation benchmarks will be developed in order to facilitate the evaluation of theattainment of the objectives of cooperation. If required by unforeseeable
circumstances, or following the result of the review referred to in Article
15(4), the strategy papers shall be revised.!B
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3. Indicative programmes national and regional covering three-year periods
shall be based on the corresponding strategy papers. They shall be establishedat national and regional level in liaison with the Bank, and they may include,respectively, interest rate subsidies and risk capital.
They shall take into account the priorities identified with the Mediterranean
partners, including the conclusions of the economic dialogue.
The programmes shall define the main objectives of, the guidelines for, and
the priority sectors of, Community support in the areas referred to in Section
II of Annex II, together with indicators for the evaluation of the programmes.
The programmes shall include indicative amounts (overall and by prioritysector) and list the criteria for funding the programme concerned.
The programmes shall be updated annually, as necessary. They may be
amended in the light of experience acquired, or the progress achieved by the
Mediterranean partners as regards structural reforms, macroeconomic
stabilisation, industrial development and social advancement, or the outcomeof cooperation under the new Association Agreements. These programmesshall describe the reforms to be implemented by the partners in the priority
sectors and shall include an evaluation of progress made in this respect.
4. Financing plans shall be based on the indicative programmes referred to
in paragraph 3 and, as a rule, be adopted annually. They shall be established at
national and regional level in liaison with the Bank. Projects relating tointerest rate subsidies shall be included in national financing plans. Projectsrelating to risk capital shall be included in regional financing plans.
The plans shall include a list of the projects to be financed. Each project shall
be examined on its merits as a component part of the financing plan as a
whole. The contents of the plans shall be described in sufficient detail so as to
allow their adoption in accordance with the procedure set out in Article 11(2).
5. The Commission, in liaison with the Bank, shall ensure that programming
of measures concerning interest-rate subsidies and risk capital is com-plementary to, and coherent with, the national and regional strategy papers,
indicative programmes and financing plans. The Bank shall ensure, at the
stage of implementation, the conformity of the measures with this Regulationand with the decisions taken thereunder.
Projects relating to interest-rate subsidies shall, as a rule, be incorporated by
the Commission, on the basis of proposals made by the Bank, into the nationalfinancing plans, as appropriate.
Projects relating to risk capital shall be incorporated by the Commission, on
the basis of proposals made by the Bank, into a regional financing plan, as
appropriate. The projects shall take the form of a risk capital facility,
consisting of an allocation for financing risk capital operations over amultiannual period.
6. Financing decisions shall be based on the corresponding indicative
programme if the projects do not form part of a financing plan.
Article 6
1. Community financing shall notably be in the form of grants or risk
capital. Concerning cooperation measures in the field of the environment itmay also take the form of interest rate subsidies for loans granted by the Bankfrom its own resources.
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Loans from the Bank carrying interest rate subsidies shall be denominated and
paid in euro. The interest rate applicable shall be set for each payment, taking
account of the financial characteristics of the operation in question; thesubsidy rate applied to each payment shall be half the interest rate applicableto the payment in question, although this subsidy rate shall not exceed the
nominal rate of 3 %.
2. Grants may be used to finance or co-finance activities, projects or
programmes which contribute to the realization of the objectives defined in
Article 2. The financing ceiling for each grant for activities, projects orprogrammes shall also depend on those grants’ ability to yield a financial
return. The financing made available to the private sector shall in general be
on commercial terms, in order to avoid distortions of local financial marketsas far as possible.!M2
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3. Financing decisions and any financing agreements and contracts resulting
therefrom shall provide, inter alia , for supervision and financial control by the
Commission (including the European Anti-fraud Office (OLAF)), includingon-the-spot checks and inspection in conformity with Regulation (Euratom,EC) No 2185/96 (
1), and audits by the Court of Auditors, where appropriate,
to be carried out on the spot. The Commission shall take measures in
accordance with the procedure set out in Article 11(2), in order to provide foradequate protection of the financial interests of the European Community inconformity with Regulation (EC, Euratom) No 2988/95 (
2).
The Court of Auditors’ supervision of operations financed under this
Regulation and managed by the Bank shall be carried out according to the
procedures agreed between the Commission, the Bank and the Court of
Auditors.
4. Risk capital shall be used, first and foremost, to make available own
funds, or funds regarded as such, to undertakings (private or mixed) in theproduction sector, in particular those that can bring together natural or legalpersons who are nationals of a Community Member State and of
Mediterranean non-member countries or territories.
Risk capital shall be used primarily to strengthen the private sector, and in
particular to reinforce the financial sector in MEDA countries. It shall addvalue clearly, by offering financial products and terms that are not availablelocally.
