21.5.81 Official Journal of the European Communities No C 119/1 
II 
(Preparatory Acts) 
COMMISSION 
Proposal for a Council Regulation amending the Financial Regulation 
of 21 December 1977 applicable to the general budget of the European Communities 
(Submitted by the Commission to the Council on 12 December 1980) 
THE COUNCIL OF THE EUROPEAN 
COMMUNITIES, 
Having regard to the Treaty establishing the Euro­
pean Coal and Steel Community, and in particular 
Article 78 h thereof, 
Having regard to the Treaty establishing the Euro­
pean Economic Community, and in particular 
Article 209 thereof, 
Having regard to the Treaty establishing the Euro­
pean Atomic Energy Community, and in particular 
Article 183 thereof, 
Having regard to the proposal from the Commis­
sion, 
Having regard to the opinion of the European 
Parliament, 
Having regard to the opinion of the Court of Audi­
tors, 
Whereas the conciliation provided for in the Joint 
Declaration of 4 March 1975 of the European 
Parliament, the Council and the Commission (') 
took place in a Conciliation Committee; 
Whereas Article 107 of the Financial Regulation of 
21 December 1977 (2), as amended by Regulation 
(ECSC, EEC, EURATOM) No 1252/79(5), 
provides for the said Financial Regulation to be 
examined by the European Parliament and the 
Council in the light of a proposal from the Commis­
sion; 
(») OJ No C 89,22. 4. 1975, p. 1. 
(2) OJ No L 356,31. 12. 1977, p. 1. 
(3) OJ No L 160,28.6. 1979, p. 1. Whereas, in view of the evolution of the general 
budget of the European Communities and of the 
application of the Financial Regulation of 
21 December 1977 since its entry into force, it is 
necessary to adjust many of the provisions of the 
said Financial Regulation; 
Whereas, in order to cover all the appropriations 
entered in the general budget of the European 
Communities, the Financial Regulation should be 
extended to include the special provisions required 
for the budgetary management of Community 
external aid; 
Whereas, in the light of the experience acquired 
since its entry into force, it is necessary to make 
more detailed or revise certain provisions of the 
Financial Regulation of 21 December 1977, notably 
in respect of the presentation of appropriations in 
the general budget, the arrangements for provisional 
twelfths, transfers and carryovers, and the 
scheduling of certain deadlines for entering items in 
the accounts and for presenting and auditing the 
accounts; 
Whereas it would appear to be in the general 
interests of the institutions concerned to shorten the 
additional period for entering in the accounts 
expenditure under the EAGGF, Guarantee Section, 
in order to rationalize the various deadlines 
governing the procedure for presenting and auditing 
the accounts; 
Whereas it is necessary to amend certain provisions 
so that it is possible, in connection with the activi­
ties of the Joint Research Centre, to utilize revenue 
from third parties; 
No C 119/2 Official Journal of the European Communities 21.5.81 
Whereas, in view of the rise in the cost of living, it is 
necessary to update certain amounts relating to the 
award of contracts referred to in Articles 52, 54, 56, 
57 and 94; 
Whereas, in the light of experience and in the inter­
ests of greater flexibility in the management of the 
Communities' own resources, any surplus or deficit 
from one financial year should be entered, for the 
purposes of adjustment, in the budget of the next 
but one financial year; 
Whereas the provisions referring to the drawing-up 
by the Court of Auditos of its annual report must be 
aligned on the text of the Treaties (Article 78 f (4) of 
the ECSC Treaty, Article 206 a (4) of the EEC 
Treaty and Article 180 a (4) of the Euratom Treaty); 
Whereas account should be taken of some of the 
suggestions made by the Court of Auditors in its 
supplementary opinion on the Financial Regulation 
of 21 December 1977, adopted at its meeting of 
8 June 1978; 
HAS ADOPTED THIS FINANCIAL REGULATION: 
Article 1 
The Financial Regulation of 21 December 1977 
applicable to the general budget of the European 
Communities, as amended by Council Regulation 
(EEC) No 1252/79 of 25 June 1979, is amended as 
follows: 
1. Article 1 (2): The second subparagraph is 
replaced by the following: 
'Without prejudice to paragraph 3 below, 
expenditure may not be authorized for a period 
going beyond the financial year. 
Operating expenditure arising from contracts 
which have been concluded in accordance with 
local usage for periods going beyond the finan­
cial year shall not be subject to the provisions of 
the preceding subparagraph. Such expenditure 
shall be charged to the budget for the financial 
year in which it is effected.' 
2. Article 1 (3): The fourth subparagraph is 
replaced by the following: 'The entries intended for multiannual activities 
and consisting of commitment and payment 
appropriations shall be shown in the budget as 
follows: 
— the commitment appropriation authorized for 
the financial year concerned and the 
payment appropriation considered necessary 
for the same financial year shall be entered 
under the appropriate heading; 
— the estimated annual payment appropriations 
required for subsequent financial years shall 
be set out against the commitment appropria­
tions in an indicative schedule in the remarks 
column.' 
3. Article 1: Paragraph 4 is deleted. 
4. Article 1: Paragraph 5 is deleted. 
5. Article 3 (2): The first subparagraph is replaced 
by the following: 
'2. Notwithstanding paragraph 1, revenue 
earmarked for a specific purpose, such as 
income from foundations, subsidies, gifts, 
bequests, contributions to Community activities 
from non-member States or various bodies, and 
revenue from third parties in respect of work 
carried out at their request shall not be used for 
any other purpose.' 
6. Article 4:The following paragraph 2 is added: 
'2. No expenditure may be entered into or 
authorized in excess of the authorized appro­
priations, without prejudice to Article 22 (2).' 
7. Article 5: The last three paragraphs are replaced 
by the following: 
'The readjustment of entries in respect of value 
added tax own resources or, if appropriate, of 
financial contributions, which under the second 
subparagraph of Article 10 (3) of the Regulation 
is carried out when the first entry is made 
following the final adoption of the supplemen­
tary or amending budget, shall be entered in the 
accounts for the financial year of the supple­
mentary or amending budget in question. 
The allotted appropriations shall be used solely 
to cover expenditure properly entered into and 
paid in the financial year for which they were 
21. 5. 81 Official Journal of the European Communities No C 119/3 
granted, save as otherwise provided in Articles 6, 
88 and 99, and to cover the debts relating to 
preceding financial years for which no appropri­
ation was carried forward. 
The commitments shall be entered in the 
accounts on the basis of the commitments 
contracted up to 31 December. 
The expenditure of a financial year shall be 
entered in the accounts for that year on the basis 
of the expenditure for which authorization 
reached the financial controller not later than 
31 December and the accounting officer not 
later than the following 10 January, and for 
which payment was effected by the accounting 
officer not later than 15 January.' 
8. Article 6: Paragraphs 2 to 8 are replaced by the 
following: 
'2. In the case of budget headings' where a 
distinction is made between commitment 
appropriations and payment appropriations: 
(a) commitment appropriations not 
committed at the end of the financial year 
for which they were entered in the budget 
shall remain available for the following 
financial year; 
(b) payment appropriations which have not 
been used at the end of the financial year 
for which they were entered shall be 
carried over automatically to the next 
financial year only. 
3. In the case of appropriations which were 
entered in the budget chapter containing 
"provisional appropriations" and which 
remain available at the end 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 expen­
diture may be carried over to the next 
financial year only. 
4. In the case of the appropriations referred to 
in paragraphs 1 (b) and 3 (b), the Commis­
sion shall submit to the budgetary authority, 
not later than 1 February, the requests to 
carry over appropriations, duly substantiated, 
made by Parliament, the Council, the Court 
of Justice, the Court of Auditors and the 
Commission itself. However, requests 
relating to the carryover of appropriations from the Guarantee Section of the European 
Agricultural Guidance and Guarantee Fund 
may be submitted until not later than 
15 March. 
In the case of requests to carry over appro­
priations in respect of expenditure neces­
sarily resulting from the Treaties or acts 
adopted in accordance therewith, the Council 
shall consult Parliament, which shall deliver 
its opinion in good time, i.e. normally within 
four weeks of receiving the request from the 
Council. 
Unless the Council, acting by a qualified 
majority, decides otherwise within six weeks 
of receiving the request, the carryover of 
those appropriations shall be deemed to have 
been approved. 
In the case of requests to carry over appro­
priations in respect of expenditure other than 
that necessarily resulting from the Treaties or 
acts adopted in accordance therewith, Parlia­
ment shall act within six weeks of receiving 
the request, after consulting the Council, 
which shall deliver its opinion in good time. 
If no decision is taken within this period, the 
requests shall be deemed to have been 
approved. 
5. Unused revenue and appropriations avail­
able at 31 December arising from the specific 
revenue referred to in Article 3 (2) shall be 
carried over automatically. 
6. The appropriations referred to in para­
graph 1 (b) which have not been committed 
by 31 December and in respect of which 
authorization has been given to carry them 
over to the next financial year shall lapse if 
they are not committed and paid by the end 
of the said financial year. 
7. The appropriations for the Guidance Section 
of the European Agricultural Guidance and 
Guarantee Fund and for the European 
Regional Development Fund may be used by 
way of exception to finance projects for 
which they were not initially committed, 
under the conditions laid down in Regula­
tions (EEC) No 3171/75 0) and (EEC) 
No 214/79 (2) respectively. 
8. Parliament and the Council shall be prov­
ided, for their information, before 15 April, 
with a list of the automatic carryovers. 
;») OJNoL315,5. 12. 1975, p. 1. 
?) OJNoL35,9.2. 1979, p. 1. 
No C 119/4 Official Journal of the European Communities 21.5.81 
9. For the purpose of implementing the budget, 
the use of appropriations carried forward 
shall be shown separately, by article, in the 
accounts for the current financial year.' 
9. Article 7: The third paragraph is replaced by the 
following: 
'Expenditure relating to rents or certain asso­
ciated expenditure which is payable in advance 
in accordance with local usage may give rise to 
payments from 20 December onwards to be 
charged to the appropriations for the next finan­
cial year. 
The advances intended, within the meaning of 
Articles 96 and 116, to finance the expenditure 
of the Guarantee Section of the European Agri­
cultural Guidance and Guarantee Fund, and 
expenditure on food aid, may be paid from 
10 December onwards.' 
10. Article 8: This article is replaced by the 
following. 
'1. If the budget is not finally adopted at the 
beginning of the financial year, Article 78 b of 
the ECSC Treaty, Article 204 of the EEC Treaty 
and Article 178 of the Euratom Treaty shall 
apply to commitment and payment of expendi­
ture of a kind already approved in principle in 
the last budget duly adopted.' 
2(a) Commitments may be entered into in 
respect of any chapter: 
— up to one quarter of the total appropriations 
entered in the relevant chapter for the 
preceding financial year plus one twelfth for 
each completed month; 
— without exceeding the appropriations pro­
vided for in the draft budget or, in the absence 
thereof, in the preliminary draft budget. 
The provisonal global commitments referred to 
in Article 96 of this Regulation shall be treated 
as commitments for the purposes of these provi­
sions. 
2(b) Payments may be made monthly in 
respect of any chapter: 
— up to one twelfth of the total appropriations 
entered in the chapter concerned for the 
preceding financial year; — as long as this measure does not have the 
effect of placing at the disposal of the 
Commission, for any month, appropriations 
in excess of one twelfth of those provided for 
in the draft budget or, in the absence thereof, 
in the preliminary draft budget. 
3. The "draft budget" referred to in paragraphs 
2 (a) and 2 (b) shall be the draft in the form in 
which it stands at the start of the financial year 
when the provisional twelfths arrangements 
began to be applied. 
4. Where the absence of a budget is due to the 
rejection of the draft budget by Parliament as 
provided for by Article 78(8) of the ECSC 
Treaty, Article 203 (8) of the EEC Treaty and 
Article 177 (8) of the Euratom Treaty, the appro­
priations referred to in the second indent of 
paragraph 2 (a) and in the second indent of 
paragraph 2 (b) shall be those entered in the 
rejected draft budget or, where appropriate, in 
the new draft budget drawn up, following the 
rejection decision, before the start of the finan­
cial year. 
5. At the request of the Commission, the 
Council, acting by a qualified majority, may, as 
dictated by administrative requirements and 
after consulting Parliament, authorize the simul­
taneous payment or commitment of two or more 
provisional twelfths in addition to those auto­
matically made available under paragraphs 2 (a) 
and 2 (b). The additional twelfths shall be 
authorized in whole and may not be split. 
6. Decisions concerning several provisional 
twelfths and relating to expenditure other than 
that necessarily resulting from the Treaties or 
from acts adopted in accordance therewith shall 
be taken in accordance with the procedure laid 
down in Article 78 b (2) of the ECSC Treaty, 
Article 204 of the EEC Treaty and the third 
paragraph of Article 178 of the Euratom Treaty. 
7. If, for a given chapter, the expenditure 
required to prevent any interruption of 
Community action in the sector concerned 
cannot be met by application of the procedures 
referred to in paragraphs 2 to 6, appropriations 
available under the twelfths arrangements may, 
on a proposal from the Commission, be trans­
ferred between chapters. 
Decisions on the proposal for transfer shall be 
taken in accordance with the procedure laid 
down in Article 78 b (2) of the ECSC Treaty, 
21. 5. 81 Official Journal of the European Communities No C 119/5 
Article 204 of the EEC Treaty and the third 
paragraph of Article 178 of the Euratom Treaty. 
If, however, in the case of transfers involving 
both expenditure necessarily resulting from the 
Treaties or from acts adopted in accordance 
therewith and other expenditure, the Council 
and Parliament disagree on the amount to be 
transferred, the smaller of the amounts accepted 
by one of the two institutions shall be deemed to 
have been approved. Where one of the institu­
tions rejects the principle of the transfer, such 
transfer shall not be made. they shall be published in the Official Journal of 
the European Communities. 
3. Any conversion between the ECU and a 
national currency shall be effected at the rate 
obtaining on the day, without prejudice to the 
special provisions referred to in Article 123 (2).' 
12. Title II: The heading is replaced by the 
following: 
TITLE II 
8. Article 92 shall apply in respect of research 
and investment appropriations. ESTABLISHMENT AND STRUCTURE OF THE 
BUDGET 
9. The decisions referred to in the preceding 
paragraphs shall specify the requisite measures 
in respect of resources for the purposes of this 
Article.' 
11. Article 10: This article is replaced by the 
following: 
41. The budget shall be drawn up in ECUs. 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 (') (2). 
Any change in the composition of the ECU 
decided on by the Council in the context of the 
European Monetary System, as provided for by 
Article 2 of Regulation (EEC) No 3180/78, shall 
automatically apply to this provision. 
2. 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. It shall be determined 
by the Commission on the basis of the exchange 
rates recorded each day on the exchange 
markets. 
The daily rates for conversion into the various 
national currencies shall be available each day: 
(') OJL379,30.12. 1978, p. 1. 
(2) The following amounts applied when this Regulation 
entered into force: 
German marks 0 
Pounds sterling 0 
French francs 1 
Italian lira 109 
Dutch guilders 0 
Belgian francs 3 
Luxembourg francs 0 
Danish kroner 0 
Irish pounds 0 828; 
0885; 
15; 
286; 
66; 
14; 
217; 
00759. 13. Section 1: The heading is replaced by the 
following: 
'SECTION 1 
ESTABLISHMENT OF THE BUDGET 
14. Article 7/:The second paragraph is replaced by 
the following: 
'The Economic and Social Committee shall, for 
1 June, forward to the Council an estimate of its 
revenue and expenditure for the following year.' 
15. Article 12 (5): A third indent is added as follows: 
'— the plans referred to in Article 90.' 
16. Article 12(6): This paragraph is replaced by the 
following: 
'6. The Commission may on its own initiative 
or if requested by Parliament, the Council, the 
Court of Justice or the Court of Auditors, 
present to the Council a letter of amendment to 
the preliminary draft budget necessitated by the 
receipt of new information which was not avail­
able at the time the preliminary draft was estab­
lished. 
However, save in very exceptional circum­
stances, the Commission must send such letter 
of amendment to the Council at least 30 days 
before the first reading of the draft budget by 
Parliament, and the Council must send a letter 
of amendment to the draft budget to Parliament 
at least 15 days before the said first reading. 
7. If circumstances arise which it could not 
have taken into account when establishing the 
draft budget, the Council may, if necessary, send 
to Parliament a letter of amendment to the said 
draft; the time limit set in the second subpara­
graph of paragraph 6 shall apply. 
8. In the event of unavoidable, exceptional or 
unforeseen circumstances, the Commission may 
submit preliminary draft supplementary and/or 
amending budgets. 
No C 119/6 Official Journal of the European Communities 21.5.81 
Also, particularly to enable policies to be 
adapted, the Commission may submit prelimi­
nary draft amending budgets which do not alter 
the total amount of the annual budget and to 
which the corresponding necessary draft Regula­
tions would be attached. 
Requests for supplementary or amending 
budgets from Parliament, the Council, the Court 
of Justice or the Court of Auditors shall be 
forwarded by the Commission to the budgetary 
authority. The Commission may attach a 
dissenting opinion. These budgets shall be 
submitted, examined, prepared and finally 
adopted in the same form and according to the 
same procedure as the budget whose estimates 
they are amending. They must be substantiated 
by reference to the latter. The competent auth­
orities shall discuss them in the light of their 
urgency. All preliminary draft supplementary 
budgets must, as a general rule, be forwarded to 
the Council by the date laid down for the 
submission of the preliminary draft budget for 
the following financial year.' 
17. Section II: The heading is replaced by the 
following: 
SECTION II 
STRUCTURE AND PRESENTATION OF THE 
BUDGET 
18. Article 15 (5): The first subparagraph is replaced 
by the following: 
45. The statement of revenue and expenditure 
in respect of the Office for Official Publications 
of the European Communities, drawn up in 
accordance with Article 118(2), shall be 
attached to the Commission section.' 
19. Article 16: Paragraph 2 is replaced by the 
following: 
'2. in the section for each Institution: 
(a) as regards the statement of revenue: 
— the estimated revenue for each 
Institution for the financial year in 
question, divided into titles, chap­
ters, articles and items, following a 
decimal classification system, 
— the revenue entered in the budget 
for the preceding financial year and 
\ the revenue established for the last 
financial year for which accounts 
have been closed, using the same 
decimal classification, 
— appropriate remarks on each 
revenue heading; (b) as regards the statement of expenditure: 
(ba) in the case of the various items, 
articles, chapters and titles: 
— the appropriations made avail­
able for the financial year, in 
question, these appropriations 
being the commitment appro­
priations and the payment 
appropriations for the budget 
headings for which this distinc­
tion has been agreed, 
— the appropriations made avail­
able for the preceding financial 
year, 
— the actual expenditure in the 
last financial year for which the 
accounts have been closed; 
This expenditure shall be deter­
mined as follows: 
— for the budget headings 
where the distinction 
between commitment appro­
priations and payment 
appropriations has not been 
made: 
— actual payments in the 
last financial year for 
which the accounts have 
been closed plus the 
carryovers to the next 
financial year; 
— for the headings where the 
distinction between commit­
ment appropriations and 
payment appropriations has 
been made: 
— in commitments: commit­
ments entered into 
during the financial year 
against appropriations 
for that financial year 
and against appropria­
tions remaining from the 
preceding financial year; 
— in payments: payments 
effected during the finan­
cial year against appro­
priations for, that finan­
cial year and against 
appropriations carried 
over from the preceding 
financial year: 
(bb) in the case of the appropriations 
intended for the implementation of 
multiannual activities and cons­
isting of commitment appropria­
tions and payment appropriations: 
21. 5. 81 Official Journal of the European Communities No C 119/7 
in the remarks column, an indica­
tive schedule of the payments 
relating to the financial year 
concerned and subsequent finan­
cial years; 
(be) appropriate remarks on each subdi­
vision ; 
as regards total staff: 
— for each section of the budget, a list of 
posts fixing the number of posts for each 
grade in each category and in each 
service, 
— a list of posts paid from research and 
investment appropriations, classified by 
category and grade, distinguishing 
between permanent and non-permanent 
staff whose employment is authorized 
within the limits of the budget appro­
priations. As regards scientific and tech­
nical staff, the classification may be 
based on groups of grades, in accord­
ance with the conditions laid down in 
each budget. The list of posts must 
specify the number of highly qualified 
technical or scientific personnel who are 
accorded special advantages under the 
Staff Regulations applicable to these 
officials, 
— a list of posts of the Official Publica­
tions Office fixing the number of posts 
for each grade in each category. / 
The list of posts shall constitute an absolute 
limit for each Institution; no appointment 
may be made in excess of the limit set. responsibility in accordance with this Financial 
Regulation and within the limits of the appro­
priations allotted.' 
21. Article 18(3): The first subparagraph is replaced 
by the following: 
'3. With the exception of decisions overruling 
the Financial Controller provided for in Arti­
cles 23, 24, 35, 44 and 47, the Commission and 
each of the other Institutions may delegate their 
powers in accordance with the conditions laid 
down by their internal rules of procedure and 
within the limits which they themselves lay 
down in the act of delegation/ 
22. Article 20: This article is replaced by the 
following: 
'In each Institution, the collection of revenue 
and the payment of expenditure shall be carried 
out by an accounting officer. 
This accounting officer shall be appointed by 
the Institution. 
Without prejudice to the system provided for in 
Articles 4 and 5 of Regulation (EEC) No 729/70 
and subject to the second paragraph of 
Article 48, to Article 49 and to Article 108 of this 
Financial Regulation, the accounting officer 
alone is empowered to manage funds and assets. 
He shall be responsible for their care. 
He may be assisted in his duties by one or more 
assistant accounting officers, appointed under 
the same conditions as the accounting officer. 
However, in cases of half-time work author­
ized by the appointing authority in accord­
ance with Article 55 a of the Staff Regula­
tions of officials of die European Communi­
ties, a post in a given grade may serve for the 
assignment of two officials of the same 
grade or of a lower grade. Such assignment 
shall automatically terminate when the 
authorization expires.' The special rules applicable to the accounting 
officer and to assistant accounting officers shall 
be laid down in implementing measures pro­
vided for in Article 121.' 
23. Article 21: This article is replaced by the 
following: 
'1. Appropriations shall be classified by 
chapter and by article. 
Paragraph 3 becomes paragraph 4. 
20. Article 18: Paragraph 1 is replaced by the 
following: 
' 1. The Commission shall, without prejudice to 
Article 102 (2), implement the budget on its own 2. The Commission may make proposals to the 
budgetary authority, as provided in paragraphs 3 
and 4, for transfers within each budget section. 
Proposals made by the other institutions for 
transfers from one chapter to another shall be 
automatically forwarded to the authority; the 
Commission may attach its own opinion to such 
proposals. 
No CI 19/8 Official Journal of the European Communities 21.5.81 
3. The appropriations which may be trans­
ferred, as provided in paragraph 5, shall be as 
follows: 
(a) within the category of appropriations where 
no distinction is made between commitment 
appropriations and payment appropriations: 
(aa) appropriations for the current financial 
year; 
(ab) appropriations carried over by virtue of 
Article 6 (l)(c); 
(b) within the category of appropriations where 
a distinction is made between commitment 
appropriations and payment appropriations: 
(ba) commitment appropriations for the 
current financial year; 
(bb) commitment appropriations remaining 
available by virtue of Article 6 (2) (a) 
and Article 88 (3); 
(be) payment appropriations carried over by 
virtue of Article 6 (2) (b). 
4. Appropriations may also be transferred, by 
decision of the budgetary authority as provided 
in paragraph 6, between headings where a 
distinction is made between commitment appro­
priations and payment appropriations and head­
ings where no such distinction is made. 
5. Transfer decisions shall be taken as follows: 
(a) the budgetary authority shall take decisions, 
in accordance with the procedure laid down 
in paragraph 6, on: 
— all transfers from one chapter to 
another provided for in paragraph 3 
(aa), (ba) and (bb), subject to para­
graph 5 (bb) and (c) below; 
— all transfers from one article to another 
and from one chapter to another prov­
ided for in paragraphs 3 (ab) and 4. 
(b) the Commission shall take decisions, in 
accordance with its internal procedure, on: 
(ba) all transfers of payment appropriations 
provided for in paragraph 3 (be) and 
(bd) from one article to another and 
from one chapter to another in its own 
section; (bb) transfers of appropriations from one 
chapter to another within the titles 
relating to staff expenditure and admin­
istrative expenditure in its own section. 
It shall inform the budgetary authority 
two weeks before making such trans­
fers; 
(be) in each section, transfers from one 
article to another within each chapter 
shall be made by the Commission, 
deciding according to the urgency of 
the matter. As regards sections which do 
not relate to the Commission, such 
transfers shall be deemed effective if, 
except in urgent cases, the Commission 
does not take a decision within six 
weeks from the date when the proposals 
was lodged. 
(c) Parliament and the Council may transfer 
appropriations from one chapter to another 
and from one article to another within their 
own sections of the budget. The Commis­
sion shall be informed of such transfers. 
6. In the case of proposals for transfers relating 
to expenditure necessarily resulting from the 
Treaties or from acts adopted in accordance 
therewith, the Council shall, after consulting 
Parliament, act by a qualified majority within 
six weeks, except in urgent cases. Parliament 
shall deliver its opinion within such time as will 
permit the Council to be apprised of it and to 
act within the time limit indicated. Where the 
Council does not act within this time limit, the 
proposals for transfers shall be deemed to be 
approved. 
In the case of proposals for transfers relating to 
espenditure other than that necessarily resulting 
from the Treaties or from acts adopted in 
accordance therewith, Parliament shall, after 
consulting the Council, act within six weeks, 
except, in urgent cases. The Council shall 
deliver its opinion within such a time as will 
permit Parliament to be apprised of it and to act 
within the time limit indicated. Where Parlia­
ment does not act within this time limit, the 
prosposals for transfers shall be deemed to be 
approved. 
Proposals for transfers relating both to expendi­
ture necessarily resulting from the Treaties or 
from acts adopted in accordance therewith, and 
to other expenditure shall be deemed to be 
approved if neither the Council nor Parliament 
has decided otherwise within six weeks of the 
21.5.81 Official Journal of the European Communities No C 119/9 
date on which the two Institutions received the 
proposals. 
If, in the case of the proposals for transfers 
referred to in the preceding subparagraph, 
Parliament and the Council reduce the proposal 
for a transfer by different amounts, whichever is 
the smaller of the amounts accepted by one of 
the two Institutions shall be deemed to be 
approved. Where one of the Institutions rejects 
the principle of the transfer, such transfer shall 
not be made. 
7. Every proposal for a transfer within a 
chapter or from one chapter to another shall be 
subject to the approval of the financial 
controller, who shall attest that the appropria­
tions are available. 
8. Appropriations may be transferred only to 
budget headings for which the budget has 
authorized appropriations or carried a token 
entry. 
9. This Article shall apply to the appropria­
tions corresponding to revenue earmarked for a 
specific purpose under Article 3 (2) only as long 
as the revenue is not used for any other purpose. 
10. No transfer shall be made between Parts I 
and II of the budget.1 
24. Article 22 (2): The first line is replaced by the 
following: 
'2. By way of derogation from Articles 3 and 4, 
the following sums may be re-used:' 
25. Article 24 (%).The third subparagraph is replaced 
by the following: 
'The accounting officer shall inform the author­
izing officer and the financial controller of any 
revenue not recovered within the time limits laid 
down. If necessary, he shall initiate the recovery 
procedure.' 
26. Article 26: This article is replaced by the 
following: 
'Estimates of the own resources and, if appro­
priate of the contributions referred to in Article 
4 (2), (3) and (6) of the Decision of 21 April 1970 
to be paid by the Member States shall be entered 
in the budget, expressed in ECU. They shall be 
made available in accordance with Council 
Regulation (EEC, Euratom, ECSC) No 2891/77, 
and with Article 28 of this Financial Regula­
tion.' 27. Article 27: This article is replaced by the 
following: 
'The, balance from each financial year, calcu­
lated in accordance with Article 15 of Council 
Regulation (EEC, Euratom, ECSC) No 2891/77, 
shall be entered as revenue in the case of a 
surplus or expenditure in the case of a deficit in 
a supplementary or amending budget in the 
second financial year following the financial 
year in question. 
However, if the situation requires, a decision 
may be taken to enter all or part of this balance 
in advance in a supplementary or amending 
budget in the financial year immediately 
following the financial year in question.' 
28. Article 28:The following paragraph 2 is inserted: 
'2. If the budget is not finally adopted before the 
start of the financial year, the contributions 
provided for in paragraph 1 shall be based on 
the amount shown in the draft budget, as 
referred to in Article 8 (3) and (4) of this Regula­
tion or, if this does not exist, in the preliminary 
draft budget.' 
Paragraph 2 becomes paragraph 3. 
Paragraph 3 becomes paragraph 4. 
29. Article 29: This article is replaced by the 
following: 
'The Commission shall, four times a year, 
present to Parliament and the Council a report 
on the Communities' financial situation, 
covering both revenue and expenditure. This 
report sha^l also give details of appropriations 
carried forward from previous financial years, as 
well as of any changes brought about by the 
adoption of supplementary or amending 
budgets.' 
30. Article 30: This article is replaced by the 
following: 
'(1) The Member States shall credit the amounts 
due to the account referred to in Article 9 (1) of 
Council Regulation (EEC, Euratom, ECSC) 
No 2891/77 in their national currency in accord­
ance with the following provisions: 
(a) the own resources referred to in Article 2 (a) 
and (b) of the Decision of 21 April 1970 and 
the balance of VAT resources referred to in 
Article 10 (4) of Council Regulation (EEC, 
Euratom, ECSC) No 2891/77, both amounts 
expressed in national currency, shall be 
credited to the abovementioned account as 
they stand; 
No C 119/10 Official Journal of the European Communities 21.5.81 
(b) the own resources accruing from VAT 
referred to in Article 4 (1) of the Council 
Decision of 21 April 1970, the amounts of 
which are expressed in ECU in the general 
budget of the European Communities, and, 
where appropriate, the financial contribu­
tions based on GNP and the adjustments to 
such contributions provided for in Article 10 
(5) of Council Regulation (EEC, Euratom, 
ECSC) No 2891/77 shall be converted at the 
rate for the ECU applying on the first 
working day following the fifteenth of the 
month preceding that in which they are 
credited to the account; 
(c) the financial contributions referred to in 
Article 4 (6) of the Decision of 21 April 1970 
shall be converted at the rate from the ECU 
applying on the last but one working day of 
the month preceding that in which they are 
credited to the account; 
(d) all other contributions or additional 
payments referred to in Article 28 (3) of this 
Financial Regulation shall be converted in 
accordance with whichever of the methods 
laid down at (a) to (c) above applies to the 
case to which, depending on their nature, 
such contributions or additional payments 
correspond. 
(2) The Commission shall enter the amounts 
credited to the account referred to in para­
graph 1 in its accounts kept in implementation 
of the statement of revenue for the general 
budget of the European Communities on the 
basis of the rate for the ECU applying for the 
month in which they are credited.' 
