Amended proposal for a COUNCIL REGULATION laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes

(presented by the Commission)

EXPLANATORY MEMORANDUM

1. Procedure

In accordance with the guidelines for an externalisation policy, on 14 December 2000 the Commission adopted a proposal for a Council Regulation laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes. [1]

[1] OJ C 120E, 24.4.2001, pp. 140-145.

In accordance with Article 308 of the EC Treaty, the proposal was sent to the Council and the European Parliament.

On 5 July 2001 the European Parliament adopted a legislative resolution containing some 20 amendments to the proposal.

The Court of Auditors, in response to a Council request of 8 March 2001, gave its opinion on [...] October 2001 and suggested certain amendments to the proposal.

On the basis of the positions expressed by Parliament, and taking account of the suggestions put forward by the Court of Auditors, the Commission has adopted the following amended proposal.

2. Analysis of the amendments suggested by the other institutions

2.1. General remark

Parliament and the Court approved the general tenor and the basic points of the initial proposal, emphasising that it constituted a key contribution in response to the concerns previously expressed by those institutions, especially as regards delegating to private bodies (TAOs) the management of certain tasks relating to Community programmes.

2.2. Particular remarks

2.2.1. Tasks

On the question of the responsibilities of agencies, Parliament wished to place more restrictions, in terms of specialisation and duration, on the tasks likely to be entrusted to them. The Commission wishes in particular to be able to entrust agencies with, for example, the management of a large number of operations, even unspecialised operations ("mass management"), and must therefore reject that amendment.

2.2.2. Setting-up and winding-up of agencies

- Legal basis: Parliament's amendment aimed at removing the reference to Article 308 of the Treaty must be rejected as this Article constitutes the only possible legal basis in the absence of any specific basis for setting up statutorily separate entities from the Commission with the task of carrying out Community programmes.

- Conditions for setting up an agency: on the other hand, as regards the preparation of any decision to externalise tasks to an executive agency, the Commission understands Parliament's concern to expand the criteria to be taken into account (such as the impact on human resources) when carrying out the analysis preceding any decision to externalise tasks to executive agencies. It has therefore incorporated the proposed amendment.

- Committee procedures: Parliament's amendment designed to drop the regulatory committee procedure for setting up and winding up agencies must be rejected as Decision 468/1999 on committee procedure is strictly applicable.

- Winding up: agencies will be set up for a specific purpose, and the Court of Auditors insists that the Commission make effective use of its power to wind up an agency that has become purposeless; the wording of Article 3 is stricter on this point in the amended proposal. On the other hand, the Court's suggestion that the assets and liabilities of an agency about to be wound up be transferred to the Commission's accounts does not comply with its statutory autonomy, which requires asset liquidation procedures to be completed until the agency has gone, at which time the Commission will receive the net result of the liquidation, whether asset or liability. The amendment must therefore be rejected.

2.2.3. Governing bodies, staff and headquarters

- Governing bodies: the Court's suggestion that the tasks of the Steering Committee include the definition of objectives and performance indicators when an agency is set up must be rejected, those objectives and indicators being by their very nature provided for in other texts: either the act setting up the agency or the agreement concluded between the agency and the Commission or the instrument delegating powers to the agency. On the other hand, detailed indicators will be incorporated into the annual work programme.

- Staff: The Commission is in full agreement with the concerns expressed by the Parliament that agencies should be guaranteed the continuity of staff necessary to their operation through renewable contracts. In line with another Parliament amendment, a provision is added on the rules governing the liability of agency staff.

- Location: Parliament's amendment aimed at enabling agencies to organise their services geographically according to requirements is accepted (deleting all references to branch offices). It is not, however, desirable to adopt the suggestion of the Court of Auditors aimed at establishing the headquarters of an agency other than at a place where the institutions are established, in order to guarantee close cooperation between the Commission and the agency, with a view to maintaining the chain of responsibility and avoid creating an obstacle to the controls applied by the Commission.

2.2.4. Budgetary and financial arrangements

- Preparation of the budget: Parliament requested that a specific statement be included to the effect that the work programme of the executive agency complies with budgetary decisions; this has been incorporated into the proposal.

