POSITION (EU) No 20/2021 OF THE COUNCIL AT FIRST READING

with a view to the adoption of a Regulation of the European Parliament and of the Council establishing the Neighbourhood, Development and International Cooperation Instrument – Global Europe, amending and repealing Decision No 466/2014/EU of the European Parliament and of the Council and repealing Regulation (EU) 2017/1601 of the European Parliament and of the Council and Council Regulation (EC, Euratom) No 480/2009

Adopted by the Council on 26 May 2021

(Text with EEA relevance)

2021/C 225/01

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Articles 209 and 212 and Article 322(1) thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Economic and Social Committee (1),

Having regard to the opinion of the Committee of the Regions (2),

Having regard to the opinion of the Court of Auditors (3),

Acting in accordance with the ordinary legislative procedure (4),

Whereas:

(1) The general objective of the Neighbourhood, Development and International Cooperation Instrument – Global Europe (the ‘Instrument’), which is a programme for the purpose of the multiannual financial framework, should be to uphold and promote the Union’s values, principles and fundamental interests worldwide in order to pursue the objectives and principles of the Union’s external action, as laid down in Article 3(5) and Articles 8 and 21 of the Treaty on European Union (TEU).

(2) In accordance with Article 21 TEU, the Union is to ensure consistency between the different areas of its external action and between these and its other policies, as well as to work for a high degree of cooperation in all fields of international relations. The wide array of actions supported under the Instrument should contribute to the objectives set out in Article 21(1) and (2) TEU.

(3) Union action should promote respect for and be rooted in international human rights law, including the Universal Declaration of Human Rights, and in international humanitarian law, and should be guided by the universality and indivisibility of human rights.

(4) In accordance with Article 8(1) TEU, the Union is to develop a special relationship with neighbouring countries, aiming to establish an area of prosperity and good neighbourliness, founded on the values of the Union and characterised by close and peaceful relations based on cooperation. The Instrument should contribute to that objective.

(5) The primary objective of the Union’s development cooperation policy, as laid down in Article 208 of the Treaty on the Functioning of the European Union (TFEU), is the reduction and, in the long term, the eradication of poverty. The Union’s development cooperation policy also contributes to the objectives of the Union’s external action, in particular to foster the sustainable economic, social and environmental development of developing countries, with the primary aim of eradicating poverty, as set out in point (d) of Article 21(2) TEU.

(6) The Union is to ensure policy coherence for development cooperation as required by Article 208 TFEU. The Union should take account of the objectives of development cooperation in the policies that are likely to affect developing countries, which will be a crucial element of the strategy to achieve the Sustainable Development Goals (SDGs) defined in the 2030 Agenda for Sustainable Development (‘2030 Agenda’) adopted by the United Nations (UN) in September 2015. Ensuring policy coherence for sustainable development, as embedded in the 2030 Agenda, requires taking into account the impact of all policies on sustainable development at all levels nationally, within the Union, in other countries and at global level.

(7) The Instrument should contribute to preserving peace, preventing conflicts and strengthening international security as set out in point (c) of Article 21(2) TEU.

(8) The Instrument should be established for a period of seven years to align its duration with that of the multiannual financial framework 2021-2027 laid down in Council Regulation (EU, Euratom) 2020/2093 (5) (the ‘2021-2027 MFF’).

(9) The Instrument should provide for actions in support of those Union objectives and of the Union’s external action policies and builds on the actions previously supported under Regulations (EU) No 230/2014 (6), (EU) No 232/2014 (7), (EU) No 233/2014 (8), (EU) No 234/2014 (9), (EU) No 235/2014 (10), (EU) No 236/2014 (11) and (EU) 2017/1601 (12) of the European Parliament and of the Council, Decision No 466/2014/EU of the European Parliament and of the Council (13), Council Regulations (EC, Euratom) No 480/2009 (14), (Euratom) No 237/2014 (15) and (EU) 2015/322 (16) and the 11th European Development Fund (EDF)’s Internal Agreement (17).

(10) The global context for action is the pursuit of a rules- and values-based global order, with multilateralism as its key principle and the UN at its core. The 2030 Agenda, together with the Paris Agreement adopted under the United Nations Framework Convention on Climate Change (18) (the ‘Paris Agreement’) and the Addis Ababa Action Agenda of the Third International Conference on Financing for Development (the ‘Addis Ababa Action Agenda’) is the international community’s response to global challenges and trends in relation to sustainable development. With the SDGs at its core, the 2030 Agenda is a transformative framework to eradicate poverty and achieve sustainable development globally. It is universal in scope, providing a comprehensive shared framework for action that applies to the Union, its Member States and its partners. It balances the economic, social and environmental dimensions of sustainable development, recognising the essential interlinkages between its goals and targets. The 2030 Agenda aims to leave no-one behind and seeks to reach the furthest behind first. The implementation of the 2030 Agenda would be closely coordinated with the Union’s other relevant international commitments. Actions supported under the Instrument should be guided by the principles and objectives set out in the 2030 Agenda, the Paris Agreement and the Addis Ababa Action Agenda and should contribute to achieving the SDGs. Particular attention should be paid to interlinkages between the SDGs and to integrated actions that can create co-benefits and meet multiple objectives in a coherent way without undermining other objectives.

(11) The implementation of the Instrument should be guided by the five priorities established in the Global Strategy for the European Union’s Foreign and Security Policy (June 2016) (the ‘Global Strategy’) endorsed by the Council in its conclusions of 17 October 2016, which represents the Union’s vision and framework for united and responsible external engagement in partnership with others, to advance its values and interests. The Union should enhance partnerships, promote policy dialogue and collective responses to challenges of global concern. Its action should support the Union’s fundamental interests, principles and values in all their aspects. In doing so, the Union should use an integrated approach and comply with, and promote, the principles of respect for high social, labour and environmental standards, including with regard to climate change, for the rule of law and for international law, including in respect of humanitarian and international human rights law.

(12) The implementation of the Instrument should also be guided by the European Consensus on Development of 8 June 2017 (the ‘Consensus’) which provides the framework for a common approach to development cooperation by the Union and its Member States to implement the 2030 Agenda and the Addis Ababa Action Agenda. Eradicating poverty, tackling discrimination and inequalities, leaving no-one behind, protecting the environment and fighting climate change, and strengthening resilience are at the heart of development cooperation policy and should underpin the implementation of the Instrument.

(13) The Instrument should take into account relevant policy documents, including future revisions thereof such as: the UN Convention relating to the Status of Refugees, the UN Convention on the Elimination of All Forms of Discrimination against Women, the UN Convention on the Rights of the Child, the Programme of Action of the International Conference on Population and Development (ICPD), the Beijing Platform for Action, the UN Convention on the Rights of Persons with Disabilities, the EU Concept for Support to Disarmament, Demobilisation and Reintegration, the Comprehensive approach to the EU implementation of the United Nations Security Council Resolutions (UNSCRs) 1325 (2000) and 1820 (2009) on women, peace and security, the Concept on Strengthening EU Mediation and Dialogue Capacities, the Council conclusions of 20 June 2011 on conflict prevention, the EU Strategic Framework on Human Rights and Democracy and the Action Plans based thereon, the Council conclusions of 14 November 2016 on EU-wide strategic framework to support Security Sector Reform endorsing the Joint Communication on ‘Elements for an EU-wide strategic framework to support Security Sector Reform’, the EU strategy against illicit firearms, small arms and light weapons and their ammunition, the EU Human Rights guidelines, other relevant UN conventions and the International Atomic Energy Agency Convention on Nuclear Safety.

(14) The Instrument should aim to increase the coherence and ensure the effectiveness of the Union’s external action thus improving the implementation of the different external action policies.

(15) In accordance with the Global Strategy, the Consensus and the Sendai Framework adopted on 18 March 2015 for Disaster Risk Reduction 2015-2030, recognition should be given to the need to move away from crisis response and containment to a more structural, long-term approach that more effectively addresses situations of fragility, natural and man-made disasters, and protracted crises. Greater emphasis and collective approaches are required on risk reduction, prevention, mitigation and preparedness, and further efforts are required to enhance swift response and a durable recovery. The Instrument should therefore contribute to strengthening resilience and linking humanitarian aid and development action, particularly through rapid response actions as well as relevant geographic and thematic programmes, while ensuring respect of humanitarian principles.

