EUROPEAN COMMISSION Brussels, 2.8.2019 COM(2019) 361 final 2019/0164(NLE) Proposal for a COUNCIL DECISION on the conclusion, on behalf of the European Union, of a Protocol to the Euro-Mediterranean Interim Association Agreement on trade and cooperation between the European Community, of the one part, and the Palestine Liberation Organization (PLO) for the benefit of the Palestinian Authority of the West Bank and the Gaza Strip, of the other part, on a Framework Agreement between the European Union and the Palestinian Authority of the West Bank and the Gaza Strip on the general principles for its participation in Union programmes



EXPLANATORY MEMORANDUM 1.CONTEXT OF THE PROPOSAL As part of the European Neighbourhood Policy (ENP), the gradual opening up of certain European Union programmes and agencies to ENP partner countries is one of many measures to promote reform, modernisation and transition in the European Union’s neighbourhood. The European Commission has expanded on this in its December 2006 Communication on the general approach to enable European Neighbourhood Policy partner countries to participate in Community agencies and Community programmes. The Council endorsed this approach in its conclusions of 5 March 2007. Further to this Communication and the 5 March 2007 conclusions, the Council, on 18 June 2007, issued directives to the Commission to negotiate Framework Agreements with Algeria, Armenia, Azerbaijan, Egypt, Georgia, Israel, Jordan, Lebanon, Moldova, Morocco, the Palestinian Authority, Tunisia and Ukraine, on the general principles for their participation in Community programmes. The June 2007 European Council reaffirmed the paramount importance of the ENP and endorsed a Presidency Progress Report that had been submitted to the Council meeting of 18 and 19 June 2007 as well as the related Council conclusions. This report recalled the Council directives to negotiate relevant additional protocols. The Joint Communication by the Commission and the High Representative of the Union for Foreign Affairs and Security Policy on a new response to a changing Neighbourhood, endorsed by the Council conclusions of 20 June 2011, further emphasised the EU’s intention to facilitate partner countries’ participation in EU programmes. To date, similar protocols have been signed with Algeria, Armenia, Azerbaijan, Georgia, Israel, Jordan, Lebanon, Moldova Morocco, Tunisia, and Ukraine, and a Protocol with Egypt is under discussion. In September 2018, during the EU-Palestinian Authority Joint Committee, the Palestinian Authority expressed its interest in signing a Protocol to a Framework Agreement for their potential full participation in a number of selected EU programmes. The objective of the Protocol is to lay down the financial and technical rules enabling the Palestinian Authority to participate in certain EU programmes. The horizontal framework established by the Protocol sets out principles for economic, financial and technical cooperation and allows the Palestinian Authority to receive assistance, in particular financial assistance, from the European Union pursuant to the programmes. This framework applies only to these programmes for which the relevant constitutive legal acts provide the possibility of the participation of the Palestinian Authority. The signing and provisional application of the Protocol does not therefore entail the exercise of powers under the various sectoral policies, which are exercised when establishing the programmes. 2.LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY The Euro-Mediterranean Interim Association Agreement on trade and cooperation between the European Community, of the one part, and the Palestine Liberation Organization (PLO) for the benefit of the Palestinian Authority of the West Bank and the Gaza Strip, of the other part, was signed on 24 February 1997 and entered into force on 1 July 1997. The European Council of 17 and 18 June 2004 welcomed the Commission’s proposals for the ENP and endorsed the Council conclusions of 14 June 2004. The Council, on 5 March 2007, expressed support for the general and global approach outlined in the Commission’s Communication of 4 December 2006 to enable ENP partners to participate in Community agencies and Community programmes on their merits and where the legal bases so allow. Further to this Communication and the 5 March 2007 conclusions, the Council, on 18 June 2007, issued directives to the Commission to negotiate Framework Agreements with ENP countries, on the general principles for their participation in Community programmes. The substantive legal basis for the conclusion of the Protocol is Article 209 of the Treaty on the Functioning of the European Union (TFEU). The procedural legal basis is Article 218(6)(a) and (7) of the TFEU. 3.RESULTS OF EX POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS Not applicable. 4.BUDGETARY IMPLICATIONS The Palestinian Authority shall contribute financially to the general budget of the European Union corresponding to the specific programmes in which the Palestinian Authority participates.

The specific terms and conditions regarding the participation of the Palestinian Authority in each programme, in particular the financial contribution payable, shall be determined in a Memorandum of Understanding between the Commission and the competent authorities of the Palestinian Authority on the basis of the criteria established by the programmes concerned. Each Memorandum of Understanding concluded pursuant to Article 5 of the Protocol, shall stipulate, in accordance with Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012, that financial control, audits or other verifications, including administrative investigations, will be carried out by or under the authority of the Commission, the European Anti-Fraud Office and the Court of Auditors. Detailed provisions shall be adopted on financial control and auditing, administrative measures, penalties and recovery enabling the Commission, the European Anti-Fraud Office, and the Court of Auditors to be granted powers equivalent to their powers with regard to beneficiaries or contractors established in the Union. 5.OTHER ELEMENTS No later than three years after the date of entry into force of this Protocol and every three years thereafter, the Parties may review the implementation of this Protocol on the basis of the actual participation of the Palestinian Authority in Union programmes. The specific terms and conditions regarding the participation of the Palestinian Authority in each programme, in particular the reporting and evaluation procedures, shall be determined in a Memorandum of Understanding between the Commission and the competent authorities of the Palestinian Authority on the basis of the criteria established by the programmes concerned. 2019/0164 (NLE) Proposal for a COUNCIL DECISION on the conclusion, on behalf of the European Union, of a Protocol to the Euro-Mediterranean Interim Association Agreement on trade and cooperation between the European Community, of the one part, and the Palestine Liberation Organization (PLO) for the benefit of the Palestinian Authority of the West Bank and the Gaza Strip, of the other part, on a Framework Agreement between the European Union and the Palestinian Authority of the West Bank and the Gaza Strip on the general principles for its participation in Union programmes THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty on the Functioning of the European Union, and in particular Article 209, in conjunction with Article 218(6)(a), Article 218(7), Having regard to the proposal from the European Commission, Having regard to the consent of the European Parliament, Whereas: (1)The Protocol to the Euro-Mediterranean Interim Association Agreement on trade and cooperation between the European Community, of the one part, and the Palestine Liberation Organization (PLO) for the benefit of the Palestinian Authority of the West Bank and the Gaza Strip, of the other part, on a Framework Agreement between the European Union and the Palestinian Authority of the West Bank and the Gaza Strip on the general principles for its participation in Union programmes (‘the Protocol’) was signed on behalf of the Union on … (2)The objective of the Protocol is to lay down the financial and technical rules enabling the Palestinian Authority of the West Bank and the Gaza Strip to participate in certain EU programmes. The horizontal framework established by the Protocol sets out principles for economic, financial and technical cooperation measure and allows the Palestinian Authority to receive technical assistance, in particular financial assistance, from the European Union pursuant to the programmes. This framework applies only to these Union programmes for which the relevant constitutive legal acts provide for the possibility of the participation of the Palestinian Authority. The conclusion of the Protocol does not therefore entail the exercise of powers under the various sectoral policies pursued by the programmes, which are exercised when establishing the programmes. (3)The Protocol should be approved on behalf of the Union, HAS ADOPTED THIS DECISION: