No C 302/6 Official Journal of the European Communities 27.11. 86 
COURT OF AUDITORS 
OPINION No 2/86 
of the Court of Auditors of the European Communities on a draft Financial Regulation on the 
application of the Financial Protocols concluded with Algeria, Morocco, Tunisia, Egypt, 
Lebanon, Jordan, Syria, Malta and Cyprus 
(86/C 302/06) 
THE COURT OF AUDITORS OF THE EUROPEAN 
COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Article 209 
thereof, 
Having regard to the Council request of 14 and 15 July 
1986 for the Court of Auditors to be consulted on the 
aforementioned draft Financial Regulation, 
Having regard to the opinion delivered previously by the 
Court of Auditors on 23 May 1978 on the proposals (') 
Doc. COM(77) 68 final and COM(78) 18 final orig­
inally submitted by the Commission, 
Whereas the appropriations for the financing of aid not 
covered by the European Investment Bank's own 
resources are administered by the Commission and 
audited by the Court of Auditors, in accordance with the 
Financial Regulation applicable to the general budget of 
the European Communities, in particular Article 80 (2) 
thereof; 
Whereas the draft rightly makes provision for explaining 
how the mandates given to the European Investment 
Bank are awarded and carried out, for improving the 
effectiveness of later aid by means of periodic assessment 
of the main projects, and, in areas falling within the 
province of the management, for avoiding having to use 
the unanimous voting mechanisms applied to date within 
the framework of an ad hoc procedure; 
Whereas, moreover, the European Investment Bank's use 
of its decision-making power as regards loans should 
under no circumstances entail budgetary consequences 
the control of which may be outside the province of the 
competent community authority; 
Whereas, in this respect, if the draft distinguishes, in 
Article 11, between the manner of examining, on the one hand, draft financing decisions involving a special loan 
or risk capital and, on the other, applications for a loan 
with an interest-rate subsidy, this distinction will have 
the effect of allowing for different procedures for 
making a final decision in the event that the Committee 
set up under Article 9 of the draft should fail to give a 
favourable opinion; 
Whereas the decision-making procedure for projects 
financed by a special loan or risk capital allows the 
Commission the power to oppose the draft decision, 
which means that the matter is then referred to the 
Council as the authority having the ultimate power to 
decide, whereas, in the case of the decision-making 
procedure for applications for a loan with an interest-
rate subsidy, the authority having the ultimate power to 
decide is the Bank's Board of Directors, acting in 
accordance with the Bank's Statute; 
Whereas, as regards the utilization of appropriations 
entered in the general budget of the Communities, the 
procedure applying to applications for loans with 
interest-rate subsidies does not allow the authority 
responsible for implementing the budget to maintain 
control over decisions regarding the implementation of 
the budget, 
HAS ADOPTED THE FOLLOWING OPINION: 
The Court of Auditors draws the Council's attention to 
the need to safeguard the prerogatives of the authority 
responsible for implementing the budget, notably by 
making an amendment to this effect to Article 11 (4) 
concerning interest-rate subsidies on loans funded from 
budgetary appropriations. 
This opinion was adopted by the Court of Auditors at its 
meeting of 11 November 1986. 
For the Court of Auditors 
Marcel MART 
(') OJNoC 139,5.6. 1979, p. 19. President