- As regards the establishment of the budget, Parliament's amendments aimed at a clearer definition of the responsibility of the budgetary authority are accepted.

- Parliament's amendment aimed at including the agency's organisation chart in the draft budget must be rejected as that is clearly a matter for the internal organisation of each agency and does not need to be submitted to the budgetary authority. On the other hand the establishment plan will be submitted to the budgetary authority. Naturally, the agency cannot adopt its budget until the general budget of the European Communities has been adopted.

- Execution of the budget: as requested in a Parliamentary amendment, any amendment to an agency's budget will subject to the same procedures as the adoption of the budget.

- The Court questioned the matter of compliance with the principles of activity-based budgeting (ABB). The principles are complied with in full at Commission level as the administrative appropriations constitute a percentage of the operational appropriations administered by the agency: the link between them and the means used for their management is thus clearly shown. On the other hand, as the agency budget is composed solely of administrative appropriations, it is outside the scope of ABB. In addition, as suggested by the Court, it will be necessary to define very precisely the conditions and methods for calculating the operating subsidy expressed as a percentage of the operational appropriations managed by the agency, but this would be covered more appropriately by the convention between the Commission and the agency, and in the agency's financial regulation.

- The Court is in favour of an agency managing the operational appropriations that continue to be entered in the general budget of the Commission - one of the innovations introduced by the Regulation - but would like administrative appropriations to be included as well. It is not appropriate to follow this line. The administrative appropriations must be transferred to the agency's budget in the form of a subsidy, a corollary of the agency's own legal personality and a guarantee of the flexibility of management it must enjoy. This type of organisation must not, however, adversely affect the production of detailed, transparent and coherent financial statements. Similarly, the financial statements will show clearly the agency's other sources of financing.

- Presentation of accounts and discharge: the Court's suggestion that the accounts be approved by the steering committee before they are forwarded to the institutions is accepted.

- On the other hand, Parliament's request, seconded by the Court, that discharge be given in respect of the administrative budgets of agencies when giving discharge in respect of the general budget cannot be accepted: as agencies have their own legal personality, their administrative budgets are different from the general budget of the Communities and must be the subject of a separate discharge. On the other hand, that discharge could be given at the same time as the general budget discharge to allow the discharge authority to state its opinion on the general management of the Commission programmes.

- Financial regulation: Parliament's amendment aimed at making the adoption of the agencies' financial regulation subject to consultation of Parliament and Council seems pointless as the financial regulation relating to agencies is adopted after consulting the Court of Auditors and based as closely as possible on the Financial Regulation applicable to the general budget. It must therefore be rejected.

2.2.5. Programmes financed from sources other than the general budget

- Should the Commission's executive agencies be entrusted with programme management tasks financed from sources other than the Community budget, Parliament, supported by the Court, has asked that this should have a neutral impact on the budget. The Commission takes up this amendment.

2.2.6. Frame of reference and controls

- General context as regards liability: the suggestions of the Court of Auditors on controls of agencies can be accepted in two directions: on the one hand the possibility for the Commission to review the acts of agencies with a view to annulling them, as part of the controls on regularity and, on the other hand, the clear definition of a general principle of controls by the Commission of the execution of Community programmes entrusted to agencies.

- Furthermore, the obligation on the director of the agency to establish a system of management and internal control is included in the proposal at the request of the Court.

- Review of regularity: on this topic, on which the opinion of the Court and the amendment proposed by Parliament concur, the Commission cannot accept the suggestion that the Commission be declared liable in law for the acts of agencies, because the agencies have their own legal personality. On the other hand, the procedures for monitoring the regularity of acts now provide that the Commission may of its own volition review the acts of an agency and annul them and that actions against acts of an agency may be brought to the Commission, whose decisions may subsequently be appealed to the Court of Justice. Such machinery to protect the interests of third parties is a clear indication of the Commission's commitment to executive agencies and its safeguarding of the chain of responsibility.

- Annual reports: at Parliament's request, a report on the activities of an agency will be submitted to the discharge authority.

- The Court of Auditors legitimately suggests detailing the content of the annual report; however, responsibility for this document is more a matter for the act setting up each agency, according to its specific tasks, and the request must be rejected for inclusion in the framework regulation.

- OLAF: The measures proposed in a Parliamentary amendment relating to OLAF are for the most part included in the amended proposal in order to provide OLAF with every facility it requires to carry out its investigations.

- Interinstitutional agreement: Parliament's amendment aimed at making the agreement on the transmission of documents and information between the Commission and Parliament applicable must be rejected as the executive agencies are not signatories to the agreement. However, equivalent provisions may be included in the act setting up the agencies, and the detailed arrangements set out in their financial regulation.

- Evaluation: the amendment requested by Parliament calls for an evaluation of the agencies after three years; the Court partly agrees and calls for regular evaluations of the agencies. These concerns have been met by providing for an evaluation of each agency after three years of operation.

2000/0337 (CNS)

Amended proposal for a COUNCIL REGULATION laying down the statute for executive agencies to be entrusted with certain tasks in the management of Community programmes

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 308 thereof,

Having regard to the proposal from the Commission, [2]

[2] OJ C [...], [...], p. [...].

Having regard to the opinion of the European Parliament, [3]

[3] OJ C [...], [...], p. [...].

Having regard to the opinion of the Court of Auditors, [4]

[4] OJ C [....], [....], p. [...].

Whereas:

(1) An increasing number of programmes are being created in a wide range of fields targeting a variety of categories of beneficiaries, as part of the operations provided for in Article 3 of the Treaty. The Commission is, as a rule, responsible for adopting measures to implement such programmes ("Community programmes").

(2) Implementation of Community programmes is financed, at least in part, from appropriations entered in the general budget of the European Communities.

(3) Under Article 274 of the Treaty, the Commission is responsible for executing that budget.

(4) If the Commission is to fulfil its proper responsibilities towards the other institutions and citizens, it must focus primarily on its institutional tasks. It should therefore be able to delegate some of the tasks relating to the management of Community programmes to third parties. Moreover, externalising certain management tasks could be a more efficient and effective way of achieving the goals of such Community programmes.

(5) Externalisation of management tasks should stay within the limits set by the institutional system as laid out in the Treaty. This means that missions assigned to the institutions by the Treaty where anything is left to the discretion of the institution concerned and which involve translating political choices into practice may not be externalised.

(6) Externalisation should be used only after assessment of a number of factors such as identification of the tasks justifying externalisation, a cost-benefit analysis that includes the costs for coordination and controls, the impact on human resources, efficiency and flexibility in the implementation of externalised tasks, simplification of the procedures used, proximity of externalised activities to final beneficiaries, visibility of the Community as promoter of the programme concerned and the need to maintain an adequate level of knowhow inside the Commission.

(7) One form of externalisation consists in using Community bodies which are legal entities in their own right ("executive agencies").

(8) In order to ensure uniformity of executive agencies in institutional terms, their statute should be laid down by regulation, in particular as regards certain essential aspects of their structure, tasks, operation, budget system, supervision and responsibility.

(9) As the institution responsible for implementing the various Community programmes, the Commission is qualified to assess whether, and to what extent, it is appropriate to entrust management tasks relating to one or more specific Community programmes to an executive agency. Recourse to an executive agency does not relieve the Commission of its responsibilities under the Treaty, particularly Article 274. It must therefore be able closely to circumscribe the action of each executive agency and maintain real control over its operation, particularly its governing bodies.

(10) This means that the Commission must have the power to decide to create and, where appropriate wind up, an executive agency in accordance with this Regulation. Since the decision to set up an executive agency is a measure of general scope within the meaning of Article 2 of Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission, [5] such decisions should be adopted by the regulatory procedure provided for in Article 5 of that Decision.

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

(11) The Commission must also be able to appoint both the members of the Steering Committee of each executive agency and its director, to ensure that in delegating tasks which are its own prerogative to an executive agency, the Commission does not thereby relinquish control of it.

(12) The activities performed by an executive agency must also fully comply with the programming that the Commission defines for the Community programmes which the agency is involved in managing. The agency's annual work programme must therefore be subject to the Commission's approval and comply with budgetary decisions.

