Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on establishing common rules in the field of civil aviation and creating a European Aviation Safety Agency

(PRESENTED BY THE COMMISSION)

EXPLANATORY MEMORANDUM

1. Introduction

1.1. Background

1.1.1. Air transport in the Community has been progressively liberalised since 1988 and the Community market in this sector has evolved from a market based on bilateral agreements, with virtually no competition, towards a genuine open market based on the Treaty principles. Hence, air transport is governed by common rules, which address licensing, market access, pricing and the application of the competition rules. As a result, airlines and consumers have greatly benefited from this situation, which has led to job opportunities and the entry into the market of new operators.

1.1.2. As soon, however, as this process started the aviation community realised that a genuine air transport single market required also the establishment and uniform application of common rules in the fields of aviation safety and environmental protection in order to ensure a high level of protection for the European citizen and provide a level playing field for Community air operators. This, moreover, would facilitate the smooth functioning of the internal market for related products, persons and services, the patchwork of national regulations being frequently used to deprive them of the freedom of movement enshrined in the Treaty.

1.1.3. The current Community system is based on Regulation (EEC) No 3922/91 [1] on the harmonisation of technical requirements and administrative procedures in the field of civil aviation, and on the JAA (Joint Aviation Authorities) [2]. During recent years this has been criticised for not working properly for the effective and timely adoption or amendment of the necessary Community legislation, nor does this provide the necessary flexibility to cope with the day-to-day needs of the industry. This is due to several reasons:

[1] OJ L 373, 31.12.1991, p. 4.

[2] An informal organisation set up by the aviation authorities of a number of European countries in 1990. Currently the full members of the JAA are the 15 EC Member States and Iceland, Malta, Monaco, Norway and Switzerland. Candidates members to the JAA are: Bulgaria, Czech Republic, Cyprus, Estonia, Former Yugoslav Republic of Macedonia, Hungary, Latvia, Moldova, Poland, Slovakia, Romania, Slovenia and Turkey.

-First, although processed through the JAA consultation machinery, all rules of a general nature adopted in this framework need nevertheless to be processed again through the Community machinery for ensuring transparency and democratic control of rule-making. This not only introduces lengthy delays, but gives rise to controversy when some interested parties use this double procedure to re-open issues which were thought solved through the JAA process.

-Secondly the JAA harmonisation process being alien to the Community produces proposals, which, although certainly satisfactory in terms of safety, often contain provisions inconsistent with Community obligations and policies. This makes it impossible for the Community to adopt them as such and requires difficult screening and rephrasing so that they can be transposed without affecting their safety content.

1.1.4. Despite significant efforts by the JAA to streamline their own working methods, particularly in the framework of its "Agenda for Change", these shortcomings continue to exist.

1.1.5. In its communication on "The European Airline industry: from Single Market to World-wide Challenges" [3] the Commission identified problems which still prevent the internal market from developing completely: fragmentation of air traffic control (ATC), physical access to the market (allocation of slots), costs of infrastructure, the absence of an external dimension to aviation and the fragmentation of safety rules. Several actions are currently being developed to tackle these issues. This proposal is the response to overcome the difficulties in the technical field.

[3] COM(1999) 182 final, 20.5.1999.

1.1.6. Discussions within the Community, but also externally and within the JAA, showed that there was a need for a strong organisation with extended powers in all fields of civil aviation safety and the potential for taking over executive tasks currently exercised at national level when collective action appears more efficient. The European Parliament has also called on several occasions for the establishment of a single aviation safety regulatory authority [4]. In other words it was felt that a body comparable to the Federal Aviation Administration (FAA) in the United States should be created, with the prime task of ensuring a uniform high level of safety in Europe through the gradual integration of the national systems. This would also facilitate the free movement of aeronautical products, as well as persons and services, by making possible the automatic recognition, without any further requirements, of certificates and approvals issued by any duly authorised body on the basis of common requirements.

[4] For example, in its recent resolution: on the Communication from the Commission to the Council, the European Parliament, the Economic and Social Committee and the committee of the Regions "The European Airline Industry: from Single Market to World-wide Challenges". Minutes of 4 May 2000.

1.2. Recent work

1.2.1. To this end, on 16 July 1998 the Council adopted a decision authorising the Commission to open negotiations with States which are full members of the JAA other than European Community Member States, with a view to concluding an agreement establishing a European Aviation Safety Authority (EASA), which will have the legal form of an international organisation.

1.2.2. On the basis of this, a draft Convention was prepared by the Commission services, in cooperation with national experts, to set up an organisation capable of executing, in cooperation with its contracting parties' aviation authorities, all the tasks related to the regulation of civil aviation safety, and to exercise the necessary powers where collective action is more efficient than that of its individual members. Its scope was to encompass initially the design, production, maintenance and operation of aircraft and aeronautical products, as well as personnel and organisations involved. In a later stage it was to be enlarged to include the safety aspects of airport operations and air traffic management. Insofar as the normative rules and individual decisions adoptedP by this organisation were to be directly applicable, a system of judicial review would have to be set up (an EASA court of justice).

1.2.3. Although the draft Convention was considered to be what the sector needed, its institutional architecture would have required cumbersome ratification procedures; some Member States would have had to make some constitutional changes; as regards the Community, the Court of Justice opinion would have been a necessary prerequisite. Quite apart from the length of these procedures, there was no guarantee that this text could be ratified because of the political uncertainty about the willingness of the European Parliament and national parliaments to accept the wide delegation of executive powers it envisaged. Therefore, the Commission expressed concerns about the feasibility of such a system and suggested a further examination to see whether the same objectives could not be met by using the Community mechanisms and institutions.

1.2.4. At the invitation of the Council, the Commission presented a detailed analysis of a Community alternative [5] that would establish an authority capable of guaranteeing a high level of safety in Europe and work with the rapidity and efficiency needed. On this basis and following further work with national experts, the Council on its meeting of 26 June agreed that such an alternative, further elaborated in a Presidency working document, was the most practicable way forward. It therefore suggested that the Commission should make a proposal to put it in place as early as possible.

[5] Commission working document for the discussions within the Council on the creation of the European Aviation Safety Authority in the Community framework (COM(2000) 144 final, 21.3.2000).

2. The Community EASA

2.1. The objectives

2.1.1. As already agreed when setting the mandate for creating an EASA, the essential objective is to achieve a high uniform level of safety and environmental protection in the Community. Additional objectives would be the facilitation of free and fair competition in the Community; more efficient certification processes; and the world-wide promotion of European aviation standards.

2.1.2. The means to achieve such objectives are the formulation, approval and uniform application of all necessary regulations; the automatic recognition, without any further requirement or verification, of approvals granted in accordance with these regulations to products, organisations and personnel involved in civil aviation; and the establishment of a Community Agency able to undertake the related tasks.

2.2. The organisational concept

2.2.1 All interested parties have always recognised that the achievement of these objectives and the implementation of related means required the creation of a specialised agency, with a high level of expertise in all areas related to aviation safety and environmental protection. To be able also to play its role effectively in protecting public interests internally and promoting European views externally, it needs to be vested with real powers and enjoy the necessary independence. In short, the aeronautical community needs a strong and efficient agency able inter alia to carry out certification functions and to be a valid partner for foreign aeronautical authorities.

2.2.2. The exercise of executive powers and the control of implementation of rules and regulations is the prerogative of the Commission; such tasks may be delegated to another body only on the basis of rules limiting its discretion to a technical judgment within its sphere of competence.

2.2.3. To remain in line with this institutional architecture, it is necessary therefore that, in a Community EASA, the European Parliament and the Council set basic principles for regulation and essential requirements defining the level of safety and of environmental protection required by European citizens. At that level targets should be specified in sufficiently broad terms to allow innovation and competition and avoid standardising products and services. Such requirements, which do not change frequently, can be incorporated in the legislation creating the EASA itself.

The Commission proposal contains therefore, as a first step, such basic principles for the certification and maintenance of aeronautical products. It also prescribes essential requirements based on Annex 8 to the Chicago Convention, annexed to the proposal, and existing Community legislation applicable to environmental protection.

As for other fields falling within the scope of the Regulation, basic principles and essential requirements will have to be adopted in due course in accordance with the normal legislative process; related legislation will complement the present proposed Regulation. This will concern in particular the safety aspects of air operations, flight crew licensing, airport operations and air traffic management, although in these last two sectors, it is likely that common rules will be adopted only at a later stage when the current activities of the JAA are covered.

2.2.4. The way the essential requirements are to be implemented, in particular the procedure to be followed to obtain the necessary approvals, the privileges attached to such approvals, as well as applicable technical standards, can be adopted by the European Parliament and the Council or delegation can be given to the Commission to do so. It is likely that in areas where such rules are to be applied by Member States themselves, they will be adopted by the European Parliament and the Council. The Commission would then be given the capacity to complement them when they refer to very specific technical fields and to adapt them to scientific or technical progress; this may be the case for air operators' certification requirements or flight crew licensing.