Risk capital provided and managed by the Bank may in particular take the
form of:
(a) subordinated loans, for which reimbursement and any interest payments
shall be effected only after settlement of other banking claims;
(b) conditional loans the repayment or duration of which depend on
fulfilment of the conditions laid down when the loans are granted;
(c) temporary minority holdings on behalf of the Community in the capital of
undertakings established in the Mediterranean non-member countries or
territories;
(d) financing of holdings in the form of conditional loans granted to the
Mediterranean partners or, with their consent, to undertakings in thoseMediterranean partner countries, either directly or through the inter-mediary of their financial institutions.
Article 7
1. Measures under this Regulation may cover expenditure on imports of
goods and services and local expenditure needed to carry out the projects and
programmes. Direct budgetary support in favour of the beneficiary partner
may also be covered to support agreed programmes of economic reform, inparticular through sectoral facilities for structural adjustment, as referred to in
Annex II, Part I(b). Taxes, duties and charges shall be excluded from
Community financing.
Contracts for the implementation of Community-funded measures under this
Regulation shall receive, from the partner concerned, fiscal and customs
treatment no less favourable than that which it applies to the most-favouredState or most-favoured international development organization.
2. Costs incurred in identifying, preparing, managing, monitoring, auditing
and controlling programmes or projects may also be covered. This may
include costs related to technical and administrative assistance when they are
to the mutual benefit of the Commission and the beneficiaries of the activityand do not constitute the permanent tasks of the public service.
(1) OJ L 292, 15.11.1996, p. 2.
(2) OJ L 312, 23.12.1995, p. 1.!B
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3. Operating and maintenance costs, in particular those to be financed in
foreign currency, may be covered within the framework of training,communications and research programmes and within that of other projects.As a general rule, such costs may be covered only in the start-up stage and
shall be progressively reduced.
4. For investment projects in the production sector, Community financing
shall be combined with the beneficiary’ s own resources or with financing onmarket conditions, taking into account the nature of the project. The
recipient’s contribution or that represented by financing on market conditions
should be maximized. In any case Community financing, including thatinvolving the Bank’ s own resources, shall not exceed 80 % of total investmentcosts. That ceiling shall be of an exceptional nature and shall be duly justified
by the nature of the operation.
Article 8
1. Invitations to tender and contract shall be open on equal terms to all
natural and legal persons in the Member States and the Mediterranean
partners.
2. The Commission shall ensure:— the widest possible participation under equal conditions in short lists and
tenders for supplies, works and services,
— the necessary transparency and rigour in the application of the selection
and evaluation criteria,
— effective competition among firms, organizations and institutions inter-
ested in participating in the initiatives financed by the programme.
3. In the Official Journal of the European Communities the Commission
shall publish, indicating the subject, the content and the value of the contracts
provided for:
— once a year, forecasts of contracts for services and technical cooperation
activities to be awarded after invitations to tender for the 12 monthsfollowing publication,
— once every three months, any amendments to the above forecasts.
4. The Commission shall provide, in liaison with Member States, on
request, to all interested firms, organisations and institutions throughout the
Community, documentation on the general aspects of the MEDA programmesand the requirements for participation in the programmes, making appropriate
use of the Internet.
5. Financing conventions referred to in Article 9(6) or financing proposals
shall include indications of the contracts to be expected, including theestimated values, the procedure for awarding them and the planned dates for
the invitations to tender.
6. Contracts shall be awarded to companies in accordance with the relevant
provisions of the Financial Regulation applicable to the general budget of theEuropean Communities.
7. The results of the invitations to tender, including information on the
number of received tenders, the date of the award of the contract, the name
and the address of the successful tenderers, shall be published in the Official
Journal of the European Communities and released on the Internet. The
Commission shall provide the Committee provided for in Article 11, every six
months, with specific detailed information on the contracts concluded in
implementation of MEDA programmes and projects.
8. In the case of co-financing, participants from countries other than the
Mediterranean partners concerned in invitations to tender and contracts may
be authorized by the Commission on a case-by-case basis. In these cases
participation of undertakings from third countries shall be acceptable only ifreciprocity is granted.!B
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Article 9
1. The Commission shall forward for information its overall financial
programme planning and its underlying reasoning in the context of the
strategy papers, indicating in particular the total amount of the national andregional indicative programmes, as well as the allocation by beneficiary
country and by priority sector of the overall amount adopted within those
programmes.
2. The strategy papers, indicative programmes, financing plans and any
amendment to them shall be adopted by the Commission in accordance with
the procedure laid down in Article 11(2).
