15.

The cash of the Office as at 31 December 2010 includes 67 million euro of advanced payments from its clients and carried over appropriations from 2010 to 2011, thus this amount cannot be considered as a surplus of the Office. (The equivalent amount in 2009 amounted to 72 million euro). As a consequence of the treasury management policy adopted by the Budget Committee (in accordance with recommendations of the Court of Auditors) the funds of the Office are being placed in Central Banks, triple A Banks and other very highly ranked international banks. Additionally a yearly reporting to the Budget Committee was established. When it comes to the accumulated budgetary surplus at year end, the Office lowered its fees in 2005 and in 2009, with a negative impact on revenue from Community Trade Mark fees of 24 % and 30 % respectively (based on budgeted figures). The following elements will significantly reduce the accumulated budgetary surplus: Firstly, the investments to implement the strategic plan endorsed by the governing board and budget authority of the Office in May 2011 aiming at organisational excellence and international cooperation, amounting to 129 million euro. The strategic plan includes investments in buildings amounting to 69 million euro, the cooperation fund 40 million euro, 4 million euro on further simplification and modernisation of IT and other important concepts that will contribute to the accomplishment of the referred to goals. Secondly, the new forthcoming legislative proposals that are currently being prepared by the Commission aiming to revise the EU trademark legislation as well as the political agreement to distribute 50 % of the renewal fee to the national offices of trademarks as a basis for cooperation in order to enhance the harmonisation of practices and tools in the field of trademarks and designs for the benefit of users (see Council conclusion of 25 May 2010 on the future revision of the Trade Mark system in the EU), will also contribute to a more balanced budget. Thirdly, the Commission is considering introducing a biennial review mechanism of the financial situation of the Office. Fourthly, the Office is ready to become an agency of intellectual property of the EU, promoting the interests of the whole EU, and to create an European network with the national offices in the interest of the end-users. In line with the above, the Commission and the Office have recently signed a memorandum of understanding that will entrust the Office with a number of activities that relate to the European Observatory on Counterfeiting and Piracy. The Commission has launched a legislative proposal (COM(2011) 288)) to fully transfer the EU Observatory to the Office, avoiding the duplication of EU agencies. The initial impact assessment of the running cost of this Observatory is between 3,3 and 5,5 million euro per year. The financial and administrative autonomy established in the founding regulation of the Office, also reflected in its financial framework, have permitted the Office to put in place tools to improve performance parameters significantly in a demanding and changing user environment and to improve its sound financial management.