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Bltë Brussels, 22.12.1995 
COM(95) 730 final 
95/0366 (CNS) 
Proposal for a 
COUNCIL REGULATION (EURATOM EC) 
amending Regulation (EURATOM, EEC) N° 2053/93 of 19 July 1993 
concerning the provision of technical assistance to economic reform and recovery in the 
Independent States of the former Soviet Union and Mongolia 
m 
(presented by the Commission) 

EXPLANATORY MEMORANDUM 
Regulation (EURATOM, EC) N° 2053/93 of 19 July 1993 provides technical assistance 
to economic reform and recovery in the independent States of the former Soviet Union 
and Mongolia. This Regulation will expire on 31 December 1995. Although the 
transition process in the NIS and Mongolia is now underway, the latter still need further 
assistance. The Commission therefore, in February 1995, adopted a proposal for a new 
Regulation, which will provide the legal basis for the provision of assistance in the years 
to come. The Commission proposal was submitted to the Council on 18 April. The latter 
consulted the European Parliament on 20 June. 
The E.P. delivered its opinion on 16 November and adopted thirty-seven amendments, out 
of which twenty-nine are acceptable to the Commission. 
In spite of efforts made, the Council has so far failed to reach unanimity on the new 
Regulation, the most contentious issue being the opportunity to incorporate the 
implementation modalities of the Tacis programme into the Regulation and its Annexes. 
Given this situation, it is necessary to fully ensure the continuation of Community 
assistance to the NIS which would constitute a positive political signal to our partner 
States. Therefore, the Commission proposes an extension of the duration of the present 
Regulation until 31 December 1996. This extension will be repealed the moment the new 
Regulation enters into force. 
& 

Proposal for a 
COUNCIL REGULATION (EURATOM EC) 
amending Regulation (EURATOM, EEC) N° 2053/93 of 19 July 1993 
concerning the provision of technical assistance to economic reform and recovery in the 
Independent States of the former Soviet Union and Mongolia 
THE COUNCIL OF THE EUROPEAN UNION 
Having regard to the Treaty establishing the European Community, and in particular Article 235 
thereof, v 
Having regard to the Treaty establishing the European Atomic Energy Community, and in 
particular Article 203 thereof, 
Havuig-reganHo-nie-proposal frbm-theCommission, 
Having regard to the opinion of the European Parliament, 
Whereas pursuant to the European Council in Dublin and in Rome in 1990 the European 
Community introduced a technical assistance programme in favour of economic reform and 
recovery m me former Union of Soviet Socialist Republics, 
Whereas Council Regulation (EURATOM, EC) N° 2053/93 of 19 July 1993 concerning the 
provision of technical assistance to economic reform and recovery in the New Independent States 
of the Former Soviet Union and Mongolia^ laid down the conditions for the provision of this 
technical assistance and foresaw such an operation from 1 January 1993 to 31 December 1995, 
Whereas the Council has not been able to decide on the adoption of a new Regulation for 1996 
onwards, and it is necessary to ensure the continuity of Community assistance to guarantee the 
sustainabihty of economic reforms, 
Whereas it is therefore necessary to extend the duration of Council Regulation (EURATOM, EC) 
N° 2053/93 of 19 July 1993 until its replacement by a new Regulation, and not later than 31 
December 1996, 
Whereas the continued provision of assistance will contribute to the attainment of the Community's 
objectives, notably in the context of the Partnership and Co-operation Agreements, 
Whereas the Treaties have not provided, for the adoption of this Regulation, powers other than 
those of Article 235 of the EEC Treaty and Article 203 of the EAEC Treaty, 
HAS ADOPTED THIS REGULATION: 
Article 1 
In. Article 1, paragraph 1 of Council Regulation (EURATOM, EC) N° 2053/93 of 19 July 1993, 
the date 31 December 1995 is replaced by 31 December 1996. 
<•> OJL 187/1 of 29.7.1993 
Article 2 
The Regulation shall enter into force on the third day following its publication in the Official 
Journal of the European Communities. 
The Regulation shall be binding in its entirety and directly applicable in all Member States. 
3 
FINANCIAL STATEMENT 
1 TITLE OF OPERATION 
Technical assistance to economic reform and recovery in the Independent States 
of the former Soviet Union and Mongolia (Tacis programme). 
2 BUDGET HEADING INVOLVED 
B7-620: Technical co-operation with the Independent States of the former 
Soviet Union 
3 LEGAL BASIS 
Article 235 of the Treaty of Rome 
Article 203 of the Euratom Treaty 
Council Regulation (Euratom, EEC) No 2053/93 of 19/7/93 (OJ N° L 
187/1 of 29/7/93) on the provision of technical assistance to economic 
reform and recovery in the independent states of the former Soviet 
Union and Mongolia (replaces Council Regulation (Euratom, EEC) No 
2157/91 of 15/7/91); 
Partnership and Co-operation Agreements signed with Russia 
(24/06/94), Ukraine (14/06/94), Moldova (28/11/94) Kazakhstan 
(23/01/95); Kyrgyzstan (09/02/95), and Belarus (06/03/95). 
