16.10. 87 Official Journal of the European Communities No C 278/'5 
II 
(Preparatory Acts) 
COMMISSION 
Second amendment to the proposal for a Council Regulation amending the Financial Regulation 
of 21 December 1977 applicable to the general budget of the European Communities (') 
COM(87) 400 final 
(Submitted by the Commission to the Council on 29 July 1987) 
(87/C 278/07) 
1. The following three recitals are added after the fourth 
recital 
'Whereas the Financial Regulation needs to be 
amended in the light of the measures to be taken to 
make a success of the Single Act as regards tighter 
budgetary discipline and greater transparency of 
budget appropriations, in particular by reinforcing 
the principle of annuality; 
Whereas the Financial Regulation states that the 
budget shall by drawn up in ECU, that the amounts 
shall be kept in ECU and that the revenue and 
expenditure account and the balance sheet shall be 
presented in ECU; whereas the principle of 
expressing and implementing the Community's 
financial rights and obligations in ECU should 
therefore be established; 
Whereas the Financial Regulation must reflect the 
changeover from the system of advances for the 
EAGGF Guarantee Section to a system of 
reimbursements to take account of the amendments 
made to Regulation (EEC) No 729/70 of 21 April 
1970 O, 
(s) OJ No L 94, 28. 4. 1970, p. 26'. 
2. Article 1 (4) of the amended proposal: the following 
paragraph 4a is added 
'4a. The legal commitments entered into for 
measures extending over more than one financial 
year shall contain a time limit for implementation 
which must be specified to the recipient in due form 
when the aid is granted.' 
O OJNoC 186, 16. 7. 1987, p. 7. 3. Article 7 of the amended proposal: 
paragraphs 2, 3, 4, 6, 7 and 8 are amended as 
follows: 
'2. In the case of budget headings where a 
distinction is made between commitment appro­
priations and payment appropriations, commitment 
appropriations and payment appropriations which 
have not been used at the end of the financial year 
for which they were entered may, by decision of the 
Commission taken not later than 15 February, be 
carried over to the next financial year only. 
The Commission shall inform the budgetary 
authority of the decision taken and state the reasons 
for carrying over the appropriations. 
3. In the case of appropriations which were 
entered in the budget chapters containing "pro­
visional appropriations" and which remain available 
at the close of the financial year: 
(a) appropriations in respect of staff and 
administrative expenditure (Titles 1 and 2) may 
not be carried over; 
(b) appropriations in respect of other expenditure 
may be carried over to the next financial year 
only. 
4. In the case of appropriations on which a 
decision to carry over may be taken under paragraph 
1 (b), the Commission shall submit to the budgetary 
authority, not later than 15 February, the duly 
substantiated requests to carry over appropriations 
made by Parliament, the Council, the Court of 
Justice, the Court of Auditors and by the 
Commission itself. 
The Council shall consult Parliament and, acting by 
qualified majority, shall decide on the requests to 
carry over appropriations in respect of expenditure 
necessarily resulting from the Treaties or acts 
adopted in accordance therewith. 
No C 278/6 Official Journal of the European Communities 16.10.87 
Parliament shall consult the Council and act on the 
requests to carry over appropriations in respect of 
expenditure other than that necessarily resulting 
from the Treaties or acts adopted in accordance 
therewith. 
If no decision is taken by the budgetary authority 
within six weeks, the requests to carry over appro­
priations shall be deemed to have been approved. 
6. The following appropriations shall lapse at the 
end of the year: 
(a) appropriations from the previous financial year: 
— appropriations carried over by decision of the 
budgetary authority under paragraph 1 (b) 
which have been neither committed nor paid, 
— appropriations carried ouver automatically 
which have not been paid, 
— commitment appropriations and payment 
appropriations carried over by the 
Commission under paragraph 2 and 
remaining unused at the end of the financial 
year; 
(b) appropriations of the financial year which have 
not been carried over. 