For products, however, where centralised certification is needed and wanted, uniformity would be better achieved by such centralised certification than by detailed technical specifications. Moreover, in such a field where technology evolves rapidly it would be a mistake to over-specify technical details at legislative level. It is proposed therefore, a more practicable and flexible approach, in which, as already agreed in preparatory work in the Council, the Commission should be empowered to adopt the necessary implementing rules and when doing so it should not affect the technical discretion of the Agency in evaluating the conformity of product with the essential requirements. Implementing rules therefore are likely to be limited to procedural requirements such as those contained in JAR-21, while airworthiness codes such as JAR-25, JAR-E, JAR-APU etc. which are listed in Annex 2 to Regulation (EEC) No 3922/91 would be considered as acceptable means of compliance, similar to industrial standards, and therefore left to the Agency or to the industry where a true standardisation process is achievable - for parts in particular. However, in order to benefit from the expertise existing in Member States and to maintain a closeness with stakeholders, a fair balance has been agreed between functions that will be centralised at the Agency level and those that will remain within national administrations (individual certifications of planes, granting of pilot licenses etc.).

2.2.5. In such a framework the Agency can be empowered with the granting of certificates attesting the conformity of aeronautical products with the applicable essential requirements since it is a purely technical judgment. In order to give, however, guidance to the industry on how such judgment will be made the agency will develop in a transparent manner - by the proper and wide consultation of all interested parties (aerospace industry, air operators, workers, consumer representatives etc.) -technical specifications and guidance material, in particular acceptable means of compliance (airworthiness codes) and publish them. Such publication would not give them any binding status for applicants - providing so for the necessary flexibility - but it would oblige the Agency to justify any deviation from published documents limiting therefore its margin of discretion.

2.2.6. For maintenance finally, which is close to product certification but which implies the approval of organisations and personnel and where centralisation is not envisaged, a mixed approach is proposed whereby the Commission is empowered to adopt the implementing rules in a sufficiently detailed manner - based on JAR-145 - to ensure their uniform application at Member State level.

2.2.7. Because the Agency will be entitled to make decisions directly affecting individuals, it is necessary to foresee a judicial control mechanism. In order to avoid as much as possible that technical cases are presented to the Court of Justice, it is proposed to put in place a first instance specialised level of boards of appeal, as for the Office for Harmonisation in the Internal Market (OHIM).

2.2.8. This new structure and sharing of rules being significantly different from that established by Regulation (EEC) No 3922/91, it is proposed to repeal that Regulation. It is, however, necessary to retain some of its elements to ensure the proper functioning of the internal market. This is the case with automatic recognition of approvals granted by the Member States or the Agency in accordance with the Regulation and rules adopted for its application. It is also the case with Community review mechanisms designed to ensure that when the essential requirements or related implementing rules open the door to flexibility (acceptance of third-country approvals, immediate safety measures, variations, exemptions and equivalent safety findings) the Commission is given necessary powers to monitor this and adopt appropriate measures.

2.3. The Agency

2.3.1. Mandate

The Agency will be established as part of the Community system, it will be entitled to build on its expertise and carry out preparatory work in all areas covered by the Regulation; it may therefore develop international cooperation and research activities as appropriate. In all these fields the Agency should be entitled to formulate recommendations or opinions. More precisely:

-It will develop essential requirements and implementing rules applicable to aeronautical products, personnel and organisations and forward them to the Commission. The Commission will either propose them to the European Parliament and the Council or adopt them in the comitology framework as the case may be (see 2.2.3. and 2.2.4. above).

-It will develop and adopt acceptable means of compliance and guidance material, including airworthiness codes, for the application of the above rules. These are not mandatory but will serve as an indication of how compliance would be verified, leaving it up to those concerned to prove whether they satisfy the essential requirements and implementing rules by other acceptable means.

-It will conduct technical investigations and issue type certificates. The Agency can carry out these tasks itself, or allocate them to national administrations and the industry - so-called qualified entities - when they have showed that they possess the required capabilities.

-It will put in place a system of surveillance, including, in particular, the continuous monitoring of the airworthiness of the products for which it has issued type certificates (it encompasses Instructions for Continued Airworthiness, Design Changes including Approved Manuals, Service Bulletins, Airworthiness Directives, Repairs). This aims, on the one hand, at ensuring that the common rules are proportionate to the safety objectives to be achieved and, on the other, at triggering immediate action where necessary to preserve the safety of goods and persons. Such surveillance may lead either to amendment of the common rules or to the adoption of safety measures such as the suspension or withdrawal of licences or the modification of the conditions for issuing a type certificate (airworthiness directive).

-It will assist the Commission in monitoring the application of the common rules at national level. It will therefore create teams of experts for inspecting the national systems and checking their working methods. It will thus verify on the field that Community law is correctly implemented and applied; it will report back to the Commission, which could then decide whether to institute infringement proceedings when incorrect application of the common rules is detected. It will also assist the Commission in the implementation of the Community review mechanisms mentioned in paragraph 2.2.8..

-In the international field, it will be able to establish appropriate relations with international organisations and third-country aeronautical authorities with the view to harmonising rules and procedures in the context of working agreements concluded by the Commission with these bodies, and make the necessary recommendations to the Commission. It will also assist the Commission in the negotiation and implementation of bilateral or multilateral agreements.

-In the field of research, the Agency should have a budget for carrying out activities related strictly to its field of expertise. It may also take the appropriate initiative to coordinate its activities and those of the Community and of the Member States in this field.

2.3.2. Functioning

(a) Management bodies

2.3.2.1. Decisions on safety should be made without any political interference or national considerations, hence they should be taken by the Executive Director of the Agency. These decisions should be based on a codified process, to be developed by the Administrative Board, designed to ensure appropriate transparency and the right of all the affected parties to present their opinions while preserving the necessary commercial and personal secrecy.

2.3.2.2. As for the development of opinions (draft material for Community rule-making) and acceptable means of compliance, the Executive Director will be able to draw on available expertise, Member States could participate in the shaping of those rules, which are to be applied by their aeronautical authorities. As far as individual cases are concerned, the Executive Director will be given a wide margin of manoeuvre to seek the best expertise and get the advice it needs to make a neutral and independent decision. The Executive Director will also be responsible for the preparation and execution of the budget and the work programme of the Agency, and for all questions related to personnel.

2.3.2.3. With individual decisions being made exclusively by the Executive Director, but affecting Member States, it is preferred that the Executive Director is appointed by the Administrative Board on a proposal from the Commission, so as to have the necessary legitimacy.

2.3.2.4. An Administrative Board consisting of one representative of each Member State, the Commission and the European Parliament will be in charge of all administrative issues. It will adopt the work programme of the Agency, after approval from the Commission, and its budget at the beginning of the financial year and adapt it to the contributions and fees received. It will also adopt guidelines for the delegation of certification tasks to qualified entities after approval from the Commission, and develop procedures applicable to the decision-making process (see above). Finally, it will establish an advisory body of interested parties (aerospace industry, workers, consumer representatives, etc.) to be consulted before it takes decisions on budget, the work programme and procedures on transparency.

2.3.2.5. Finally, as mentioned earlier, it is proposed to establish one or several boards of appeal whose role is to verify whether the Agency has applied the implementing rules properly without going beyond the scope for technical appraisal which these texts allow (judicial review). Member States, however, may lodge a direct appeal before the Court of Justice of the European Communities against decisions of the Agency on type certification and inspections.

(b) Personnel

2.3.2.6. For carrying out the tasks described above, the Agency needs to have a sufficient number of high-quality staff, even if to conduct its certification duties it may be more efficient in a first stage to set up joint teams largely calling on experts from national administrations without having to recruit them. Persons are required to conduct the rule-making activities, organise the certification process and provide the necessary support to the Boards of Appeal. To that must be added additional personnel for the surveillance and inspections tasks, as well as to allow the Agency to fully play its role in the international arena. The number of staff the Agency might require would be around 150 persons.

2.3.2.7. The personnel of the Agency will be subject to the Staff Regulations applicable to Officials of the European Communities and the Conditions of Employment of Other Servants. It is envisaged that only a small number of these will be seconded from the Commission or the Member States to carry on management functions under temporary contract, as it is already the case for instance in the European Agency for the Evaluation of Medicinal Products (EMEA). The other personnel will be recruited on the basis of experience and merit from national administrations or the industry. Without prejudice to the need to ensure stable qualified staff in sufficient number, they will be hired on the basis of temporary renewable contracts, so as to ensure continuous renewal and that such personnel is abreast of technological developments.

(c) Budget

2.3.2.8 The Agency needs a budget allocation large enough to hire its personnel as described above; to conduct its certification tasks; to pay the members of the Boards of Appeal; to undertake research activities; and to have the common standards translated and published. For the first year this budget can be valued at roughly EUR 3 100 000. When fully operational the Agency will need a budget of circa EUR 28 700 000.