31. Article 32 (3): This paragraph is replaced by the 
following: 
'3. The procedure for implementing para­
graphs 1 and 2 above shall be determinded by 
the implementing measures provided for in 
Article 121. This procedure shall ensure that an 
exact account is kept of commitments and 
authorizations.' 
32. Article 37 (2): This paragraph is deleted. Para­
graph 3 becomes paragraph 2. 
33. Article 40: The third indent is replaced by the 
following: 
'— the amount to be paid (in figures and 
words), expressed in national currency or 
ECU,' 
34. Article 42: The second paragraph is replaced by 
the following: 
'The authorizing officer may grant advances if a 
provision laid down by regulation specifically 
provides therefor.' 35. Article 50: Paragraph 1 is replaced by the 
following: 
'1. Contracts for the purchase or hiring of build­
ings or goods, for the provision of services or for 
the performance of construction work shall be in 
writing. Apart from contracts relating to build­
ings, all such contracts shall be concluded 
following an automatic public tendering or 
discretionary tendering procedure. 
However, contracts may be made by private 
treaty in the circumstances referred to in 
Article 52. 
Contracts may be made against invoice or bill of 
costs in the cases provided for in Article 57.' 
36. Article 52 (a): '6 500 EUA' is replaced by '10 000 
ECU'. 
37. Article 54: '18 000 EUA' is replaced by '30 000 
ECU'. 
38. Article 56, third paragraph: '200 000 EUA' is 
replaced by '300 000 ECU'. 
39. Article 57: This article is replaced by the 
following: 
'Contracts may be made against invoice or bill 
of costs only where the expected value of the 
goods and services supplied does not exceed 
500 ECU. This limit shall be increased to 1 200 
ECU for expenditure to be entered into outside 
the provisional places of work of the institution.' 
40. Article 58: This article is replaced by the 
following: 
'Without prejudice to the provisions laid down 
in this Financial Regulation, when concluding 
contracts referred to in this Regulation, each 
institution shall comply with the Directives^) 
adopted by the Council, pursuant to the Treaty 
establishing the European Economic 
Community, in respect of public works and 
supplies, whenever the amounts involved are 
equal to or greater than the amounts provided 
for in those Directives. 
The implementing measures provided for in 
Article 121 shall include the supplementary 
provisions which may be required in order to 
implement this Article.' 
(') The following Directives were in force at the time this 
Regulation was drawn up: 
(a) Public works: Directive 71/305/EEC, as amended 
by Directive 78/669/EEC; 
(b) Supplies: Directive 77/62/EEC. 
21.5.81 Official Journal of the European Communities No C 119/11 
41. Article 59, first paragraph: This paragraph is 
replaced by the following: 
'Permanent inventories showing the quantity 
and value of all movable and immovable 
property belonging to the Communities shall be 
kept in accordance with a model drawn up by 
the Commission. Only movable property 
exceeding a specific value laid down in the 
implementing measures provided for in Article 
121 shall be entered in those inventories.' 
42. Article 61, first paragraph: This paragraph is 
replaced by the following: 
'A statement or record shall be drawn up by the 
authorizing officer and authenticated by the 
financial controller whenever any property in 
the inventory is sold, given away free of charge, 
scrapped, hired out, or missing on account of 
loss, theft or any other reason.' 
43. Article 64, second paragraph: This paragraph is 
replaced by the following: 
"These entries shall make it possible to draw up 
a general monthly balance, and a statement by 
chapter and article, of budgetary revenue and 
expenditure, which shall be forwarded to the 
financial controller and the authorizing officer.' 
44. Article 68: This article is replaced by the 
following: 
'Authorizing officers who, when establishing 
entitlements to be recovered or issuing recovery 
orders, entering into a commitment of expendi­
ture or signing a payment order do so without 
complying with this Financial Regulation and 
the rules for its implementation, shall render 
themselves liable to disciplinary action and, 
where appropriate, to payment of compensation. 
The same shall apply if they omit to draw up a 
document establishing a debt or if they neglect 
to issue recovery or payment orders or are, 
without justification, late in issuing them, 
thereby rendering the institution liable to civil 
action by third parties.' 
45. Article 73 (1), (2), (3) and (4): These paragraphs 
are replaced by the following: 
'The Commission shall draw up, not later than 
15 April of the following year, a revenue and 
expenditure account for the Communities, 
which shall include the following documents 
classified in accordance with the budget nomen­
clature: 1. a table of revenue including: 
— estimated revenue for the financial year, 
— amendments to the revenue estimates as a 
result of supplementary or amending 
budgets and additional revenue as speci­
fied in the first subparagraph of Article 3 
(2), 
— entitlements established in the course of 
the financial year, 
— entitlements still to be collected from the 
preceding financial year, 
— revenue collected during the financial 
year and revenue carried over pursuant to 
Article 6 (5), 
— amounts still to be collected at the end of 
the financial year. 
Statements shall be attached to this table 
showing revenue carried over pursuant to 
Article 6 (5) and, where appropriate, the 
balances and the gross payments arising from 
the transactions referred to in Article 22 (2); 
2. tables showing the movement in appropria­
tions for the financial year and, with a 
distinction being made between commitment 
appropriations, payment appropriations and 
non-differentiated appropriations, indi­
cating: 
— the initial appropriations, 
— any amendments introduced by means of 
supplementary or amending budgets, 
— any amendments to appropriations intro­
duced by means of transfer, 
— the final appropriations for the financial 
year, 
— the appropriations remaining or carried 
over under Article 6; 
3. tables showing the use of the appropriations 
allocated for the financial year and, with a 
distinction being made between commitment 
appropriations, payment appropriations and 
non-differentiated appropriations, indi­
cating: 
— the commitments entered into and charge­
able to the financial year, 
— the payments made and chargeable to the 
financial year, 
No C 119/12 Official Journal of the European Communities 21.5.81 
— the settlement of the commitments of the 
financial year and the calculation of the 
sums still to be paid at the close of that 
financial year, 
— the commitment appropriations remaining 
by virtue of Articles 6 and 88, 
— the payment appropriations carried over 
in accordance with Articles 6 and 88, 
— the non-differentiated appropriations 
carried over in accordance with Article 6. 
— cancelled appropriations. 47. Article 76: This article is replaced by the 
following: 
'l.The Commission shall draw up, within the 
time limit provided for in Article 73, a balance 
sheet of assets and liabilities of the Communi­
ties as at 31 December of the proceeding finan­
cial year. A statement, showing the movements 
and balances of the accounts, drawn up on the 
same date, shall be attached thereto. 
2. These documents shall be submitted to the 
financial controller.' 
Where appropriate/ a statement shall be 
attached to this table showing the balances 
and gross payments arising from the transac­
tions referred to in Article 22 (2); 48. Article 77: This article is replaced by the 
following: 
'The Commission shall forward the revenue and 
expenditure account, the financial analysis and 
the balance sheet to Parliament, the Council and 
the Court of Auditors by 15 April at the latest.' 
4. tables showing the use of the appropriations 
available from previous financial years and 
indicating: 
— the amount of appropriations remaining 
or carried over, a distinction being made 
between commitment appropriations, 
payment appropriations and non-differen­
tiated appropriations, 
— the commitments entered into and charge­
able to available commitment appropria­
tions, 
— the payments made from payment appro­
priations and non-differentiated appro­
priations which have been carried over, 
— the settlement of sums still to be paid at 
the close of the previous financial year 
and the calculation of the sums still to be 
paid at the end of the current financial 
year, 
— the amount unused and maintained for 
the following financial year, 
— the amount cancelled, a distinction being 
made between commitment appropria­
tions, payment appropriations and 
non-differentiated appropriations.' 
46. Article 74: This article is replaced by the 
following: 
'Each institution shall, not later than 1 March, 
forward to the Commission the information 
required for drawing up the revenue and 
expenditure account and the balance sheet, 
together with a contribution to the analysis of 
the financial management referred to in Article 
75, after submitting them to its financial 
controller.' 49. Article 78: This article is replaced by the 
following: 
"The Court of Auditors and its members may, in 
carrying out the task of the Court, be assisted by 
officers of the Court. 
The Court itself or one of its members shall 
notify the authorities with which the delegated 
officer is to work of the tasks delegated to him.' 
50. Article 79: The reference to .'Article 19' of Regu­
lation No 2891/77 is corrected to 'Article 18'. 
51. Article 80: The reference in the third paragraph 
to 'Article 18 and 19' of Regulation No 2891/77 
is corrected to 'Articles 17 and 18'. 
52. Article 83: This article is replaced by the 
following: 
1. The Court of Auditors shall, by 15 July at the 
latest, adopt the report provided for in Article 
78 f (4) of the ECSC Treaty, Article 206 a (4) of 
the EEC Treaty and Article 180 a (4) of the 
Euratom Treaty. It shall transmit the report 
without delay to the institutions of the Commu­
nities. They shall address their replies to the 
Court of Auditors and shall forward them to the 
Commission by 15 October at the latest. 
The Court of Auditors shall transmit its report 
together with the replies of the institutions to the 
authorities responsible for giving discharge and 
to the other institutions by 15 November at the 
latest and it shall ensure publication thereof in 
the Official Journal of the European Communi­
ties. 
21.5.81 Official Journal of the European Communities No C 119/13 
2. The Court of Auditors shall attach to the 
annual report an assessment of the soundness of 
the financial management.' 
53. Article 84: This article is replaced by the 
following: 
'The Court of Auditors may, at any time, submit 
observations on specific questions and deliver 
opinions at the request of one of the institutions 
of the Communities. 
It shall transmit any observations made or 
opinions given pursuant to the preceding para­
graph to Parliament, the Council, the Commis­
sion and, where appropriate, to the institution or 
body concerned. 
The Commission and, where appropriate, the 
institution concerned shall have six weeks in 
which to forward to the Court of Auditors, and 
to Parliament and the Council, any comments 
they wish to make on the observations or 
opinions in question. 
Should the Court of Auditors decide to have 
such observations or opinions published in the 
Official Journal of the European Communities, it 
shall include after them any comments 
submitted pursuant to the previous paragraph.' 
54. Article 85: This article is replaced by the 
following: 
'1. Parliament, upon a recommendation from the 
Council, which shall act by a qualified majority, 
shall, before 30 April of the next year, give a 
discharge to the Commission in respect of the 
implementation of the budget. If that date 
cannot be met, Parliament or the Council shall 
inform the Commission of the reasons for the 
postponement. 
2. The financial controller shall take account of 
the comments made in the decisions giving 
discharge. 
3. The Institutions shall take all appropriate 
steps to take action on the comments appearing 
in the decisions giving discharge. At the request 
of Parliament or the Council, the institutions 
shall report on the measures taken in the light of 
these comments and, in particular, on the 
instructions given to those of their departments 
which are responsible for the implementation of 
the budget. Such reports shall also be forwarded 
to the Court of Auditors. 
4. Without prejudice to the reports provided for 
in the third paragraph, the institutions must give 
an account, in an annex to the revenue and 
expenditure account for the financial year 
following the discharge of the measures taken in 
the light of the comments appearing in the deci­
sions giving discharge. 5. Supporting documents pertaining to the 
accounts and the drawing up of the revenue and 
expenditure account and the balance sheet shall 
be kept for a period of five years following the 
date of the decision giving discharge in respect 
of the implementation of the budget, referred to 
in Article 85. 
However, the documents relating to transactions 
not finally closed shall be kept for longer than 
the said period until the end of the year 
following the year in which Such transactions are 
finally closed.' 
55. Article 88: This article is replaced by the 
following: 
'1. An overall allocation covering several years 
(hereinafter called 'tranche') shall be made for 
each type of action project referred to in Article 
87 corresponding to a research and investment 
objective defined by the Council in the 
programme decisions or corresponding deci­
sions. 
In budgetary terms, the tranche shall be the total 
allocation provided in the budget for each 
research and investment objective, taking into 
account any financial reserves, except where the 
objective as defined by the Council in the 
programme decisions or corresponding deci­
sions comprises several specific stages, each 
forming a self-contained whole. 
2. The figures given in programme decisions or 
corresponding decisions shall be merely indica­
tive. 
3. Amounts authorized annually in the budget to 
cover research and investment expenditure shall 
comprise commitment appropriations and 
payment appropriations. 
4. The commitment appropriations within each 
tranche are intended to enable the Commission 
to meet all the legal obligations which it may 
contract. 
They constitute the upper limit of expenditure to 
which the Commission may commit itself during 
the financial year in question for the implemen­
tation of the operations to which the expendi­
ture relates. 
However, with regard to additional revenue as 
specified in the first subparagraph of Article 3 
(2), additional appropriations may be made 
available corresponding to the amounts pro­
vided for in agreements and contracts with third 
parties. These appropriations shall be made 
available under the relevant budget heading. 
Notwithstanding Article 6 (2) (a), the commit­
ment appropriations shall remain valid until 
cancelled under the budgetary procedure. 
No C 119/14 Official Journal of the European Communities 21.5.81 
5. The payment appropriations represent the 
upper limit of expenditure which may be paid or 
authorized for payment during each financial 
year to cover commitments entered into during 
the current year or earlier financial years. 
However, with regard to additional revenue as 
specified in the first subparagraph of Article 3 
(2), additional appropriations may be made 
available corresponding to the additional 
amounts actually received under agreements or 
contracts with third parties. These appro­
priations shall be made available under the 
relevant budget heading. 
Payment appropriations not used by the end of 
the financial year for which they were entered 
shall be carried over automatically in accord­
ance with Article 6 (2) (b), without prejudice to 
Article 6 (5).' , 
56. Article 90 (2): A fourth indent is added at (b) as 
follows: 
'— the major installations;' 
57. Article 91 (2): The second subparagraph is 
replaced by the following: 
"The charges to the appropriation accounts shall 
not exceed the amount of the appropriations 
entered in the articles and items in Part I of the 
financial plans referred to in Article 90 (2) (a).' 
58. Article 91 (3): The fourth subparagraph is 
replaced by the following: 
'The charges booked to research and investment 
objectives and other activities in Part I of the 
financial plan shall be allocated monthly m the 
budget to the articles and items in the special 
chapter provided for in Article 87.' 
59. Article 92: A paragraph 3 is added as follows: 
'3. The general provisions relating to provisional 
twelfths set out in Article 8 (3), (4), (5), (6), (7) 
and (9) shall apply to research appropriations.' 
60. Article 94: This article is replaced by the 
following: 
'1. For the purposes of applying Article 21, the 
items of the chapter provided for in Article 87 
shall be treated as chapters. 2. Notwithstanding Article 21 (2), the Commis­
sion may, within the limits and subject to the 
conditions fixed at the final adoption of the 
budget, transfer appropriations from one article 
to another and from one item to another within 
the special chapter referred to in Article 87, the 
said Articles and items being specified, provided 
that such transfers relate to direct action projects 
and do not include action projects financed 
according to a special budgetary scale. 
3. Notwithstanding Article 52 (a), a contract for 
scientific and technical supplies and for works 
may be made by private treaty where the amount 
does not exceed 45 000 ECU without prejudice 
to those cases where private treaties are allowed 
under Article 52 (b), (c) and (d) and subject to 
the general obligation to invite competitive 
tenders, as far as possible and by all suitable 
means, from those capable of supplying the 
goods and services required by the contract. 
4. Notwithstanding Article 54, the following 
shall be submitted, before the decision of the 
authorizing officer, for the opinion of an Advi­
sory Committee on procurements and contracts, 
whose composition and functioning shall be 
determined by the implementing measures pro­
vided for in Article 121: 
(a) contracts of a scientific or technical nature, 
for sums exceeding 200 000 ECU, and the 
acquisition of immovable property; 
(b) contracts for supplies and equipment of a 
nature other than scientific or technical, for 
sums exceeding 45 000 ECU; 
(c) contracts for supplies and equipment of a 
nature other than scientific or technical for 
sums exceeding 15 000 ECU, to which points 
(c), (d) and (e) of Article 52 apply. 