(16) In accordance with the international commitments of the Union in relation to the Busan Partnership Agreement for Effective Development Cooperation, reaffirmed at the Nairobi High Level Forum in 2016 and recalled in the Consensus, the Union should apply, in the context of its Official Development Assistance (ODA) and across all aid modalities, the development effectiveness principles, namely ownership of development priorities by developing countries, a focus on results, inclusive development partnerships, transparency and mutual accountability as well as alignment and harmonisation. In that regard, it is important that national development strategies include broad consultative processes in line with the principles of the Paris Declaration on Aid Effectiveness, in particular when those serve as a basis for programming.

(17) Pursuant to the SDGs, the Instrument should contribute to reinforced monitoring and reporting with a focus on results, covering outputs, outcomes and impacts in partner countries benefiting from the Union’s external financial assistance.

(18) The Commission should ensure that clear monitoring and evaluation mechanisms are in place in order to provide effective accountability and transparency in implementing the Union budget, and in order to ensure effective assessment of progress towards the achievement of the objectives of the Instrument. Whenever possible and appropriate, the results of the Union’s external action should be monitored and evaluated on the basis of pre-defined, transparent, country-specific and measurable indicators, adapted to the specificities and objectives of the Instrument and preferably based on the results framework of the partner country.

(19) The Commission should regularly monitor actions financed under the Instrument and review progress made towards expected results, covering outputs and outcomes. Wherever possible, existing results frameworks should be used. The indicators used to measure progress should be in line with the SDGs and be clear, relevant and have robust methodologies. The data for the indicators should be readily available and of a good quality. The values of the indicators on 1 January 2021 should be used as a basis for assessing the extent to which the objectives of the Instrument have been achieved and will feed into the annual reports as well as the mid-term and final evaluations of the Instrument. The Commission should also make appropriate use of independent external evaluations. In that regard, the Commission should ensure, where relevant, appropriate involvement of the European Parliament, the Council as well as other stakeholders, including civil society organisations.

(20) The Commission should send its evaluation reports to the European Parliament, to the Council and to the Member States. Evaluations may be discussed at the request of Member States pursuant to this Regulation.

(21) The Instrument should contribute to the collective Union objective of providing 0,7 % of Gross National Income (GNI) as ODA within the timeframe of the 2030 Agenda, by supporting realistic, verifiable actions to meet this commitment, on which progress should continue to be monitored and reported. In that regard, at least 93 % of the funding under the Instrument should contribute to actions designed in such a way that they fulfil the criteria for ODA as established by the Development Assistance Committee of the Organisation for Economic Cooperation and Development (OECD).

(22) In order to ensure resources are provided to where the need is greatest, especially to the Least Developed Countries (LDCs) and the countries in situations of fragility and conflict, the Instrument should contribute to the Union collective target of reaching between 0,15 and 0,20 % of the Union GNI as ODA to LDCs in the short term, and of reaching 0,20 % of GNI as ODA within the timeframe of the 2030 Agenda, by supporting realistic, verifiable actions to meet this commitment, on which progress should continue to be monitored and reported. As agreed in the Consensus, actions under the Instrument are expected to contribute at least 20 % of the ODA funded under the Instrument to social inclusion and human development, including basic social services, such as health, education, nutrition, water, sanitation and hygiene, and social protection, particularly to the most marginalised.

(23) The Instrument should support children and youth as key agents of change and as contributors to the realisation of Agenda 2030, giving particular attention to their needs and empowerment.

(24) The Instrument should reflect the need to focus on strategic priorities, both geographically – the European Neighbourhood and Africa, as well as countries that are in a situation of fragility and most in need – but also thematically – security, migration, climate change and environment, and human rights and democracy.

(25) The Instrument should contribute to creating state and societal resilience in the area of global public health by addressing global public health threats, strengthening health systems, achieving universal health coverage, preventing and combating communicable diseases and helping to secure affordable medicines and vaccines for all.

(26) The financial envelopes envisaged for the Neighbourhood and Sub-Saharan Africa geographic programmes should only be increased, given the particular priority the Union gives to those regions.

(27) The Instrument should support the implementation of the European Neighbourhood Policy, as reviewed in 2015 and endorsed by the Council in its conclusions of 14 December 2015, while maintaining an adequate geographical balance, and the implementation of regional cooperation frameworks, such as cross-border cooperation, transnational and maritime cooperation as well as the external aspects of relevant macro-regional and sea basin strategies and policies in the eastern and southern neighbourhood, including the Northern Dimension and the Black Sea regional cooperation, as well as the integrated Union policy for the Arctic. Those initiatives offer political supplementary frameworks for deepening relations with and among partner countries, based on the principles of mutual accountability, shared ownership and responsibility.

(28) The European Neighbourhood Policy aims to deepen democracy, promotion of human rights and upholding of the rule of law, the stabilisation of neighbouring countries and strengthening their resilience, particularly by promoting political, economic and social reforms, as the Union’s main political priorities. In order to attain its objective, the European Neighbourhood Policy, which was reviewed in 2015, focuses on the following priority areas: good governance, democracy, the rule of law and human rights, with a particular focus on engaging further with civil society; socio-economic development, including the fight against youth unemployment, as well as education and environmental sustainability and enhanced connectivity; security; and migration and mobility, including tackling the root causes of irregular migration and forced displacement. Differentiation and enhanced mutual ownership, including through the implementation of the incentive-based approach that responds to performance in key areas, are the hallmark of the European Neighbourhood Policy, recognising different levels of engagement, and reflecting the interests of each country concerning the nature and focus of its partnership with the Union. The Instrument should support the implementation of the association, partnership and cooperation agreements, jointly agreed association agendas and partnership priorities, and other relevant, existing and future, jointly agreed documents with countries in the Neighbourhood area. The visibility of Union assistance in the Neighbourhood area should be enhanced.

(29) The Instrument should support the implementation of the Partnership Agreement between the members of the African, Caribbean and Pacific Group of States of the one part, and the European Community and its Member States, of the other part (19) (‘the ACP-EU Partnership Agreement’), signed in Cotonou on 23 June 2000 and entered into force on 1 April 2003, and subsequent agreements with countries of the Africa, Caribbean and Pacific (ACP) Group of States and allow the Union and its ACP partners to develop further strong alliances on key global challenges. In particular, the Instrument should support the continuation of the established cooperation between the Union and the African Union in line with the Joint Africa-EU Strategy and build on the ACP-EU Partnership Agreement, including by way of a continental approach towards Africa and a mutually beneficial partnership of equals between the Union and Africa.

(30) The Union should also seek to further develop relations and build partnerships with third countries in Asia and the Americas. Geographic programmes should support the Pacific and the Caribbean with an indicative amount of at least EUR 500 000 000 and at least EUR 800 000 000, respectively.

(31) The Instrument should also contribute to the trade-related aspects of the Union’s external relations including supply-chain due diligence in order to ensure consistency and mutual support between Union trade policy and development goals and actions.

(32) The Union should seek the most efficient use of available resources in order to optimise the impact of its external action. That should be achieved through coherence, consistency and complementarity among the Union’s external financing instruments, in particular the Instrument for Pre-Accession Assistance established by a Regulation of the European Parliament and of the Council establishing the Instrument for Pre-accession Assistance (IPA III) (the ‘IPA III Regulation’), the Humanitarian Aid Instrument established by Council Regulation (EC) No 1257/96 (20), the association of the overseas countries and territories with the Union established by a Council Decision on the Association of the Overseas Countries and Territories with the European Union including relations between the European Union on the one hand, and Greenland and the Kingdom of Denmark on the other (‘the Decision on the Overseas Association, including Greenland’), the European Instrument for International Nuclear Safety Cooperation established by Council Regulation (Euratom) 2021/… (21) (1), the common foreign and security policy including, where relevant, the Common Security and Defence Policy, and the European Peace Facility established by Council Decision (CFSP) 2021/509 (22) which is financed outside the Union budget, as well as the creation of synergies with other Union policies and programmes. This includes coherence and complementarity with macro-financial assistance, where relevant. In order to maximise the impact of combined interventions to achieve a common objective, the Instrument should allow for the combination of funding with other Union programmes, as long as the contributions do not cover the same costs.