4DESCRD7TION OF OPERATION 
4.1 General objective 
Backing for the process of reform, notably by financing or part-
financing of assistance to achieve the transition to a market economy and 
to bolster the democratic process. The focus will be on human resources 
(tndning, job-finding and social security, civil society, etc.), developing 
and restructuring companies (SME, conversion, restructuring, etc.), 
energy and nuclear safety, infrastructure and production and distribution 
of food. 
u 
4.2 Period covered and arrangements for renewal or extension 
Council Regulation (EURATOM, EEC) N° 2053/93 expires in 
December 1995. The Commission had submitted a new proposal to the 
Council on 18 April. However, the Council has so far failed to reach a 
consensus on the new regulation. It is imperative to avoid any disruption 
of Community assistance to the New Independent States (NIS) and 
Mongolia which would constitute a negative political signal to our 
partner States, as well as a serious risk for the sustainability of economic 
reforms in these countries. Therefore, it is now proposed to extend the 
duration of Council regulation N° 2053/93 until 31 December 1996, 
unless a new regulation enters into force before. 
5 CLASSIFICATION OF EXPENDITURE 
5.1 Non-compulsory expenditure 
5.2 Differentiated appropriations 
6TYPE OF EXPENDITURE 
The Tacis financing will usually be a 100% subsidy, but in some cases co-
financing may be arranged with partners such as the EBRD or the Member 
States. 
The projects to be financed will be selected on the basis of the recipient 
countries'proposals. 
The programmes drawn up by the Commission departments will be forwarded 
to the Tacis committee (which consists of representatives of the Member States) 
for its opinion. 
7 FINANCIAL IMPACT 
7.1 Method of calculating total cost of operation 
The budget authority will determine the appropriations available for each 
financial year. 
Commitment appropriations amounting to 528 Mecu have been requested 
for the 1996 budget. 
(fWtf 
The attached multiannual indicative programme for financing reflects the 
options adopted at the Edinburgh Council and is in conformity with the 
Copenhagen Council declaration. Indeed, the Community shall continue 
to grant an important part of its funds to external actions, namely 
towards the newly independent states through the Tacis programme. 
Even though, given the needs of the newly independent states, the 
financial aid which can be provided by the Tacis programme until the 
end of the Financial Perspectives of the Budget seems limited, the Union 
plans to grant, under the provision of the yearly budget procedure, for 
the period 1995-1999 2,725 MECU to implement chapter B7-62 "Co­
operation with the newly independent States from the former Soviet 
Union". This represents an average nominal growth per year of about 
3.5 % for the same period of time. 
7.2 Itemised breakdown of cost 
A rough breakdown by programme group is as follows: 
in % 
National programmes 60 
Multi-Country programmes 30 
Other programmes (Multidisciplinary, EBRD, 10 
et__ 1 
The programmes aim namely at the following sectors: human resources, 
enterprise development, transport and telecommunications, nuclear safety 
and environment, energy, food production and distribution and 
government institutions. The effective sharing within the frame of the 
programmes takes account of the priorities of each partner country. 
An indicative breakdown of interventions per sector is given below: 
(derived from interventions under 1991-1994. budgets) 
Sector Share in % 
Government Advice 5,4 
Food Production & Distribution 12,3 
Energy 10,6 
Nuclear Safety and Environment 18,4 
Transport & Telecommunication 9,0 
Support to Enterprises 16,5 
Human Resources ' 16,1 
Other 1 11,7 
5 
8 FRAUD PREVENTION MEASURES 
The administrative side of contract and financial affairs is still concentrated in 
the hands of the Commission. Progressively more decentralised management is 
a possibility but depends on the circumstances and abilities of the recipient 
countries. A monitoring system is in place with three teams based in Moscow, 
Kiev and Almaty and co-ordinated by a central Tacis M&E section from 
Brussels. The monitoring teams are responsible for making a detailed follow-up 
of the implementation of projects and activities. In the Commission 
headquarters, sector and programme evaluations are carried out on the basis of 
the information gathered by the monitors. The Commission delegations in 
Moscow, Kiev, Almaty and Tblissi also assist in follow-up of the project 
implementation. These checks are backed up by audit teams sent by the 
Commission departments to examine work done under contract. 
ELEMENTS OF COST-EFFECTIVENESS ANALYSIS 
9.1 Specific and quantified objectives; target population 
The aim of the programme of assistance for the countries of the former 
Soviet Union and for Mongolia is: 
to support the transition to a market economy in the partner 
States; 
to modernise the countries' economies; 
to back the process of démocratisation. 
