EXPLANATORY MEMORANDUM

1. CONTEXT OF THE PROPOSAL

The Commission proposal for the Multiannual Financial Framework (MFF) 2014-2020 adopted on June, 29th, set the budgetary framework and main orientations for the funding of Common Fisheries Policy (CFP) and the Integrated Maritime Policy (IMP).

Further, the Commission adopted on July 13th, 2011 a package laying down the new CFP legislative framework. The Integrated Maritime Policy (IMP) was financed in the years 2008-2010 through a series of pilot schemes and preparatory actions. A new financial instrument has been proposed by the Commission for the period between 2012 and 2013. With the launch of the new MFF, it becomes necessary to adopt a long-term instrument for financial support of the IMP.

The Commission adopted on October 6th 2011 a proposal for a "Common Provisions" Regulation which lays down common rules for the shared-management funds, with the main aim of simplification of policy delivery. The European Regional Development Fund, European Social Fund, Cohesion Fund, European Agricultural Fund for Rural Development and the future European Maritime and Fisheries Fund (CSF Funds) pursue complementary objectives and share the same management mode. The "Common Provisions" Regulation sets out a series of common rules for these funds. These provisions concern the general principles such as partnership, multi-level governance, equality between men and women, sustainability and compliance with applicable EU and national law. The proposal also contains the common elements of strategic planning and programming, including a list of thematic objectives derived from the Europe 2020 Strategy, provisions on the Common Strategic Framework at Union level and on Partnership Contracts to be concluded with each Member State. It introduces macroeconomic conditionalities and sets out a common approach to the performance orientation of the CSF funds. Accordingly, it includes ex-ante conditionalities and performance review, but also the arrangements for monitoring, reporting and evaluation. Common provisions are also set out with regard to eligibility rules, and special arrangements are defined for financial instruments and community led local development. Some management and control arrangements are also common to all CSF Funds.

The current proposal for the Regulation on European Maritime and Fisheries Fund (EMFF) aims at achieving the objectives of the reformed CFP and of IMP. It is based on these objectives, re-defined in terms of funding:

(1) promotion of sustainable and competitive fisheries and aquaculture;

(2) fostering the development and implementation of the Union's Integrated Maritime Policy, in a complementary manner to cohesion policy and to CFP;

(3) promotion of balanced and inclusive territorial development of fisheries areas (including aquaculture and inland fishing);

(4) contribution to the implementation of the CFP.

The World Trade Organisation negotiations on new fisheries subsidies disciplines are ongoing. Their preliminary nature does not allow anticipating the outcome. However, if new EU obligations arise as the result of these negotiations, the compatibility of the EMFF proposal should be ensured. For this purpose, a compatibility analysis of the relevant EMFF measures may be needed.

2. RESULTS OF CONSULTATIONS WITH THE INTERESTED PARTIES AND IMPACT ASSESSMENTS

On the basis of the FIFG ex-post evaluation, the interim evaluation of the EFF and the impact assessment for the CFP reform, the impact assessment of the EMFF assesses three alternative scenarios: (i) the "EFF+", which is a continuation of the current EFF without most of the direct fleet subsidies and the support focused on the objectives of the CFP reform (ii) the "EFF+ integration", in which the other CFP funding instruments are integrated into a post EFF fund, but keep the same management mode as today and (iii) the "EFF+ convergence" in which support to IMP is also integrated under the new single fund and all the instruments are brought to the extent possible under the shared management.

These three policy scenarios were aligned with the preferred scenario for the CFP reform and evaluated against the same baseline scenario. They also took into account the results of the consultations launched with the adoption of the Green Paper in April 2009. The outcome of these consultations is summarised below:

– Many contributions ask for the continuation of public funding for the fisheries, although a few Member States and most NGOs argue that they preserve unviable structures, contribute to overcapacity and maintain industry dependence on subsidies.

– There is an agreement that any future support should accompany the implementation of CFP reform and ease adjustment costs of the industry.

– EU funding should focus on research and innovation, enhancing marine protection, and supporting fishermen’s organisations and local development.

– The link to the IMP is considered important: maritime policies can no longer act in isolation, and the coherence of the CFP with the IMP needs to be reinforced.

– More conditionality between EU financing and reaching CFP objectives is needed. Compliance with rules/targets should have a bearing on fund availability.

– A more sectoral approach to the allocation of funding (linked to the size of the fisheries sector instead of the level of economic development, as it is the case today) is strongly supported by a group of Member States while the EP opposes this.

– There is general agreement on the importance of the small-scale coastal fleets which remain a significant source of jobs in coastal communities. Some Member States want a privileged access of this fleet to financing, while others do not favour a specific approach.

– An overwhelming majority of industry and MS consider that common services (such as control and data collection) should continue to be supported under EU funding.

In addition to the public consultation, around 200 meetings with the stakeholders were organized. Meetings during which the CFP reform and funding were discussed took also place in 2010 and 2011. In particular: (i) a dedicated seminar on the future EFF with the stakeholders from industry, trade unions, EP and Member States was organised on April 13th, 2010, in Brussels (ii) two meetings with the Member States took place in Gand (12-14 September 2010) and Noordwijk (9-11 March 2011) (iii) a conference on the future of local development in fisheries areas took place in Brussels, 12-13th April, 2011. Finally, the validity of the integrated approach to maritime affairs and the need for IMP funding have been confirmed by the Commission, the Council and the EP.

The impact assessment concluded that the "EFF+ Convergence" performs better than the two other options on the three impact indicators chosen for the analysis: the reduction of the impact of fisheries on the environment, the closure of the innovation gap in fisheries and aquaculture and the number of jobs created in communities dependent on fisheries.

3. LEGAL ELEMENTS OF THE PROPOSAL

It is proposed that most of the current CFP and IMP financial instruments are integrated into one fund, with the exception of Sustainable Fisheries Agreements (SFAs) and the compulsory contribution to RFMOs. The EMFF is structured around 4 pillars:

· Smart, Green Fisheries (shared management) to foster the transition to sustainable fishing which is more selective, produces no discards, does less damage to marine ecosystems and thus contributes to the sustainable management of marine ecosystems; and to provide support focused on innovation and value added, making the fisheries sector economically viable and resilient to external shocks and to competition from third countries.

· Smart, Green Aquaculture (shared management) - to achieve economically viable, competitive and green aquaculture, capable of facing global competition and providing EU consumers with healthy and high nutrition value products.

· Sustainable and Inclusive Territorial Development (shared management) - to reverse the decline of many coastal and inland communities dependent on fishing, through adding more value to fishing and fishing related activities and through diversification to other sectors of the maritime economy.

· Integrated Maritime Policy (direct centralised management) to support those cross cutting priorities which generate savings and growth but which the Member States will not take forward on their own – such as marine knowledge, maritime spatial planning, integrated coastal zone management and integrated maritime surveillance, the protection of the marine environment, in particular its biodiversity, and adaptation to the adverse effects of climate change on coastal areas.

In addition to the four pillars, the EMFF will include accompanying measures: data collection and scientific advice, control, governance, fisheries markets (including outermost regions), voluntary payments to RFMOs and technical assistance.

The proposal complies with the principle of subsidiarity. The general objective of the EMFF is to support the objectives of the CFP, a policy on which the EU has exclusive competence, and to further develop the EU Integrated Maritime Policy. Acting on their own, the MS are not in a position to achieve these objectives which will be better achieved at EU level by multi-annual financing focussed on the relevant priorities.

4. Lessons learned and new features of the EMFF

Contribution to Europe 2020

EMFF will contribute to achieving the objectives of the Europe 2020 strategy under three flagship initiatives: i) a resource efficient Europe, ii) an innovation union and iii) the agenda for new skills and jobs.

Supporting the transition to sustainable fishing, based on maximum sustainable yields, the elimination of discards and the reduction of the impact of fisheries on the marine environment, the promotion of aquaculture with high levels of environmental protection and an increased coordination of maritime policies leading to more sustainable use of resources will be a key contribution of the EMFF to "Resource Efficient Europe".

Under "An agenda for new skills and jobs" the priority of the EMFF will be to increase employment, territorial cohesion and social inclusion in fisheries dependent communities. The diversification of local economies, in particular towards other sectors of the maritime economy, will create new jobs and growth opportunities in coastal areas.

The EMFF will also contribute to "Innovation Union", through the support for product and process innovation at all levels of the production, marketing and distribution chains of the fisheries and aquaculture sectors, increase in added value of fisheries and aquaculture products, support to eco-innovation and further development of new, innovative, cross-cutting policy tools such as Marine Knowledge, Maritime Spatial Planning and Integrated Maritime Surveillance.

Reinforced social dimension

EMFF will promote social cohesion and job creation in fisheries dependent communities through adding more value to fisheries and through diversification into other maritime sectors. The community-led approach to the sustainable development of fisheries areas will be reinforced. EMFF also recognises for the first time the role that spouses – mostly women - often play in the family fishing business, in many cases without any legal recognition. They can benefit inter alia from EMFF support for training, in particular for the acquisition of skills linked to entrepreneurship and business management.

The EMFF will also promote human capital and foster diversification by enabling local communities to acquire skills needed for entering new activities emerging in other maritime sectors. This approach will also build on natural and cultural heritage, turning them into important assets for local development.