2.3.2.9. The Agency's budget will be financed to an extent by a subsidy from the Community, in particular as far as its contribution to legislative tasks and Community control is concerned. In order to ensure full transparency and complete evaluation of the Agency budget, in particular by the Community Budgetary Authority, it will be necessary to create a new budget line in the general Budget of the European Union. Services the Agency provides (such as certification, training and documentation) will be paid for by beneficiaries in the form of fees, which must be non-discriminatory and charged uniformly in all the States participating in the system. The level of these fees would have to be in line with international practice so as not to affect the competitiveness of the industry. It is proposed that the Commission adopts them. In the first four years, however, because it will be difficult to evaluate the exact contribution such fees and charges can make to the budget of the Agency, it is proposed that the Community subsidy may cover part of the expenditures related to such services. Consequently, the Community contribution might be EUR 3 100 000 the first year and increase progressively to EUR 10 600 000. Beyond 2006, the subsidy will, in principle, diminish in relation with the rule-making activity.

Of course, the Agency must put in place an appropriate set of rules and controls. The Administrative Board will be entitled to adopt the necessary measures, but the Agency will ultimately be subject to the supervision of the Court of Auditors.

(d) Language

2.3.2.10. The language regime should allow the Agency to work in an efficient and swift manner. Hence, all acceptable means of compliance and guidance material adopted by the Agency will be available only in English as it is the language commonly, if not exclusively, used for all technical documentation in the aeronautical industry. Therefore its use will maximise the process of standardisation while enhancing cost-effectiveness. The rights of third parties will be preserved to the extend that they can use the Community language of their choice in correspondence with the Agency and the Agency will be required to reply in the same language. By contrast, all preparatory material for future Community acts, to be adopted by the Commission, the Council or the European Parliament and the Council, will have to be available in all Community languages.

(e) Location

2.3.2.11. The Agency will need to be located in a convenient location, also for the working relation with the Community institutions with which it will develop close links. The location should also be easily accessible for all stakeholders. Taking into account such requirements and after evaluation of applications received, the Commission will propose to the competent authorities one or several locations. On the basis of such proposal, the competent authorities will have to set a location at the latest six months after the adoption of this Regulation. Besides, the Agency, as other Community agencies, can decide to establish regional offices in any Member State, with the assent of such Member State.

2.4. Participation by European States that are not members of the European Union

2.4.1. It is in the interest of Member States, European citizens and the industry to enjoy a high level of safety on as wide a geographical scale as possible. The long-standing cooperation between European countries in this field, in particular in the JAA, has always allowed European States that are not member of the EU to take part in the work and the decision-making process on an equal footing. It is therefore the intention to give the Community EASA a pan-European dimension and allow these countries to continue to participate as fully as possible.

2.4.2. Since this proposal gives decision-making powers to the Agency, other European countries cannot participate unless they fully adopt and apply the Community acquis in the fields covered by the scope of the Regulation. This is the case with the different agreements which the Community has concluded with Norway and Iceland (EEA) or is about to conclude with the central European countries (European Common Aviation Area, ECAA) and Switzerland. It is therefore possible for these countries to be associated in a Community EASA, subject to appropriate conditions to be set in the framework of these agreements, including financial contributions.

2.4.3. As regards the application in these States of the legislation adopted in the field covered by this Regulation, since it will form part of the "acquis communautaire" the various mechanisms provided in the agreements will be used. In these agreements, proper implementation and judicial review are generally the responsibility of national courts. These courts sometimes have the possibility (EEA et ECAA agreements) of requesting an interpretation from the Court of Justice of the European Communities, which would be a way of preserving uniform interpretation and application of the rules.

2.5. International cooperation

2.5.1 This new Community system will not work in isolation from other pan-European organisations such as ECAC (European Civil Aviation Conference) or Eurocontrol, or from other international organisations involved in the field covered by this Regulation, such as ICAO (International Civil Aviation Organisation). Its work and activities will be interdependent of those carried out in such organisations and should liase closely with them. The Agency will be entitled to undertake the necessary steps for early and close involvement of and cooperation with these organisations.

3. The choice of the legal basis

3.1. The legal basis of the proposed Regulation is Article 80 paragraph 2, which is consistent with the objective of the proposal and all the legislation adopted so far in the field of aviation, particularly where safety and environmental protection are concerned.

3.2. The chosen instrument, a Regulation, is justified because an effective Community system in this field calls for a harmonised and common regulatory framework, applied and enforced in an effective and uniform manner, to ensure fair competition and maintain high safety standards. Uniformity and efficiency would not be ensured by a less constraining legislative instrument.

4. Subsidiarity and proportionality: justification and value added

4.1 The objective of this proposal is to establish a high uniform level of safety in the Community by means of the formulation, approval and uniform application of all necessary aviation safety regulations, and to create a Community Aviation Safety Agency.

4.2. The current system has been criticised for not being able to ensure aviation safety oversight efficiently and in a cost-effective manner. The establishment of common rules and of an independent authority for the certification of aeronautical products would overcome those deficiencies. Indeed carrying out all executive tasks at a Community level will provide effective support for Community policies - particularly on air safety, harmonisation of conditions of competition and association with other European States - while easing the administrative and financial burden these tasks impose on the European industry. Thanks to a common system, applicants for certification of aeronautical products will have only one set of procedures to follow to get an approval, which would then be valid throughout the whole Community without restrictions or additional bureaucratic requirements. This is particularly important in view of the fact that Europe's main competitors' certification mechanisms, eg in the USA, are provided free of charge to the aircraft manufacturing industry.

4.3. The proposed legislative act limits itself to the minimum required to achieve the objectives defined above and does not exceed what is necessary to this end.

5. Comments on Articles

Chapter I

Principles

Article 1 - Scope

This Article specifies that the Regulation applies to all fields of civil aviation. State aircraft as defined in the Chicago Convention - i.e. aircraft involved in military, customs and police services - and persons and organisations involved in these activities are excluded, subject to their compatibility with the objectives of the Regulation.

Article 2 - Objectives

This Article defines the purpose of the Regulation. It aims at establishing a high, uniform level of protection of European citizens without imposing unnecessary burdens on the industry and users. The means to achieve it are the formulation, approval and uniform application of all necessary legislation, the automatic recognition, without any further requirement or verification, of approvals granted in accordance with these regulations to products, organisations and personnel, and the establishment of an Agency.

Article 3 - Definitions

This Article contains the definitions of the various terms used in the provisions of the proposed Regulation.

(a), (b), (c), (d), (e) and (f) "Continued oversight" "Chicago Convention", "product", "appliance", "certification" and "type certificate" are self explanatory; the reference date for the Chicago Convention can only be modified by a comitology procedure.

(g) The definition of "commercial transportation" excludes private transportation and more generally general aviation.

(h) The Agency will have the right to outsource its tasks to so-called "qualified entities". These, as defined in this Article, can be the national aviation authorities or even third parties such as manufacturers. The Agency, or more precisely its Administrative Board, will have to define a policy on the delegation of tasks to these entities, to be approved by the Commission.

Chapter II

Substantive requirements

Article 4 - Basic principles

This Article lays down the foundation for any regulatory activity affecting fundamental freedoms of persons. It establishes the principle of certification of products, organisations and personnel. Its content derives from, and is similar to that of, national aviation laws. It also recalls that if the Community may regulate third-country operators and crew when flying in the airspace of its Member States it shall respect their rights specified in applicable international Conventions. Accordingly, for example, certificates granted by third countries to their own citizen in accordance with the Chicago Convention should be accepted as specified in that Convention.

Article 5 - Essential requirements for airworthiness

This Article establishes that essential airworthiness requirements products must meet in order to be certified are those contained in Annex 8 to the Chicago Convention, annexed to the proposal, (paragraph 1). It empowers the Commission to adopt within a "comitology" procedure (paragraph 3) any additional rule (of a procedural or technical nature, as necessary) for the application of these requirements. Products must receive their certificates if they have been found airworthy according to Annex 8.

Article 6 - Essential requirements for environmental protection

Essential environmental requirements are already set in Council Directive 80/51/EEC (paragraph 1). The application of these requirements will have to be defined in implementing rules to be adopted by the Commission in comitology (paragraph 2).

Article 7 - Other basic principles and essential requirements

This Article indicates that basic principles and essential requirements concerning aspects, other than products, falling within the scope of this Regulation will be adopted in accordance with the applicable legislative process.

Article 8 - Recognition of certificates

This Article ensures that products, persons and organisations can freely circulate within the Community, as soon as they are recognised by one Member State as meeting the conditions set by the Regulation and derived implementing rules, by creating an obligation for other Member States to accept them without additional conditions. Besides, when the first recognition has been given for a particular purpose it cannot be subsequently recognised for other purposes, i.e. if a screw or rivet, which has been certified for use on a propeller for a particular type of aeroplane it cannot subsequently be certified for use on a helicopter rotor blade. It also recognises that, pending the adoption by the Community of the necessary legislation, products and derivatives may be certified in accordance with national legislation.

Article 9 - Acceptance of third-country proposals

This Article provides both for the possibility to derogate to the provisions of this Regulation in the framework of a mutual recognition agreement between the Community and a third country and for a simplified procedure: as long as the Community has not concluded such mutual recognition agreements. It is proposed in that later case that Member States be empowered to recognise the approvals granted to foreign products, organisations and personnel by a third country subject to an appropriate Community review procedure to verify that Community and other Member States interests are safeguarded.