7. When commitments in budget headings where 
there is a distinction between commitment appro­
priations and payment appropriations are cancelled 
in any financial year after that in which the 
commitment appropriations were entered in the 
budget, the appropriations concerned may be made 
available again and recommitted. 
At the beginning of each financial year, the 
Commission shall therefore examine the can­
cellations which have taken place in the previous 
financial year and assess, in the light of 
requirements, the need for making the appro­
priations available again. 
The Commission shall take this decision by 15 
February of each financial year: it shall inform the 
budgetary authority of the decision taken and state 
the reasons for maintaining these appropriations. 
8. The revenue and expenditure account shall 
show the automatic carryovers, the appropriations 
carried over by decision of the budgetary authority, 
those carried over by decision of the Commission 
and the appropriations made available again by the 
decision of the Commission after commitments have 
been cancelled.' 
4. Article 8 of the amended proposal: 
paragraph 4 is deleted. 
5. Article 9 of the amended proposal: 
the final subparagraph of paragraph 2 (a) is deleted. 6. Article 11 of the amended proposal: 
this Article is replaced by the following: 
'1. The budget shall be drawn up in ECU. 
2. The ECU is the sum of specified amounts of 
the currencies of the Member States as set out in 
Council Regulation (EEC) No 3180/78 of 18 
December 1978 changing the value of the unit of 
account used by the European Monetary 
Cooperation Fund (x) (2). 
Any change in the composition of the ECU decided 
on in accordance with Regulation (EEC) No 
3180/78, shall automatically apply to this provision. 
The value of the ECU in a given currency shall be 
equal to the sum of the equivalents in that currency 
of the amounts of the currencies which make up the 
ECU. 
3. The financial rights and obligations of the 
Communities shall be expressed and implemented in 
ECU. 
4. When the principle set out in the third 
paragraph cannot be complied with because of 
special derogations arising from the application of 
sectoral rules governing debts or expenditure, any 
conversion between the ECU and a national 
currency shall be effected in accordance with the 
special provisions referred to in Article 123.' 
7. Article 19 of the amended proposal: 
(a) Paragraph 4 is replaced by the following: 
'4. Each section of the budget containing 
appropriations for administrative expenditure 
must include a chapter for provisional appro­
priations and a "contingency reserve" chapter. 
The appropriations entered in these chapters 
may be used only by means of transfer in 
accordance with the procedure laid down in 
Article 25.'; 
O OJ No L 379, 30. 12. 1978, p. 1, as last amended by Council 
Regulation (EEC) No 2626/84 of 15 September 1984 (OJ 
No L 247, 16. 9. 1984). 
(2) The following amounts applied when this Regulation 
entered into force: 
— German marks 0,719, 
— Pounds sterling 0,0878, 
— French francs 1,31, 
— Italian lira 140,00, 
— Dutch guilders 0,256, 
— Belgian francs 3,71, 
— Luxembourg francs 0,14, 
— Danish kroner 0,219, 
— Irish pounds 0,00871, 
— Greek drachmas 1,15. 
16.10.87 Official Journal of the European Communities No C 278/7 
(b) The following paragraph 4a is added: 
'4a. Each part of the budget containing 
operating appropriations must include a chapter 
for provisional appropriations and, in a separate 
section, an overall reserve for meeting any 
requirements which may arise as a result of the 
strict approach adopted when determining the 
initial allocation. 
The appropriations entered in the overall reserve 
may be used only by means of transfer in 
accordance with the procedure laid down in 
Article 25.' 
8. Article 25 of the amended proposal: 
Paragraph 8 is replaced by the following: 
'8. The appropriations which may be transferred 
shall be as follows: 
(a) non-differentiated appropriations for the current 
financial year; 
(b) non-differentiated appropriations carried over 
under Article 7 (1) (b); 
(c) commitment appropriations for the current 
financial year; 
(d) commitment appropriations carried over from 
the preceding financial year under Article 7 (2); 
(e) payment appropriations (differentiated) for the 
current financial year; 
(f) payment appropriations (differentiated) carried 
over under Article 7 (2). 