In view of the importance of small-scale coastal fleets for coastal communities, the EMFF proposes to apply to them a higher aid intensity rate and introduces some special measures eligible only for these fleets. These measures include professional advice on business and marketing strategies, business start ups outside fishing and special support for innovation; the latter is particularly important considering that the majority of these fishing businesses are micro enterprises with restricted access to funding.

Priority will be given to collective approaches, inter alia by producer organisations, which build on social capital and permit the achievement of critical mass of investment. These collective approaches will also benefit from a higher aid intensity rate.

Environmental sustainability

The existing measures have been streamlined and reviewed in order to establish a strong link to environmental sustainability. Overcapacity remains the major problem of the CFP and is one of the key drivers of overfishing. The removal of overcapacity through public aid such as scrapping has proven ineffective; despite €1.7 billion spent since 1994, actual fishing capacity has not decreased in most of EU fleets. The EMFF will therefore not support scrapping anymore and deploy thus saved financial resources towards more effective forms of assistance to sustainable fishing.

EMFF will support the transition to Maximum Sustainable Yield (MSY) and facilitate the gradual introduction of a discard ban through the integral approach, involving measures such as support for more selective gears and fishing techniques, investment in equipment on board and port facilities necessary for the use of unwanted catches, marketing measures and processing. With the same objective, the financial allocation to data collection and scientific advice (to increase the number of stocks for which scientific advice is available) and to control expenditure (to ensure better compliance) has been substantially increased.

There will also be a focus on the development of aquaculture with high level of environmental protection and support for aquaculture which has a positive effect on ecosystems.

Worldwide fisheries represent around 1.2% of the global fuel consumption. There is a need to increase resource efficiency and reduce emissions in the catching sector and, to a lesser extent, in aquaculture in order to contribute to the Europe 2020 headline target on climate change. Accordingly, the EMFF will support some measures to mitigate climate change.

Focus on innovative, viable and competitive fisheries and aquaculture

Both fisheries and aquaculture have difficulties to innovate. Supply, marketing and commercialisation are currently organised in such a way that fishing and aquaculture businesses are rarely involved in selling and marketing their products.

1. New measures with a strong focus on innovation have been included in the EMFF to promote the development of new or improved products, processes, management and organisation systems throughout the whole value chain, in order to help the fisheries and aquaculture to add value to their products, reduce the environmental impact of their activities and lower production costs. Innovation will also be fostered by measures to stimulate co-operation between scientists and fishermen. The support for community-led local development will also disseminate innovation at the local level, taking into account that such innovation is often defined in the local context, and may be technological or non technological, and based on new or traditional practices.

2. The EMFF will also seek, for the first time, to promote new forms of aquaculture with high growth potential, such as offshore and non food aquaculture and to encourage business start ups. The new features include also support to multifunctional aquaculture, allowing diversifying the income of aquaculture enterprises through activities such as angling, direct sale, eco tourism or aquaculture related educational activities. Support for the use of advisory services by aquaculture firms and measures increasing the potential of aquaculture sites (through, inter alia, funding for maritime spatial planning and improvement of infrastructures) are also proposed.

Complementarity and synergy with research and innovation programmes foreseen with the new Research Framework programme in preparation (Horizon 2020) will be encouraged.

New impetus to the development of Integrated Maritime Policy (IMP)

The IMP was launched in 2007 to facilitate maritime coordination across borders and sectors (maritime transport, industry, coastal regions, offshore energy, fisheries or the marine environment). Coordination between previously compartmentalized policies results in the reduction of costs and more efficiency.

Funding for the IMP in the EMFF will focus on the development of cross-sectoral policy tools: initiatives that benefit different sectors but that cannot be accomplished within individual policy areas. Maritime Spatial Planning provides a stable legal framework for the management of marine areas, resources and ecosystem services in a sustainable way. It has been shown to accelerate maritime investments and lower legal and administrative costs for companies. Integrated Maritime Surveillance allows public actors to share data in order to efficiently cope with real time events at sea. It avoids costly duplications of resource-consuming maritime surveillance activities. Integrated surveillance means cost-effective synergies for the better use of public money. Marine Knowledge 2020 aims at pooling together Europe's fragmented marine knowledge into a resource that is freely and publicly accessible. The Marine Strategy Framework Directive, which is the environmental pillar of the IMP, will further define the boundaries of sustainability of human activities that have an impact on the marine environment.

Managing maritime affairs in an integrated way means spending public money better and maximising the effect of the various policies affecting the sea. On that line, funding will also support the development of integrated maritime governance at sea basin level. Coordination at sea basin level ensures that funds are spent within a consistent policy framework, combining different sources of funding. The inclusion of the IMP in the EMFF also supports the mainstreaming of maritime objectives into other funds enabling maritime policies to make a stronger contribution to the Europe 2020 strategy.

Simplification and reduction of the administrative burden

The integration of five CFP and IMP financial instruments into a single fund will lead to a major simplification due to the streamlined and unified rules and procedures. In addition, data collection, control and market measures, including the compensation for the outermost regions, will be managed together with the ex-EFF measures under the shared management. This means that four sets of financial decisions, reporting, monitoring and evaluation procedures will be replaced by one.

Moreover, the interim evaluation of the EFF shows that the main administrative burden was due to the setting up of the Management and Control System. The proposal for the "Common Provisions" Regulation envisages a management and control system which is similar for CSF funds and is based on common principles. A system of national accreditation is put in place to emphasize the commitment of Member States to sound financial management. The arrangements underpinning the assurance of the Commission with regard to the regularity of expenditure have been harmonised and new common elements such as a management declaration of assurance and annual clearance of accounts have been introduced. This approach shall significantly reduce the amount of the time necessary for setting up management and control systems and accelerate the implementation. In particular the alignment of the delivery mechanism with that of the rural development fund, will give the Member States a possibility to use the same bodies for the management of the EARDF and EMFF Operational Programmes. This will further reduce the administrative costs due to the unified approach in terms of management and control, including reporting, evaluation and monitoring.

Common rules on the use of the financial instruments give clearer framework and clarify that financial instruments can be used for all types of investment and beneficiary. This allows for bringing the EMFF contribution to already existing financial institutions, where collaboration agreements have already been developed for other EU funds, thus avoiding administrative burden and duplication and making financial engineering a more attractive alternative to co-financing through grants.

The integrated approach for community led local development (current Axis 4) facilitates joint ventures funded by CSF funds, by allowing joint assessment and approval of local development strategies, allowing the financing of management costs from one source only and avoiding reporting on these costs to different bodies.

The use of common indicators will facilitate the reporting by the Member States, focusing it on quantified data on progress and reducing the descriptive elements.

EMFF also clarifies rules of compliance with CFP, in particular with data collection framework, control and IUU Regulations, thus giving the Member States and beneficiaries more legal certainty.

In order to further simplify the implementation of the EMFF, eligibility rules are harmonised with other EU funds. This will make projects easier to handle for both beneficiaries and national authorities and will also facilitate the implementation of integrated projects. A wider utilisation of simplified cost options will be allowed for the shared management part of the EMFF (standard costs, lump sump payments and flat rate financing for grants) thus reducing the costs of control and error rate.

Strategic approach:

The CSF and Partnership Contracts cover five shared-management funds under the "Common Provisions" Regulation. This framework allows a better strategic fit between these funds at Union level. The CSF will be implemented through a Partnership Contract, coordinating the CSF funds at national level.

Currently, the coordination of the EFF with other strands of EU funding is done using the principle of "demarcation lines" between the funds, which led to both overlaps and gaps in policy coverage. A better coordination mechanism is therefore needed and the new delivery mechanism reinforcing the strategic approach should answer those problems. CSF and Partnership Contracts will replace the strategic approach (National Strategic Plans) introduced in the current EFF, which has serious limitations and required a disproportionate effort for Member States receiving limited EFF funding.

Strategic programming

EMFF focuses on CFP and IMP long-term strategic objectives including sustainable and competitive fisheries and aquaculture, consistent policy framework for the further development of IMP and balanced and inclusive territorial development of fisheries areas. In line with the Europe 2020 strategy, these broad objectives for 2014-2020 are translated into the following six Union priorities for the EMFF:

– Increasing employment and territorial cohesion;

– Fostering innovative, competitive and knowledge based fisheries;

– Fostering innovative, competitive and knowledge based aquaculture;

– Promoting sustainable and resource efficient fisheries;

– Promoting a sustainable and resource efficient aquaculture;

– Fostering the implementation of the CFP.

These priorities will form the basis of financial programming, including the definition of target indicators in relation to each of them.

Conditionality

The "Common Provisions" Regulation introduces new conditionality provisions to ensure that Union funding creates strong incentives for Member States to deliver Europe 2020 objectives and targets. Conditionality will take the form of both ‘ex ante’ conditions that must be in place before funds are disbursed and 'ex post' conditions that will make the release of 5% of the EMFF allocation contingent on performance. Ex post' conditionality will be based on the achievement of milestones related to targets for outputs and results linked to Europe 2020 objectives set for programmes in the Partnership Contract.