Article 10 - Flexibility provisions

The objective of this Article is to introduce necessary flexibilities in the regulatory framework so as to cope with rare circumstances where Member States should be entitled, under their own responsibility, to adopt measures, subject to an appropriate Community review aimed at maintaining the overall consistency of the system. These circumstances are:

-The immediate safety case where an urgent action must be taken to avoid an accident or the recurrence of an accident. In such case Community review is made "ex post facto" and appropriate conclusions shall be drawn.

-The unforeseen urgent operational issue (for example an aircraft for which a special authorisation is required to fly back to its home base) or the operational need of a limited duration (for example the use of a replacement aircraft). In such case the Community review can be done "ex post facto" to verify whether such flexibility is not used to escape the obligations created by the regulator.

-The equivalent safety case where other means than those specified in the common rules can guarantee the same level of safety. In such a case the Community review must take place "ex-ante" in order to verify that the measure does not affect other objectives of the common rules, such as fair competition in the market, and if so allows all other parties to benefit from it.

Article 11 - Dissemination and protection of information

This Article ensures that the information collected in the field covered by this Regulation is confidential. Nevertheless, it ensures that this information will be available to each national civil aviation authority, which will use it for its day to day work and to the entities investigating civil aviation accidents and incidents. Other parties involved in the improvement of aviation safety such as research centres, training organisations or universities may also receive selected information for their own use. Release of this information will be made on a case by case and "need to know" basis. The legitimate interest of the public to be informed of the safety level of aviation will also be taken into account by the publication of specific regular review.

Chapter III

The European Aviation Safety Agency

Section I

Tasks

Article 12 - Establishment and functions of the Agency

This Article establishes the Agency and describes the functions it will carry out. It shall be able to develop its technical expertise and work in all matters covered by this Regulation in order to assist the Commission as necessary. The Agency will also be endowed with decision-making powers in the field of type certification and will be able to conduct investigations and inspections.

Article 13 - Typology of acts

This Article provides an exhaustive list of the types of acts the Agency may take. The Agency may take binding individual decisions by granting type certificates, by conducting inspections and investigations. In relation to general acts the Agency may issue non-binding materials e.g. airworthiness codes, and present opinions to the Commission on essential requirements and implementing rules, or following inspections or investigations, as well as in the areas of research and relations with third countries.

Article 14 - Development of opinions, acceptable means of compliance and guidance material

This Article relates to the role of the Agency in presenting opinions on essential requirements and implementing rules to the Commission to be adopted by itself in comitology or by the European Parliament and the Council in co-decision. The Agency may also issue non-binding material providing acceptable means of compliance (e.g. airworthiness codes) and guidance material.

Article 15 - Certification

This Article relates to the core activity of the Agency, namely the granting of type approval for products and appliances. To this end, the Agency is authorised to conduct itself or through qualified entities inspections, and to issue, modify, suspend or revoke type certificates.

Article 16 - Monitoring the application of rules

This Article requires the Agency to monitor the application of this Regulation in cooperation with the Commission, in particular of its Article 10 on flexibility.

Article 17 - Research

This Article requires the Agency to conduct research activities falling strictly within its field of competence and to coordinate with the Commission and the Member States. For this purpose the Agency must be endowed with the appropriate budget.

Article 18 - Relations with third countries

This Article gives the possibility to the Agency to assist the Commission in relations with third countries. It will be able, within the bounds of the working agreements established between the Commission and the aeronautical authorities of third countries or international organisations competent in the field of civil aviation, to discuss directly with them and send its contribution to the Commission. It will also assist the Commission in the negotiation and implementation of mutual recognition agreements. This Article also entitles the Agency to assist the Community and its Member States in their relations with third countries, this may cover technical cooperation, safety assessment of third-country aircraft, etc. as the Community and its Member States may decide.

Section II

Internal structure

Article 19 - Legal status, location, local offices

This Article specifies that the Agency is an independent body of the Community. The competent authorities will have to decide its location on a proposal from the Commission. The Agency, with the consent of the Member State concerned may have local offices in any Member State as required for its day to day work.

Article 20 - Staff

The Staff Regulations of the Community institutions will also apply to the staff of the Agency.

Article 21 - Privileges and immunities

This provision stipulates that, like the European Communities, the Agency should also benefit from the same privileges and immunities as set out in the Protocol on the Privileges and Immunities of the European Communities.

Article 22 - Liability

The regime of contractual and non-contractual liability of the Agency corresponds to the regime applicable to the Community by virtue of the Treaty, Article 288.

Article 23 - Languages

This Article specifies the language regime for the Agency. All opinions addressed to the Commission for possible future acts, to be adopted by the Commission, the Council or the European Parliament and the Council, will have to be available in all Community languages. All other non-binding acts of the Agency will be available only in English, the language commonly, if not exclusively, used for all technical documentation in the aeronautical industry.. The rights of third parties are preserved to the extent that they can use the Community language of their choice in correspondence with the Agency, and the Agency is required to reply in the same language. However, in some specific cases, third parties might have to provide some documentation in English as well.

Article 24 - Creation and powers of the Administrative Board

This Article lays down the powers of the Administrative Board, which forms part of the management bodies of the Agency. It has a supervisory function in appointing the Executive Director, in adopting the annual report, the work programme - after approval by the Commission - and in taking budgetary decisions. Moreover, it shall ensure that the Agency works with the necessary transparency and neutrality and shall adopt, therefore, procedures for decisions made by the Agency and guidelines, to be approved by the Commission, for the allocation of certification tasks to qualified entities. The Administrative Board shall also establish a body of interested parties (aerospace industry, air operators, workers, and consumer representatives) to be consulted at least before it takes decisions on budget issues, on the work programme, on rules on transparency.

Article 25 - Composition of the Administrative Board

This provision specifies that the Administrative Board will be composed of one representative of each Member State, one representative of the Commission, and one representative of the European Parliament.

Article 26 - Chairmanship of the Administrative Board

This Article specifies that the Administrative Board will elect its Chairman and Deputy Chairman.

Article 27 - Meetings

This Article provides for ordinary, as well as extraordinary meetings of the Administrative Board, which can be attended by the Executive Director, as well as by outside observers.

Article 28 - Voting

A two third majority will be required for decisions of the Administrative Board, with each member having one vote.

Article 29 - Functions and powers of the Executive Director

This provision sets out the functions and powers of the Executive Director. To be made free from any political interference or national consideration safety decisions are taken by the Executive Director of the Agency. The Executive Director is also the manager of the Agency, he is therefore responsible for the preparation and execution of the budget and of the working programme as well as for all questions related to personnel.

Article 30 - Appointment of senior officials

The Executive Director together with one or more Directors are appointed by the Administrative Board, which exercises disciplinary authority on the Executive Director. Appointments are made for a limited, renewable period.

Article 31 - Establishment and powers of the Boards of Appeal

This Article establishes Boards of Appeal in order to review individual decisions taken by the Agency as detailed in Article 35.

Article 32 - Composition of the Boards of Appeal

This Article stipulates in general that the members of the Board of Appeal will be drawn from a list established by the Commission in accordance with Article 33. More detailed provisions on the functioning of the Boards of Appeal will be adopted by the Commission in accordance with Article 53.

Article 33 - Independence of the members of the Board of Appeal

This Article provides for the clear separation of functions between the Boards of Appeal and the Agency, so as to allow for the independence of the members of the Board of Appeal in reviewing decisions of the Agency.

Article 34 - Exclusion and objection

This Article allows for the exclusion of members of the Board of Appeal having an interest in the appeal brought before them.

Article 35 - Decisions subject to appeal

This Article specifies the decisions, which are subject to appeal. These are the granting of type certificates, decisions taken in the context of an investigation and decisions related to fees. Appeals will have a suspensory effect only when decided by the Agency. Appeal shall be made against a final decision; intermediate appeal can be made only when provided by the decision.

Article 36 - Persons entitled to appeal

Any person may appeal against a decision addressed to that person or of direct and individual concern to him.

Article 37 - Time-limit and form

This Article sets out a two-month time-limit for appeals.

Article 38 - Interlocutory revision

This Article allows the responsible body of the Agency to rectify a decision subject to appeal, unless the appellant is opposed to another party and not the Agency. If the Agency has not revised its decision, the case is brought to the Board of Appeal with the possibility for the Agency to suspend its decision.

Article 39 - Examination of appeals

This Article specifies that the Board of Appeal may invite third parties to the appeal proceedings in order to determine that the appeal is well-founded.

Article 40 - Decisions on appeal

This Article provides that the Board of Appeal may conclude its examination either by taking a decision or by remitting the case to the competent body of the Agency. Nevertheless, in this last case, the Agency is bound by the reasoning of the Board.

Article 41 - Actions before the Court of Justice

This Article gives the possibility for review of the decisions of the Board of Appeal by the Court of Justice on the same grounds as those provided in the EU Treaty on review of Community acts (Article 230).

Article 42 - Representative

This Article mandates the designation of a procedural representative for non-Community persons.

Article 43 - Direct appeal

This Article enables Member States to lodge an appeal against decisions taken by the Agency on type certification and on inspections.