The transfers of carryovers under (b) must be 
proposed at the same time as the request for a 
carryover is submitted to the budgetary authority. 
The transfers of carryovers under (d) and (f) must be 
proposed at the same time as the budgetary authority 
is informed of the Commission's decision to carry 
over these appropriations. 
These proposals for transfers must be duly sub­
stantiated.' 
9. Article 78 of the amended proposal: 
(a) The last indent of paragraph 2 is replaced by the 
following: 
'— appropriations carried over under Article 7.'; (b) The fourth indent of paragraph 3 is replaced by 
the following: 
'— commitment appropriations carried over 
under Articles 7 and 92 (4),'; 
(c) The first indent of paragraph 4 is replaced by the 
following: 
'— the amount of appropriations carried over, a 
distinction being made between commitment 
appropriations, payment appropriations and 
non-differentiated appropriations,'. 
10. Article 97 of the amended proposal: 
The second paragraph of this Article is replaced by 
the following: 
'In accordance with Article 4 (2) of this Regulation, 
the Member States shall place the necessary appro­
priations for these operations at the disposal of the 
designated authorities and bodies.' 
11. Article 98 of the amended proposal: 
This Article is replaced by the following: 
'1. Expenditure effected by authorities and bodies 
under Article 4 of Regulation (EEC) No 729/70 and 
reimbursed to the Member States by the Commission 
under Article 5a (1) of the same Regulation shall be 
booked to the accounts of a given financial year on 
the basis of the reimbursements made by the 
Commission during that financial year. 
2. The reimbursement of expenditure incurred by 
the Member States and the detailed booking of that 
expenditure as commitments and payments to the 
relevant budget headings shall be carried out after 
examination of the statements sent in by the Member 
States in accordance with the provisions laid down 
pursuant to Article 5 (3) of Regulation (EEC) No 
729/70. 
3. Paragraphs 1 and 2 shall apply without 
prejudice to the clearance of accounts provided for 
in Article 5 (2) of Regulation (EEC) No 729/70.' 
12. Article 99 of the amended proposal: 
this Article is deleted. 
13. Article 100 of the amended proposal: 
this Article is deleted. 
14. Article 101 of the amended proposal: 
(a) In the first subparagraph of paragraph 1 'Article 5 
(2) (b)' is replaced by 'Article 5 (2)'; 
No C 278/8 Official Journal of the European Communities 16.10. 87 
(b) In the final subparagraph of paragraph 1, footnote 
(1) is deleted; 
(c) Paragraph 4 is replaced by the following: 
'4. The outcome of the clearance decision, i.e. 
any difference which may exist between the total 
expenditure booked to the accounts for a 
financial year pursuant to Article 98 and the 
total expenditure established by the Commission 
when clearing the accounts shall be booked, 
under a single article, as increased or reduced 
expenditure for the financial year in which the 
accounts are cleared. However, if the procedures 
required for this purpose — transfers or a sup­
plementary or amending budget — cannot be 
completed by the end of the year, the clearance 
decision shall be booked as soon as possible to 
the following financial year.' 
15. Article 102 of the amended proposal: 
this Article is deleted. 
16. Article 103 of the amended proposal: 
this Article is replaced by the following: '1. Transfers from article to article and from item 
to item within a chapter shall be made by 
Commission decision taken no later than 31 
December. 
The Commission shall inform the budgetary 
authority of such transfers. 
2. The Commission may make proposals to the 
budgetary authority, in accordance with Article 25, 
for transfers of appropriations from chapter to 
chapter. The Council shall take a decision by 
qualified majority within four weeks, after 
consulting Parliament. If the Council does not act 
within this time, the transfers of appropriations shall 
be deemed to be approved. 
3. The Commission shall take decisions on 
transfers of appropriations between the EAGGF 
Guarantee chapters and the food aid chapter, where 
such transfers are made necessary by changes, in 
relation to the appropriations authorized, in the 
parts of the expenditure chargeable to the respective 
chapters. 
The Commission shall inform the budgetary 
authority 15 days before making such transfers.'