(33) Building on its success, the Instrument should enable the Union to further strengthen the external dimension of the Erasmus+ programme. An indicative amount of EUR 1 800 000 000 from the geographic programmes under the Instrument should be used to finance actions under the international dimension of the Erasmus+ programme implemented in accordance with Regulation (EU) 2021/… of the European Parliament and of the Council (23) (2) and with the programming document adopted under the Instrument. Programming under the Instrument should fully enhance the potential of the Erasmus+ programme.

(34) Union funding under the Instrument should be used to finance actions under the international dimension of the Creative Europe programme established by Regulation (EU) 2021/… of the European Parliament and of the Council (24) (3) in order to contribute to foster international cultural relations and recognise the role of culture in promoting European values.

(35) The main approach for actions financed under the Instrument should be through geographic programmes, in order to maximise the impact of the Union’s assistance and bring Union’s action closer to partner countries and populations. That main approach should be complemented, where relevant, by thematic programmes and by rapid response actions, whilst ensuring the consistency and coherence of all programmes and actions.

(36) Local authorities embrace a large variety of sub-national levels and branches of government, including municipalities, communities, districts, counties, provinces, regions and their associations. In line with the Consensus, the Union should foster close consultation and association of local authorities, as well as their participation in contributing to sustainable development and to the implementation of the SDGs at local level, in particular regarding democracy, the rule of law, human rights and fundamental freedoms, social justice and as providers of basic social services. The Union should recognise the multiple roles played by local authorities as promoters of a territorial approach to local development, including decentralisation processes, participation and accountability. The Union should further enhance its support for local authorities’ capacity building in order to strengthen their voice in the sustainable development process and advance political, social and economic dialogue, as well as promote decentralised cooperation. Support to local authorities under the geographic programmes should amount indicatively to at least EUR 500 000 000.

(37) The Union’s and Member States’ development cooperation policies should complement and reinforce each other. The Union and its Member States should be united in diversity and working better together, using a variety of experiences and approaches, bearing in mind their respective comparative advantages. Therefore, the Union should foster inclusiveness and collaboration with Member States seeking to maximise added value and taking into account experience and capacities, thus reinforcing shared interests, values and common goals. In that regard, the Union and its Member States should also seek to promote the exchange of best practices, knowledge sharing and capacity-building amongst them. In cases of forms of Union funding in which public administrations of Member States are involved, such as twinning, simplified implementing and contractual provisions should be discussed with Member States and applied in accordance with Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (25) (the ‘Financial Regulation’).

(38) In line with the Consensus, the Union and its Member States should enhance joint programming to increase their collective impact by bringing together their resources and capacities. Joint programming should be promoted and strengthened, while being kept voluntary, flexible, inclusive and tailored to the country context and should allow for the replacement of Union and Member States’ programming documents with Union joint programming documents. Joint programming should build on the partner countries’ engagement, appropriation and ownership. The Union and its Member States should seek to support partner countries through joint implementation, whenever appropriate. Joint implementation should be inclusive and open to all Union partners who agree and can contribute to a common vision, including Member States’ agencies and their development financial institutions, local authorities, the private sector, civil society and academia.

(39) The criteria used to establish partners’ needs in the programming approach should be consistent with the transparency principles laid down in this Regulation.

(40) As the respect for democracy, human rights and the rule of law is essential for sound financial management and effective Union funding as referred to in the Financial Regulation, assistancecould be suspended in the event of degradation in democracy, human rights or the rule of law in third countries.

(41) The Union is committed to facilitating the objectives of nuclear safety cooperation specified in Regulation (Euratom) 2021/… (4). Therefore, the partner countries’ track records in implementing obligations and commitments concerning nuclear safety should be taken into account and be taken up in the regular political dialogue with those countries. Where a partner country persistently fails to respect the basic nuclear safety standards and provisions of the relevant international conventions, the Union should take appropriate steps.

(42) Under the Instrument, the Union should address human rights and democratisation issues at all levels. Whilst democracy and human rights, including gender equality and women’s empowerment should be reflected and mainstreamed throughout the implementation of the Instrument, Union assistance under the Human Rights and Democracy thematic programme and the Civil Society Organisations thematic programme should have a specific complementary and additional role by virtue of its global nature and its independence of action from the consent of the governments and public authorities of the third countries concerned. That role should allow for cooperation and partnership with civil society, especially on sensitive human rights and democracy issues. The Union should pay particular attention, in a flexible manner, to countries and urgency situations where human rights and fundamental freedoms are most at risk and where disrespect for those rights and freedoms is particularly pronounced and systematic.

(43) EU election observation missions should contribute to increase transparency and confidence in electoral processes, and provide an informed assessment of elections as well as recommendations for their further improvement, in the context of Union cooperation and political dialogue with partner countries. An indicative amount not exceeding 25 % of the resources initially allocated to the Human Rights and Democracy thematic programme should be devoted to the funding of EU election observation missions.

(44) The implementation of the Instrument should be guided by the principles of gender equality, women and girls’ empowerment and of preventing and combating violence against women and domestic violence, and should seek to protect and promote women’s rights in line with the EU Gender Action Plans and relevant Council conclusions and international conventions, including the Council conclusions on Women Peace and Security of 10 December 2018. Strengthening gender equality and women’s empowerment in the Union’s external action and increasing efforts to reach the minimum standards of performance indicated by the EU Gender Action Plans should lead to a gender sensitive and transformative approach in all Union external action and international cooperation. At least 85 % of new actions implemented under the Instrument should have gender equality as a principal or a significant objective, as defined by the gender equality policy marker of the OECD Development Assistance Committee. At least 5 % of those actions should have gender equality and women’s and girls’ rights and empowerment as a principal objective.

(45) The Instrument recognises that demographic growth and demographic shifts can have significant impact on development gains and economic progress. In order to ensure that current and future generations will be able to achieve their full potential in a sustainable way, the Instrument should support partners’ efforts towards an integrated approach that minimises the challenges related to population growth and maximises the benefits of a demographic dividend, while respecting each country’s right to decide on its demographic policy and while respecting, protecting and fulfilling human rights as well as gender equality.

(46) Civil society organisations embrace a wide range of actors with multiple roles and mandates which includes all non-State, not-for-profit independent and non-violent structures, through which people organise the pursuit of shared objectives and ideals, whether political, cultural, religious, environmental, social or economic. Operating from local, national, regional and international levels, they comprise urban and rural, formal and informal organisations. The Union values civil society organisations’ diversity and specificities, and engages with accountable and transparent civil society organisations which share its commitment to sustainable development and to the fundamental values of peace, freedom, equal rights and human dignity. The Instrument should provide Union support to civil society organisations in order to pursue the values, interests and objectives of the Union. Civil society organisations should be duly consulted and have timely access to relevant information allowing them to be adequately involved and play a meaningful role during the design, implementation and associated monitoring processes of programmes. The role of organisations supporting democracy, free elections, civil society, human rights and the rule of law worldwide, such as the European Endowment for Democracy, as well as citizen election observation organisations and their European and other regional and global platforms, should be supported under the Instrument.

(47) The Instrument should foster the participation of civil society organisations in contributing to sustainable development and to the implementation of the SDGs, inter alia, in the areas of democracy, the rule of law, human rights and fundamental freedoms, social justice and basic social services.

(48) This Regulation lays down a financial envelope for the Instrument, which is to constitute the prime reference amount, within the meaning of point 18 of the Interinstitutional Agreement of 16 December 2020 between the European Parliament, the Council of the European Union and the European Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management, as well as on new own resources, including a roadmap towards the introduction of new own resources (26), for the European Parliament and the Council during the annual budgetary procedure.