Section III

Working Methods

Article 44 - Procedures for the development of opinions, acceptable means of compliance and guidance material

This Article requires that transparent procedures are developed by the Administrative Board to regulate the Agency's rule-making with a view to ensuring the use of the relevant expertise, the proper and wide consultation of all interested parties (aerospace industry, air operators, workers, representatives of consumers, etc.), and the right of each Member State to be associated when the Agency is developing opinions on rules to be applied at their level.

Special procedures must also be developed to allow the Agency to take immediate actions in case of safety problems.

Article 45 - Individual decisions

This Article mandates similar transparent procedures in the case of individual decisions.

Article 46 - Investigating powers

This Article allows the Agency to undertake inspections and investigations for the application of this Regulation. The investigation tasks may also be allocated to qualified entities according to guidelines to be developed by the Administrative Board.

Article 47 - Inspection of Member States

The Agency will assist the Commission in monitoring the application of the Regulation and its implementing rules at national level. It will have at its disposal teams of inspectors for monitoring the national administrations and checking their working methods on its own initiative or at the Commission's request. The Agency will thus verify in the national administrations that Community law has been correctly implemented and applied; it will report back to the Commission, which could then decide whether to initiate infringement proceedings for incorrect application of the common rules and procedures. The Member States can appeal to the Court of Justice against the decision to inspect.

Article 48 - Investigation of undertakings

This Article authorises the Agency to conduct technical investigations required for purposes of Article 15 in order to issue the relevant certificates and ensure continued safety oversight.

Section IV

Financial Requirements

Article 49 - Budget

The Agency's budget could be financed to an extent by a subsidy from the Community. Also, services it provides (such as certification, training and documentation) may be paid for in the form of fees.

The Agency would need a budget allocation large enough to employ adequate and qualified personnel; to enable it to undertake research activities and have the common standards translated and published.

The Executive Directive will establish a preliminary draft budget to be adopted by the Board and then forwarded to the Commission, which will in turn process it in accordance with standard budgetary procedure.

Article 50 - Implementation and control of the budget

This Article specifies that the Executive Director will be responsible for the implementation of the budget. Financial control will be ensured by the Financial Controller of the Commission. The Court of Auditors will examine the Agency accounts and publish an annual report. The discharge of the Agency budget will be given by the Administrative Board to the Executive Director on recommendation of the European Parliament.

Article 51 - Financial provisions

This Article specifies that for the purpose of guiding the Agency in preparing and implementing the budget a Financial regulation will be adopted by the Administrative Board, after obtaining the agreement of the Commission and the opinion of the court of Auditors.

Article 52 - Fees regulation

This Article refers to the establishment of fees to be charged to applicants for the services they receive from the Agency. They shall be adopted by the Commission, which shall therefore adopt a regulation in accordance with Article 53 (Comitology).. When developing such regulation, the Commission shall ensure inter alia that fees are charged uniformly and without discrimination to all the States participating in the system. Although such fees should cover all the costs associated with the service provided, in a transitional period of four years, the Community subsidy could cover part of the expenses.

Chapter IV

Final provisions

Article 53 - Committee

This Article establishes one committee with two kind of procedures, a regulatory and a consultative one. This provision refers to Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission [6], in particular to Articles 3 and 5 of that Decision.

[6] OJ L 184, 17.7.1999.

Article 54 - Participation of European third countries

This Articles opens for the possibility for other European countries to participate in the work of the Agency within the framework of the different agreements which the Community has concluded or is about to conclude with the central European countries (European Common Aviation Area, ECAA), and the agreement with Switzerland and the EEA, whereby they are bound to fully apply the Community acquis in the field covered by this Regulation. The modalities of participation of these countries will be decided through the internal procedure foreseen by the above mentioned agreements.

Article 55 - Commencement of Agency's operation

This Article specifies that while the Regulation enters into force according to Article 56, the Agency will only be operational 12 months later, in order to give it sufficient time for its establishment.

Article 56 - Repeal

This Article specifies that while Regulation (EEC) No 3922/91 is repealed, products, persons and organisation which have already been approved according to that Regulation will still be able to circulate freely.

Article 57 - Entry into force

This Article lays down the date when the Regulation enters into force. However, the entry into force of each Articles 5, 6 and 7, will occur when the necessary rules are taken for their application.

2000/0246 (COD)

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on establishing common rules in the field of civil aviation and creating a European Aviation Safety Agency

(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 80(2) thereof,

Having regard to the proposal from the Commission [7],

[7] OJ C

Having regard to the opinion of the Economic and Social Committee [8],

[8] OJ C

Having regard to the opinion of the Committee of the Regions [9],

[9] OJ C

Acting in accordance with the procedure laid down in Article 251 of the Treaty [10],

[10] OJ C

Whereas:

(1) A high uniform level of protection of the European citizen should at all times be ensured in civil aviation, by the adoption of common safety rules and by measures ensuring that products, persons and organisations operating in the Community comply with such rules and those adopted to protect the environment: this will contribute to facilitating the free movement of goods, persons and organisations in the internal market.

(2) As a consequence, aeronautical products must be subject to certification to verify their airworthiness and appropriate requirements should be developed to cover persons and organisations involved in aviation safety.

(3) The Convention on International Civil Aviation, signed in Chicago on 7 December 1944, already provides for minimum standards to ensure the safety of civil aviation. Third-country aircraft, air crew and air operators complying with such standards should enjoy the rights provided for by that Convention.

(4) Aeronautical products should be certified once they have been found airworthy according to Annex 8 of the Chicago Convention and in compliance with essential environmental requirements laid down by the Community in line with standards set pursuant to that Convention. The Commission should be empowered to develop the necessary implementing rules.

(5) In order to achieve the Community objectives as regards the freedom of movement of goods, persons and services, as well as those of the common transport policy, Member States should accept without further requirements or evaluation, products, organisations or persons certified in accordance with this Regulation and the implementing rules adopted for its application.

(6) Enough flexibility should be provided for addressing urgent circumstances such as urgent safety measures, unforeseen or limited operational needs, and provisions should also be made for reaching an equivalent safety level by other means. Member States shall be entitled to grant exemptions from the requirements of this Regulation and of its implementing rules, provided that they are strictly limited in scope and subject to appropriate Community control.

(7) The fulfilment of the objectives of this Regulation can be achieved through cooperation with third countries and in that event its provisions and those of related implementing rules may be adapted by mutual recognition agreements concluded by the Community with such third countries. In the absence of such agreements, Member States should nevertheless be allowed, subject to appropriate Community control, to recognise the approvals granted to foreign products, organisations and personnel by a third country.

(8) It is widely accepted that there is a need for better arrangements in all fields covered by this Regulation, so that certain tasks currently performed at Community or national level could be carried out by a specialised expert body. There is, therefore, a need within the Community's existing institutional structure and balance of powers, to establish a European Aviation Safety Agency which is independent in relation to technical matters and has legal, administrative and financial autonomy. To this end, it is necessary and appropriate that it should be a body of the Community having legal personality and exercising the implementing powers which are conferred on it by this Regulation.

(9) In order to properly assist the Community, the Agency should be allowed to develop its expertise in all aspects of aviation safety and environmental protection covered by this Regulation. It should assist the Commission in the preparation of the necessary legislation and assist the Member States and the industry in their implementation; it should be able to issue non-binding acceptable means of compliance and guidance material; it should also be able to make technical findings and issue type certificates for all aeronautical products; it should be given the necessary power and authority to fulfil such tasks; and it should assist the Commission in monitoring the application of this Regulation and of the implementing rules taken for its application and should be given the necessary authority to do so.

(10) In order to effectively control the functions of the Agency Member States, the Commission and the European Parliament should be represented within an Administrative Board entrusted with the necessary powers to establish the budget, verify its execution, adopt the appropriate financial rules, establish transparent working procedures for decision making by the Agency and appoint the Executive Director. It is also appropriate that the Agency be allowed to conduct research activities and to organise appropriate coordination with the Commission and the Member States. It is desirable that the Agency should assist the Community and its members States in the field of international relations, including the harmonisation of rules, mutual recognition of approvals and technical cooperation, and that it should be entitled to establish the appropriate relations with the aeronautical authorities of third countries and the international organisations competent in matters covered by this Regulation.

(11) Public interest requires the Agency to base its safety-related action solely on independent expertise, strictly applying this Regulation and the implementing rules adopted by the Commission for its application. To that end, all safety-related Agency decisions should be made by its Executive Director, who should be left with a high degree of flexibility as to how to seek advice and to organise the internal functioning of the Agency. When, however, the Agency has to develop drafts rules of a general nature to be implemented by national authorities, Member States should be involved in the decision-shaping process.

(12) It is necessary to ensure that parties affected by decisions made by the Agency enjoy the necessary legal remedies in a manner which is suited to the special character of aviation. An appropriate appeal mechanism should be set up so that decision of the Executive Director can be subject to appeal to a specialised Board of Appeal, whose decisions are, in turn, open to action before the Court of Justice of the European Communities.

(13) In order to guarantee the full autonomy and independence of the Agency, it is considered necessary to grant it an autonomous budget whose revenue comes essentially from a contribution from the Community and from fees paid by the users of the system. However, the Community budgetary procedure remains applicable as far as any subsidies chargeable to the general budget of the European Communities are concerned. Moreover, the auditing of accounts should be undertaken by the Court of Auditors

(14) In accordance with Article 2 of Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission [11], measures for the implementation of this Regulation should be adopted by use of the advisory procedure provided for in Article 3 of that Decision or by use of the regulatory procedure provided for in Article 5 of that Decision, as the case may be.

