EUROPEAN COMMISSION Brussels, 11.8.2017 COM(2017) 429 final 2017/0195(NLE) Proposal for a COUNCIL DECISION on the signing, on behalf of the Union, and provisional application of the Agreement for scientific and technological cooperation between the European Union and the Arab Republic of Egypt setting out the terms and conditions for participation of the Arab Republic of Egypt in the Partnership for Research and Innovation in the Mediterranean Area (PRIMA)



EXPLANATORY MEMORANDUM 1.CONTEXT OF THE PROPOSAL •Reasons for and objectives of the proposal Following a proposal by the Commission for an Article185 TFEU PRIMA initiative , the Decision (EU) 2017/1324 of the European Parliament and of the Council on the participation of the Union in the Partnership for Research and Innovation in the Mediterranean Area ('PRIMA') jointly undertaken by several Member States was adopted. PRIMA aims at implementing a joint programme to foster research and innovation capacities and to develop knowledge and common innovative solutions for improving the efficiency, safety, security and sustainability of agro-food systems and of integrated water provision and management in the Mediterranean area. PRIMA will be jointly undertaken by a number of Member States and third countries ('PRIMA Participating States') with a high level of commitment to scientific, management and financial integration and under the same terms and conditions. The Arab Republic of Egypt ('Egypt') expressed its wish to join PRIMA as a Participating State by letters of 25 February 2016 and 25 May 2017, committing to provide a financial contribution of 33 million euros to the initiative. In order to ensure that Egypt participates in PRIMA on an equal footing with Member States and third countries associated to Horizon 2020, an International Agreement with the Union is required to extend the scope of the legal regime established by Decision (EU) 2017/1324 to Egypt. On 30 May 2017 the Council authorised the Commission to open negotiations, on behalf of the Union, with Egypt on an International Agreement between the Union and Egypt laying down the terms and conditions for the participation of Egypt in PRIMA, subject to the adoption of Decision (EU) 2017/1324. The negotiations started on 26 June 2017 and were successfully completed on 27 July 2017, when the text of the draft Agreement was initialled by representatives from each of the future Parties. The draft Agreement attached to this proposal is in line with the negotiating directives issued by the Council. In particular, it establishes that the terms and conditions for the participation of Egypt in PRIMA shall be those set out in Decision (EU) 2017/1324, making direct reference to the Union legislative act. In order to ensure the protection of Union financial interests, particularly the powers of the Commission, the European Anti-Fraud Office, the Court of Auditors and the PRIMA Implementation Structure (PRIMA-IS) to carry out audits and investigations in accordance with the applicable Union legislation, the Agreement makes specific reference to the relevant provisions of Decision (EU) 2017/1324 and obliges the Parties to provide all necessary assistance to ensure their implementation. In addition, the future Agreement stipulates that the Parties must agree on detailed arrangements for assistance, such arrangements being essential to their cooperation under this Agreement. Upon the request of Egypt and as agreed during the negotiations, an additional recital was inserted in the preamble of the Agreement to reflect that full cooperation and coordination between competent authorities of both future Parties is essential for implementation of the future Agreement. •Consistency with existing policy provisions in the policy area As also presented in the impact assessment report for PRIMA, the openness of PRIMA to the participation of third countries such as Egypt is consistent with the objectives of international cooperation for research and innovation as outlined in the 2012 Commission Communication 'Enhancing and focusing EU international cooperation in research and innovation: A strategic approach' and Horizon 2020 Framework Programme, which promotes cooperation with third countries in science, technology and innovation in order to tackle global societal challenges and support Union external policies. This Agreement is also consistent with the existing Euro-Mediterranean Agreement establishing an Association between the European Communities and their Member States, of the one part, and the Arab Republic of Egypt, of the other part and the Agreement for scientific and technological cooperation between the European Community and the Arab Republic of Egypt which provide for cooperation between the Union and Egypt in research and technological development and encourage research and development activities in the fields of common interest.

