No C 296/8 Official Journal of the European Communities 24. 11. 89 
Proposal for a Council Regulation (EEC) on economic aid to the Republic of Hungary and the 
Polish People's Republic 
COM(89) 536 final 
(Submitted by the Commission on 27 October 1989) 
(89/C 296/06) 
THE COUNCIL OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 235 
thereof, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European 
Parliament, 
Whereas the European Economic Community has 
concluded Agreements on trade and commercial and 
economic cooperation with the Republic of Hungary and 
the Polish People's Republic; whereas Title II of those 
Agreements provides inter alia that the Contracting 
Parties shall foster economic cooperation on as broad a 
base as possible in all fields deemed to be in their mutual 
interest; 
Whereas the Community and its Member States have 
decided to take concerted action with certain 
non-member countries in the form of measures intended 
to support the process of economic and social reform 
under way in Hungary and Poland; 
Whereas the implementation of such measures will help 
achieve the Community's aims; 
Whereas the Community must have the means to 
implement such measures; 
Whereas the fields in which measures are to be 
undertaken should be determined; 
Whereas it is necessary to estimate the amount of 
Community financial resources needed to implement 
these measures in 1990; whereas that amount is 
consistent with the financial perspective annexed to the 
Interinstitutional Agreement of 29 June 1988; 
Whereas the appropriations actually available will be 
determined under the budget procedure in accordance 
with the said Agreement; 
Whereas the Treaty has not specifically provided for the 
necessary powers of action, HAS ADOPTED THIS REGULATION: 
Article 1 
The Community shall make economic aid available to 
the Republic of Hungary and the Polish People's 
Republic in accordance with the criteria laid down in this 
Regulation. 
Article 2 
1. The amount of Community expenditure needed to 
implement the measures introduced by this Regulation is 
estimated at ECU 200 million for the period to 31 
December 1990. 
2. The budget authority shall determine the amount of 
appropriations available each year. 
Article 3 
The aid shall be used primarily to finance or participate 
in the financing of projects or cooperation operations 
aimed at the economic development and modernization 
of Hungary and Poland and the strengthening of 
commercial and economic links between the Community 
and those countries. 
Such projects or cooperation operations should be 
undertaken in particular in the areas of agriculture, 
industry, investment, energy, training, environmental 
protection, trade and services; they should be aimed in 
particular at the private sector in Hungary and Poland. 
Article 4 
The aid shall be granted by the Community, either inde­
pendently or in the form of cofinancing with the 
Member States, non-member countries or multilateral 
organizations. 
Article 5 
Community aid shall in general be in the form of grants. 
They may generate funds that can be used for financing 
cooperation projects or operations. 
Article 6 
1. The aid may cover expenditure on imports and 
local expenditure needed to carry out the projects and 
programmes. 
24. 11. 89 Official Journal of the European Communities No C 296/9 
Taxes, duties and charges and the purchase of property 
shall be excluded from Community financing. 
2. Maintenance and operating costs may be covered 
for training and research programmes and for other 
projects; however, for the latter such costs may be 
covered only in the start-up stage and shall be degressive. 
3. However, in the case of cofinancing, account shall 
be taken in each case of the procedures applied by the 
other donors. 
Article 7 
1. In the case of assistance exceeding ECU 50 000 for 
which the Community is the sole source of external aid, 
participation in invitiations to tender and contracts shall 
be open on equal terms to all natural and legal persons 
of the Member States and the recipient State. 
2. Paragraph 1 shall apply also to cofinancing. 
3. In the case of cofinancing, however, the partici­
pation of third countries in invitations to tender and 
contracts may be authorized by the Commission, but 
only on a case-by-case basis, after examination of the 
case. 
Article 8 
1. The Commission shall administer the aid. 
2. The general guidelines applicable to the aid 
allocated for the following year shall be adopted before 
the end of each year in accordance with the procedure 
laid down in Article 9 (2). 
Article 9 
1. An advisory committee on aid for economic 
restructuring in Poland and Hungary, hereinafter called 
the 'advisory committee', is hereby set up. The 
committee shall draw up its own rules of procedure. The committee shall consist of representatives of the Member 
States and shall be chaired by the Commission represen­
tative. 
2. The Commission representative shall present to the 
committee a proposal for the measures to be taken. The 
committee shall deliver its opinion on the proposal, 
within a period which the Chairman may set in the light 
of the urgency of the measures, and where appropriate a 
vote may be taken. 
The opinion shall be entered in the minutes; each 
Member State shall have the right to request that its 
position be noted in the minutes. 
The Commission shall take the fullest possible account of 
the opinion delivered by the committee and shall inform 
the committee of how its opinion has been taken into 
account. 
3. The Commission may put before the advisory 
committee any matter concerning the implementation of 
cooperation operations. 
Article 10 
Account shall be taken of the preferences and wishes 
expressed by the recipient countries concerned in the 
choice of measures to be financed pursuant to this Regu­
lation. 
Article 11 
From 1990 the Commission shall draw up each year a 
report on the implementation of cooperation operations. 
The report shall be sent to Parliament, the Council and 
the Economic and Social Committee. 
Article 12 
This Regulation shall enter into force on the third day 
following that of its publication in the Official Journal of 
the European Communities.