[11] OJ L 184, 17.7.1999, p. 23.

(15) In accordance with the principles of subsidiarity and proportionality as set out in Article 5 of the Treaty, the objectives of the proposed action, namely the establishment of common rules in the field of aviation safety and environmental protection complying with the Chicago Convention and their permanent supervision by a European body created for that purpose, cannot be sufficiently achieved by the Member States and can therefore, by reason of the European-wide scope of this Regulation, be better achieved by the Community. This Regulation confines itself to the minimum required in order to achieve those objectives and does not go beyond what is necessary for that purpose.

(16) This Regulation establishes a more appropriate and comprehensive framework for the definition and implementation of common technical requirements and administrative procedures in the field of civil aviation. Council Regulation (EEC) No 3922/91 of 16 December 1991 on the harmonization of technical requirements and administrative procedures in the field of civil aviation [12] should therefore be repealed, without prejudice to the certification of products, persons and organisations already performed in accordance with that Regulation.

[12] OJ L 373, 31.12.1991, p. 4: Regulation as last amended by Regulation (EC) No 1069/1999 (OJ L 130, 26.5.1999, p. 16).

(17) It has been widely recognised that a wide involvement of European countries not Members of the European Union should be pursued, so as to ensure a proper pan-European dimension in order to facilitate the improvement of aviation safety throughout Europe. Only those European countries that have concluded agreements with the Community to fully adopt and apply the Community acquis in the field covered by this Regulation can be associated with its work according to conditions to be agreed in the framework of such agreements,

HAVE ADOPTED THIS REGULATION:

CHAPTER I

PRINCIPLES

Article 1

Scope

1. This Regulation shall be applicable to:

(a) the design, production, maintenance and operation of aeronautical products and appliances;

(b) personnel and organisation involved in the tasks described in point (a);

(c) products, personnel and organisations involved in air navigation facilities.

It shall not apply when such products and appliances, personnel and organisations are engaged in military, customs or police operations.

2. Each Member State shall ensure that military, customs or police operations are compatible with the objectives of this Regulation.

Article 2

Objective

1. The principal objective of this Regulation is to establish a high uniform level of aviation safety in Europe.

2. Additional objectives are, in the fields covered by this Regulation:

(a) to facilitate the free movement of goods, persons and services;

(b) to promote cost-efficiency in the regulatory and certification processes;

(c) to ensure a common interpretation of the provisions and Annexes of the Chicago Convention dealing with subjects covered by this Regulation, in order to facilitate their uniform implementation in the Community; and

(d) to promote Community views of aviation safety standards and rules throughout the world by establishing appropriate cooperation with third countries and international organisations.

3. The means of achieving the objectives set out in paragraphs 1 and 2 shall be:

(a) the preparation, adoption and uniform application of all necessary acts;

(b) the recognition without additional requirements of certificates, licences, approvals or other documents granted to products, personnel and organisations in accordance with this Regulation and implementing rules taken for its application;

(c) the establishment of a European Aviation Safety Agency.

Article 3

Definitions

1. For the purpose of this Regulation:

(a) "continuing oversight" shall mean the tasks to be conducted to verify that the conditions under which a certificate has been granted continue to be fulfilled at any time during its period of validity, as well as the taking of any safeguard measure;

(b) "Chicago Convention" shall mean the Convention on International Civil Aviation and its annexes, signed in Chicago on 7 December 1944, as subsequently amended, as in force and as applicable to all Member States at the entry into force of this Regulation;

(c) "product" shall mean an aircraft, engine or propeller;

(d) "appliance" shall mean any instrument, equipment, mechanism, apparatus or accessory used or intended to be used in operating an aircraft in flight, whether installed in, intended to be installed in, or attached to, an aircraft, but without forming part of an airframe, engine or propeller;

(e) "certification" shall mean any form of recognition that a product, organisation or person complies with the applicable requirements including the provisions of this Regulation and the implementing rules taken for its application, as well as the issuance of the relevant certificate, licence, approval or other document attesting such compliance;

(f) "type certificate" shall mean a document which certifies that the type of products or appliance complies with the provisions of this Regulation and any implementing rules taken for its application;

(g) "commercial transportation" shall mean carriage performed by aircraft of passengers, mail and/or cargo for remuneration and/or hire;

(h) "qualified entity" shall mean a body - whether national aviation authority or any other legal person - which may conduct certification tasks under the control and the responsibility of the Agency.

2. In accordance with the procedure referred to in Article 53(3), Articles 3(1)b and 5(1) of this Regulation may be adapted and its Annex may be amended, in order to apply, for the purpose of this Regulation, subsequent amendments to the Chicago Convention, which enter into force after the adoption of this Regulation and which become applicable in all Member States.

CHAPTER II

SUBSTANTIVE REQUIREMENTS

Article 4

Basic principles

1. Products and appliances shall not be used in the territory of the Member States unless they are certified as complying with the provisions of this Regulation relating to airworthiness and those relating to environmental protection.

2. Paragraph 1 shall apply to third-country aircraft, organisations and personnel without prejudice to their rights as specified in applicable international Conventions and to the Chicago Convention.

Article 5

Essential requirements for airworthiness

1. Products and appliances shall be considered as airworthy if they meet the standards prescribed in parts 1, 3 and 4 of Annex 8 to the Chicago Convention shown in the Annex to this Regulation, and if they are maintained in such a way that flight safety continues to be ensured.

2. When products and appliances have been shown to be airworthy and maintained in accordance with paragraph 1, the appropriate certificate shall be granted. Such a certificate shall include the conditions under which products and appliances are allowed to operate and their conditions of maintenance.

3. The Commission shall adopt, in accordance with the procedure laid down in Article 53(3), the implementing rules for the application of paragraphs 1 and 2 specifying the conditions under which products and appliances are certified and maintained.

Article 6

Essential requirements for environmental protection

1. Products and appliances shall be subject to noise certification in accordance with the provisions of Council Directive 80/51/EEC [13].

[13] OJ L 18, 24.1.1980, p. 26; Directive as amended by Directive 83/206/EEC (OJ L 117, 4.5.1983, p. 15).

2. The Commission shall prescribe the necessary implementing rules for the certification referred to in paragraph 1 in accordance with the procedure laid down in Article 53(3).

Article 7

Other basic principles and essential requirements

With regard to the basic principles and essential requirements for the fields covered by points (b) and (c) of Article 1(1), the Commission shall, where appropriate and as soon as possible, submit proposals thereon to the European Parliament and the Council for adoption on the basis of Article 80(2) of the Treaty.

Article 8

Recognition of certificates

1. Member States shall, without further technical requirements or evaluation, recognise the certificates issued in accordance with this Regulation. When the original recognition is for a particular purpose, or purposes, any subsequent recognition shall only cover the same purpose(s).

2. Pending the adoption of the necessary implementing rules and without prejudice to Article 56, certificates which cannot be issued in accordance with this Regulation may be issued on the basis of the current national regulations.

Article 9

Acceptance of third-country approvals

1. By way of derogation from the provisions of this Regulation and the rules adopted for its implementation, Member States or the Agency may issue certificates on the basis of certificates issued by aeronautical authorities of a third country, as provided for in mutual recognition agreements between the Community and that country.

2. In the absence of any mutual recognition agreement, where a Member State intends to issue certificates on the basis of certification issued by the competent authorities of a third country, it shall notify the Commission and the Member States of the scope and the detailed conditions under which the certificates should be issued.

The Commission may, in accordance with the procedure laid down in Article 53(2), require a Member State to modify the certificates it proposes to issue, or may require it not to issue such certificates if, within three months of the notification, the Commission considers that:

(a) the conditions under which such certificates would be issued do not provide a level of safety equivalent to that specified by this Regulation and the rules taken for its application; and/or

(b) such certificates would give an unfair advantage to a third country, or are contrary to Community policy vis-à-vis such third country.

Certificates issued on the basis of the first subparagraph shall expire upon the entry into force of an agreement between the Community and the third country in question, but not later than two years after the issuance of such certificates. Upon request by the Member State concerned, in respect of the issuance of any certificates, the Commission may, in accordance with the procedure laid down in Article 53(2), authorise the extension of such two-year period as appropriate, provided that the circumstances envisaged in the second subparagraph do not obtain.

Article 10

Flexibility provisions

1. The provisions of this Regulation and of rules adopted for its implementation shall not prevent a Member State from reacting immediately to a safety problem which involves a product, a person or an organisation subject to the provisions of this Regulation. In such a case the Member State shall notify to the Commission and to the other Member States the measures taken and the reasons therefor.

2. The Commission shall decide, in accordance with the procedure referred to in Article 53(3), whether an inadequate level of safety or a shortcoming in this Regulation or the rules adopted for its application justify the continuing application of the measures adopted pursuant to paragraph 1. In that event, it shall also take the necessary steps to amend the related rule. If the Member State's measures are found not to be justified, the Member State shall revoke the measures in question.