(49) Reflecting the importance of tackling climate change in line with the Union’s commitments to implement the Paris Agreement and to achieve the UN SDGs, the Instrument should contribute to mainstream climate action in the Union policies and to the achievement of an overall target of 30 % of the Union budget expenditure supporting climate objectives. Actions under the Instrument are expected to contribute 30 % of its overall financial envelope to climate objectives. Relevant actions will be identified during the implementation of the Instrument, and the overall contribution from the Instrument should be part of relevant monitoring, evaluations and review processes. In view of contributing to halting and reversing the decline of biodiversity, the Instrument should contribute to the ambition of providing 7,5 % of annual spending under the multiannual financial framework to biodiversity objectives in the year 2024 and 10 % of annual spending under the multiannual financial framework to biodiversity objectives in 2026 and 2027, while considering the existing overlaps between climate and biodiversity goals. Union action in this area should favour the adherence to the Paris Agreement and the UN Convention on Biological Diversity, the UN Framework Convention on Climate Change and the UN Convention to Combat Desertification, and not contribute to environmental degradation or cause harm to the environment or climate. In particular, funding allocated in the context of the Instrument should be coherent with the long-term temperature goal of holding the increase in the global average temperature to well below 2 °C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1,5 °C. It should also be coherent with the objective to increase the ability to adapt to the adverse effects of climate change and foster climate resilience. Particular attention should be given to actions that create co-benefits and meet multiple objectives, including for climate, biodiversity and the environment.

(50) The Union should favour a constructive engagement on mobility and all aspects of migration, working to ensure that migration takes place in a safe and well-regulated manner. It is essential to further step up cooperation on migration with partner countries while respecting competences of Member States, reaping the benefits of orderly, safe, regular and responsible migration and effectively addressing irregular migration and forced displacement. Such cooperation should contribute to ensuring access to international protection, addressing the root causes of irregular migration and forced displacement, enhancing border management and pursuing efforts to prevent irregular migration and forced displacement, fighting against trafficking in human beings and migrant smuggling, and working on dignified and sustainable returns, readmission and reintegration where relevant, on the basis of mutual accountability and full respect of humanitarian and human rights obligations under international and Union law, and by engaging with diasporas and supporting legal migration pathways. Therefore, third countries’ effective cooperation with the Union in this area should be an integral element of the Instrument. Increased coherence between migration and development cooperation and other external policies is important to ensure that the Union’s external assistance supports partner countries to manage migration more effectively towards sustainable development. The Instrument should contribute to a coordinated, holistic and structured approach to migration, maximising synergies and applying the necessary leverage.

(51) The Instrument should enable the Union, in cooperation with Member States, to comprehensively respond to challenges, needs and opportunities related to migration and forced displacement in a way that is coherent with and complementary to Union migration policy. To contribute to that end and without prejudice to unforeseen circumstances, indicatively 10 % of the financial envelope for the Instrument should be dedicated particularly to actions supporting management and governance of migration and forced displacement within the objectives of the Instrument. In addition, that target should also include actions to address the root causes of irregular migration and forced displacement when they directly target specific challenges related to migration and forced displacement. Migration-related actions under the Instrument, as needed through its geographic and thematic programmes and rapid response actions, should build on the experience learned during the implementation of the European Agenda on Migration and the multiannual financial framework 2014-2020, to build comprehensive partnerships. Union support should take into account the development benefits of regular migration. Migration-related actions under the Instrument should contribute to the effective implementation of EU agreements and dialogues on migration with third countries by encouraging cooperation relying on a flexible incitative approach and supported by a coordination mechanism under the Instrument. The coordination mechanism should enable ongoing and emerging migration challenges to be addressed under the Instrument, using all appropriate components through flexible funding, while respecting its financial envelopes and relying on their flexible implementation. Those actions should be implemented in full respect of international law, including international human rights and refugee law, and Union and national competences. The Commission should develop and use a robust and transparent tracking system to measure such expenditure and to report on it.

(52) The Instrument should consider digital solutions and information and communication technologies as powerful enablers for sustainable development and inclusive growth, and should contribute to further promoting digitalisation.

(53) Actions adopted under the Instrument in relation to the fight against terrorism and organised crime, cyber security and the fight against cybercrime, and capacity building of military actors in support of development and security for development should aim to generate direct human security benefits for the population, contain relevant good practices to ensure sustainability and accountability in the medium and long term, including effective democratic oversight, and should promote the rule of law, transparency and established international law principles.

(54) The 2030 Agenda underlines the importance of promoting peaceful and inclusive societies both as a SDG 16 and in order to achieve other development policy outcomes. SDG 16.a specifically requests to ‘Strengthen relevant national institutions, including through international cooperation, for building capacities at all levels, in particular in developing countries, to prevent violence and combat terrorism and crime’.

(55) In the High Level Meeting Communiqué of 19 February 2016, the OECD Development Assistance Committee updated the reporting directives on ODA in the field of peace and security. The financing of the actions under the Instrument constitutes ODA when it fulfils the criteria set out in those reporting directives or any subsequent reporting directives, upon which the Development Assistance Committee is able to agree.

(56) Capacity building in support of development and security for development should be used in exceptional cases only, where the objectives of the Instrument cannot be met by recourse to non-military actors.

(57) The Instrument should build on the experience gained and lessons learned from actions on capacity-building for development and security for development, in particular from relevant consultations and evaluations, conducted within the framework of Regulation (EU) 2017/2306 of the European Parliament and of the Council (27). In that context, the Commission should also take into account, where appropriate, joint evaluations with Member States.

(58) The Union should also promote a conflict-sensitive and gender-sensitive approach in all actions and programmes under the Instrument.

(59) Horizontal financial rules adopted by the European Parliament and the Council on the basis of Article 322 TFEU apply to this Regulation. Those rules are laid down in the Financial Regulation and determine in particular the procedure for establishing and implementing the budget through grants, prizes, procurement, indirect management, financial instruments, budgetary guarantees, financial assistance and the reimbursement of external experts, and provide for checks on the responsibility of financial actors. Rules adopted on the basis of Article 322 TFEU also include a general regime of conditionality for the protection of the Union budget.

(60) The types of financing and the methods of implementation under this Regulation should be chosen on the basis of their ability to achieve the specific objectives of the actions and to deliver results, taking into account, in particular, the costs of controls, the administrative burden and the expected risk of non-compliance. When making that choice, the use of lump sums, unit costs and flat rates, as well as financing not linked to costs of the relevant operation as referred to in point (a) of Article 125(1) of the Financial Regulation, should be considered.

(61) In accordance with Article 193(2) of the Financial Regulation, a grant may be awarded for an action which has already begun, provided that the applicant can demonstrate the need for starting the action prior to signature of the grant agreement. However, the costs incurred prior to the date of submission of the grant application are not eligible, except in duly justified exceptional cases. In order to avoid any disruption in Union support which could be prejudicial to Union interests, it should be possible to provide in the financing decision, during a limited period of time at the beginning of the 2021-2027 MFF, and only in duly justified cases, for eligibility of actions and costs from 1 January 2021, even if those actions were implemented and those costs were incurred before the grant application was submitted.