•Consistency with other Union policies The implementation of PRIMA in close cooperation with third countries such as Egypt is also consistent with, and relevant for, other Union policies, such as migration policy, development policy and neighbourhood policy. 2.LEGAL elements of the proposal The proposal for a Council decision is based on Article 186 and Article 218(5) of the Treaty on the Functioning of the European Union. 3.BUDGETARY IMPLICATIONS The Legislative Financial Statement presented with this Decision sets out the indicative budgetary implications. In the light of the above, the Commission proposes that the Council - decides on the signature and provisional application of the Agreement on behalf of the Union; - authorises the negotiator of the Agreement to sign, on behalf of the Union, the Agreement for scientific and technological cooperation between the European Union and the Arab Republic of Egypt setting out the terms and conditions for participation of the Arab Republic of Egypt in the Partnership for Research and Innovation in the Mediterranean Area (PRIMA) 2017/0195 (NLE) Proposal for a COUNCIL DECISION on the signing, on behalf of the Union, and provisional application of the Agreement for scientific and technological cooperation between the European Union and the Arab Republic of Egypt setting out the terms and conditions for participation of the Arab Republic of Egypt in the Partnership for Research and Innovation in the Mediterranean Area (PRIMA) THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty on the Functioning of the European Union, and in particular Article 186 in conjunction with Article 218(5) thereof, Having regard to the proposal from the European Commission, Whereas: (1)Decision (EU) 2017/1324 of the European Parliament and of the Council provides for the participation of the Union in the Partnership for Research and Innovation in the Mediterranean Area ('PRIMA') jointly undertaken by several Member States.

(2)PRIMA aims at implementing a joint programme to foster research and innovation capacities and to develop knowledge and common innovative solutions for improving the efficiency, safety, security and sustainability of agro-food systems and of integrated water provision and management in the Mediterranean area. (3)PRIMA will be jointly undertaken by a number of Member States and third countries ('PRIMA Participating States) with a high level of commitment to scientific, management and financial integration and under the same terms and conditions. (4)The Arab Republic of Egypt ('Egypt') expressed its wish to join PRIMA as a Participating State and on an equal footing with the Member States and countries associated to Horizon 2020 participating in PRIMA. (5)In accordance with Article 1(2) of Decision (EU) 2017/1324 Egypt is to become a Participating State in PRIMA subject to the conclusion of an international agreement for scientific and technological cooperation with the Union setting out the terms and conditions for the participation of Egypt in PRIMA. (6)On 30 May 2017 the Council authorised the Commission to open negotiations, on behalf of the Union, with Egypt, on an international agreement setting out the terms and conditions for the participation of Egypt in PRIMA, subject to the adoption of the Decision (EU) 2017/1324. The negotiations were successfully completed by the initialling of the Agreement. (7)Therefore, the Agreement should be signed on behalf of the Union, subject to its conclusion at a later date. (8)In view of allowing for the participation of Egypt in PRIMA from its start, the Agreement should be applied provisionally. HAS ADOPTED THIS DECISION: Article 1 The signing of the Agreement for scientific and technological cooperation between the European Union and the Arab Republic of Egypt setting out the terms and conditions for participation of the Arab Republic of Egypt in the Partnership for Research and Innovation in the Mediterranean Area (PRIMA) is hereby approved on behalf of the Union, subject to the conclusion of that Agreement. The text of the Agreement is attached to this Decision. Article 2 The Council Secretariat General shall establish the instrument of full powers to sign the Agreement, subject to its conclusion, for the person(s) indicated by the negotiator of the Agreement. Article 3 The Agreement shall be applied provisionally, in accordance with Article 4(2) of the Agreement, as of the date on which the EU receives the notification concerning the completion by Egypt of its own procedures for the approval of the Agreement, pending its entry into force. Article 4 This Decision shall enter into force on [the date of its adoption]. Done at Brussels, For the Council The President

LEGISLATIVE FINANCIAL STATEMENT 1.FRAMEWORK OF THE PROPOSAL/INITIATIVE 1.1.Title of the proposal/initiative 1.2.Policy area(s) concerned in the ABM/ABB structure 1.3.Nature of the proposal/initiative 1.4.Objective(s) 1.5.Grounds for the proposal/initiative 1.6.Duration and financial impact 1.7.Management mode(s) planned 2.MANAGEMENT MEASURES 2.1.Monitoring and reporting rules 2.2.Management and control system 2.3.Measures to prevent fraud and irregularities 3.ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE 3.1.Heading(s) of the multiannual financial framework and expenditure budget line(s) affected 3.2.Estimated impact on expenditure 3.2.1.Summary of estimated impact on expenditure 3.2.2.Estimated impact on operational appropriations 3.2.3.Estimated impact on appropriations of an administrative nature 3.2.4.Compatibility with the current multiannual financial framework