3. Member States may grant exemptions from the substantive requirements laid down in this Regulation and the rules adopted for its implementation in the event of unforeseen urgent operational circumstances or operational needs of a limited duration. In these cases the Commission and the other Member States shall be notified as soon as possible.

4. The Commission, acting in accordance with the procedure referred to in Article 53(3), may decide that exemptions granted under paragraph 3 do not comply with the objectives of this Regulation, or some other rule of Community law. In such a case the Member State shall revoke the exemption.

5. In circumstances where a safety level equivalent to that attained by the application of the implementing rules for Articles 4 to 7, can be achieved by other means, Member States may, without discrimination on grounds of nationality of the applicants and having regard to the need not to distort competition, grant approval derogating from those Articles. In such cases, the Member State concerned shall notify the Commission before granting such approval and shall give reasons demonstrating the need to derogate, as well as the conditions foreseen to ensure that an equivalent level of safety is achieved.

6. The Commission, acting in accordance with the procedure referred to in Article 53(3), shall decide whether a proposed approval affords an equivalent level of safety and can be granted. In such a case, it will notify its decision to all Member States, which shall also be entitled to apply that measure. The relevant implementing rules may also be amended to reflect such a measure. The provisions of Article 8 shall apply to the measure in question.

Article 11

Dissemination and protection of information

1. The information collected during the application of this Regulation by the Commission, the Agency, and national aviation authorities shall be confidential and subject to Directive 95/46/EC of the European Parliament and of the Council [14].

[14] OJ L 281, 23.11.1995, p. 31.

2. The Commission, the Agency, national aviation authorities and any entity entrusted under Council Directive 94/56/EC [15] with the investigation of civil aviation accidents and incidents within the Community shall have access to information referred to in paragraph 1.

[15] OJ L 319, 12.12.1994, p. 14.

3. The Commission may, in accordance with the procedures referred to in Article 53(3), decide on the release of selected information to interested parties. Such decisions, which may be generic or individual, shall be based on the need:

(a) to provide persons and organisations with the information they need to improve aviation safety; and

(b) to limit the dissemination of information to what is strictly required for the purpose of its users.

4. In order to inform the public of the general safety level, a safety review shall be published annually by the Agency.

CHAPTER III

THE EUROPEAN AVIATION SAFETY AGENCY

Section I

Tasks

Article 12

Establishment and functions of the Agency

1. For the purpose of the implementation of this Regulation, a European Aviation Safety Agency, hereinafter referred to as "the Agency", is established.

2. In order to ensure the proper functioning and development of aviation safety the Agency shall:

(a) undertake any task and formulate opinions on all matters covered by this Regulation;

(b) assist the Commission by preparing measures to be taken for the implementation of this Regulation and provide it with the necessary technical, scientific and administrative support to exercise its tasks;

(c) adopt the necessary acts within the powers conferred to it by this Regulation or any applicable Community legislation;

(d) conduct inspections and investigations as necessary to fulfil its tasks.

Article 13

Typology of acts

The Agency may adopt the following:

(a) opinions addressed to the Commission;

(b) non-binding acceptable means of compliance and any guidance material for the application of this Regulation and of the rules for its implementation;

(c) decisions for the application of Articles 15, 46 and 47.

Article 14

Development of opinions, acceptable means of compliance and guidance material

1. In order to assist the Commission in the preparation of proposals for basic principles and essential requirements to be presented to the European Parliament and to the Council and the adoption of the necessary implementing rules, including those applicable to products and appliances foreseen in Articles 5(3) and 6(2), the Agency shall prepare drafts thereof. These drafts shall be submitted by the Agency as opinions to the Commission.

2. The Agency shall, in strict compliance with this Regulation and the implementing rules adopted by the Commission for its implementation, in accordance with Article 44, develop non binding acceptable means of compliance and guidance material to be used in the certification process.

Article 15

Certification

With regard to products and appliances, the Agency shall:

(a) conduct, itself or through qualified entities, technical inspections required to check that their type is airworthy, in accordance with the rules adopted in respect of the design of products and appliances according to the conditions set in the implementing rules adopted pursuant to Article 5(3).

(b) issue the appropriate type certificates, including the certification of design organisations according to the conditions set out in the implementing rules adopted pursuant to Article 5(3), and ensure continuing oversight.

(c) modify, suspend or revoke the relevant type certificate if a legal or natural person fails to fulfil the obligations imposed on it by this Regulation or rules adopted for its implementation.

(d) react immediately to any safety problem for products and appliances it has certified; in such cases, the procedures referred to in Article 10, paragraphs 1 and 2, shall apply.

Article 16

Monitoring the application of rules

1. The Agency shall conduct inspections to verify the application by the Member States of this Regulation and of any implementing rules adopted by the Commission, and shall report to the Commission.

2. The Agency shall conduct technical investigations into the application of Article 10 and any rules adopted for the implementation of this Regulation, subject to requirements to be adopted in accordance with the procedure referred to in Article 53(2).

Article 17

Research

1. The Agency may develop and finance research activities strictly relating to the improvement activities in its field of competence, without prejudice to the applicable Community law.

2. The Agency shall coordinate its research and development activities with those of the Commission and the Member States so as to ensure that policies and actions are mutually consistent.

Article 18

Relations with third countries

1. The Agency may assist the Community and its Member States in their relations with third countries in accordance with the relevant Community legislation. It shall, in particular, upon request, assist the Commission in its negotiations for the harmonisation of the relvant rules and for the mutual recognition of approvals attesting the satisfactory application of rules.

2. The Agency may cooperate with the aeronautical authorities of third countries and the international organisations competent in matters covered by this Regulation in the framework of working arrangements concluded by the Commission with those bodies.

Section II

Internal structure

Article 19

Legal status, location, local offices

1. The Agency shall be a body of the Community. It shall have legal personality.

2. In each of the Member States, the Agency shall enjoy the most extensive legal capacity accorded to legal persons under their laws. It may in particular, acquire or dispose of movable and immovable property and may be a party to legal proceedings.

3. The location of the Agency shall be decided by the competent authorities, at the latest six months after the adoption of this Regulation, on a proposal from the Commission. With the consent of the Administrative Board referred to in Article 24, the Agency may establish its own local offices in the Member States, subject to their consent.

4. The Agency shall be represented by its Executive Director.

Article 20

Staff

1. The Staff Regulations of Officials of the European Communities, the Conditions of Employment of Other Servants of the European Communities and the rules adopted jointly by the institutions of the European Communities for purposes of the application of those Staff Regulations and conditions of Employment shall apply to the staff of the Agency, without prejudice to the application of Article 33 of this Regulation to the members of the Board of Appeal.

2. Without prejudice to Article 30, the powers conferred on the appointing authority by the Staff Regulations, and by the Conditions of Employment of Other Servants, shall be exercised by the Agency in respect of its own staff.

3. The Agency's staff shall consist of a strictly limited number of officials assigned or seconded by the Commission or Member States to carry out management duties. The remaining staff shall consist of other employees recruited by the Agency for a period strictly limited to its requirements.

Article 21

Privileges and immunities

The Protocol on the Privileges and Immunities of the European Communities shall apply to the Agency.

Article 22

Liability

1. The contractual liability of the Agency shall be governed by the law applicable to the contract in question.

2. The Court of Justice of the European Communities shall have jurisdiction to give judgment pursuant to any arbitration clause contained in a contract concluded by the Agency.

3. In the case of non-contractual liability, the Agency shall, in accordance with the general principles common to the laws of the Member States, make good any damage caused by its departments or by its servants in the performance of their duties.

4. The Court of Justice shall have jurisdiction in disputes relating to compensation for the damage referred to in paragraph 3.

5. The personal liability of its servants towards the Agency shall be governed by the provisions laid down in the Staff Regulations or Conditions of Employment applicable to them.

Article 23

Languages

1. English shall be the working language of the Agency. Opinions addressed to the Commission for the application of Article 14(1) shall be presented in all official languages of the Community. Acceptable means of compliance and guidance material for the application of Article 14(2) shall be available in English. Applications to the Agency for certification, the documents required to process such applications and all other papers submitted may be filed in one of the official languages of the Community and, when so required by the relevant rule, in English. Individual decisions and procedures linked to such application shall be available in the language used by the addressee.

2. The translation services required for the functioning of the Agency shall be provided by the Translation Centre of the Bodies of the Union.

Article 24

Creation and powers of the Administrative Board

1. An Administrative Board is hereby set up.

2. The Administrative Board shall:

(a) appoint the Executive Director in accordance with Article 30;

(b) before 31 March each year, adopt the general report of the Agency for the previous year and forward it to the European Parliament, the Council, the Commission and the Member States;

(c) before 30 September each year, and after approval from the Commission, adopt the Agency's programme of work for the coming year and forward it to the European Parliament, the Council, the Commission and the Member States;

(d) adopt guidelines for the allocation of certification tasks to qualified entities after approval from the Commission;

(e) establish procedures for making decisions by the Executive Director as referred to in Articles 44 and 45;

(f) carry out its functions relating to the Agency's budget pursuant to Articles 49, 50 and 51;

(g) appoint the members of the Board of Appeal pursuant to Article 33;

(h) exercise disciplinary authority over the officials referred to in Article 30(1) and (3).