(62) The new European Fund for Sustainable Development Plus (EFSD+), built on the European Fund for Sustainable Development (EFSD) as established by Regulation (EU) 2017/1601, should constitute an integrated financial package supplying financing capacity in the form of grants, technical assistance, financial instruments, budgetary guarantees and blending operations worldwide. The EFSD+, complemented by efforts to improve the investment climate of partners, should become part of the External Investment Plan and combine blending and budgetary guarantee operations covered by the External Action Guarantee, including those covering sovereign risks associated with lending operations, previously carried out under the external lending mandate to the European Investment Bank (EIB). The allocation of funds to be used for EFSD+ operations should be based on the relevant programming documents, in particular the priorities defined therein, and should take into consideration, inter alia, the specific realities and needs of each partner country or region and the relative weight of the allocation of funds per geographical area laid down in this Regulation. Programming should lead to an appropriate balance between blending and budgetary guarantee operations under the EFSD+ as well as other forms of Union funding provided for in this Regulation. The EFSD+ should be implemented through an open and collaborative investment architecture to ensure the optimal use of the sectoral and geographic expertise of eligible counterparts and maximise its development impact. The EFSD+ should be composed of regional investment platforms within the regional areas covered by this Regulation and, where relevant, by the IPA III Regulation. To ensure that risk management of the EFSD+ is independent, impartial, inclusive and transparent, a technical risk assessment group, open to experts from the EIB, other eligible counterparts and interested Member States, organised and led by the Commission should be established. The Commission should ensure that information and analysis are shared in a timely, transparent and inclusive manner with all Member States, with due regard to confidentiality issues. The Commission should conclude External Action Guarantee agreements with all selected eligible counterparts, including the EIB, after consulting and taking into account the advice of the technical risk assessment group and should present the key elements of those agreements to the strategic board concerned.

(63) Given its role under the Treaties and its experience over the last decades in supporting Union policies, the EIB should remain a natural partner of the Commission for the implementation of operations under the External Action Guarantee. The EIB and the Commission should enhance their cooperation and coordination throughout the implementation of the External Action Guarantee under the EFSD+, including during the programming process and in the field. The EIB should be entrusted with the implementation of a dedicated investment window covering comprehensive risk cover for operations with sovereign counterparts and non-commercial sub-sovereign counterparts, which should be exclusive except for operations that the EIB cannot carry out or decides not to carry out. Additional non-exclusive dedicated investment windows should be established for the EIB, if appropriate, to provide comprehensive risk cover for operations with commercial sub-sovereign counterparts, and operations for the promotion of foreign direct investment, trade and the internationalisation of partner countries’ economies, including through inward foreign direct investments, as well as other Union thematic priorities in support of the objectives of the Instrument and in line with the SDGs, including with, but not limited to, European Development Finance Institutions and Union private sector entities. The EU guarantee should only provide a political risk cover for private sector operations, which should be coherent with those of the export credit agencies of Member States. Those investment windows, which should constitute the dedicated mandates required by the EIB to operate outside the Union, should apply the same rules and conditions as any other investment window under the EFSD+, including the rules of governance, and, except for the exclusive investment window, should be established in accordance with the procedure for eligibility and selection of operations and counterparts for the External Action Guarantee under the EFSD+ provided by this Regulation. For those three EIB-dedicated investment windows, the overall indicative amount should be EUR 26 725 000 000. The amounts for each of the investment windows should be substantiated and confirmed as a result of the programming process at the beginning of the multiannual financial framework and during the reviews of programming. The objectives, priorities and amounts for each of the investment windows and their implementation should ensure full policy alignment with the Union priorities and comply with this Regulation and the relevant multiannual indicative programmes, including its geographic and thematic priorities. The risk assessment and remuneration methodology under EFSD+ should be consistently applied to all investment windows, including those dedicated to the EIB, in order to ensure a level playing field. The investment windows implemented by the EIB should be able to cover any of the countries eligible for the External Action Guarantee, in particular where most needed and in accordance with the geographical priorities of the Instrument and, where relevant, the IPA III Regulation. EFSD+ guarantees for EIB operations with commercial sub-sovereign counterparts and private sector operations should be undertaken on terms similar to guarantees provided to other eligible counterparts. It should be possible for EFSD+ guarantees for operations with sovereign counterparts and non-commercial sub-sovereign counterparts and operations with commercial sub-sovereign counterparts that do not generate substantial revenues, undertaken by the EIB or other eligible counterparts, to be non-remunerated to help reduce the cost of financing for public sector investments undertaken by partner countries. In compliance with the objectives and general principles of the Instrument, the relevant indicative programming documents as well as, where relevant, the IPA III Regulation, the Commission and the EIB should conclude dedicated External Action Guarantee agreements for the EIB dedicated investment windows.

(64) The EFSD+ should aim to support investments as a means of contributing to the achievement of the SDGs by fostering sustainable and inclusive economic, environmental and social development, transition into sustainable value-added economy and a stable investment environment, and promoting socio-economic and environmental resilience in partner countries with a particular focus on the eradication of poverty, contributing to the reduction of socio-economic inequalities, sustainable and inclusive growth, the fight against climate change in line with the Paris Agreement, climate change adaptation and mitigation, environmental protection and management, the creation of decent jobs on the basis of the core labour standards of the International Labour Organization (ILO), economic opportunities, skills and entrepreneurship, socio-economic sectors, including social enterprises and cooperatives, micro, small and medium-sized enterprises (‘SMEs’), sustainable connectivity and, support to vulnerable groups, respect of human rights, gender equality and the empowerment of women and young people, as well as addressing specific socio-economic root causes of irregular migration and root causes of forced displacement, in accordance with the relevant indicative programming documents. The implementation of the EFSD+ should comply with the objectives, general principles and policy framework of the Instrument and, where relevant, the IPA III Regulation, in particular the applicable internationally agreed guidelines, principles and conventions on investment, including the UN Principles for Responsible Investment, the UN Guiding Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprises, the UN Food and Agriculture Organization’s Principles for Responsible Investment in Agriculture and Food Systems, ILO conventions, international human rights law and the development effectiveness principles as set out in the Busan Partnership for Effective Development Cooperation and reaffirmed at the Nairobi High Level Forum in 2016, including ownership, alignment, focus on results, transparency and mutual accountability, as well as the objective of untying aid. Special attention should be given to countries identified as experiencing fragility or conflict, LDCs, small island developing states, landlocked developing countries and heavily indebted poor countries.

(65) The EFSD+ should maximise additionality of funding, address market failures and sub-optimal investment situations, support local public entities in scaling up and autonomously financing their investment, deliver innovative products and ‘crowd-in’ private sector funds. Additionality should be applied in accordance with the objectives and principles of the Instrument and with other relevant Union policies. Involvement of the private sector, including SMEs, in the Union’s cooperation with partner countries through the EFSD+ should yield a measurable and additional development impact without distorting the local market and unfairly competing with local economic actors. It should be cost-effective, transparent, based on mutual accountability and risk and cost sharing. The EFSD+ should operate as a ‘one-stop-shop’, receiving financing proposals from financial institutions and public or private investors and delivering a wide range of financial support to eligible investments. The leveraging effect of EFSD+ should be evaluated, measuring the mobilisation of additional funding for sustainable development through the use of the EFSD+ financial support. The leverage effect should be measured according to the definition laid down in point 38 of Article 2 of the Financial Regulation and international rules and practices for measuring the amounts mobilised from the private sector by official development finance interventions, such as the OECD Development Assistance Committee methodologies. The European Parliament and the Council should be able to invite eligible counterparts and civil society to an exchange of views concerning the financing and investment operations covered by this Regulation.

(66) An External Action Guarantee should be established, building on the existing EFSD Guarantee established by Regulation (EU) 2017/1601 and the guarantees supported by the Guarantee Fund for external action established by Regulation (EC, Euratom) No 480/2009 The External Action Guarantee should support the EFSD+ operations covered by budgetary guarantees, macro-financial assistance and loans to third countries based on Council Decision 77/270/Euratom (28). Those operations should be supported by appropriations under the Instrument, together with those under the IPA III Regulation and Regulation (Euratom) 2021/… (5), which should also cover the provisioning and liabilities arising from macro-financial assistance loans and loans to third countries referred to in Article 10(2) of Regulation (Euratom) 2021/… (5), respectively. When funding EFSD+ operations, priority should be given to those which maximise additionality and development impact, including those which have a high impact on decent job creation and whose cost-benefit ratio enhances the sustainability of investment and which provide for sustainability and long-term development impact. The operations supported with the External Action Guarantee should be accompanied by an in-depth ex ante assessment of environmental, financial and social aspects, as appropriate and in line with the Better Regulation requirements. Budgetary guarantees and financial instruments should adhere to the Union policy on non-cooperative jurisdictions for tax purposes and updates thereto, as laid down in relevant legal acts of the Union and Council conclusions, in particular the Council conclusions of 8 November 2016 and the Annex thereto as well as principles laid down in Directive (EU) 2015/849 of the European Parliament and of the Council (29). All relevant Financial Regulation provisions apply, in particular those on indirect management laid down in Title VI of the Financial Regulation. The provision of essential public services should remain a government responsibility.