Union financial assistance under the EMFF will be made conditional upon the compliance of Member States and operators with the objectives and rules of CFP, in particular control obligations, the IUU Regulation and data collection obligations. In addition ex ante conditionality will apply to aquaculture, requiring the Member States to prepare multiannual national strategic plans on the basis of Union strategic guidelines. As foreseen by the CFP Regulation, the objective of these plans, based on the Union strategic guidelines, will be to facilitate sustainable development of aquaculture in relation to the business security, access to waters and space, and administrative simplification of licensing. These conditionalities will foster the compliance with CFP rules and increase the coherence of the whole policy.

Monitoring and evaluation

The interim evaluation of the EFF concluded that the existing indicators are focused on output and are too numerous. Moreover, they lack common approach and a common definition of the units to be measured.

Accordingly, the EMFF proposes a Common Strategic Monitoring and Evaluation Framework (CMEF) in which a set of common output, result and impact indicators will be defined in cooperation with the MS and adopted in an implementing act. These indicators will be linked to the priorities of the EMFF, allowing the aggregation of data at Union level and the assessment of the progress, efficiency and effectiveness of policy implementation necessary, inter alia, for allocation of the performance reserve. Ex-ante evaluation will be used to set baseline, milestones and target indicator values which will feed into the Partnership Contracts and the OPs. Two special annual reports in 2017 and 2019 will look at the state of delivery and the lessons for the next programming period.

4. BUDGETARY IMPLICATION

The MFF proposal provides that a significant part of the EU budget should continue to be dedicated to fisheries and maritime policies. The envelope for 2014-2020, in current prices, is set at €7,535 billion, including SFAs and the compulsory contributions to RFMOs, which will be funded separately. The EMFF budget amounts, in current prices to € 6567 million. Details on the financial impact of the EMFF proposal are set out in the financial statement accompanying the proposal.

2011/0380 (COD)

Proposal for a

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

on the European Maritime and Fisheries Fund [repealing Council Regulation (EC) No 1198/2006 and Council Regulation(EC) No 861/2006 and Council Regulation No XXX/2011 on integrated maritime policy

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 42, Article 43(2), Article 91(1), Article 100(2), Article 173(3), Article 175, Article 188, Article 192(1), Article 194(2) and Article 195(2) thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national Parliaments,

Having regard to the opinion of the European Economic and Social Committee[1],

Having regard to the opinion of the Committee of the Regions[2],

Acting in accordance with the ordinary legislative procedure,

Whereas:

(1) The Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the "Reform of the Common Fisheries Policy" (hereinafter "the CFP Communication") set out potential challenges, objectives and orientations for the Common Fisheries Policy (hereinafter "the CFP") after 2013. In the light of the debate on that Communication, the CFP should be reformed with effect from 1 January 2014. That reform should cover all the main elements of the CFP, including its financial aspects. In order to address the objectives of the reform, it is appropriate to repeal Council Regulation (EC) No 1198/2006 on the European Fisheries Fund[3], Regulation (EC) No 861/2006 establishing Community financial measures for the implementation of the Common Fisheries Policy and in the area of the Law of the Sea[4], the provisions of Regulation (EC) No 1290/2005 Guarantee Fund concerning the fishery and aquaculture products[5], Regulation (EC) No 791/2007 introducing a scheme to compensate for the additional costs incurred in the marketing of certain fishery products from the Azores, Madeira, the Canary Islands and the French departments of Guiana and Réunion, as a result of those regions' remoteness[6] and to replace them with a new Regulation on the European Maritime Fisheries Fund (EMFF). Recognizing that all matters related to Europe's oceans and seas are interlinked, the new Regulation should also support the further development of the Integrated Maritime Policy (IMP) covered in [Regulation of the European Parliament and of the Council establishing a Programme to support the further development of an Integrated Maritime Policy].

(2) The scope of the EMFF should cover the support of the CFP which extends to conservation, management and exploitation of marine biological resources, fresh water biological resources and- aquaculture, as well as to the processing and marketing of fishery and aquaculture products, where such activities take place on the territory of Member States, or in Union waters, including by fishing vessels flying the flag of, and registered in, third countries, or by Union fishing vessels, or by nationals of Member States, without prejudice to the primary responsibility of the flag State, bearing in mind the provisions of Article 117 of the United Nations Convention on the Law of the Sea.

(3) The success of the Common Fisheries Policy depends on an effective system of control, inspection and enforcement as well as on reliable complete data, both for scientific advice and for implementation and control purposes; therefore the EMFF should support these policies.

(4) The scope of the EMFF should cover the support to the IMP which extends to the development and implementation of coordinated operations and decision-making in relation to the oceans, seas, coastal regions and maritime sectors complementing the different EU policies that touch upon them, notably the Common Fisheries Policies, transport, industry, territorial cohesion, environment, energy and tourism. Coherence and integration should be ensured in the management of different sectoral policies within the Baltic Sea, North Sea, Celtic Seas, Bay of Biscay and the Iberian Coast, Mediterranean and Black Sea sea basins.

(5) In line with the conclusions of the European Council of 17 June 2010, whereby the Europe 2020 Strategy was adopted, the Union and Member States should implement the delivery of smart, sustainable and inclusive growth, while promoting harmonious development of the Union. In particular, resources should be concentrated to meet the Europe 2020 objectives and targets and effectiveness should be improved by an increased focus on results. The inclusion of the IMP in the new EMFF also contribute to the major policy objectives set out in the Communication from the Commission of 3 March 2010 "Europe 2020 - A strategy for smart, sustainable and inclusive growth"[7] ("Europe 2020 Strategy") and is in line with the general objectives to increase economic, social and territorial cohesion set out in the Treaty.

(6) To ensure that the EMFF contributes to the achievement of the objectives of the CFP, the IMP and the Europe 2020 Strategy, it is necessary to focus on a limited number of core priorities relating to fostering innovation and knowledge based fisheries and aquaculture, promoting sustainable and resource-efficient fishing and aquaculture, and increasing employment and territorial cohesion by unlocking the growth and job potential of coastal and inland fisheries communities and promoting diversification of fisheries activities into other sectors of the marine economy.

(7) The Union should at all stages of implementation of the Fund, aim at eliminating inequalities and promoting equality between men and women, as well as combating discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation.

(8) The overall objective of the Common Fisheries Policy is to ensure that fishing and aquaculture activities contribute to long-term sustainable environmental conditions which are necessary for economic and social development. It should contribute moreover to increased productivity, a fair standard of living for the fisheries sector, stable markets, ensure the availability of resources and that supplies reach consumers at reasonable prices.

(9) It is paramount to better integrate environmental concerns into the CFP which should deliver on the objectives and targets of the Union's environmental policy and the Europe 2020 Strategy. The CFP is aimed at an exploitation of living marine biological resources that restores and maintains fish stocks at levels which can produce the maximum sustainable yield, not later than 2015. The CFP shall implement the precautionary and eco-system approaches to fisheries management. Consequently the EMFF should contribute to the protection of the marine environment as set out in the Directive 2008/56/EC of the European Parliament and the Council of 17 June 2008 establishing a framework for community action in the field of marine environmental policy (Marine Strategy Framework Directive)[8].

(10) Since the objectives of this Regulation cannot be sufficiently achieved by the Member States given the scale and effects of the operations to be financed under the operational programmes and the structural problems encountered in the development of the fisheries and maritime sectors as well as the limited financial resources of the Member States, these objectives can therefore be better achieved at Union level by providing multi-annual financial assistance focused on the relevant priorities, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5(3) of the Treaty on the European Union. In accordance with the principle of proportionality as set out in Article 5(4) of that Treaty, this Regulation does not go beyond what is necessary in order to achieve that objective.

(11) The financing of the Common Fisheries Policy and Maritime Integrated Policy expenditure through a single fund, the EMFF, should address the need for simplification as well as strengthening the integration of both policies. The extension of shared management to Common Markets Organisations including the compensation for the outermost regions, control and data collection activities should further contribute to simplification and reduce the administrative burden both for the Commission and the Member States as well as achieve greater coherence and efficiency of the support granted.

(12) The Union budget should finance the Common Fisheries Policy and the Integrated Maritime Policy expenditure through a single fund, the EFMF, either directly or in the context of shared management with the Member States. Shared management with the Member States should apply not only to measures to support fisheries, aquaculture and community-led local development but also to Common Markets Organisations and the compensation for the outermost regions, control and data collection activities. Direct management should apply to scientific advice, voluntary contributions to Regional Fisheries Management Organisations, advisory councils and operations for the implementation of an Integrated Maritime Policy. The types of measures that can be financed using the EMFF should be specified.

(13) It is necessary to distinguish between control and enforcement measure categories being co-financed within the framework of shared management and those within the framework of direct management. It is crucial to ring-fence the resources to be allocated to control under shared management.

(14) According to Articles 50 and 51 of the [Regulation on the Common Fisheries Policy] (hereinafter CFP Regulation) Union financial assistance under EMFF should be made conditional upon compliance by Member States as well as by operators with the rules of the CFP. This conditionality is intended to reflect the responsibility of the Union to ensure, in public interest, conservation of marine biological resources under the CFP, as enshrined in Article 3 of the TFEU.