3.2.5.Third-party contributions 3.3.Estimated impact on revenue LEGISLATIVE FINANCIAL STATEMENT 1.FRAMEWORK OF THE PROPOSAL/INITIATIVE 1.1.Title of the proposal/initiative Proposal for a Council Decision on the signing on behalf of the Union, and provisional application of the Agreement for scientific and technological cooperation between the European Union and the Arab Republic of Egypt setting out the terms and conditions for participation of the Arab Republic of Egypt in the Partnership for Research and Innovation in the Mediterranean Area (PRIMA). 1.2.Policy area(s) concerned in the ABM/ABB structure Title 08 Research and Innovation, Horizon 2020 Framework Programme. 1.3.Nature of the proposal/initiative ☑ The proposal/initiative relates to a new action ◻ The proposal/initiative relates to a new action following a pilot project/preparatory action ◻ The proposal/initiative relates to the extension of an existing action ◻ The proposal/initiative relates to an action redirected towards a new action 1.4.Objective(s) 1.4.1.The Commission's multiannual strategic objective(s) targeted by the proposal/initiative The purpose of the present initiative is to allow Egypt to become a Participating State in PRIMA, whose strategic objective is to build research and innovation capacities and to develop knowledge and common innovative solutions for agro-food systems, to make them sustainable, and for integrated water provision and management in the Mediterranean area, to make those systems and that provision and management more climate resilient, efficient, cost-effective and environmentally and socially sustainable, and to contribute to solving water scarcity, food security, nutrition, health, well-being and migration problems upstream . 1.4.2.Specific objective(s) and ABM/ABB activity(ies) concerned Specific objective No In view of achieving its objectives, PRIMA will be jointly undertaken by a number of Member States and third countries under the same terms and conditions. In order to ensure that Egypt participates in PRIMA on an equal footing with Member States and third countries associated to Horizon 2020, an International Agreement with the Union is required to extend the scope of the legal regime established by Decision (EU) 2017/1324 to Egypt. 1.4.3.Expected result(s) and impact

Specify the effects which the proposal/initiative should have on the beneficiaries/groups targeted. The present initiative will allow Egypt to become a Participating State in PRIMA, and thus engaged on an equal footing with Member States and third countries associated to Horizon 2020. In accordance with the provisions of Decision (EU) 2017/1324, Egyptian legal entities would be automatically eligible to apply for EU funding in projects funded from the EU budget. 1.4.4.Indicators of results and impact Specify the indicators for monitoring implementation of the proposal/initiative. The purpose of the present initiative is to allow the participation of Egypt in PRIMA. The indicators of results and impact of the present initiative are thus strictly linked with those for the PRIMA initiative as a whole, as specified in the corresponding Commission proposal. 1.5.Grounds for the proposal/initiative 1.5.1.Requirement(s) to be met in the short or long term Please refer to the Commission proposal for an Article185 TFEU PRIMA initiative mentioned above and to the PRIMA Impact Assessment Report, accompanying this Commission proposal. 1.5.2.Added value of EU involvement Please refer to the Commission proposal for an Article185 TFEU PRIMA initiative mentioned above. 1.5.3.Lessons learned from similar experiences in the past There are no precedents for this intiative, since PRIMA is the first intiative of its kind to count with participation of third countries not associated to EU Research Framewrok Programme on an equal footing with Member States and thus requiring the conclusion of international agreements with the Union for their participation. 1.5.4.Compatibility and possible synergy with other appropriate instruments Please refer to the Commission proposal for an Article185 TFEU PRIMA initiative mentioned above. 1.6.Duration and financial impact ☑ Proposal/initiative of limited duration –☑ Proposal/initiative in effect from the date of provisional application of the Agreement and for as long as Decision (EU) 2017/1324 is in force (31/12/2028). –☑ Financial impact from the date of provisional application of the Agreement until 31.12.2020 (during this period an arrangement implementing the Agreement is to be set up. After this period, no further activities are envisaged under the Agreement). ◻ Proposal/initiative of unlimited duration –Implementation with a start-up period from YYYY to YYYY,

–followed by full-scale operation. 1.7.Management mode(s) planned ◻ Direct management by the Commission –◻ by its departments, including by its staff in the Union delegations; –◻ by the executive agencies ◻ Shared management with the Member States ☑ Indirect management by entrusting budget implementation tasks to: –◻ third countries or the bodies they have designated; –◻ international organisations and their agencies (to be specified); –◻the EIB and the European Investment Fund; –◻ bodies referred to in Articles 208 and 209 of the Financial Regulation; –◻ public law bodies; –☑ bodies governed by private law with a public service mission to the extent that they provide adequate financial guarantees; –◻ bodies governed by the private law of a Member State that are entrusted with the implementation of a public-private partnership and that provide adequate financial guarantees; –◻ persons entrusted with the implementation of specific actions in the CFSP pursuant to Title V of the TEU, and identified in the relevant basic act. –If more than one management mode is indicated, please provide details in the ‘Comments’ section. Comments A new legal entity will be established - dedicated exclusively to the PRIMA implementation. The EU financial contribution to PRIMA will be provided through this structure. 2.MANAGEMENT MEASURES 2.1.Monitoring and reporting rules