(13) To ensure that externalisation is effective and that full benefit is drawn from the expertise which an executive agency can offer, the Commission must be allowed to delegate to it all or some of the implementing tasks for one or more Community programmes, except for those requiring discretionary powers in translating political choices into action. Tasks which may be delegated include managing all or some of the phases in the lifetime of a given project, executing the budget, gathering and processing information to be forwarded to the Commission and preparing recommendations for the Commission.

(14) Since the budget of an executive agency is intended to finance only its running costs, its revenue should consist chiefly of a percentage, to be determined by the budgetary authority, of the financial allocation to the Community programme which the agency is involved in managing.

(15) With a view to the application of Article 274 of the Treaty, the operational appropriations of the Community programmes which an executive agency is involved in managing must continue to be entered in the general budget of the European Communities and must be implemented by direct charging to the budget. The financial operations relating to these appropriations must therefore be carried out in accordance with the Financial Regulation governing the general budget of the European Communities.

(16) An executive agency may be entrusted with tasks relating to the management of programmes that are financed from sources other than the general budget of the European Communities. However, this should not lead even indirectly to extra administrative costs, which should be covered by additional appropriations entered in the general budget. In such cases, this Regulation should apply, subject to specific provisions in the basic acts relating to the programmes concerned.

(17) The objective of transparency and reliability in the management of executive agencies requires that internal and external checks be made on their operation, that agencies be made accountable for their actions and that the public should have access to the documents held by the agencies, on terms and within limits similar to those in Article 255 of the Treaty.

(18) Each executive agency must collaborate intensively and continuously with the Commission departments responsible for the Community programmes that it is involved in managing. To facilitate such collaboration as much as possible, each executive agency should be located at the place where the Commission departments are sited.

(19) The Treaty does not provide, for the adoption of this Regulation, powers other than those conferred by Article 308,

HAS ADOPTED THIS REGULATION :

Article 1

Aim

This Regulation lays down the statute of executive agencies to which the Commission, under its own control and responsibility, may entrust certain tasks relating to the management of Community programmes.

Article 2

Definitions

For the purpose of this Regulation:

a) "Executive agency" means a legal entity established in accordance with this Regulation,

b) "Community programme" means any operation or set of operations or other initiative which the relevant basic instrument or budgetary authorisation requires the Commission to implement for the benefit of one or more categories of specific beneficiaries, by committing expenditure.

Article 3

Setting-up and winding-up of executive agencies

1. The Commission may decide to set up an executive agency with a view to entrusting it with certain tasks relating to the management of one or more Community programmes. It may set the duration of existence of the agency.

2. Where the Commission considers that it no longer requires the services of an executive agency which it has set up, it shall decide to wind it up. In that event, it shall appoint two liquidators. The Commission shall determine the conditions for the liquidation of the executive agency. The net result after liquidation shall be transferred to the general budget of the European Communities.

3. The Commission shall adopt the decisions referred to in paragraphs 1 and 2 in accordance with the procedure laid down in Article 23(2).

4. All executive agencies set up under paragraph 1 must comply with this Regulation.

Article 4

Legal status

1. An executive agency is a Community body and has a public service mission.

2. An executive agency shall be a legal entity in its own right. In each of the Member States, it shall enjoy the most extensive legal capacity accorded to legal entities under national law. It may, in particular, acquire or dispose of movable and immovable property and be a party to legal proceedings.

Article 5

Headquarters

An executive agency shall have its headquarters in one of the places where the Commission departments are located.

It shall organise its departments according to the management needs of the programmes for which it is responsible.

Article 6

Tasks

To attain the objective set out in Article 3(1), the Commission may entrust an executive agency with any tasks required to implement a Community programme, with the exception of tasks requiring discretionary powers in translating political choices into action.

Executive agencies may in particular be entrusted with the following tasks:

a) drawing up recommendations to the Commission about the implementation of a Community programme;

b) managing some or all of the phases in the lifetime of specific individual projects in the context of implementing a Community programme, and carrying out the necessary checks to that end, by adopting the relevant decisions using the powers delegated to it by the Commission;

c) adopting the instruments of budget execution for the revenue and expenditure and carrying out all operations required to implement a Community programme on the basis of a delegation from the Commission, and in particular those linked to the awarding of contracts and grants;

d) gathering, analysing and transmitting to the Commission all the information needed to guide the implementation of a Community programme.

The terms, criteria, parameters and procedures with which an executive agency must comply when performing the tasks referred to in the second paragraph and the details of the controls to be applied by the Commission departments responsible for Community programmes which an agency is involved in managing shall be defined by the Commission in the instrument of delegation.

Article 7

Structure

1. An executive agency shall be managed by a Steering Committee and a director.

2. An executive agency's director shall have authority over its staff.

Article 8

Steering Committee

1. The Steering Committee shall consist of five members appointed by the Commission.

2. The term of office of the members of the Steering Committee shall be at least two years. The appointment may be renewed. On expiry of their term of office, or should they resign, the members shall remain in office until their appointment is renewed or replacements have been appointed.

3. The Steering Committee shall choose a chairperson and vice-chairperson from among its members.

4. The Steering Committee shall meet when convened by the chairperson, at least twice a year. It may also be convened at the request of its members, by at least a simple majority, or at the request of the director.

5. Any member of the Steering Committee unable to attend a meeting may be represented by another member specially empowered for the meeting concerned. Each member may represent only one other member. Should the chairperson be unable to attend, the Steering Committee shall be chaired by the vice-chairperson.

6. The Steering Committee's decisions shall be adopted by a simple majority of votes. In the event of a tie, the chair shall have the casting vote.

Article 9

Tasks of the Steering Committee

1. The Steering Committee shall adopt its own rules of procedure.

2. On the basis of a draft submitted by the director and after approval by the Commission, the Steering Committee shall, no later than the beginning of each year, adopt the executive agency's annual work programme comprising detailed objectives and performance indicators. The work programme must comply with the programming defined by the Commission in accordance with the instruments establishing the Community programmes which the executive agency is involved in managing. The annual work programme may be amended during the year following the same procedure, in particular to take account of Commission decisions on the Community programmes concerned. The projects included in the annual work programme shall be accompanied by an estimate of the necessary expenditure.

3. The Steering Committee shall adopt the executive agency's administrative budget by the procedure laid down in Article 13.

4. The Steering Committee shall obtain the Commission's agreement before deciding to accept any legacies, gifts and grants from sources other than the Community.

5. The Steering Committee shall decide on the organisation of the departments of the executive agency.

6. The Steering Committee shall adopt any special rules needed to implement the right of access to the executive agency's documents in accordance with Article 22(1).

7. No later than 31 March of each year, the Steering Committee shall adopt and present to the European Parliament and the Commission an annual report on the activities of the executive agency during the preceding year and their financing. In particular, the report shall highlight any disparities between the objectives set in the work programme for the year in question and achievements during that same period.

8. The Steering Committee shall adopt and apply measures to combat fraud and irregularities.

9. The Steering Committee shall perform the other tasks entrusted to it by this Regulation.

Article 10

Director

1. The director of the executive agency shall be appointed by the Commission, which shall to that end appoint an official within the meaning of the rules and regulations applicable to officials and other servants of the European Communities.

2. The director shall be appointed for a term of four years. The appointment may be renewed. After receiving the opinion of the Steering Committee, the Commission may remove the director from office before expiry of the term of office.

Article 11

Tasks of the director

1. The director shall represent the executive agency and shall be responsible for its management.

2. The director shall prepare the work of the Steering Committee, in particular the draft annual work programme of the executive agency. The director shall participate, without voting, in the work of the Steering Committee.

3. The director shall ensure that the annual work programme of the executive agency is implemented. In particular, the director shall be responsible for performance of the tasks referred to in Article 6 and shall adopt the relevant decisions to that effect. The director shall act as the executive agency's authorising officer by delegation for executing the operational appropriations relating to the programmes which the agency is involved in managing, where the Commission has delegated powers to the agency to perform budget execution tasks.

4. The director shall draw up the provisional statement of revenue and expenditure and, as authorising officer, shall execute the executive agency's administrative budget in accordance with the Financial Regulation referred to in Article 15.

5. The director shall be responsible for preparing and publishing the reports which the executive agency must present to the Commission. These are the annual report on the activities of the executive agency referred to in Article 9(7) and all other reports, of a general or specific nature, which the Commission asks the executive agency to produce.

6. The director shall be empowered under the arrangements applicable to other servants of the European Communities to conclude employment contracts in respect of staff of the executive agency. The director shall be responsible for all other matters relating to staff of the executive agency.

7. The director shall set up management and internal control systems adapted to the tasks entrusted to the executive agency to ensure the operations it performs are lawful, comply with the rules and are effective.

Article 12

Administrative budget

1. Forecasts of all the revenue and expenditure of the executive agency shall be prepared for each financial year, which shall be the same as the calendar year, and shall be shown in its administrative budget. The forecasts, which shall include the establishment plan of the executive agency, shall be sent to the budgetary authority with the documents relating to the preliminary draft budget. The establishment plan, consisting only of temporary posts and specifying the number, grade and category of the staff employed by the executive agency during the financial year concerned, shall be approved by the budgetary authority and published in an annex to the Commission budget.

2. The revenue and expenditure of the executive agency's administrative budget shall be in balance.

3. The executive agency's revenue shall include a subsidy entered in the general budget of the European Union, without prejudice to other revenue, which represents of a percentage, to be determined by the budgetary authority, of the financial allocation to the Community programme which the agency is involved in managing.

Article 13

Preparation of the administrative budget

1. Each year the director shall draw up a draft administrative budget for the executive agency covering the agency's running costs for the following financial year and shall submit it to the Steering Committee.

2. No later than 1 March each year, the Steering Committee shall adopt the draft administrative budget, including the establishment plan, for the following year and shall submit it to the Commission.

3. On the basis of this draft budget and in the light of the Commission's programming for the Community programmes which the executive agency is involved in managing, the Commission shall propose, as part of the annual budget procedure, the annual subsidy to the executive agency's administrative budget as a specified percentage of the annual financial allocation to the programmes concerned.

4. At the beginning of each budget year, the Steering Committee shall adopt the executive agency's administrative budget, on the basis of the annual subsidy thus determined by the competent budgetary authority, at the same time as it adopts the annual work programme, adjusting the budget in accordance with the different contributions granted to the executive agency and any funds from other sources.

5. The administrative budget of the agency may not be adopted definitively until the general budget of the European Communities has been adopted.

6. Within the limits set by the Financial Regulation referred to in Article 15, all amendments to the budget, including the establishment plan, shall be submitted in a supplementary and amending budget adopted in accordance with the procedure provided for in this Article.

Article 14

Execution of the administrative budget and discharge

1. The director shall execute the executive agency's administrative budget.

2. No later than 31 March of each year, the director shall submit detailed accounts of all revenue and expenditure for the previous budget year to the Steering Committee, which shall forward them to the European Parliament, the Court of Auditors and the Commission.

3. The European Parliament shall grant discharge to the executive agency for the execution of its budget no later than 30 April of year n+2.

Such discharge shall be granted together with that relating to the general budget of the European Communities.

Article 15

Financial regulation applying to the administrative budget

The financial regulation applicable to the administrative budget of the executive agency shall be adopted by the Commission, after receiving the opinion of the Court of Auditors, in accordance with Article 142 of the Financial Regulation applicable to the general budget of the European Communities.

Article 16

Financial regulation applying to the operational appropriations

1. Where the Commission has delegated tasks to the executive agency relating to the budget execution of operational appropriations for Community programmes, such appropriations shall be entered in the general budget of the European Communities and shall be executed by direct charging to that budget.

2. The director shall act as the executive agency's authorising officer by delegation for executing these operational appropriations and shall comply to that end with the obligations laid down in the Financial Regulation applicable to the general budget of the European Communities.

Article 17

Programmes financed from sources other than the general budget

Articles 13 and 16 shall apply without prejudice to specific provisions laid down in the basic instruments relating to programmes financed from sources other than the general budget of the European Communities.

Article 18

Staff

1. The executive agency's staff shall be subject to the rules and regulations applicable to officials and other servants of the European Communities. The steering committee, in agreement with the Commission, shall adopt the necessary implementing rules.