(15) The achievement of the objectives of the CFP would be undermined if Union financial assistance under EMFF is disbursed to operators who, ex-ante, do not comply with requirements related to the public interest of conservation of marine biological resources. Therefore only operators should be admissible who, within a particular period of time before lodging an application for aid, were not involved in the operation, management or ownership of fishing vessels included in the Union IUU vessel list as set out in Article 40(3) of Council Regulation (EC) No 1005/2008 of 29 September 2008 establishing a Community system to prevent, deter and eliminate illegal, unreported and unregulated fishing, amending Regulation (EEC) No 2847/93, (EC) No 1936/2001 and (EC) No 601/2004 and repealing Regulations (EC) No 1093/94 and (EC) No 1447/1999[9], and who have not committed a serious infringement under 42 of the Regulation (EC) No 1005/2008 or Article 90(1) of the Regulation (EC) No 1224/2009 of 20 November 2009 establishing a Community control system for ensuring compliance with the rules of the common fisheries policy, amending Regulations (EC) No 847/96, (EC) No 2371/2002, (EC) No 811/2004, (EC) No 768/2005, (EC) No 2115/2005, (EC) No 2166/2005, (EC) No 388/2006, (EC) No 509/2007, (EC) No 676/2007, (EC) No 1098/2007, (EC) No 1300/2008, (EC) No 1342/2008 and repealing Regulations (EEC) No 2847/93, (EC) No 1627/94 and (EC) No 1966/2006[10]. or other cases of non-compliance with CFP rules which particularly jeopardise the sustainability of the stocks concerned and constitute a serious threats to the sustainable exploitation of living marine biological resources that restores and maintains populations of harvested species above levels which can produce the Maximum Sustainable Yield (hereinafter MSY).

(16) In addition, the beneficiaries should continue to comply with requirements related to the public interest of conservation of marine biological resources after lodging the aid application, during the whole period of implementation of operation and, for certain types of operation, also for an identified period of time after the last payment. Support disbursed to or retained by beneficiaries who do not respect the requirements related to the public interest of conservation of marine biological resources might be possibly linked to infringements and thus might jeopardize the achievements of the objectives of the CFP.

(17) The consequences laid down for the failure to fulfil the eligibility conditions should apply in case of infringements of the CFP rules by the beneficiaries. In order to determine the amount of ineligible expenditure, the gravity of the non compliance by the beneficiary with CFP rules, the economic advantage derived from the non-compliance with CFP rules or the importance of the EMFF contribution to the economic activity of the beneficiary should be taken into account.

(18) The achievement of the objectives of the CFP would also be undermined if Union financial assistance under EMFF is paid to Member States who do not comply with their obligations under the CFP rules related to the public interest of conservation of marine biological resources, such as collecting data and implementing the control obligations. Moreover, without complying with those obligations there is a risk that inadmissible beneficiaries or ineligible operations are not detected by the Member States.

(19) As precautionary measures, in order to prevent that non compliant payments take place as well as incentivise the Member State to comply with CFP rules or require compliance by the beneficiary, interruption of the payment deadline and suspension of payments, which are timely limited in their scope of application, should both be used. In order to respect the principle of proportionality, the financial corrections which have definite and irrevocable consequences should only apply to expenditure directly linked to operations during which the cases of non-compliance with CFP rules have been committed.

(20) In order to improve coordination and harmonise implementation of the Funds providing support under the cohesion policy, namely the European Regional Development Fund (ERDF), the European Social Fund (ESF) and the Cohesion Fund (CF), with the Funds for rural development, namely the European Agricultural Fund for Rural Development (EAFRD), and for the maritime and fisheries sector, namely the European Maritime and Fisheries Fund (EMFF), common provisions have been established for all these Funds (the 'CSF Funds') in the [Regulation (EU) No […] laying down Common Provisions][11]. In addition to this Regulation, the EMFF contains specific provisions due to the particularities of the CFP and the IMP.

(21) Taking into account the size of the future EMFF and in the light of the principle of proportionality, the provisions relating to the strategic planning have been derogated from the Regulation [on Common Provisions], henceforth the consultation of the stakeholders should take place at least twice during the programming period however not obligatory once each year as it would constitute a excessive administrative and financial burden both for the Commission and the Member States.

(22) Action by the Union should be complementary to action carried out by Member States or seek to contribute to that action. In order to ensure significant added value the partnership between the Commission and Member States should be strengthened through arrangements for the participation of various types of partners with full regard to the institutional competences of the Member States. Particular attention should be paid to ensuring adequate representation for women and minority groups. This partnership concerns regional, local and other public authorities, as well as other appropriate bodies, including those responsible for the environment and for the promotion of equality between men and women, the economic and social partners and other competent bodies. The partners concerned should be involved in the preparation of Partnership Contracts, as well as in the preparation, implementation, monitoring and evaluation of programming.

(23) According to the principle of proportionality, the means employed by the Commission and Member States may vary according to the total amount of public expenditure allocated to the operational programme. Such variation should apply in particular to the means used for evaluation, control, and reporting on implementation of operational programmes;

(24) The Commission should establish an annual breakdown by Member States of available commitment appropriations using objective and transparent criteria; these criteria should include the historical allocations under Council Regulation (EC) No 1198/2006 and the historical consumption under Council Regulation No 861/2006.

(25) The fulfilment of certain ex-ante conditionalities is of outmost importance in the context of the CFP, especially as regards the submission of a Multiannual National Strategy Plan on Aquaculture and proven administrative capacity to comply with the data requirements for fisheries management and to enforce with the implementation of a Union control, inspection and enforcement system.

(26) In line with the goal of simplification, all activities of the EMFF which fall under shared management, including control and data collection, should take the form of one single operational programme per Member State, in accordance with its national structure. The programming exercise shall cover the period from 1 January 2014 to 31 December 2020. Each Member State should prepare a single operational programme. Each programme should identify a strategy for meeting targets in relation to the Union priorities for the EMFF and a selection of measures. Programming should comply with Union priorities, while being adapted to national contexts and complement the other Union policies, in particular rural development policy and cohesion policy.

(27) In order to contribute to the goal of simplification in the implementation of the EMFF and to reduce the costs of control and the error rate, Member States should make use as much as possible of the possibility offered in the [Regulation laying down Common Provisions] to use lump sums and other simplified forms of grant.

(28) For the purpose of enforcing control obligations under the CFP, Member States should draw up the section on control of the Operational Programme in line with the priorities of the Union adopted by the Commission for this policy area. In order to adjust the operational programme to the evolving needs in terms of control and enforcement; the control section of the operational programmes may be reviewed regularly on the basis of the changes in the priorities of the Union in the control and enforcement policy under CFP. These amendments should be approved by the Commission.

(29) In order to keep flexibility in the programming of activities in the field of control, the revision of the section of the operational programme concerning control should be subject to a simplified procedure.

(30) Member States should draw up the section on data collection of the Operational Programme in line with a Multiannual Union programme; In order to adapt to the specific needs of data collection activities, Member States should elaborate annual work plan which should adapted annually under the guidance of the Commission and which should subject to its approval.

(31) In order to increase the competitiveness and economic performance of fishing activities it is vital to stimulate innovation and entrepreneurship. Therefore the EMFF should support innovative operations and business development.

(32) Investment in human capital is also vital to increase the competitiveness and economic performance of fishing and maritime activities. Therefore, the EMFF should support lifelong learning, co-operation between scientists and fishermen stimulating the dissemination of knowledge as well as for advisory services helping to improve the overall performance and competitiveness of operators.

(33) Recognising the importance of the role that spouses of self-employed fishermen play in small scale coastal fishing, the EMFF should support training and networking contributing to their professional development and giving them the means to better fulfil the ancillary tasks they traditionally perform.

(34) Conscious of the weak presence of small scale coastal fishermen in the social dialogue, the EMFF should support organisations promoting this dialogue in the appropriate fora.

(35) Conscious of the potential that diversification offers for small scale coastal fishermen and their crucial role in coastal communities, the EMFF should help diversification by covering business start-ups and investments for the retrofitting of their vessels, in addition to the relevant training to acquire professional skills in the relevant field outside fishing activities.

(36) In order to address health and safety needs on board, the EMFF should support investments covering safety and hygiene on board.

(37) As a result of the establishment of systems of transferable fishing concessions envisaged in Article 27 of the [CFP Regulation] and in order to support Member States in the implementation of these new systems, the EMFF should grant support in terms of capacity building and exchange of best practices.

(38) The introduction of the transferable fishing concessions systems should make the sector more competitive. Consequently, there may be a need for new professional opportunities outside the fishing activities. Therefore, the EMFF should support the diversification and job creation in fishing communities in particular by supporting business start-ups and the reassignment of vessels for maritime activities outside fishing activities of small scale coastal fishing vessels. This last operation seems to be appropriate as the small scale coastal fishing vessels are not covered by the transferable fishing concessions systems.

(39) The objective of the Common Fisheries Policy is to ensure a sustainable exploitation of fish stocks. Overcapacity has been identified as a major driver for overfishing. It is therefore paramount to adapt the Union fishing fleet to the resources available. The removal of overcapacity through public aid such as temporary or permanent cessation and scrapping schemes has proven ineffective. The EMFF will therefore support the establishment and management of systems of transferable fishing concessions aiming at the reduction of overcapacity and increased economic performance and profitability of the operators concerned.

(40) With overcapacity being one of the key drivers of overfishing, measures need to be taken to adapt the Union fishing fleet to the resources available; in this context, the EMFF should support the establishment, modification and management of the systems of transferable fishing concessions introduced by the CFP as management tools for reducing overcapacity.