(67) In order to provide for flexibility, increase the attractiveness for the private sector and maximise the impact of the investments, a derogation from the rules related to the methods of implementation of the Union budget, as laid down in the Financial Regulation, should be provided as regards the eligible counterparts. Those eligible counterparts could also be bodies which are not entrusted with the implementation of a public-private partnership or bodies governed by the private law of a partner country.

(68) In order to increase the impact of the External Action Guarantee, Member States and contracting parties to the Agreement on the European Economic Area (30) should have the possibility of providing contributions in the form of cash or a guarantee. A contribution in the form of a guarantee should not exceed 50 % of the amount of operations guaranteed by the Union. The financial liabilities arising from that guarantee should not be provisioned and the liquidity cushion should be provided by the common provisioning fund established by Article 212 of the Financial Regulation.

(69) External actions are often implemented in a highly volatile environment requiring continuous and rapid adaptation to the evolving needs of Union partners, to global challenges to human rights, democracy and good governance, security and stability, climate change and the environment, and oceans, and to challenges related to migration and forced displacement and their root causes. Reconciling the principle of predictability with the need to react rapidly to new needs consequently means adapting the financial implementation of the programmes. To increase the ability of the Union to respond to unforeseen needs, and building on the successful experience of the European Development Fund, an amount should be left unallocated as an emerging challenges and priorities cushion. It should be mobilised in accordance with the procedures established in this Regulation.

(70) The emerging challenges and priorities cushion should guarantee the following additional resources: EUR 200 000 000 for the Human Rights and Democracy thematic programme, EUR 200 000 000 for the Civil Society Organisations thematic programme and EUR 600 000 000 for the Global Challenges thematic programme.

(71) The Commission should inform in detail the European Parliament before it mobilises the funds of the emerging challenges and priorities cushion and should fully take into consideration its observations on the nature, objectives and financial amounts envisaged.

(72) Therefore, while respecting the principle that the Union budget is set annually, this Regulation should preserve the possibility to apply the flexibilities already allowed by the Financial Regulation for other policies, namely carryovers and re-commitments of funds, to ensure efficient use of the Union funds both for Union citizens and the partner countries, thus maximising the Union funds available for the Union’s external action interventions.

(73) Capacity building of military actors in third countries should be undertaken as part of the Union’s development cooperation policy when it mainly pursues objectives in the field of development and as part of the Union’s Common Foreign and Security Policy (CFSP) when it mainly pursues objectives in the field of peace and security, in compliance with Article 40 TEU. This Regulation respects the application of the procedures and the extent of the powers of the institutions under the Union’s development cooperation policy and the Union’s CFSP.

(74) Actions under the Instrument that involve the provision or financing of equipment, services or technology should be in line with relevant Union, national and international provisions, in particular the rules set out in Council Common Position 2008/944/CFSP (31), with Union restrictive measures as well as with Regulation (EU) 2021/… of the European Parliament and of the Council (32) (6). Risk assessments by the Commission under the Instrument are without prejudice to the assessment of export licence applications by Member States. Each Member State should assess the export licence applications made to it, including those relating to government-to-government transfers, for items on the EU Common Military List, on a case-by-case basis against the criteria established in Common Position 2008/944/CFSP. In accordance with Regulation (EU) 2019/125 of the European Parliament and of the Council (33) such actions should not finance the provision of any type of equipment that may be used for torture or other cruel, inhuman or degrading treatment or punishment.

(75) The Decision on the Overseas Association, including Greenland lays down the financial envelope for the association of the overseas countries and territories with the Union. That financial envelope is the main source of funding for overseas countries and territories. Pursuant to the Decision on the Overseas Association, including Greenland, persons and entities established in overseas countries and territories should be eligible for funding under that Decision, subject to its rules and objectives and possible arrangements applicable to the Member State to which the relevant overseas country or territory is linked. Moreover, cooperation between the partner countries and the overseas countries and territories as well as the Union outermost regions under Article 349 TFEU should be encouraged in areas of common interest.

(76) In order to enhance partner countries’ ownership of their development processes and the sustainability of external aid, the Union should, where relevant, favour the use of partner countries’ own institutions, capacities and expertise and of partner countries’ systems and procedures for all aspects of the project cycle for cooperation while ensuring the full involvement of local governments and civil society. The Union should make available information and training on how to apply for Union funding to potential beneficiaries of Union funding.

(77) Communication fosters democratic debate, reinforces institutional control and scrutiny over Union funding, and contributes to boosting the credibility of the Union. The Union and the beneficiaries of Union funding should enhance the visibility of the Union’s action, and communicate adequately the added value of the Union’s support. In that regard, in accordance with the Financial Regulation, agreements concluded with recipients of Union funding should contain obligations ensuring appropriate visibility and the Commission should act in an appropriate and timely manner where these obligations are not met.

(78) Annual or multi-annual action plans and measures referred to in this Regulation should constitute work programmes under the Financial Regulation. Annual or multi-annual action plans should consist of a set of measures grouped into one document.

(79) In accordance with the Financial Regulation, Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council (34) and Council Regulations (EC, Euratom) No 2988/95 (35), (Euratom, EC) No 2185/96 (36) and (EU) 2017/1939 (37), the financial interests of the Union are to be protected by means of proportionate measures, including measures relating to the prevention, detection, correction and investigation of irregularities, including fraud, to the recovery of funds lost, wrongly paid or incorrectly used, and, where appropriate, to the imposition of administrative penalties. In particular, in accordance with Regulations (Euratom, EC) No 2185/96 and (EU, Euratom) No 883/2013, the European Anti-Fraud Office (OLAF) has the power to carry out administrative investigations, including on-the-spot checks and inspections, with a view to establishing whether there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union. The European Public Prosecutor’s Office (EPPO) is empowered, in accordance with Regulation (EU) 2017/1939, to investigate and prosecute criminal offences affecting the financial interests of the Union as provided for in Directive (EU) 2017/1371 of the European Parliament and of the Council (38). In accordance with the Financial Regulation, any person or entity receiving Union funds is to fully cooperate in the protection of the financial interests of the Union, grant the necessary rights and access to the Commission, OLAF, the Court of Auditors and, in respect of those Member States participating in enhanced cooperation pursuant to Regulation (EU) 2017/1939, the EPPO, and ensure that any third parties involved in the implementation of Union funds grant equivalent rights. For that reason, agreements with third countries and territories and with international organisations, and any contract or agreement resulting from the implementation of the Instrument, should contain provisions expressly empowering the Commission, the Court of Auditors and OLAF to conduct such audits, on-the-spot checks and inspections, in accordance with their respective competences and ensuring that any third parties involved in the implementation of Union funding grant equivalent rights.

(80) The Instrument should contribute to the international fight against tax fraud, tax evasion, fraud, corruption and money laundering.

(81) In order to supplement or amend non-essential elements of this Regulation, the power to adopt acts in accordance with Article 290 TFEU should be delegated to the Commission in respect of amending the amount of actions for capacity building of military actors in support of development and security for development, the maximum amount for the External Action Guarantee, the provisioning rates and maximum provisioning amount for the External Action Guarantee, the areas of cooperation and intervention listed in Annexes II, III and IV, the priority areas of the EFSD+ operations listed in Annex V, the indicators in Annex VI, as well as in respect of supplementing this Regulation with specific objectives and priority areas of cooperation drawn from the areas of cooperation for the geographic programmes set out in Annex II, including a prioritisation per sub-region, thematic targets and indicative financial allocations for certain sub-regions, and of supplementing this Regulation with provisions on the establishment of a monitoring and evaluation framework. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including with relevant stakeholders such as civil society and experts, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making (39). In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States’ experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts.