2. The executive agency's staff shall consist partly of Community officials seconded as temporary officials by the institutions to positions of responsibility in the executive agency, and partly of other servants recruited by the executive agency on renewable contracts. The nature of the contract, governed by either private law or public law, the duration of the obligations binding such staff to the agency, and the appropriate qualifications criteria shall depend on the specific content and duration of the tasks to be performed, and shall comply with current national legislation.

3. The Protocol on the privileges and immunities of the European Communities shall apply to both the executive agency and its staff.

Article 19

Supervision

1. Implementation of the Community programmes entrusted to executive agencies shall be supervised by the Commission. Such supervision shall follow the procedures it shall adopt in accordance with the third paragraph of Article 6.

2. The functions of internal auditor and financial controller shall be performed in the executive agencies by the competent departments of the Commission.

3. The Commission and the executive agency shall implement the recommendations of the internal auditors, each according to their respective powers.

4. The European Anti-Fraud Office (OLAF) shall enjoy the same powers in respect of executive agencies and their staff as it enjoys in respect of Commission departments. As soon as the executive agency is set up it shall subscribe to the interinstitutional agreement on internal investigations conducted by OLAF. The Steering Committee shall formalise this acceptance and adopt the provisions needed to facilitate OLAF's conduct of its internal inquiries.

5. The Court of Auditors shall scrutinise the executive agency's accounts in accordance with Article 248 of the Treaty.

6. All acts of the executive agency, in particular all decisions adopted and contracts concluded by it, must provide explicitly that the Commission's internal auditor, OLAF and the Court of Auditors may inspect files and, where necessary, make on-the-spot checks, including at the premises of recipients of funds and, where applicable, the intermediaries that distribute them.

Article 20

Liability

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

2. In the case of non-contractual liability, the executive agency shall make good any damage caused by the agency or its servants in the performance of their duties, in accordance with the general principles common to the laws of the Member States. The Court of Justice of the European Communities shall have jurisdiction in disputes relating to compensation for any such damage.

3. The personal liability of staff towards the executive agency shall be governed by the rules applicable to them.

Article 21

Legality of acts

1. Any act of the executive agency having binding legal effects which is liable to prejudice the interests of a third party may be referred to the Commission by that third party, by any other person directly and individually concerned or by a Member State for a review of its lawfulness.

2. Actions shall be referred to the Commission within one month of the day on which the applicant learnt of the act challenged.

3. After hearing the arguments of the applicant and those of the executive agency, the Commission shall take a decision on the action within one month. Failure to produce a decision within that period shall mean that the action has been implicitly rejected.

4. The Commission may examine any act of an executive agency within one month of the day on which the act was adopted and may decide, having heard the reasons of the agency, to annul it.

5. Executive agencies must take the necessary measures as soon as possible to act on decisions taken pursuant to this Article by the Commission.

Article 22

Access to documents and confidentiality

1. Executive agencies shall be subject to Regulation (EC) No 1049/2001 of the European Parliament and of the Council on public access to European Parliament, Council and Commission documents [6] when it receives a request for access to a document in its possession.

[6] OJ L 145, 31.5.2001, p. 43.

The Steering Committee shall adopt any special rules needed to implement these provisions no later than six months after the setting-up of the executive agency.

2. The members of the Steering Committee, the director and members of staff and all persons involved in the activities of the executive agency shall be required, even after termination of their appointments, not to disclose information which, by its nature, is covered by confidentiality.

Article 23

Committee

1. The Commission shall be assisted by a Committee for Executive Agencies, composed of representatives of the Member States and chaired by the representative of the Commission.

2. Where reference is made to this paragraph, the regulatory procedure provided for in Article 5 of Decision 1999/468/EC shall apply, subject to Article 7 of that Decision.

3. The period laid down in Article 5(6) of Decision 1999/468/EC shall be three months.

Article 24

Evaluation

An external evaluation report on the first three years of operation of each executive agency shall be drawn up by the Commission and presented to the steering committee of the executive agency, the European Parliament, the Council and the Court of Auditors.

Article 25

Entry into force

This Regulation shall enter into force on the [...] day following that of its publication in the Official Journal of the European Communities.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

For the Council

President