(41) It is paramount to integrate environmental concerns into the EMFF and support the implementation of conservation measures under the CFP taking however into account the diverse conditions throughout the Union waters. For this purpose it is essential to develop a regionalised approach to conservation measures.

(42) In the same vein, the EMFF should support the reduction of the impact of fishing on the marine environment in particular through the promotion of eco innovation, more selective gears and equipment as well as measures aiming at protecting and restoring marine biodiversity and ecosystems and the services they provide, in line with the EU Biodiversity Strategy to 2020.

(43) In line with the discard ban introduced by the CFP, the EMFF should support investments on board aiming at make the best use of unwanted fish caught and valorise underused components of the fish caught. Considering the scarcity of the resources, in order to maximise the value of the fish caught, the EMFF should also support investments on board aiming at adding commercial value to fish caught.

(44) Conscious of the importance of fishing ports, landing sites and shelters, the EMFF should support relevant investments in particular to increase energy efficiency, environmental protection, the quality of the product landed, as well as safety and working conditions.

(45) It is vital for the Union that a sustainable balance be achieved between fresh water resources and their exploitation; therefore having due regard to environmental impact while ensuring that these sectors retain economic viability, appropriate provisions should support inland fishing.

(46) In line with the Commission's Strategy for the Sustainable Development of European Aquaculture[12], the CFP objectives and Europe 2020 Strategy, the EMFF should support the environmentally, economically and socially sustainable development of the aquaculture industry.

(47) Aquaculture contributes to growth and jobs in coastal and rural regions. Therefore, it is crucial that the EMFF is accessible to aquaculture enterprises, in particular SMEs and contributes to bringing new aquaculture farmers into the business. In order to increase the competitiveness and economic performance of aquaculture activities it is vital to stimulate innovation and entrepreneurship. Therefore the EMFF should support innovative operations and business development, in particular non-food and off-shore aquaculture.

(48) New forms of income combined with aquaculture activities have already shown their added value for business development. Therefore the EMFF should support these complementary activities outside aquaculture such as angling-tourism, educational or environmental activities.

(49) An other important form of increasing the income of aquaculture enterprises is adding value to their products by processing and marketing their own production, as well as introducing new species with good market prospects and thus diversifying their production.

(50) Conscious of the need to identify the most suitable areas for developing aquaculture taking into account access to waters and space, the EMFF should support national authorities in making their strategic choices at national level.

(51) Investment in human capital is also vital to increase the competitiveness and economic performance of aquaculture activities. Therefore, the EMFF should support lifelong learning and networking stimulating the dissemination of knowledge as well as advisory services helping to improve the overall performance and competitiveness of operators.

(52) In order to promote environmentally sustainable aquaculture, the EMFF should support aquaculture activities which are highly respectful of the environment, the conversion of aquaculture enterprises to eco-management, the use of audit schemes as well as the conversion to organic aquaculture. In the same vein, the EMFF should also support aquaculture providing for special environmental services.

(53) Conscious of the importance of consumer protection, the EMFF should ensure adequate support to farmers in order to prevent and mitigate the risk for public and animal health that aquaculture rearing may generate.

(54) Recognizing the risk of investments in aquaculture activities, the EMFF should contribute to business security by covering access to stock insurance and therefore safeguarding the income of producers in case of abnormal production losses due in particular to natural disasters, adverse climatic events, sudden water quality changes, diseases or pest infestations and destruction of production facilities.

(55) Considering that the community-led approach for local development has, over a number of years, proven its utility in promoting the development of fisheries and rural areas by fully taking into account the multi-sectoral needs for endogenous development, support should be continued and reinforced in the future.

(56) In fisheries areas, community-led local development should encourage innovative approaches to create growth and jobs, in particular by adding value to fisheries products and diversifying the local economy towards new economic activities, including those offered by "blue growth" and the broader maritime sectors.

(57) The sustainable development of fisheries areas should contribute to the EU2020 objectives of promoting social inclusion and poverty reduction and to fostering innovation at local level as well as to the objective of territorial cohesion, a main priority in the Lisbon Treaty.

(58) Community-led local development should be implemented through a bottom-up approach by local partnerships that are composed of representatives of the public, private and civil society sectors and mirror correctly the local society; these local actors are best placed to draw up and implement integrated multi-sectoral local development strategies to meet the needs of their local fisheries areas; it is important in order to ensure the representativeness of local action groups that no single interest groups has more than 49% of the voting right in the decision-making bodies.

(59) Networking between local partnerships is an essential feature of this approach. Cooperation between these local partnerships is an important development tool which should be made available by the EMFF.

(60) The support to fisheries areas through the EMFF should be coordinated with the local development support offered by other Union Funds and should cover all aspects of the preparation and implementation of local development strategies and operations of local action groups as well as the costs of animating the local area and running the local partnership.

(61) In order to ensure the viability of fisheries and aquaculture in a highly competitive market, it is necessary to lay down provisions granting support for the implementation of the [Regulation (EU) No on the common organisation of the markets in fishery and aquaculture products][13] as well as for marketing and processing activities carried by operators to maximise the value of fisheries and aquaculture products. Particular attention should be paid to the promotion of operations which integrate producing, processing and marketing activities of the supply chain. In order to adapt to the new discard ban policy, the EMFF should also support the processing of unwanted catches.

(62) Priority should be given to producer organisations and associations of producer organisations by granting them support. The compensation for storage aid and aid for production and marketing plans should gradually be phased out as the importance of this particular kind of support has lost its interest in the light of the evolving structure of the Union market for this kind of products and the growing importance of strong producer's organisations.

(63) Recognising the growing competition small scale coastal fishermen are confronted to, the EMFF should support entrepreneurial initiatives of small scale coastal fishermen adding value to the fish they catch, in particular by carrying out the processing or direct marketing of the fish they catch.

(64) Fishing activities in the outermost regions of the European Union are facing difficulties, in particular because of the additional costs incurred in the marketing of certain fishery products, due to the particular handicaps recognised by Article 349 of the Treaty on the Functioning of the European Union.

(65) In order to maintain the competitiveness of certain fishery products from the outermost regions of the European Union compared with that of similar products from other European Union's regions, the European Union introduced measures in 1992 to compensate for the related additional costs in the fisheries sector. The measures applying for the period 2007-2013 are laid down in Council Regulation (EC) No 791/2007[14]. It is necessary to continue providing support to offset the additional costs for the marketing of certain fishery products as of 1 January 2014.

(66) In view of the different marketing conditions in the outermost regions concerned, the fluctuations in captures and stocks and of market demands, it should be left to the Member States concerned to determine the fishery products eligible for compensation, their respective maximum quantities and the compensation amounts within the overall allocation per Member State.

(67) Member States should be authorised to differentiate the list and the quantities of fishery products concerned and the amount of compensation within the overall allocation per Member State. They should also be authorised to adjust their compensation plans if justified by changing conditions.

(68) Member States should set the compensation amount at a level which allows appropriate off-setting of additional costs, arising from the specific handicaps of the outermost regions and in particular from the costs of transporting the products to mainland Europe. To avoid overcompensation, the amount should be proportional to the additional costs the aid off-sets and in no case exceed 100 % of the transport and other related costs to mainland Europe. To this end, it should also take into account other types of public intervention having an impact on the level of additional costs.

(69) It is paramount that Member States and operators are equipped in such a way that controls can be carried out to a high standard and therefore ensure compliance with the rules of the Common Fisheries Policy while providing for the sustainable exploitation of living aquatic resources; the EMFF should therefore support Member States and operators in conformity with Council Regulation (EC) No 1224/2009. By creating a culture of compliance, this support should contribute to sustainable growth.

(70) The support granted to Member States on the basis of the Regulation (EC) No. 861/2006 for the expenditure incurred relating to the implementation of the Union control system should be continued under the EMFF pursuing the logic of a single fund.

(71) In line with the Union control and enforcement policy objectives, it seems appropriate that a minimum time is dedicated to fisheries control in the usage of patrol vessels, aircrafts and helicopters which should be set out precisely in order to provide a basis for the support under the EMFF.

(72) Considering the importance of cooperation between Member States in the field of control, the EMFF should provide support for that purpose.

(73) Provisions should be laid down for support to collect, manage and use of fisheries data as specified in the multiannual Union programme, in particular to support national programmes and the management and use of data for scientific analysis and CFP implementation. The support granted to Member States on the basis of the Regulation (EC) No. 861/2006 for the expenditure incurred relating to the collection, management and use of fisheries data should be continued under the EMFF pursuing the logic of a single fund.

(74) It is also necessary to support the cooperation among Member States, as well as with third countries where relevant, with respect to the collection of data within the same sea basin, as well as with the relevant international scientific bodies.

(75) The objective of the IMP is to support sustainable use of seas and oceans and to develop coordinated, coherent and transparent decision-making in relation to the policies affecting the oceans, seas, islands, coastal and outermost regions and maritime sectors, in accordance with the Commission Communication "An Integrated Maritime Policy of the European Union[15].

(76) Sustained funding is needed for the implementation and further development of the Integrated Maritime Policy for the European Union as reflected in the statements of the Council, the European Parliament and the Committee of the Regions[16].