(82) In order to ensure uniform conditions for the implementation of the relevant provisions of this Regulation, implementing powers should be conferred on the Commission. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council (40).

(83) Pursuant to paragraphs 22 and 23 of the Interinstitutional Agreement of 13 April 2016 on Better Law-Making, the Instrument should be evaluated on the basis of information collected in accordance with specific monitoring requirements, while avoiding an administrative burden, in particular on Member States, and overregulation. Those requirements, where appropriate, should include measurable indicators, as a basis for evaluating the effects of the Instrument on the ground.

(84) The references to Union external assistance instruments in Article 9 of Council Decision 2010/427/EU (41), which are replaced by this Regulation, should be read as references to this Regulation. The Commission should ensure that this Regulation is implemented in accordance with the role of the European External Action Service as provided in that Decision.

(85) Actions and measures as provided for in this Regulation should, where relevant, be complementary to, consistent with and respect the measures adopted by the Union in pursuit of the CFSP objectives within the framework of Chapter 2 of Title V TEU and the measures adopted within the framework of Title IV of Part Five TFEU.

(86) Since the objectives of this Regulation cannot be sufficiently achieved by the Member States but can be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 TEU. In accordance with the principle of proportionality as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve those objectives.

(87) Decision No 466/2014/EU should be amended and repealed, and Regulations (EU) 2017/1601 and (EC, Euratom) No 480/2009 should be repealed.

(88) In order to ensure continuity in providing support in the relevant policy area and to allow implementation to start from the beginning of the 2021-2027 MFF, this Regulation should enter into force as a matter of urgency and should apply, with retroactive effect, from 1 January 2021,

HAVE ADOPTED THIS REGULATION:

TITLE I

GENERAL PROVISIONS

Article 1 Subject matter This Regulation establishes the Neighbourhood, Development and International Cooperation Instrument – Global Europe (the ‘Instrument’), including the European Fund for Sustainable Development Plus (the ‘EFSD+’) and the External Action Guarantee, for the period of the 2021-2027 MFF. It lays down the objectives of the Instrument, the budget for the period from 2021 to 2027, the forms of Union funding and the rules for providing such funding.

Article 2 Definitions For the purposes of this Regulation, the following definitions apply: (1) ‘country indicative programme’ means an indicative programme covering one country; (2) ‘multi-country indicative programme’ means an indicative programme covering more than one country; (3) ‘regional indicative programme’ means a multi-country indicative programme covering more than one third country within the same geographic area as established in Article 4(2); (4) ‘trans-regional indicative programme’ means a multi-country indicative programme covering more than one third country from different geographic areas as established in Article 4(2); (5) ‘cross-border cooperation’ means cooperation between one or more Member States, and one or more third countries and territories along the external adjacent land and maritime borders of the Union and shall be understood to cover also transnational cooperation over larger transnational territories or around sea basins and interregional cooperation as laid down in a Regulation of the European Parliament and of the Council on specific provisions for the European territorial cooperation goal (Interreg) supported by the European Regional Development Fund and external financing instruments (the ‘Interreg Regulation’); (6) ‘legal entity’ means a natural person, or a legal person created and recognised as such under Union, national or international law, which has legal personality and the capacity to act in its own name, exercise rights and be subject to obligations, or an entity which does not have legal personality as referred to in point (c) of Article 197(2) of the Financial Regulation; (7) ‘civil society organisation’ means a wide range of actors with multiple roles and mandates, which may vary over time and across institutions and countries, and includes all non-State, not-for-profit independent and non-violent structures, through which people organise the pursuit of shared objectives and ideals, including political, cultural, religious, environmental, social or economic, and which operate at local, national, regional or international levels, and which comprise urban and rural, formal and informal organisations; (8) ‘local authority’ encompasses public institutions with legal personality, which are components of the State structure, below the level of central government, such as villages, municipalities, districts, counties, provinces or regions, which are accountable to citizens and usually composed of a deliberative or policy-making body, such as a council or assembly, and an executive body, such as a mayor or other executive officer, which are directly or indirectly elected or selected at local level; (9) ‘investment window’ means a targeted area for support by the External Action Guarantee under the EFSD+ to portfolios of investments in specific regions, countries or sectors; (10) ‘additionality’ means the principle based on Article 209(2) of the Financial Regulation, according to which, in the context of this Regulation and the IPA III Regulation, the External Action Guarantee support under the EFSD+ contributes to sustainable development by operations which could not have been carried out without that Guarantee, or which achieve positive results above and beyond what could have been achieved without it. The principle of additionality also means that the operations supported by the External Action Guarantee crowd in private sector funding and address market failures or sub-optimal investment situations as well as improve the quality, sustainability, impact or scale of an investment. The principle also ensures that External Action Guarantee operations do not replace the support of a Member State, private funding or another Union or international financial intervention, and avoid crowding out other public or private investments unless duly justified in accordance with the objectives and principles of the Instrument. Projects supported by the External Action Guarantee typically have a higher risk profile than the portfolio of investments supported by the eligible counterparts under their normal investment policies without the External Action Guarantee; (11) ‘operation with sovereign counterparts and non-commercial sub-sovereign counterparts’ means any operation where the counterpart is either directly a State or a public entity fully backed by an explicit guarantee of the State because it does not have the legal capacity or the financial autonomy or ability to benefit from necessary direct financing; (12) ‘operation with commercial sub-sovereign counterparts’ means any operation where the counterpart is a public entity which is not backed by an explicit guarantee of a State and that is financially able to borrow at its own risk and has the legal capacity to do so; (13) ‘contributor’ means an international finance institution, a Member State or a public institution of a Member State, a public agency or other public or private entity contributing to the common provisioning fund; (14) ‘partner country’ means a country or territory that may benefit from Union support under the Instrument pursuant to Article 4. For the purposes of this Regulation, where reference is made to human rights, it shall be understood to include fundamental freedoms.

Article 3 Objectives of the Instrument 1. The general objectives of the Instrument are to: (a) uphold and promote the Union’s values, principles and fundamental interests worldwide, in order to pursue the objectives and principles of the Union’s external action, as laid down in Article 3(5) and Articles 8 and 21 TEU, thus contributing to the reduction and, in the long term, the eradication of poverty, to consolidating, supporting and promoting democracy, the rule of law and respect for human rights, sustainable development and the fight against climate change and addressing irregular migration and forced displacement, including their root causes; (b) contribute to the promotion of multilateralism, the achievement of the international commitments and objectives that the Union has agreed to, in particular the SDGs, the 2030 Agenda and the Paris Agreement; (c) promote stronger partnerships with third countries, including with the European Neighbourhood Policy countries based on mutual interests and ownership with a view to fostering stabilisation, good governance and building resilience. 2. The specific objectives of the Instrument are: (a) to support and foster dialogue and cooperation with third countries and regions in the Neighbourhood, in Sub-Saharan Africa, in Asia and the Pacific, and in the Americas and the Caribbean; (b) to develop special strengthened partnerships and enhanced political cooperation with the European Neighbourhood Policy countries, founded on cooperation, peace and stability and a shared commitment to the universal values of democracy, the rule of law and respect for human rights, and aiming towards deep and sustainable democracy and progressive socio-economic integration as well as people-to-people contacts; (c) at global level: (i) to protect, promote and advance democracy, the rule of law, including accountability mechanisms, and human rights, including gender equality and the protection of human rights defenders, including in the most difficult circumstances and urgent situations; (ii) to support civil society organisations; (iii) to further stability and peace and prevent conflict, thereby contributing to the protection of civilians; and (iv) to address other global challenges such as climate change, the protection of biodiversity and the environment, as well as migration and mobility; (d) to respond rapidly to: (i) situations of crisis, instability and conflict, including those which may result from migratory flows and forced displacement, and hybrid threats; (ii) resilience challenges, including natural and man-made disasters, and linking of humanitarian aid and development action; and (iii) Union foreign policy needs and priorities. 3. The achievement of the objectives referred to in paragraphs 1 and 2 of this Article shall be measured using relevant indicators as referred to in Article 41. 4. At least 93 % of the expenditure under the Instrument shall fulfil the criteria for ODA, established by the Development Assistance Committee of the OECD, thus contributing to ODA collective commitments, including towards LDCs. The specificity of the expenditure related to the partner countries and territories listed in Annex I shall be taken into account.