3. Financing decisions that are not covered by the national or regional
financing plans shall be adopted individually by the Commission in
accordance with the procedure laid down in Article 11(2), subject to
paragraph 5 of this Article.
4. Decisions amending the financing decisions referred to in paragraph 3
shall be taken by the Commission where they do not entail any substantial
amendments or additional commitments in excess of 20 % of the originalcommitment. The Commission shall inform the Committee referred to inArticle 11 immediately of any such decisions.
5. Financing decisions not exceeding EUR 2 000 000 shall be adopted by
the Commission if they form part of an overall allocation. An overallallocation shall be adopted in accordance with the procedure laid down in
Article 11(2). The Committee provided for in Article 11 shall be informed
systematically and promptly, and in any event before its next meeting, offinancing decisions for measures not exceeding EUR 2 000 000.
6. Without prejudice to Article 106 of the Financial Regulation of 21
December 1977 applicable to the general budget of the EuropeanCommunities (
1), (hereinafter referred to as ‘the Financial Regulation’),
financing conventions shall be forwarded for information to the members of
the Committee provided for in Article 11 two weeks before they are signed.
7. The further procedure laid down in Article 12 shall be applied in relation
to interest-rate subsidies for loans granted by the Bank for projects financed
in the field of environment. The further procedure laid down in Article 13
shall be applied in relation to risk capital.
Article 10
1. Measures referred to in this Regulation which are financed from the
general budget of the European Communities shall be administered by theCommission in accordance with the Financial Regulation applicable to the
general budget of the European Communities.
2. In financing decisions taken under this Regulation and the assessments
and evaluations mentioned in Article 15, the Commission shall abide by the
principles of sound financial management and, in particular, those of
economy and cost-effectiveness referred to in the Financial Regulation.
Article 11
1. A management committee shall be established (hereinafter referred to as
‘the MED Committee’). A representative of the Bank shall take part in the
proceedings without a right to vote.
2. Where reference is made to this paragraph, Articles 4 and 7 of Decision
1999/468/EC shall apply.
3. The period laid down in Article 4(3) of Decision 1999/468/EC shall be
set at three months.
(1) OJ L 356, 31.12.1977, p. 1. Regulation as last amended by Regulation (EC, ECSC,
Euratom) No 2673/1999 (OJ L 326, 18.12.199, p. 1).!B
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4. The Committee may examine any other question relating to the
implementation of this Regulation which is put to it by its Chairman,possibly at the request of the representative of a Member State, and inparticular any question relating to general implementation, the administration
of the programme or the co-financing and coordination referred to in Articles
4 and 5.
5. The Committee shall adopt its rules of procedure by qualified majority, in
accordance with Article 205(2) of the Treaty.
6. The Commission shall keep the Committee regularly informed and shall
supply it with information on the implementation of measures under this
Regulation.
Article 12
1. The Bank shall communicate to the Commission the proposed project
relating to interest-rate subsidies either for incorporation into a financing planor for adoption as an individual financing decision, as provided for in Article9(2) and (3) respectively. The Commission shall verify the conformity of the
proposed project with this Regulation and the relevant decisions taken
thereunder.
2. The Commission shall communicate to the Bank each decision relating to
interest rate subsidies, whether adopted as a financing plan or as an individualfinancing decision.
3. In accordance with the decision referred to in paragraph 2, the Bank,
where the decision grants the interest rate subsidy, may grant the
corresponding loan with the said subsidy, subject to a positive opinion ofthe Committee referred to in Article 14 and of the Commission representativetherein.
4. The Bank shall inform the Commission accordingly.
Article 13
1. The Bank shall communicate to the Commission the proposed project
relating to risk capital in the form of a risk capital facility for incorporation
into a regional financing plan. The Commission shall verify the conformity ofthe terms of this project with this Regulation and the relevant decisions takenthereunder.
2. The Commission shall communicate to the Bank each decision adopted
pursuant to Article 9(2) on a regional financing plan including risk capital for
its implementation.
3. On this basis, the Bank shall submit to the Committee referred to in
Article 14, for its opinion, individual operations implementing the risk capitalproject envisaged within a regional financing plan. The Commissionrepresentative shall convey to that Committee the position of his institution
on the operation concerned and in particular on its conformity with the
regional financing plan.
4. On this basis, and subject to a positive opinion of the Committee referred
to in Article 14 and of the Commission representative therein, the individualrisk capital operations shall be submitted to the Bank for appropriate
measures.
5. The Bank shall inform the Commission accordingly.
Article 14
1. A Committee consisting of the representatives of the Member States,
hereinafter referred to as the ‘Article 14 Committee’, shall be set up at theBank. That Committee shall be chaired by the representative of the MemberState currently holding the chair of the Board of Governors of the Bank; its
secretariat shall be provided by the Bank. A representative of the Commission
shall take part in its proceedings.!B
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2. The rules of procedure of the Article 14 Committee shall be adopted
unanimously by the Council.
3. The Committee shall act by a qualified majority in accordance with
"M2Article 205(2) of the Treaty 3.
4. Within the Article 14 Committee, the votes of the representatives of the
Member States shall be weighted in accordance with "M2Article 205(2) of
the Treaty 3.
Article 15
1. The Commission shall, together with the Bank, examine progress
achieved in implementing the measures undertaken pursuant to this
Regulation and shall submit to the European Parliament and the Council anannual report, no later than 30 June of the following year. The report shallcontain information on the measures financed during the year, with regard for
due confidentiality, as well as information on the results of monitoring
activities and provide an assessment of the results obtained in the overallcontext of the strategy papers.
2. The Commission shall inform the Member States each year of the
budgetary execution of the previous year, in terms of commitments andpayments.
3. The Commission and the Bank shall evaluate at mid-term and ex-post
their respective projects and main sectors of intervention in order to
determine whether the objectives have been achieved and to establish
guidelines for increasing the effectiveness of future activities. The evaluationreports, with regard for due confidentiality, shall be made available to the
MED Committee as well as to the European Parliament. For operations
managed by the Bank, the reports shall be made available to the MEDCommittee.
4. Every three years the Commission shall, together with the Bank, produce
an overall evaluation report of the assistance already provided to theMediterranean partners, including the effectiveness of the programmes and
the review of the strategy papers. This report shall be presented to the MED
Committee forthwith for discussion.
5. The Council will review this Regulation before 30 June 2006. To that end,
the Commission shall submit to the Council before 31 December 2005 anevaluation report accompanied by proposals regarding the future of this
Regulation and, if necessary, the amendments to be made to it.
Article 16
When an essential element for the continuation of support measures to a
Mediterranean partner is missing, the Council may, acting by a qualified
majority on a proposal from the Commission, decide upon appropriatemeasures.
Article 17
1. Regulation (EEC) No 1763/92 is hereby repealed as from 31 December
1996.
2. As from 1 January 1997, Regulation (EEC) No 1762/92 shall apply for
the management of the protocols still in force at that date and for the
commitment of funds remaining under the expired protocols.
Article 18
This Regulation shall enter into force on the third day following its
publication in the Official Journal of the European Communities .
This Regulation shall be binding in its entirety and directly applicable in all
Member States.!B
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ANNEX I
P ARTNER TERRITORIES AND COUNTRIES REFERRED TO IN ARTICLE 1
The People’ s Democratic Republic of Algeria
The Republic of CyprusThe Arab Republic of EgyptThe State of IsraelThe Kingdom of Jordan
The Lebanese Republic
The Republic of MaltaThe Kingdom of MoroccoThe Syrian Arab RepublicThe Republic of TunisiaThe Republic of TurkeyThe Occupied Territories of Gaza and the West Bank!
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ANNEX II
Objectives and rules for the implementation of Article 2
I. (a) Support for economic transition and the establishment of a Euro-
Mediterranean free-trade area shall include in particular:
— job creation and private sector development, including improvement
of the business environment and support for SMEs,
— the opening-up of markets, promotion of investment, industrial
cooperation and trade between the European Community and theMediterranean partners, as well as among the Mediterranean partnersthemselves,
— upgrading of economic infrastructure, possibly to include the
financial and taxation systems.
(b) Operations in support of reform programmes of the partners are
implemented on the basis of the following principles:
— the support programmes shall be designed to restore or, as the case
may be, consolidate the major financial balances and to create aneconomic environment favourable to accelerated growth, while at the
same time seeking to improve the well-being of the population,
— the support programmes shall also contribute to reforms in the key
sectors with a view to the creation of a free trade area with theEuropean Community,
— the support programmes shall be adapted to the particular situation of
each country and take account of economic and social conditions,
— the support programmes shall lay down measures intended, in
particular, to accompany, as regards social conditions and employ-
ment, economic transition and the accomplishment of a Euro-Mediterranean free trade area, and to alleviate the negative effectswhich this process may have on social conditions and employment,especially for the most underprivileged sections of the population,
— disbursement of the support will be implemented in tranches in the
form of direct budgetary support according to the compliance with the
objectives and/or sectoral targets agreed within the support pro-gramme.
The following eligibility criteria must be satisfied:— the country concerned must undertake a reform programme approved
by the Bretton Woods institutions or implement programmesrecognised as analogous, in coordination with those institutions, but
not necessarily financially supported by them, in accordance with the
scope and effectiveness of the reforms,
— account must be taken of the economic situation of the country, at the
macroeconomic level, (indebtedness, cost of debt-servicing, thebalance of payments, the budget situation, the monetary situation,the level of per capita income and the unemployment level) and at the
level of sectoral reforms, with a view to creating a free trade area with
the European Community.
II. Support for sustainable economic and social development shall include in
particular:
— the participation of civil society and populations in the planning and
implementation of development measures,
— the improvement of social services, especially in the areas of health, family
planning, water supplies, sanitation and housing,
— the promotion of wide and equitable sharing of the fruits of growth, paying
particular attention to the objectives and targets agreed at UN summits
concerning the fight against poverty and incorporated in the international
development targets,
— harmonious and integrated rural development and the improvement of
urban living conditions,
— reinforced cooperation concerning agriculture, particularly as regards
quality and standards,
— reinforced cooperation concerning fisheries and the sustainable exploita-
tion of marine resources,
— protection and improvement of the environment, particular consideration
being given to the precautionary and the preventive action principles in!
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supporting economic development through reinforced environmental
cooperation,
— upgrading of economic infrastructures, particularly in the sectors of
transport, energy, rural and urban development, strengthening activitiesrelated to the information society, information technology and telecom-munications,
— integrated development of human resources to complement Member
States’ programmes, notably with regard to continuing vocational trainingin the context of industrial cooperation, and improvement of the potential
for scientific and technological research,
— strengthening democracy, respect for, and defence of, human rights, in
particular through non-governmental organisations in the European
Community and the Mediterranean partners,
— cultural cooperation and youth exchanges,
— cooperation and technical assistance in order to strengthen cooperation in
the area of migrations and combating illegal migration, including
repatriation of illegal residents,
— cooperation and technical assistance in combating organised crime,
including illegal drug trafficking and trafficking in human beings,
— the development of cooperation in areas relating to the rule of law, such as
cooperation in judicial and criminal matters, the strengthening ofinstitutions which guarantee the independence and effectiveness of thejudicial system, the training of national security services and civilprotection.
III. Regional, subregional and cross-border cooperation shall be supported in
particular by:
(a) establishing and developing structures for regional cooperation between
the Mediterranean partners, and between them and the European Union
and its Member States;
(b) — establishing the physical infrastructure necessary for regional trade,
including transport, communications and energy,
— improvement of the regulatory framework and small-scale infra-
structure projects in the context of border-crossing facilities,
— cooperation on the level of large geographic regions as well as
measures complementary to those undertaken in this field within the
European Community, including support for connection between thetransport and energy networks of the Mediterranean partners and thetrans-European networks;
(c) other regional activities including the Euro-Arab dialogue;(d) exchanges between civil society in the European Community and the
Mediterranean partners; in this context, decentralised cooperation will:
— have as its objective to identify the non-governmental beneficiaries of
Community aid,
— concentrate particularly on the networking of universities and
researchers, local communities, associations, political science foun-dations, trade unions and non-governmental organisations, the media,private business and cultural institutions in the widest sense, as well asthe other bodies listed in point IV .
The programmes must concentrate on promoting the participation and the
emergence of civil society within the partner countries, in particular byencouraging information between networks and durable links between network
partners.
IV . Good governance shall be promoted by supporting key institutions and key
protagonists in civil society such as local authorities, rural and village groups,mutual-aid associations, trade unions, the media and organisations supportingbusiness, and by assisting in the improvement of the capacity of the publicadministration to develop policies and manage their implementation.
V . Measures taken under this Regulation shall take into account analyses of the
needs and potential of women and men in economic and social life so as to
include gender aspects in the programming and implementation of development
cooperation. Special importance shall be attached to education and the creationof jobs for women.
The measures shall also take account of the need to promote education and the
creation of jobs for young people in order to facilitate their social integration.
VI. The activities financed under this Regulation shall mainly take the form of
technical assistance, training, institution-building, information, seminars,studies, projects for investment in micro-enterprises, small and medium-sized!
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undertakings and infrastructures and action designed to highlight the
Community nature of the assistance. Recourse should be had to decentralisedcooperation where this may prove effective. Risk-capital operations andinterest-rate subsidies will be financed in collaboration with the Bank.
VII. Due regard shall be paid to environmental considerations in the preparation and
implementation of activities financed by means of this Regulation.!
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