(77) The EMFF should support the promotion of integrated maritime governance at all levels especially through exchanges of best practices and the further development and implementation of sea basin strategies. These strategies aim at setting up an integrated framework to address common challenges in European sea basins and strengthened co-operation between stakeholders to maximise the use of Union financial instruments and funds and contribute to the economic, social and territorial cohesion of the Union.

(78) The EMFF should also support the further development of tools to create synergies between initiatives taken in different sectors and affecting the seas, oceans and coasts. This is the case for integrated maritime surveillance, which aims at improving maritime situational awareness through enhanced and secure information exchanges across sectors. However, operations related to maritime surveillance falling under the scope of Title V of the Treaty on the Functioning of the European Union should not be financed through the EMFF.

(79) Interconnection of the certain information systems run by those sectors may require mobilisation of their own funding mechanisms in a coherent way and in line with Treaty provisions. Maritime spatial planning and integrated coastal zone management are essential for the sustainable development of marine areas and coastal regions and both contributing to the aims of ecosystem-based management and the development of land-sea links. These tools are also important to manage diverse uses of our coasts, seas and oceans to enable their sustainable economic development and to stimulate cross-border investment, whereas the implementation of the Marine Strategy Framework Directive will further define the boundaries of sustainability of human activities that have an impact on the marine environment. Furthermore, it is necessary to improve knowledge of the marine world, and stimulate innovation by facilitating collection, free sharing, re-use and dissemination of data concerning the status of oceans and seas.

(80) The EMFF should also support sustainable economic growth, employment, innovation and competitiveness within maritime sectors and in coastal regions. It is particularly important to identify regulatory barriers and skill deficiencies hindering growth in emerging and prospective maritime sectors, as well as operations aimed at fostering investment in technological innovation necessary to enhance the business potential of marine and maritime applications.

(81) The EMFF should be complementary and coherent with existing and future financial instruments made available by the Union and the Member States, at national and sub-national level, for promoting the protection and sustainable use of the oceans, seas and coasts, helping to foster more effective cooperation between the Member States and their coastal, island, and outermost regions, and taking into account the prioritisation and progress of national and local projects. The Fund will tie in with other Union policies that may encompass a maritime dimension, in particular the European Regional Development Fund, the Cohesion Fund and the European Social Fund as well the Horizon 2020 Programme for Research and energy policy

(82) In order to achieve the objectives of the CFP at the global level, the Union plays an active role in the work of international organisations. It is therefore essential that the Union contributes to the activities of such organisations that help to ensure the conservation and sustainably exploitation of fisheries resources on the high seas and in third country waters. The support granted to international organisations on the basis of the Regulation No. (EC) 861/2006 should be continued under the EMFF pursuing the logic of a single fund.

(83) In order to improve governance within the CFP and ensure the effective functioning of the Advisory Councils (ACs), it is essential for ACs to be provided with sufficient and permanent funding in order to pursue effectively their advisory role within the CFP. Pursuing the logic of a single fund, the support granted to ACs under the EMFF should replace the support given to Regional Advisory Councils (RACs) on the basis of the Regulation (EC) No. 861/2006.

(84) By way of technical assistance the EMFF should provide preparatory, administrative and technical support as well as support for information measures, networking, evaluations, audits, studies and exchanges of experience in order to facilitate the implementation of the operational programme and to promote innovative approaches and practices for simple and transparent implementation. Technical assistance should also include the setting up of a European network of Fisheries Local Action Groups aiming at capacity building, disseminating information, exchanging experience and supporting cooperation between the local partnerships.

(85) In relation to all operations financed under this Regulation, both under shared and direct management, it is necessary to ensure the protection of the Union financial interests by the proper application of the legislation pertaining to the protection of those interests, and to ensure that appropriate controls are carried out by Member States and by the Commission.

(86) [Regulation (EU) No […] laying down Common Provisions] and the provisions adopted pursuant to it should apply to the provisions of this Regulation, which fall under shared management. In particular the [Regulation (EU) No […] laying down Common Provisions][17] lays down provisions related to the shared management of the Union funds with Member States based on the principles of sound financial management, transparency and non-discrimination, as well as provisions on the function of accredited bodies, the budgetary principles, provisions which should be respected in the framework of this Regulation.

(87) Taking however into account the specificity of the EMFF, in particular its size, the types of operations financed, the strong link to the CFP and any other relevant factors, some of the common provisions relating to shared management should be adapted, derogated or supplemented in this regulation. Where required by the provisions of the [Regulation (EU) No […] laying down Common Provisions], the EMFF should complete and supplement those common provisions.

(88) Conscious of the importance of ensuring conservation of marine biological and protecting fish stocks in particular from illegal fishing and in the spirit of the conclusions drawn in the Green Paper on the Reform of the CFP[18], those operators who do not comply with the rules of the CFP, and particularly jeopardise the sustainability of the stocks concerned and constitute therefore a serious threat to the sustainable exploitation of living marine biological resources that restores and maintains populations of harvested species above levels which can produce the MSY, and those who are involved in IUU fishing should be excluded from support under the EMFF. Union funding should not at any stage from the selection to the implementation of an operation be used to undermine the public interest of conservation of marine biological resources expressed in the objectives of the CFP Regulation.

(89) Member States should adopt adequate measures to guarantee the proper functioning of management and control systems. To that end, a managing authority, a paying agency and a certification body should be designated for each operational programme and their responsibilities should be specified. These responsibilities should relate primarily to the sound financial implementation, organisation of evaluation, certification of expenditure, audit and compliance with Union law. Provision should be made for regular meetings between the Commission and the national authorities concerned in order to monitor the assistance. With respect to management and control it is necessary, in particular, to establish the modalities by which Member States give the assurance that the systems are in place and function satisfactorily.

(90) The financial interests of the European Union should be protected through proportionate measures throughout the expenditure cycle, including the prevention, detection, and investigation of irregularities, the recovery of funds lost, wrongly paid or incorrectly used and, where appropriate, penalties.

(91) Sums recovered by Member States following irregularities should remain available to the operational programmes of the Member State concerned. A system of financial responsibility of Member States should be designed in the absence of total recovery of irregularities and the Commission should be enabled to safeguard the interests of the Union budget by charging to the Member State concerned sums lost as a result of irregularities and not recovered within reasonable deadlines.

(92) In the interest of a good working partnership and the proper promotion of Union assistance, the broadest possible information and publicity about it should be provided for. The authorities responsible for managing assistance should be responsible for this aspect and for keeping the Commission informed of measures taken.

(93) The rules and procedures governing commitments and payments should be simplified so that a regular cash flow is ensured. A pre-financing of 4 % of the contribution from the EMFF should help speeding up the implementation of the operational programme.

(94) In order to ensure the sound management of Union resources, improvements should be made to the forecasting and implementing of expenditure. To that end Member States should regularly send the Commission their forecasts regarding the use of Union resources and any delays in financial implementation should give rise to repayment of advances and to automatic decommitments.

(95) In order to address the specific needs of the CFP mentioned in Articles 50 and 51 of the [CFP Regulation] and contribute to the compliance with the CFP rules, additional provisions to the rules on interruption of the payment deadline [Regulation (EU) No […] laying down Common Provisions] should be laid down. Where a Member State or an operator has failed to comply with its obligations under the CFP or where the Commission has evidence to suggest this lack of compliance, as a precautionary measure, the Commission should be allowed to interrupt payments.

(96) In addition to the possibility of interruption and, in order to avoid an evident risk of paying out ineligible expenditure, the Commission should be allowed to suspend payments linked to a non compliance of CFP rules as required by Articles 50 and 51 of the [CFP Regulation].

(97) In order to establish the financial relationship between the accredited paying agencies and the Union budget, the Commission should clear the accounts of these paying agencies annually. The clearance of accounts decision should cover the completeness, accuracy and veracity of the accounts but not the conformity of the expenditure with Union legislation.

(98) The operational programme should be subject to monitoring and evaluation in order to improve its quality and demonstrate its achievements. The Commission should set up a framework for a common monitoring and evaluation ensuring among others that relevant data is available on a timely manner. In this context a list of indicators should be determined and the impact of the EMFF policy assessed by the Commission in relation to specific objectives.

(99) Responsibility for monitoring of the programme should be shared between the Managing Authority and a Monitoring Committee set up for this purpose. To this end the respective responsibilities should be specified. Monitoring of the programme should involve the drawing up of an annual implementation report, to be sent to the Commission.

(100) With a view to strengthening accessibility and transparency of information about funding opportunities and project beneficiaries, in each Member State a single website or website portal providing information on operational programme, including the lists of operations supported under each operational programme, should be made available. This information should give a reasonable, tangible and concrete idea to the wider public and in particular to Union taxpayers on how Union funding is spent in the framework of the EMFF. In addition to this objective, the publication of relevant data should serve the purpose of further publicising the possibility of applying for Union funding. However in full respect of the fundamental right to data protection and in line with the judgment of the Court in the Joined Cases Schecke[19], the publication of the names of natural persons should not be requested.

