Brussels, 03.12.2004

COM(2004)771 final

Proposal for a

COUNCIL REGULATION

laying down the weightings applicable from 1 July 2004 to the remuneration of officials, contract staff and temporary staff of the European Communities serving in third countries and of certain officials remaining in post in the ten new Member States for a maximum period of fifteen months after accession

(presented by the Commission)

EXPLANATORY MEMORANDUM

Regulation (Euratom, ECSC, EEC) No 3019/87 of 5 October 1987 amended the Staff Regulations by adding an Annex X laying down special and exceptional provisions applicable to officials of the European Communities serving in third countries.

Articles 11, 12 and 13 of Annex X deal with the remuneration of officials posted in countries outside the European Union. Remuneration is payable in euros in Belgium but there is also provision for all or part of an official's remuneration to be paid in the currency of the country of employment. In that event, the portion paid in local currency is subject to a weighting.

Since the new Staff Regulations entered into force on 1 May 2004 (Regulation (EC, Euratom) No 723/2004 of 22 March 2004), this system of remuneration also applies to contract agents.

Article 13 of Annex X required the Council to determine the weightings for third countries every six months.

Council Regulation (ECSC, EEC, Euratom) No 2175/88 of 18 July 1988 laid down the initial weightings applicable from 10 October 1987.

The most recent weightings were set by Council Regulation (EC, Euratom) No 1785/2004 of 5 October 2004 and came into effect on 1 January 2004.

Article 33(4) of the Treaty on the accession of the ten new Member States created a legal basis authorising the extension of the application of Annex X of the Staff Regulations (rules applicable to staff working outside the Community) to officials remaining in post in the new Member States for a maximum period of fifteen months after accession. Therefore weightings should be set for these new Member States not only in accordance with Annex XI, but also in accordance with Annex X of the Staff Regulations.

Article 13 of Annex X to the new Staff Regulations now requires the Council to set the weightings applicable in third countries annually.

This proposal concerns the adjustment of weightings applicable from 1 July 2004 to the remuneration of officials, contract staff and staff of the European Communities serving in third countries and of certain officials remaining in post in the ten new Member States for a maximum period of fifteen months after accession.

These weightings are thus the first to be set on an annual basis.

The budgetary impact is negligible compared with the total operating costs of the delegations.

The remuneration system for staff serving in countries outside the Community is based on purchasing power parity of remuneration paid in local currency compared with that paid in Brussels.

To apply this principle Eurostat calculates the economic parities. The weighting is the factor obtained by dividing the economic parity by the exchange rate. This means that implementation of the weighting system primarily involves calculating economic parities between Brussels and other places of employment.

The exchange rates used are established in accordance with the rules for the implementation of the Financial Regulation and correspond to the date of application of the weightings.

Table A sets out the new economic parities, the corresponding exchange rates and the resulting weightings as at 1 July 2004 for all places of employment.

Table B shows the variation in percentage terms between the figures in Table A and those set in the most recent Regulation in force.

ANNEX

TABLE A

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ANNEX

TABLE B

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Proposal for a

COUNCIL REGULATION

laying down the weightings applicable from 1 July 2004 to the remuneration of officials, contract staff and temporary staff of the European Communities serving in third countries and of certain officials remaining in post in the ten new Member States for a maximum period of fifteen months after accession

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community,

Having regard to the Staff Regulations of officials of the European Communities and the conditions of employment of other servants of the Communities laid down by Regulation (EEC, Euratom, ECSC) No 259/68,[1] as last amended by Regulation (EC, Euratom) No 857/2004[2] and in particular the first paragraph of Article 13 of Annex X thereto,

Having regard to the Treaty of Accession of the ten new Member States, and in particular Article 33(4) thereof,

Having regard to the proposal from the Commission,

Whereas:

It is necessary to take account of changes in the cost of living in countries outside the Community, and to determine accordingly the weightings applicable from 1 July 2004 to remuneration payable in the currency of the country of employment to officials, contract staff and temporary staff of the European Communities serving in third countries and of certain officials remaining in post in the ten new Member States for a maximum period of fifteen months after accession.

The weightings in respect of which payment has been made on the basis of Regulation (EC, Euratom) No 1785/2004[3] may lead to retrospective upward or downward adjustments to remuneration.

Provision should be made for back-payments in the event of an increase in remuneration as a result of the new weightings.

Provision should be made for the recovery of sums overpaid in the event of a reduction in remuneration as a result of the new weightings for the period between 1 July 2004 and the date of entry into force of this Regulation.

Provision should be made for any such recovery to be restricted to a period of no more than six months preceding the date of entry into force of this Regulation and for its effects to be spread over a period of no more than twelve months following that date, as is the case with the weightings applicable within the European Community to remuneration and pensions of officials and other servants of the European Communities,

HAS ADOPTED THIS REGULATION:

Article 1

With effect from 1 July 2004, the weightings applied to the remuneration of officials, contract staff and temporary staff of the European Communities serving in third countries and of certain officials remaining in post in the ten new Member States for a maximum period of fifteen months after accession, payable in the currency of the country of employment, shall be as shown in the Annex hereto.

The exchange rates used for the calculation of this remuneration shall be established in accordance with the rules for the implementation of the Financial Regulation and shall correspond to the date of application of the weightings.

Article 2

The institutions shall make back-payments in the event of an increase in remuneration as a result of the weightings shown in the Annex.

The institutions shall make retrospective downward adjustments to remuneration in the event of a reduction as a result of the weightings shown in the Annex for the period between 1 July 2004 and the date of entry into force of this Regulation.

Retrospective adjustments involving the recovery of sums overpaid shall be restricted to a period of no more than six months preceding the date of entry into force of this Regulation. Recovery shall be spread over no more than twelve months from that date.

Article 3

This Regulation shall enter into force on the day of its publication in the Official Journal of the European Union .

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

Done at Brussels,

For the Council

The President

ANNEX

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(***) Not available

FINANCIAL STATEMENT

1. TITLE OF OPERATION

Proposal for a Council Regulation laying down the weightings applicable from 1 July 2004 to the remuneration of officials, contract staff and temporary staff of the European Communities serving in third countries and of certain officials remaining in post in the ten new Member States for a maximum period of fifteen months after accession

2. 2. BUDGET HEADING INVOLVED

XX-010102-01

3. LEGAL BASIS

Articles 12 and 13 of Annex X to the Staff Regulations

4. FINANCIAL IMPACT

4.1 Estimated actual expenditure € 125 139 579 for 2004 (€ 10 428 298.25 per month) (1)

4.2 Estimated impact of weigh tings of July 2004 - €11 814.59 (2)

4.3 Estimated expenditure for six months [(2) x 6] - €70 887 .54

4.4 Estimated annual expenditure [ (2) x 12] - €141 775.08

4.5 Impact in terms of estimatedact ual expenditure [(2) : (1)] - 0.11329356%

This financial impact does not include the impact of the intermediate weightings set monthly by the Commission.

[1] OJ L 56, 4.3.1968, p. 1.

[2] OJ L 161, 30.4.2004, p. 11.

[3] OJ L 317, 16.10.2004, p. 1.