5. Notwithstanding the provisions of the first 
paragraph of Article 60, scientific and technical 
equipment may be sold, without first being 
advertised, following a decision taken by the 
authorizing officer after he has consulted the 
Advisory Committee on procurements and 
contracts.' 
61. Articles 98, 99, 100 and 101: These articles are 
replaced by the following: 
21.5.81 Official Journal of the European Communities No C 119/15 
'Article 98 
1. Expenditure shall be taken into account for a 
financial year on the basis of payments made up 
to 31 December by the authorities and bodies 
referred to in Article 4 of Regulation (EEC) No 
729/70, provided that their commitment and 
authorization have reached the accounting 
officer not later than 28 February of the 
following year. 
2. Any adjustments to the expenditure declared 
which may be authorized separately from the 
clearance of the accounts, under the imple­
menting provisions adopted pursuant to Article 
5 (3) of Regulation (EEC) No 729/70, may be 
charged to the accounts of the following finan­
cial year. 
Article 99 
1. Any difference which may exist between the 
total expenditure charged to the accounts for a 
financial year pursuant to Articles 97 and 98 and 
the total expenditure established by the 
Commission when clearing the accounts as 
provided for in Article 5 (2) (b) of Regulation 
(EEC) No 729/70 shall be charged, under a 
single article, as over- or under-expenditure to 
the financial year in which the accounts are 
cleared. 
2. For the purpose of paragraph 1, the adjust­
ments referred to in Article 98 (2) shall be 
deemed to have been- charged to the accounts of 
the original financial year. 
Article 100 
1. Provisional global commitments which have 
been made for a financial year in accordance 
with Article 96 and which have not been specifi­
cally committed under the budget nomenclature 
in accordance with Article 97 by 1 March of the 
following financial year, shall be released under 
the original financial year. 
2. A provisional global commitment corres­
ponding to the amount released shall be made 
from the appropriations for the current financial 
year. 
Article 101 
1. Appropriations made available in one chapter 
of expenditure may not be allocated to another 
chapter of expenditure. 
2. Transfers from one chapter to another and 
transfers within a chapter shall be made by 
decision of the Commission in accordance with the procedure provided for in Article 13 of Reg­
ulation (EEC) No 729/70, which must be 
completed not later than 28 February. 
3. The procedure referred to in paragraph 2 shall 
also apply to transfers between the EAGGF 
Guarantee chapters and the food aid chapter, in 
so far as such transfers are made necessary by 
changes, in relation to the appropriations 
authorized, in the parts of the expenditure 
chargeable to the respective chapters. 
4. The Commission shall inform the budgetary 
authority of such transfers immediately.' 
62. Title IX: This title is replaced by the following: 
SPECIAL PROVISIONS APPLICABLE TO 
EXTERNAL AID 
SECTION I 
GENERAL PROVISIONS 
Article 102 
1. The appropriations assigned by the 
Community to its development cooperation 
policy shall be used either under global coopera­
tion agreements of a contractual nature or as aid 
granted unilaterally. 
2. These appropriations may be earmarked for 
grants, special loans, risk capital, or interest rate 
subsidies, and shall be paid out by the Commis­
sion, which may confer on the European Invest­
ment Bank general authority on behalf of the 
Community to administer a part thereof. 
3. The appropriations paid out by the Commis­
sion shall be used in accordance with the 
following provisions. 
Article 103 
1. A financing agreement shall be drawn up 
between the Commission, acting for the 
Community, and the Government or the compe­
tent authority of the recipient State in respect of 
any investment project on which the Commis­
sion takes a financing decision. 
2. In addition, a loan contract shall be drawn up 
between the Commission, acting for the 
Community, and the borrower in respect of any 
investment project financed by a special loan. 
No C 119/16 Official Journal of the European Communities 21.5.81 
SECTION II 
EXECUTIVE AGENTS 
Article 104 
Where finance is provided by the Community 
under a global cooperation agreement, the 
disbursement of funds shall, as a rule, be 
entrusted to a chief authorizing officer, a 
national authorizing officer, a Commission dele­
gate and a paying agent. 
Article 105 
1. The Commission shall perform the functions 
of chief authorizing officer, which shall be to 
ensure that financing decisions are carried out 
and to be responsible for the management of 
resources. In this capacity it commits, clears and 
authorizes expenditure. 
2. The chief authorizing officer, in close cooper­
ation with the national authorizing officer, shall 
ensure that participants in tendering procedures 
can compete on an equal footing, that there is 
no discrimination and that the tender selected is 
economically the most advantageous. In parti­
cular, he shall approve the terms of the invita­
tion to tender before it is issued, be apprised of 
the results of the examination of the tenders, 
and approve the proposal for the award of the 
contract, save where such powers are conferred 
on the Commission delegate. 
3. The chief authorizing officer shall make any 
adjustments and take commitment decisions 
which prove necessary to ensure the proper 
execution of approved projects and programmes 
in the best economic and technical conditions. 
Article 106 
1. The Government of the recipient State shall 
appoint a national authorizing officer to repre­
sent the national authorities in all operations 
relating to projects financed by the Community. 
2. The national authorizing officer shall submit 
invitations to tender to the Commission for 
agreement before issuing them. On the basis of 
the decisions thus endorsed and in close cooper­
ation with the chief authorizing officer and with 
the delegate referred to in Article 105 where such 
a delegate has been appointed, the national authorizing officer shall issue invitations to 
tender, receive tenders, preside over the exami­
nation of tenders and establish the results of the 
tendering procedure. 
3. He shall transmit to the Commission for 
agreement the results of the examinations of the 
tendering procedure and a proposal for the 
award of the contract. He shall sign contracts 
and riders thereto and estimates and notify the 
Commission thereof. 
4. The national authorizing officer shall clear 
and authorize expenditure against appropria­
tions committed by the Commission clears the 
operations for the execution of which he is 
responsible. 
Article 107 
1. For the purposes of applying the agreement 
or convention between the Community and the 
recipient State, and in respect of the appropria­
tions for which it is the authorizing officer, the 
Commission may be represented in the recipient 
State by a delegate approved by that State. 
2. At the request of the recipient State, the 
delegate shall give technical assistance in 
preparing and appraising projects. 
3. The delegate shall, regularly, and in certain 
cases acting on special instruction from the 
Commission, inform the authorities of the State 
to which he has been appointed of Community 
activities which may directly concern coopera­
tion between the Community and that State. 
4. The delegate shall make sure, on behalf of 
the Commission, that the projects financed by 
the Community are executed properly from the 
financial and technical angles. To this end he 
shall approve all payment authorizations issued 
by the national authorizing officer. This 
approval shall not constitute the Commission's 
clearance of the operation concerned and shall 
not discharge the national authorizing officer 
from his liability under Article 106 (4). 
Article 108 
1. For payments in a currency other than that 
of the recipient State, the Commission shall 
21.5.81 Official Journal of the European Communities No C 119/17 
make payment direct for services provided in 
connection with projects financed with grant 
aid. 
2. For payments in the currency of the reci­
pient State, accounts denominated in the 
currency of a Member State shall be opened on 
behalf of the Commission with the recipient 
State's central bank, which shall exercise the 
functions of paying agent. 
3. The accounts referred to in paragraph 2 shall 
be replenished to meet actual cash requirements. 
Transfers shall be made in the currency of a 
Member State and converted into the currency 
of the recipient State as payments fall due, at the 
exchange rate ruling on the day of payment. 
4. The paying agent shall not be remunerated 
for his services; nor shall interest be paid on the 
funds deposited. 
5. Within the limits of the funds available, the 
paying agent shall make the payments author­
ized after verifying that the supporting docu­
ments provided are substantively accurate and 
in order, and that the discharge is valid. 
6. At regular intervals, and at least once a 
quarter, the paying agent shall send the 
Commission a statement of expenditure 
effected, together with supporting documents. 
SECTION III 
AWARD OF CONTRACTS 
Article 109 
By way of derogation from Title IV of this 
Financial Regulation, the award of contracts 
financed by the Community shall be governed 
by the following provisions. 
Article 110 
The procedure to be followed prior to the award 
of works, supply or service contracts, or the 
conclusion of technical cooperation contracts, 
shall be specified in the technical and adminis­
trative provisions annexed to the financing 
agreement, subject to the following principles. Article 111 
1. Participation in tendering procedures shall 
be open on equal terms to all natural persons 
and firms coming within the scope of applica­
tion of Treaty and to all natural persons and 
firms in the recipient State. 
The specifications shall therefore require 
tenderers to state their nationality and to present 
the supporting evidence normally acceptable 
under their own law. 
2. By way of exception, it may be decided, by 
mutual agreement between the Commission and 
the recipient State, to allow nationals of 
non-member countries to compete for contracts 
financed by the Community. 
3. For financial and technical cooperation 
projects in favour of non-associated developing 
countries funded from the budget appropria­
tions earmarked for that purpose, eligibility to 
participate in tendering procedures and 
contracts may be extended to other developing 
countries which have received Community aid 
from these appropriations in the current finan­
cial year and the two preceding years. 
Article 112 
1. The Commission and the relevant auth­
orities of the recipient State shall take the neces­
sary implementing measures to ensure that parti­
cipants in tendering procedures and other proce­
dures for the award of contracts financed by the 
Community can compete on an equal footing. 
2. To this end, without prejudice to Article 113, 
care shall be taken in particular to: 
(a) ensure advance publication in reasonable 
time of invitations to tender in the Official 
Journal of the European Communities and the 
official journal of the recipient State; 
(b) eliminate any discriminatory practice or tech­
nical specification liable to hamper participa­
tion on equal terms by all natural or legal 
persons of the Member States and of the reci­
pient State. 
Article 113 
In urgent cases or where the nature, small scale 
or particular characteristics of certain works or 
supplies so warrant, the relevant authorities of 
No C 119/18 Official Journal of the European Communities 21. 5. 81 
the recipient State may, in agreement with the 
Commission, exceptionally authorize: 
— the award of contracts after restricted invita­
tions to tender; 
— the conclusion of contracts by private treaty; 
— the performance of contracts through public 
works departments. 
Article 114 
The Commission and the relevant authorities of 
the recipient State shall ensure that Articles 112 
and 113 are observed for each operation and 
that the tender selected is economically the most 
advantageous, with due regard notably to the 
qualifications of and the guarantees offered by 
the tenderers, the nature and conditions of 
execution of the works or supplies, and the 
price, utilization costs and technical value of 
those works or supplies. 
The Commission and the relevant authorities of 
the recipient State shall ensure that all the selec­
tion criteria are specified in the invitation to 
tender dossier. 
The result of invitations to tender shall be 
published at the earliest possible date in the 
Official Journal of the European Communities. 
Article 115 
1. For technical cooperation projects, service 
contracts shall be concluded with a consultancy 
bureau, a consultant engineer or an expert. Such 
contracts shall be made by private treaty or, 
where justified on technical, economic or finan­
cial grounds, following competitive tendering. 
2. For each technical cooperation project the 
Commission shall select one or more candidates 
according to criteria guaranteeing their qualifi­
cations, experience and independ­
ence and taking into account their availability 
for the proposed project. 
Where a private treaty procedure is used and the 
Commission has selected a number of candi­
dates, the recipient State shall choose freely 
which of these candidates it wishes to deal with. 
Where a tendering procedure is used, the 
contract shall be awarded to the candidate who, 
in the opinion of the Commission and the State concerned, has entered the economically most 
advantageous bid. 
3. Service contracts shall, as a rule, be 
prepared, negotiated and concluded by the 
relevant authorities of the recipient State, with 
the agreement and assistance of the Commission 
delegate. 
However, they may be prepared, negotiated and 
concluded by the Commission where they relate 
to urgent, short-term expert services in connec­
tion with the preparation, appraisal, execution 
on utilization of projects, or where special provi­
sions in the financing agreements referred to in 
Article 103 (1) so stipulate. 
SECTION IV 
FOOD AID 
Article 116 
1. Every food-aid programme shall as soon as 
possible be made the subject of a proposal for 
commitment in accordance with the procedure 
laid down in Articles 32 to 35. 
The advances paid to Member States shall be 
entered globally against the abovementioned 
commitments; the sum set aside for the commit­
ments may not be exceeded. 
Articles 97, 98 and 99 shall apply as regards 
entry as payment of expenditure effected by the 
Member States using the funds advanced by the 
Commission, and as regards the clearance of 
accounts. 
2. Articles 32 to 48 shall apply as regards the 
commitment and payment of expenditure 
effected by the Commission direct, particularly 
in respect of purchases on the world market, the 
occasional transport or storage of goods, or 
quality controls on products supplied. 
3. The Commission may decide, up to. 
28 February of the following financial year, on 
transfers from one article to another within the 
chapter relating to food aid. 
4. The provisions of Article 101 (3) shall apply 
to transfers made necessary by changes, in rela­
tion to the appropriations authorized, in the 
parts of the expenditure chargeable to the 
EAGGF Guarantee chapters and the food aid 
chapter. 
21. 5. 81 Official Journal of the European Communities No C 119/19 
SECTION V 
AUDITING OF ACCOUNTS 
Article 117 
1. The Community's Court of Auditors may, 
on the basis of records and, if necessary, on the 
spot, conduct a full audit of the accounts, 
records of accounting operations and any other 
documents relating to projects which are kept by 
recipients of Community aid. 
2. Should the Court of Auditors wish to carry 
out audits on the territory of recipient States, or 
States in which recipients are located, it may do 
so only by agreement with the relevant auth­
orities of the State concerned. Such audits 
would be limited to the inspection arrangements 
implemented pursuant to the provisions 
governing Community aid and would not apply 
in respect of the execution arrangements which 
are the responsibility of the national authorizing 
officer.' 
63. Article 103 becomes Article 118. 
Article 104 becomes Article 119. 
Article 105 becomes Article 120. 
Article 106 becomes Article 121. 
Article 107 becomes Article 122. 
64. Article 108 becomes Article 123 and is amended 
as follows: 
' 1. Appropriations for the Guidance Section of 
the European Agricultural Guidance and Guar­
antee Fund entered in the budget for the finan­
cial year 1976 and in the budgets of previous 
financial years shall be carried over under the 
following conditions: 
(a) where they relate to payment remaining due 
under commitments, they shall be carried 
over automatically for a period of five years 
reckoned from 31 December of the financial 
year during which they were committed; (b)upon expiry of that period, the Commission 
may submit to the Council and forward to 
Parliament, by 1 February, the lists of appro­
priations remaining committed, for which a 
duly substantiated request for carryover is 
being made. The decision shall be taken in 
accordance with the second subparagraph of 
Article 6 (3). 
2. The conditions under which the ECU is to 
be applied to revenue and expenditure shall be 
determined by the implementing measures prov­
ided for in Article 121.' 
65. Article 109 becomes Article 124. 
66. Article 110 becomes Article 125. 
Article 2 
(1) In Articles 18, 19, 23, 24, 32, 33, 34, 37, 41, 42, 
48,49, 51, 54, 56, 59,60,66, 70,94 and 108 the refer­
ences to Article 106 concerning implementing 
measures shall be understood as being to Article 
121. 
(2) The name 'the European Parliament' in the 
present text of the Financial Regulation is replaced 
by 'Parliament'. 
Article 3 
References to provisions of the Financial Regula­
tion of 21 December 1977 shall be understood as 
being to the corresponding provisions as amended 
by this Regulation. 
Article 4 
This Regulation shall enter into force on ... 
It shall be binding in its entirety and directly appli­
cable in all Member States.