(101) In order to supplement and amend certain non-essential elements of this Regulation, the power to adopt acts in accordance with Article 290 of the Treaty should be delegated to the Commission in respect of a code of conduct on identification of the cases of non-compliance of CFP rules which could lead to inadmissibility of application and the timeframe of application, in order to ensure ex ante conditionality in a proportionate way, identification of eligible investments on board in order to avoid investments which would lead to increasing the fishing capacity of the vessel, on the method of calculation of net revenue in the case of eco-innovation, on the determination of the eligible operations and costs linked to the protection and restoration of marine protected areas, on the identification of eligible costs in the investments in off-shore and non-food aquaculture, the determination of the content of the action plan of local development strategies, determination of eligible costs under the preparatory support for local development strategies, definition of the eligible costs under running costs and animation costs for the local development strategies, the obligations of paying agencies, the determination of tasks of certification bodies, the clarification of the procedures for adequate audit trail, the clarification of the obligations of Member States in case of recoveries of undue payments, the determination of cases of non-compliance of CFP which might lead to suspension of payments, the establishment of the criteria and methodology to apply in case of flat rate or extrapolated financial corrections and the list of relevant cases of non-compliance with CFP rules which might lead to the application of financial corrections and on the content and construction of the monitoring and evaluation system.

(102) The Commission, when preparing and drawing up delegated acts, should ensure a simultaneous, timely and appropriate transmission of relevant documents to the European Parliament and Council.

(103) The Commission should be empowered to adopt, by means of implementing acts, decisions on the annual breakdown of allocations, decisions approving the operational programmes and their amendments, decisions on the priority of the Union in the control and enforcement policy, decision approving the annual work plans for data collection, decisions establishing evidence of non-compliance with CFP leading to possible interruptions of the payment deadline, decisions on the failure to comply with CFP rules leading to possible suspension of payments, decisions suspending payments and lifting suspension of payments, decisions on financial corrections an decision on clearance of accounts.

(104) In order to ensure uniform conditions for the implementation of this Regulation, the implementing powers relating to the format of the operational programme, the procedures to adopt the operational programme, the procedures relating to the adoption of annual work plan for data collection, the concrete application of the percentage points of aid intensity of Annex I, the period of time for sending the intermediate declaration of expenditure, rules on the obligation of paying agencies as regard to management and control, specific tasks of the certification bodies, the rules for efficient management and control, rules for the determination of the payments to be suspended, the procedures for interrupting the payment deadline or for suspending payments, the procedure for additional on-the-spots controls by the Commission, the format of the Annual Implementation Reports, the elements to be included in the ex-ante and ex-post evaluations and the elaboration of technical elements for publicity measures should be conferred on the Commission. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission's exercise of implementing powers[20].

(105) In light of the procedural nature of the provisions to be adopted by the Commission with the implementing acts of Article 24, Article 98, Article 120 and Article 143, the advisory procedure should apply when adopting these latter.

(106) In order to facilitate a smooth transition from the system established by Regulation (EC) No 1198/2006 to the system established by this Regulation, the power to adopt acts in accordance with Article 290 of the Treaty should be delegated to the Commission in respect of establishing transitional provisions.

(107) The new support scheme provided for by this Regulation replaces the support scheme set up by Regulation (EC) No 1198/2006, Regulation (EC) No 861/2006, Regulation of the European Parliament and of the Council establishing a Programme to support the further development of an Integrated Maritime Policy, Regulation (EC) No 1290/2005 Guarantee Fund, Regulation (EC) No 791/2007 and Article 103 of the Regulation 1224/2009. Therefore, these regulations and provision should be repealed from 1 January 2014.

HAVE ADOPTED THIS REGULATION:

TITLE I OBJECTIVES

CHAPTER I Scope and Definitions

Article 1 Subject matter

This Regulation defines Union financial measures for the implementation of:

(a) the Common Fisheries Policy (CFP),

(b) relevant measures relating to the Law of the Sea,

(c) the sustainable development of fisheries areas and inland fishing,

(d) and the Integrated Maritime Policy (IMP).

Article 2 Geographical scope

This Regulation shall apply to operations carried out in the territory of the Union unless otherwise expressly provided for in this Regulation.

Article 3 Definitions

1. For the purposes of this Regulation and without prejudice to paragraph 2, the definitions referred to in Article 5 of the [Regulation on the Common Fisheries Policy][21], Article 5 of the [Regulation on the Common Organisation of the markets in fishery and aquaculture products] and Article 4 of the Council Regulation (EC) No 1224/2009 and Article 2 of Regulation No [Regulation laying down Common Provisions][22] shall apply.

2. For the purpose of this Regulation, the following definitions shall apply:

(1) 'Common Information Sharing Environment (CISE)' means a network of systems with a decentralised set-up developed for the exchange of information across users from different sectors to improve situational awareness of activities at sea;

(2) 'cross-sectoral operations' means initiatives that mutually benefit different sectors and/or sectoral policies, as referred to in the Treaty on the Functioning of the European Union, and that cannot be accomplished entirely through measures encompassed within respective policy areas;

(3) 'electronic recording and reporting system' (ERS) means a system for the electronic recording and reporting of data as referred to in Articles 15, 24 and 63 of Council Regulation (EC) No 1224/2009;

(4) 'European Marine Observation and Data Network' means a network that integrates national marine observation and data programmes into a common and accessible European resource;

(5) 'fisheries area' means an area with sea or lake shore or including ponds or a river estuary with a significant level of employment in fisheries or aquaculture and designated as such by the Member State;

(6) 'fisherman' means any person engaging in professional fishing, as recognised by the Member State, on board of an operational fishing vessel or engaging in professional harvesting of marine organisms, as recognised by the Member State, without a vessel;

(7) "Integrated Maritime Policy" (IMP) means a Union policy whose aim is to foster coordinated and coherent decision making to maximise the sustainable development, economic growth and social cohesion of Member States, and notably the coastal, insular and outermost regions in the Union, as well as maritime sectors, through coherent maritime-related policies and relevant international cooperation;

(8) 'Integrated Maritime Surveillance' is a EU initiative aiming to enhance effectiveness and efficiency in surveillance activities of the European seas through information exchange and collaboration across sectors and borders;

(9) "irregularity" means irregularity as defined in Article 1(2) of the Council Regulation 2988/95;

(10) 'inland fishing' means fishing carried out for commercial purposes by vessels operating exclusively in inland waters or by other devices used for ice fishing;

(11) 'integrated coastal zone management" means such strategies and measures as defined in the Recommendation of the European Parliament and of the Council (2002/413/EC)of 30 May 2002 concerning the implementation of Integrated Coastal Zone Management in Europe[23];

(12) 'integrated maritime governance' means the coordinated management of all sectoral policies of the EU affecting the oceans, seas, and coastal regions;

(13) 'marine regions' means the geographical areas set out in Annex I to Council Decision 2004/585/EC and the areas established by the regional fisheries management organisations;

(14) 'maritime spatial planning' means a process by which public authorities analyse and allocate the spatial and temporal distribution of human activities in marine areas to achieve ecological, economic and social objectives;

(15) 'measure' means a set of operations;

(16) 'public expenditure' means any contribution to the financing of operations derived from the Member State's budget or from the budget of regional or local authorities, or the European Union and any similar expenditure. Any contribution to the financing of operations whose origin is the budget of public-law bodies or associations of one or more regional or local authorities or public-law bodies acting in accordance with Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts shall be regarded as a public contribution[24];

(17) 'sea basin strategy' means a structured framework of cooperation in respect to a given geographical area, developed by European Institutions, Member States, their regions and where appropriate third countries sharing a sea basin; the strategy takes into account the geographic, climatic, economic and political specificities of the sea basin;

(18) 'small scale coastal fishing' means fishing carried out by fishing vessels of an overall length of less than 12 metres and not using towed gear as listed in Table 3 Annex I of Commission Regulation (EC) No 26/2004 of 30 December 2003 regarding the fishing vessels register of the Union[25];

(19) 'vessels operating exclusively in inland waters' means vessels engaged in commercial fishing in inland waters and not included in the Union fishing fleet register.

TITLE II GENERAL FRAMEWORK

CHAPTER I Establishment and objectives of the European Maritime and Fisheries Fund

Article 4 Establishment

The European Maritime and Fisheries Fund (EMFF) is hereby established.

Article 5 Objectives

The EMFF shall contribute to the following objectives:

(a) promoting sustainable and competitive fisheries and aquaculture;

(b) fostering the development and implementation of the Union's Integrated Maritime Policy in a complementary manner to cohesion policy and to the Common Fisheries Policy;

(c) promoting a balanced and inclusive territorial development of fisheries areas;

(d) fostering the implementation of the CFP.

Article 6 Union priorities

The achievement of the objectives of the EMFF shall contribute to the Europe 2020 strategy for smart, sustainable and inclusive growth. It shall be pursued through the following six Union priorities, which translate the relevant Thematic Objectives of the Common Strategic Framework (hereinafter CSF):

(1) Increasing employment and territorial cohesion through the following objectives:

(a) promotion of economic growth, social inclusion, creation of jobs and supporting labour mobility in coastal and inland communities depending on fishing and aquaculture;

(b) diversification of fisheries activities into other sectors of maritime economy and growth of maritime economy, including mitigation of climate change.

(2) Fostering innovative, competitive and knowledge based fisheries through the focus on the following areas:

(a) support to strengthening technological development, innovation and knowledge transfer;

(b) enhancement of the competitiveness and viability of fisheries, in particular of small scale coastal fleet, and improvement of safety or working conditions;

(c) development of new professional skills and lifelong learning;

(d) improved market organisation for fishery products.