Within the frame of the main objective (purpose) under point 4.1 above, 
the actions undertaken aim at a part or full financing of projects in the 
field of: 
- human resources training 
- restructuring of the public administration 
- employment and social security services 
- backing and reinforcement of civil company 
- assistance to macro-economic policy 
- legal assistance, namely the unification of legislative systems 
- support to the development of SMEs 
- military industry conversion 
- support to enterprises privatisation and restructuring 
- financing system modernisation 
- reforms linked with the rehabilitation and modernisation of basic 
infrastructures, namely within the transport and telecommunications 
sector 
- modernisation of energy-producing companies, including improvement 
of nuclear safety 
- food manufacturing, transformation, distribution and safety. 
The environmental dimension shall be integrated in the programmes' 
design and implementation. 
C 
The final recipient of the Tacis projects will be policy decision makers, 
government officials, in particular economic and legal advisers, public 
administration staff, professionals in all sectors concerned (agriculture, 
energy, nuclear safety, transport, telecommunication, financial services, 
SME, conversion etc.) and finally, as far as measures aiming at the 
creation of a pluralist and democratic society are concerned, all citizens 
of the beneficiary countries. 
9.2 Grounds for the operation 
The operation is in line with the decisions of the European Council 
(December 1990) of Rome. 
As the economic situation of the beneficiary countries does not allow 
them to direct themselves towards a pluralist democracy and a market 
economy independent from any external assistance, and as it is in the 
interest of the EU to complete the above-mentioned objectives as soon as 
possible, the Community is dedicated to these actions, including from a 
financial point of view. 
The aim of Community assistance is to use knowledge and know-how to 
produce a multiplier effect in the sectors involved and establish the 
framework and institutions for a market economy operating in a 
democratic society. 
The programme offers the advantage of genuinely European sourcing, 
with a very wide choice of systems and economic partners. 
The Community element is designed to back up the Member States' 
programmes of bilateral assistance. 
Spin-off effects 
By concentrating on key areas of economic infrastructure (energy, 
transport and finance), the programme is seeking to create a suitable 
climate for internal economic activity and investment from public and 
private sources. 
Multiplier effects 
Community financing for a project often draws in financing from other 
sources, either because co-financing from the Community is a condition 
for the involvement of other institutions or because funds from the 
Commission create the climate needed for other privately or publicly 
financed projects to succeed. 
\ 
Factors of uncertainty 
The main uncertainty which could influence the results of the operation 
is the continuity and speed of reform in the partner countries. 
9.3 Monitoring and evaluation of the operation 
Performance indicators 
The success of the operations will be measurable by the ability of the 
recipient countries to take over rapidly from European experts in 
projects started with Community backing. Everything will be done to 
achieve a gradual replacement of those experts with experts from the 
countries themselves in the sectors involved. 
The "demand-driven" nature of the operations and the recipients' 
undertakings that they will accept the assistance provided will ensure that 
they have an impact. 
European experts will be recruited under service contracts containing 
detailed terms of reference setting out the goals and duration of the 
functions in question, in order to allow subsequent evaluation. 
Procedure for evaluation and assessment of results 
The Commission departments will draw up annual reports on the 
progress of the operations, difficulties encountered and proposed 
solutions. These will be put to the Member States, the Council of the 
European Union, the European Parliament and the Economic and Social 
Committee. 
The projects will be run and evaluated regularly in accordance with the 
Logical Framework. The experts in charge of the projects will 
themselves produce half-yearly reports on their work (see also 8. above) 
The Commission will give the Member States (as represented on the 
Tacis Committee) and the European Parliament regular updates on the 
programme's progress. 
10 ADMINISTRATIVE EXPENSES (PART A OF THE BUDGET) 
none. 
Ï 
Community assistance to economic reform and recovery in the Newly Independent States of the former Soviet 
Union and In Mongolia (Tacis programme) 
Indicative multiannual programming of commitment appropriations 
(million ECU, current prices) 
_JD 
Ceiling on heading 4 of 
the Financial 
Perspectives (EUR 15) 
Indicative programming 
for Chapter B7.62 <1) 1993 
4.120 
510 1994 
4.311 
460 1995 
4.895 
506,85 1996 
5.264 
528 1997 
5.743 
546 1998 
6.345 
565 1999 
7.064 
585 total 
1995-1999 
29.311 
2.730,85 
(1) For 1995 = 470 (Budget) + 36,85 MECU (APBRS N° 1/95) 
For 1996-1999, following a growth of approximately 3.5% a year. 


ISSN 0254-1475 
COM(95) 730 final 
DOCUMENTS 
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Catalogue number : CB-CO-95-764-EN-C 
ISBN 92-77-98713-8 
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