Specify frequency and conditions. Please refer to the Commission proposal for an Article185 TFEU PRIMA initiative mentioned in the previous sections. 2.2.Management and control system 2.2.1.Risk(s) identified Please refer to the Commission proposal for an Article185 TFEU PRIMA initiative mentioned in the previous sections. 2.2.2.Information concerning the internal control system set up Please refer to the Commission proposal for an Article185 TFEU PRIMA initiative mentioned in the previous sections. 2.2.3.Estimate of the costs and benefits of the controls and assessment of the expected level of risk of error Please refer to the Commission proposal for an Article185 TFEU PRIMA initiative mentioned in the previous sections. 2.3.Measures to prevent fraud and irregularities Specify existing or envisaged prevention and protection measures. In order to ensure the protection of Union financial interests, particularly the powers of the Commission, the European Anti-Fraud Office, the Court of Auditors and the PRIMA Implementation Structure (PRIMA-IS) to carry out audits and investigations in accordance with the applicable Union legislation, the Agreement to be concluded between the EU and Egypt makes specific reference to the relevant provisions of Decision (EU) 2017/1324 and obliges the Parties to provide all necessary assistance to ensure their implementation. In addition, the future Agreement stipulates that the Parties must agree on detailed arrangements for assistance, such arrangements being essential to their cooperation under this Agreement. 3.ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE 3.1.Heading(s) of the multiannual financial framework and expenditure budget line(s) affected ·Existing budget lines In order of multiannual financial framework headings and budget lines. Heading of multiannual financial framework Budget line Type of

expenditure Contribution Heading 1a - Competitiveness for growth and jobs Diff./Non-diff. from EFTA countries from candidate countries from third countries within the meaning of Article 21(2)(b) of the Financial Regulation 1a 08.01.05 Non-diff. YES YES NO NO ·New budget lines requested In order of multiannual financial framework headings and budget lines. Heading of multiannual financial framework Budget line Type of

expenditure Contribution Number

[Heading………………………………………] Diff./Non-diff. from EFTA countries from candidate countries from third countries within the meaning of Article 21(2)(b) of the Financial Regulation [XX.YY.YY.YY] YES/NO YES/NO YES/NO YES/NO

3.2.Estimated impact on expenditure [This section should be filled in using the spreadsheet on budget data of an administrative nature (second document in annex to this financial statement) and uploaded to CISNET for interservice consultation purposes.] 3.2.1.Summary of estimated impact on expenditure EUR Heading of multiannual financial

framework 1a 'Competetiveness for growth and jobs' DG: <RTD.> Year

2018 Year

2019 Year

2020 Year

2021-2029 TOTAL • Operational appropriations Number of budget line Commitments (1) Payments (2) Number of budget line Commitments (1a) Payments (2a) Appropriations of an administrative nature financed from the envelope of specific programmes Number of budget line: 08.010501 (3) 23000 23000 23000 69000 TOTAL appropriations

for DG RTD Commitments =1+1a +3 23000 23000 23000 69000 Payments =2+2a +3 23000 23000 23000 69000









• TOTAL operational appropriations Commitments (4) Payments (5) • TOTAL appropriations of an administrative nature financed from the envelope for specific programmes (6) 23000 23000 23000 69000 TOTAL appropriations

under HEADING <1a>

of the multiannual financial framework Commitments =4+ 6 23000 23000 23000 69000 Payments =5+ 6 23000 23000 23000 69000 If more than one heading is affected by the proposal / initiative: • TOTAL operational appropriations Commitments (4) Payments (5) • TOTAL appropriations of an administrative nature financed from the envelope for specific programmes (6) TOTAL appropriations

under HEADINGS 1 to 4

of the multiannual financial framework

(Reference amount) Commitments =4+ 6 Payments =5+ 6







Heading of multiannual financial

framework 5 ‘Administrative expenditure’ EUR Year

2018 Year

2019 Year

2020 Year

2021-2029 TOTAL DG: <RTD.> • Human resources • Other administrative expenditure 4600 4600 4600 13800 TOTAL DG <RTD.> Appropriations 4600 4600 4600 13800 TOTAL appropriations

under HEADING 5

of the multiannual financial framework (Total commitments = Total payments) 4600 4600 4600 13800 EUR Year