(3) Fostering innovative, competitive and knowledge based aquaculture through the focus on the following areas:

(a) support to strengthening technological development, innovation and knowledge transfer;

(b) enhancement of the competitiveness and viability of aquaculture enterprises, SMEs in particular;

(c) development of new professional skills and lifelong learning;

(d) improved market organisation for aquaculture products.

(4) Promoting a sustainable and resource efficient fisheries through the focus on the following areas:

(a) reduction of the impact of fisheries on the marine environment;

(b) protection and restoration of marine biodiversity and ecosystems including the services they provide.

(5) Promoting a sustainable and resource efficient aquaculture through the focus on the following areas:

(a) enhancement of ecosystems related to aquaculture and promotion of resource efficient aquaculture;

(b) promotion of aquaculture with high level of environmental protection and of animal health and welfare and of public health and safety.

(6) Fostering the implementation of the CFP through:

(a) the supply of scientific knowledge and collection of data;

(b) the support to control and enforcement, enhancing institutional capacity and an efficient public administration.

CHAPTER II Shared and direct management

Article 7 Shared and direct management

1. Measures covered by Title V and technical assistance under Article 92 shall be financed by the EMFF in accordance with the principle of shared management between the Member States and the Union and under the common rules laid down by the [Regulation (EU) No […] laying down Common Provisions].[26]

2. Measures covered by Title VI with the exception of the technical assistance under Article 92 shall be financed by the EMFF in accordance with the principle of direct management.

CHAPTER III General Principles of Assistance under Shared Management

Article 8 State aid

1. Without prejudice to paragraph 2 of this Article, Articles 107, 108 and 109 of the Treaty shall apply to aid granted by the Member States to enterprises in fisheries and aquaculture.

2. However Articles 107, 108 and 109 of the Treaty shall not apply to payments made by Member States pursuant to, and in conformity with, this Regulation within the scope of Article 42 of the Treaty.

3. National provisions setting up public financing going beyond the provisions of this Regulation concerning financial contributions, as provided for in paragraph 2, shall be treated as a whole on the basis of paragraph 1.

Article 9 Partnership

By derogation to Article 5(4) of the [Regulation (EU) No […] laying down Common Provisions] the Commission shall consult at least twice during the programming period the organisations which represent the partners at Union level on the implementation of support from the EMFF.

Article 10 Coordination

In addition to the principles enounced in Article 4 of the [Regulation (EU) No […] laying down Common Provisions], the Commission and the Member States shall ensure coordination and complementarity between support from the EMFF and from other Union policies and financial instruments, including the Regulation (EC) No [establishing the Framework Programme for Environment and Climate Change Action (LIFE Framework Programme)][27] and those in the framework of the Union's external action. Coordination between assistance from the EMFF and LIFE Framework Programme shall be achieved in particular, by promoting the funding of activities that complement integrated projects funded under LIFE Framework Programme, as well as by promoting the use of solutions, methods and approaches validated under LIFE Framework Programme.

Article 11 Ex ante conditionalities

The ex ante conditionalities referred to in Annex III of this Regulation shall apply for the EMFF.

CHAPTER IV Admissibility of applications and ineligible operations

Article 12 Admissibility of applications

1. Applications submitted by the following operators shall not be admissible for support from the EMFF for an identified period of time:

(a) operators that have committed a serious infringement under 42 of the Regulation (EC) No 1005/2008 or Article 90(1) of the Regulation (EC) No 1224/2009;

(b) operators involved in the operation, management or ownership of fishing vessels included in the Union IUU vessel list as set out in Article 40(3) of the Regulation (EC) No 1005/2008;

(c) operators who committed other cases of non compliance with the CFP rules which seriously jeopardise the sustainability of the stocks concerned.

2. Applications submitted by operators that have committed an irregularity under the EFF or the EMFF shall not be admissible for an identified period of time.

3. The Commission shall be empowered to adopt delegated act in accordance with Article 150 concerning:

(a) the identification of the period of time referred to in paragraphs 1 and 2 which shall be proportionate to the seriousness or to the repetition of the infringement or non-compliance;

(b) the relevant starting or ending dates of the period referred to in paragraph 1;

(c) the identification of the other cases of non compliance referred to in paragraph 1(c) which seriously jeopardise the sustainability of the stocks concerned.

4. Member States shall require that operators submitting an application under the EMFF provide to the managing authority a signed statement confirming that they respect the criteria listed in paragraph 1 and have not committed an irregularity under the EEF or the EMFF as referred to in paragraph 2. Member States shall verify the veracity of the statement before the approval of the operation.

5. The Commission shall be empowered to adopt delegated acts in accordance with Article 150 on delegation concerning the establishment of a system for the exchange of information of non-compliance between Member States.

Article 13 Ineligible operations

The following operations shall not be eligible under the EMFF:

(a) operations increasing the fishing capacity of the vessel;

(b) construction of new fishing vessels, decommissioning or importation of fishing vessels;

(c) temporary cessation of fishing activities;

(d) experimental fishing;

(e) transfer of ownership of a business;

(f) direct restocking, unless explicitly foreseen as a conservation measure by a Union legal act or in the case of experimental restocking.

TITLE III FINANCIAL FRAMEWORK

Article 14 Budget implementation

1. The Union budget allocated to the EMFF under Title V shall be implemented within the framework of shared management according to Article 4 of [Regulation (EU) No […] laying down Common Provisions].

2. The Union budget allocated to the EMFF under Title VI shall be implemented directly by the Commission in accordance with Article 55(1)(a) of the [new Financial Regulation].

3. The Commission shall cancel all or part of the budget commitment under direct management in accordance with the [new Financial Regulation] and in accordance with Article 147 of this Regulation.

4. The principle of sound financial management shall be applied in accordance with Articles 27 and 50 of the [new Financial Regulation].

Article 15 Budgetary resources under shared management

1. The resources available for commitments from the EMFF for the period 2014 to 2020 under shared management shall be EUR 5 520 000 000 in current prices in accordance with the annual breakdown set out in Annex II.

2. EUR 4 535 000 000 of the resources referred to in paragraph (1) shall be allocated to the sustainable development of fisheries, aquaculture and fisheries areas under Chapters I, II and III of Title V.

3. EUR 477 000 000 of the resources referred to in paragraph (1) shall be allocated to control and enforcement measures referred to in Article 78.

4. EUR 358 000 000 of the resources referred to in paragraph (1) shall be allocated to measures on data collection referred to in Article 79.

5. The resources allocated to compensation of outermost regions under Chapter V of Title V, shall not exceed per year:

– EUR 4 300 000 for the Azores and Madeira;

– EUR 5 800 000 for the Canary Islands;

– EUR 4 900 000 for the French Guiana and Réunion.

6. EUR 45 000 000 of the resources referred to in paragraph (1) shall be allocated to the storage aid referred to in Article 72 from 2014 to 2018 included.

Article 16 Budgetary resources under direct management

An amount of EUR 1 047 000 000 of the EMFF shall allocated to measures under direct management as specified in Chapter I and II of Title VI. This amount includes technical assistance under Article 91.

Article 17 Financial distribution for shared management

1. The resources available for commitments by Member States referred to in Article 15 (2) to (6) for the period 2014 to 2020 as set out in the table in Annex II are determined on the basis of the following objective criteria:

(a) As regards Title V:

(i) the level of employment in fisheries and aquaculture,

(ii) the level of production in fisheries and aquaculture, and

(iii) the share of small scale coastal fishing fleet in the fishing fleet;

(b) As regards Article 78 and Article 79:

(i) the extent of the control tasks of the Member state concerned approximated by the size of the national fishing fleet, the amount of landings and the value of imports from third countries;

(ii) the available control resources compared to the extent of the control tasks of the Member State, whereby available means are approximated by number of controls conducted at sea and of landing inspections;

(iii) the extent of data collections tasks of the Member State concerned, approximated by the size of the national fishing fleet, the amount of landings, the amount of scientific monitoring activities at sea and the number of surveys the Member State is taking part in, and

(iv) the available data collection resources compared to the extent of the data collection tasks of the Member State, where available means are approximated to the number of observers at sea and the amount of human resources and technical means needed to implement the national sampling programme for data collection.

(c) As regards all measures, the historical allocations under Council Regulation (EC) No 1198/2006 and the historical consumption under Council Regulation (EC) No 861/2006.

2. The Commission shall adopt a decision, by means of implementing act, setting out the annual breakdown of the global ressources by Member State.

TITLE IV PROGRAMMING

CHAPTER I Programming for measures financed under shared management

Article 18 Preparation of operational programmes

1. Each Member State shall draw up a single operational programme to implement the Union priorities to be co-financed by the EMFF.

2. The operational programme shall be established by the Member State following close co-operation with the partners referred to in Article 5 of the [Regulation (EU) No [...] laying down Common Provisions]. Consultation of the partners on the preparatory documents shall be organised in such a way as to allow the partners to examine them.

3. For the section of the operational programme referred to in Article 20(1)(n) the Commission shall adopt by means of implementing act the priorities of the Union for enforcement and control policy by 31 May 2013 at the latest.

4. The section of the operational programme referred to in Article 20(1)(o) covering the part of the multiannual programme referred to in Article 37(5) of the [Regulation on Common Fisheries Policy] for the year 2014 shall be tra