3. The Administrative Board shall establish an advisory body of interested parties, which it shall consult prior to making decisions in the fields referred in points (c), (e) and (f) of paragraph 2.

Article 25

Composition of the Administrative Board

The Administrative Board shall be composed of one representative of each Member State, one representative of the Commission and one representative appointed by the European Parliament, and their alternates. The duration of the terms of office shall be five years. This term of office shall be renewable.

Article 26

Chairmanship of the Administrative Board

1. The Administrative Board shall elect a chairman and a Deputy Chairman from among its members. The Deputy Chairman shall ex-officio replace the Chairman in the event of his being prevented from attending to his duties.

2. The terms of office of the Chairman and Deputy Chairman shall expire when their respective membership of the Administrative Board ceases. Subject to this provision, the duration of the terms of office of the Chairman or Deputy Chairman shall be three years. These terms of office shall be renewable.

Article 27

Meetings

1. Meetings of the Administrative Board shall be convened by its Chairman.

2. The Executive Director of the Agency shall take part in the deliberations.

3. The Administrative Board shall hold an ordinary meeting once a year; in addition it shall meet at the instance of the Chairman or at the request of the Commission or of one-third of the Member States.

4. The Administrative Board may invite observers to attend its meetings.

5. The secretariat for the Administrative Board shall be provided by the Agency.

Article 28

Voting

1. The Administrative Board shall take its decisions by a two-thirds majority.

2. Each member shall have one vote. The Executive Director of the Agency shall not vote.

Article 29

Functions and powers of the Executive Director

1. The Agency shall be managed by its Executive Director, who shall be completely independent in the performance of his/her duties. Without prejudice to the respective competencies of the Commission and the Administrative Board, the Executive Director shall neither seek nor take instructions from any government or from any other body.

2. The Executive Director shall have the following functions and powers:

(a) He/she shall adopt the acts of the Agency as defined in Article 13 within the limits specified by this Regulation, the rules adopted for its implementation and any applicable law.

(b) He/she shall decide on inspections and investigations as provided for in Articles 47 and 48.

(c) He/she shall allocate certification tasks to qualified entities according to guidelines set by the Administrative Board.

(d) He/she shall undertake any international functions and technical cooperation with third countries pursuant to Article 18.

(e) He/she shall take all necessary steps, including the adoption of internal administrative instructions and the publication of notices, to ensure the functioning of the Agency in accordance with the provisions of this Regulation.

(f) He/she shall prepare each year a draft general report and submit it to the Administrative Board.

(g) He/she shall exercise in respect of the staff the powers laid down in Article 20(2).

(h) He/she shall draw up estimates of the revenues and expenditure of the Agency pursuant to Article 49, and shall implement the budget pursuant to Article 50.

(i) He/she may delegate his/her powers to other members of the Agency's staff subject to rules to be adopted in accordance with the procedure referred to in Article 53(2).

Article 30

Appointment of senior officials

1. The Executive Director of the Agency shall be appointed or dismissed by the Administrative Board on a proposal from the Commission.

2. The term of office of the Executive Director shall be five years. This term of office shall be renewable.

3. The Executive Director may be assisted by one or more Directors. If the Executive Director is absent or indisposed, one of the Directors shall take his/her place.

4. The Directors of the Agency shall be appointed or dismissed as provided for in paragraphs 1 and 2, after consultating the Executive Director.

Article 31

Establishment and powers of the Boards of Appeal

1. One or more Boards of Appeal shall be established within the Agency.

2. The Board or Boards of Appeal shall be responsible for deciding on appeals against the decisions referred to in Article 35.

3. The Board or Boards of Appeal shall be convened as necessary. The number of Boards of Appeal and the work allocation shall be determined by the Commission according to the procedure referred to in Article 53(2).

Article 32

Composition of the Boards of Appeal

1. A Board of Appeal shall consist of a Chairman and two other members.

2. The Chairman shall select for each case the other members and their respective alternates from the list of qualified members established pursuant to Article 33(1).

Where the Board of Appeal considers that the nature of the appeal so requires, it may call up to two further members from the aforesaid list for that case.

3. The qualifications required for the members of each Board of Appeal, the powers of individual members in the preparatory phase of the decisions and the voting conditions shall be determined by the Commission according to the procedure referred to in Article 53(2).

Article 33

Independence of the members of the Boards of Appeal

1. The members of the Boards of Appeal, as well as their Chairmen and their respective alternates shall be appointed by the Administrative Board from a list of candidates which shall be proposed by the Commission. The term of office shall be five years. It shall be renewable.

2. The members of the Boards of Appeal shall be independent. In making their decisions they shall not be bound by any instructions.

3. The members of the Boards of Appeal may not perform any other duties in the Agency. The function of the members of the Boards of Appeal may be a part-time function.

4. The members of the Boards may not be removed either from office or from the list during their respective terms, unless there are serious grounds for such removal and the Court of Justice, on application by the Commission after obtaining the opinion of the Administrative Board, takes a decision to this effect.

Article 34

Exclusion and objection

1. Members of the Boards of Appeal may not take part in any appeal proceedings if they have any personal interest therein, or if they have previously been involved as representatives of one of the parties to the proceedings, or if they participated in the decision under appeal.

2. If, for one of the reasons mentioned in paragraph 1 or for any other reason, a member of a Board of Appeal considers that he/she should not take part in any appeal proceedings, he shall inform the Board of Appeal accordingly.

3. Members of the Boards of Appeal may be objected to by any party to the appeal proceedings on any of the grounds mentioned in paragraph 1, or if suspected of partiality. An objection shall not be admissible if, while being aware of a reason for objecting, the party to the appeal proceedings has taken a procedural step. No objection may be based on the nationality of members.

4. The Boards of Appeal shall decide as to the action to be taken in the cases specified in paragraphs 2 and 3 without the participation of the member concerned. For the purposes of taking this decision, the member concerned shall be replaced on the Board of Appeal by his alternate.

Article 35

Decisions subject to appeal

1. An appeal may be brought against decisions of the Agency which have been taken pursuant to Article 15 or Article 48, as well as against decisions relating to the fees pursuant to Article 52.

2. An appeal lodged pursuant to paragraph 1 shall not have suspensory effect. The Agency may, however, if it considers that circumstances so permit, suspend the application of the contested decision.

3. An appeal against a decision which does not terminate proceedings as regards one of the parties may only be made in conjunction with an appeal against the final decision, unless the decision provides for separate appeal.

Article 36

Persons entitled to appeal

Any natural or legal person may appeal, subject to Article 42, against a decision addressed to that person, or against a decision which, although in the form of a decision addressed to another person, is of direct and individual concern to the former. The parties to proceedings may be party to the appeal proceedings.

Article 37

Time-limit and form

The appeal, together with the statement of grounds thereof, shall be filed in writing at the Agency within two months of the notification of the measure to the person concerned, or, in the absence thereof, of the day on which it came to the knowledge of the latter, as the case may be.

Article 38

Interlocutory revision

1. If the body of the Agency which has prepared the decision considers the appeal to be admissible and well-founded, the Agency shall rectify the decision. This shall not apply where the appellant is opposed to another party to the appeal proceedings.

2. If the decision is not rectified within one month after receipt of the statement of grounds for the appeal, the Agency shall forthwith decide whether or not to suspend the application of the decision pursuant to the second sentence of Article 35(2), and shall remit the appeal to the Board of Appeal.

Article 39

Examination of appeals

1. If the appeal is admissible, the Board of Appeal shall examine whether the appeal is well-founded.

2. When examining the appeal, the Board of Appeal shall as often as necessary invite the parties to the appeal proceedings to file observations on notifications issued by itself or on communications from the other parties to the appeal proceedings, within specified time-limits. Parties to the appeal proceedings shall be entitled to make oral presentations.

Article 40

Decisions on appeal

The Board of Appeal may exercise any power which lies within the competence of the Agency, or it may remit the case to the competent body of the Agency. The latter shall be bound by the decision of the Board of Appeal.

Article 41

Actions before the Court of Justice

1. Actions may be brought before the Court of Justice against decisions of the Boards of Appeal on appeals.

2. The action may be brought on grounds of lack of competence, infringement of an essential procedural requirement, infringement of the Treaty, of this Regulation or of any rule of law relating to its application, or misuse of power.

3. The Court of Justice has jurisdiction to annul or to alter the contested decision.

4. The action shall be open to any party to proceedings before the Board of Appeal adversely affected by its decision.

5. The action shall be brought before the Court of Justice within two months of the date of notification of the decision of the Board of Appeal.

6. The Agency shall be required to take the necessary measures to comply with the judgment of the Court of Justice.

Article 42

Representative

Persons who are not domiciled or do not have a seat or an establishment within the territory of the Member States may participate as party to proceedings before the Agency only if they have designated a procedural representative who is domiciled or has his seat or an establishment within the territory of the Community.

Article 43

Direct appeal

1. Member States may lodge a direct appeal before the Court of Justice against decisions of the Agency pursuant to Arti