2018 Year

2019 Year

2020 Year

2021-2029 TOTAL TOTAL appropriations

under HEADINGS 1 to 5

of the multiannual financial framework Commitments 27600 27600 27600 82800 Payments 27600 27600 27600 82800

3.2.2.Estimated impact on operational appropriations –◻ The proposal/initiative does not require the use of operational appropriations –◻ The proposal/initiative requires the use of operational appropriations, as explained below: Commitment appropriations in EUR Indicate objectives and outputs ⇩ Year

N Year

N+1 Year

N+2 Year

N+3 Enter as many years as necessary to show the duration of the impact (see point 1.6) TOTAL OUTPUTS Type Average cost No Cost No Cost No Cost No Cost No Cost No Cost No Cost Total No Total cost SPECIFIC OBJECTIVE No 1… - Output - Output - Output Subtotal for specific objective No 1 SPECIFIC OBJECTIVE No 2 ... - Output Subtotal for specific objective No 2 TOTAL COST 3.2.3.Estimated impact on appropriations of an administrative nature 3.2.3.1.Summary –◻ The proposal/initiative does not require the use of appropriations of an administrative nature –☑ The proposal/initiative requires the use of appropriations of an administrative nature, as explained below: EUR Year

2018 Year

2019 Year

2020 Year

2021-2029 TOTAL HEADING 5

of the multiannual financial framework Human resources Other administrative expenditure 4600 4600 4600 13800 Subtotal HEADING 5

of the multiannual financial framework 4600 4600 4600 13800 Outside HEADING 5

of the multiannual financial framework Human resources 23000 23000 23000 69000 Other expenditure

of an administrative nature Subtotal

outside HEADING 5

of the multiannual financial framework 23000 23000 23000 69000 TOTAL 27600 27600 27600 82800 The appropriations required for human resources and other expenditure of an administrative nature will be met by appropriations from the DG that are already assigned to management of the action and/or have been redeployed within the DG, together if necessary with any additional allocation which may be granted to the managing DG under the annual allocation procedure and in the light of budgetary constraints. 3.2.3.2.Estimated requirements of human resources –◻ The proposal/initiative does not require the use of human resources.

–☑ The proposal/initiative requires the use of human resources, as explained below: Estimate to be expressed in full time equivalent units Year

2018 Year

2019 Year 2020 Year 2021-2029 • Establishment plan posts (officials and temporary staff) XX 01 01 01 (Headquarters and Commission’s Representation Offices) XX 01 01 02 (Delegations) 08 01 05 01 (Indirect research) 0.2 0.2 0.2 10 01 05 01 (Direct research) • External staff (in Full Time Equivalent unit: FTE) XX 01 02 01 (AC, END, INT from the ‘global envelope’) XX 01 02 02 (AC, AL, END, INT and JED in the delegations) XX 01 04 yy - at Headquarters - in Delegations XX 01 05 02 (AC, END, INT - Indirect research) 10 01 05 02 (AC, END, INT - Direct research) Other budget lines (specify) TOTAL 0.2 0.2 0.2 XX is the policy area or budget title concerned. The human resources required will be met by staff from the DG who are already assigned to management of the action and/or have been redeployed within the DG, together if necessary with any additional allocation which may be granted to the managing DG under the annual allocation procedure and in the light of budgetary constraints. Description of tasks to be carried out: Officials and temporary staff Preparation and conclusion of administrative arrangement with Egyptian authorities for assistance regarding protection of EU financial interests, as provided for Article 2 of the Agreement. External staff 3.2.4.Compatibility with the current multiannual financial framework –☑ The proposal/initiative is compatible the current multiannual financial framework. –◻ The proposal/initiative will entail reprogramming of the relevant heading in the multiannual financial framework. Explain what reprogramming is required, specifying the budget lines concerned and the corresponding amounts. –◻ The proposal/initiative requires application of the flexibility instrument or revision of the multiannual financial framework. Explain what is required, specifying the headings and budget lines concerned and the corresponding amounts. 3.2.5.Third-party contributions –☑ The proposal/initiative does not provide for co-financing by third parties. –The proposal/initiative provides for the co-financing estimated below: Appropriations in EUR Year

N Year

N+1 Year

N+2 Year

N+3 Enter as many years as necessary to show the duration of the impact (see point 1.6) Total Specify the co-financing body TOTAL appropriations co-financed



3.3.Estimated impact on revenue