Article 4 Scope and structure 1. Union funding under the Instrument shall be implemented through: (a) geographic programmes; (b) thematic programmes; (c) rapid response actions. 2. The geographic programmes shall encompass country and multi-country cooperation in the following areas: (a) Neighbourhood; (b) Sub-Saharan Africa; (c) Asia and the Pacific; (d) Americas and the Caribbean. Geographic programmes may cover all third countries, except for candidates and potential candidates as defined in Regulation (EU) 2021/…. (7) and overseas countries and territories. Geographic programmes of a continental or trans-regional scope may also be established, in particular a pan-African programme covering African countries under points (a) and (b) of the first subparagraph and a programme covering African, Caribbean and Pacific countries under points (b), (c) and (d) of the first subparagraph. Geographic programmes in the Neighbourhood area may cover any country or territory listed in Annex I. In order to attain the objectives of the Instrument, geographic programmes shall be based on the areas of cooperation set out in Annex II. 3. The thematic programmes shall encompass actions linked to the pursuit of the SDGs at global level, in the following areas: (a) Human Rights and Democracy; (b) Civil Society Organisations; (c) Peace, Stability and Conflict Prevention; (d) Global Challenges. Thematic programmes may cover all third countries as well as overseas countries and territories. In order to attain the objectives of the Instrument, thematic programmes shall be based on the areas of intervention set out in Annex III. 4. The rapid response actions shall enable early action to: (a) contribute to peace, stability and conflict prevention in situations of urgency, emerging crisis, crisis and post-crisis, including those which may result from migratory flows and forced displacement; (b) contribute to strengthening the resilience of states, societies, communities and individuals and to linking humanitarian aid and development action and, where relevant, peacebuilding; (c) address Union foreign policy needs and priorities. Rapid response actions may cover all third countries as well as overseas countries and territories. In order to attain the objectives of the Instrument, rapid response actions shall be based on the areas of intervention set out in Annex IV. 5. Actions under the Instrument shall be implemented primarily through geographic programmes. Actions implemented through thematic programmes shall be complementary to actions funded under geographic programmes and shall support global and trans-regional initiatives aimed towards achieving internationally agreed goals, in particular the SDGs and the Paris Agreement, as well as protecting global public goods or addressing global challenges. Actions implemented through thematic programmes may also be undertaken where: (a) there is no geographic programme; (b) the geographic programme has been suspended; (c) there is no agreement on the action with the partner country concerned; or (d) the action cannot be adequately addressed by geographic programmes. Rapid response actions shall be complementary to geographic and thematic programmes. Rapid response actions shall be designed and implemented to enable, where relevant, their continuity under geographic or thematic programmes. 6. The Commission is empowered to adopt delegated acts in accordance with Article 44 to amend Annexes II, III and IV. 7. The Commission is empowered to adopt a delegated act in accordance with Article 44 by 31 December 2021, to supplement this Regulation with provisions setting out: (a) specific objectives and priority areas of cooperation drawn from the areas of cooperation for the geographic programmes in Annex II, including a prioritisation, for the following sub-regions: Neighbourhood South, Neighbourhood East, West Africa, East and Central Africa, Southern Africa and Indian Ocean, Middle East, Central Asia, South Asia, North and South East Asia, the Pacific, the Americas and the Caribbean; (b) indicative thematic targets for the geographic pillar; and (c) indicative financial allocations for West Africa, East and Central Africa, Southern Africa and Indian Ocean sub-regions. The delegated act referred to in the first subparagraph of this paragraph shall be reviewed at the mid-term evaluation referred to in Article 42(2).

Article 5 Consistency, coherence, synergies and complementarity 1. In implementing the Instrument, consistency, coherence, synergies and complementarity with all areas of Union external action, including other external financing instruments, and with other relevant Union policies and programmes, as well as policy coherence for development shall be ensured. For that purpose, the Union shall take into account the impact of all internal and external policies on sustainable development and shall seek to promote increased synergies and complementarities in particular with trade policy, economic cooperation and other sectorial cooperation. 2. Actions falling within the scope of Regulation (EC) No 1257/96 shall not be funded under the Instrument. 3. Where appropriate, an action that has received a contribution under the Instrument may also receive a contribution from another Union programme, provided that the contributions do not cover the same costs. The Instrument may also contribute to measures established under other Union programmes, provided that the contributions do not cover the same costs. The rules of the relevant Union programme shall apply to the corresponding contribution to the action. The cumulative financing shall not exceed the total eligible costs of the action. The support from the different Union programmes may be calculated on a pro-rata basis in accordance with the documents setting out the conditions for support.

Article 6 Budget 1. The financial envelope for the implementation of the Instrument for the period from 1 January 2021 to 31 December 2027 shall be EUR 79 462 000 000 in current prices. 2. The financial envelope referred to in paragraph 1 shall be composed of: (a) EUR 60 388 000 000 for geographic programmes: — Neighbourhood: at least EUR 19 323 000 000, — Sub-Saharan Africa: at least EUR 29 181 000 000, — Asia and the Pacific: EUR 8 489 000 000, — Americas and the Caribbean: EUR 3 395 000 000; (b) EUR 6 358 000 000 for thematic programmes: — Human Rights and Democracy: EUR 1 362 000 000, — Civil Society Organisations: EUR 1 362 000 000, — Peace, Stability and Conflict Prevention: EUR 908 000 000, — Global Challenges: EUR 2 726 000 000; (c) EUR 3 182 000 000 for rapid response actions. 3. The emerging challenges and priorities cushion of EUR 9 534 000 000 shall increase the amounts referred to in points (a), (b) and (c) of paragraph 2 of this Article in accordance with Article 17. 4. The financial envelope referred to in point (a) of paragraph 2 shall correspond to at least 75 % of the financial envelope referred to in paragraph 1. 5. Actions under Article 9 shall be financed up to the amount of EUR 270 000 000. The Commission is empowered to adopt delegated acts in accordance with Article 44 to amend that amount.

Article 7 Policy framework The association agreements, partnership and cooperation agreements, multilateral agreements to which the Union is a party, and other agreements that establish a legally binding relationship between the Union and partner countries as well as European Council conclusions, Council conclusions, summit declarations or conclusions of meetings with partner countries at the level of heads of state or government or ministers, European Parliament resolutions, communications of the Commission and the High Representative of the Union for Foreign Affairs and Security Policy (the ‘High Representative’) shall constitute the overall policy framework for the implementation of the Instrument.

Article 8 General principles 1. The Union shall seek to promote, develop and consolidate the principles of democracy, good governance, the rule of law, respect for human rights, including their universality and indivisibility, and fundamental freedoms and respect for human dignity, the principles of equality and solidarity on which it is founded, through dialogue and cooperation with partner countries, regions and civil society, including through action in multilateral fora. 2. The Instrument shall apply a rights-based approach encompassing all human rights, whether civil and political or economic, social and cultural in order to integrate human rights principles, to support the right holders in claiming their rights, with a focus on poorer, marginalised and vulnerable people and groups, including persons with disabilities, and to assist partner countries in implementing their international human rights obligations. That approach shall be guided by the principles of ‘leaving no-one behind’, equality and non-discrimination on any grounds. 3. The Instrument shall promote gender equality, women’s and girls’ rights and empowerment and non-discrimination on any grounds, through targeted and mainstreamed actions. It shall also give particular attention to the rights of the child and empowerment of youth. 4. The Instrument shall be implemented in full accordance with the Union commitment to the promotion, protection and fulfilment of all human rights and to the full and effective implementation of the Beijing Platform for Action and the Programme of Action of the ICPD and the outcomes of their review conferences and remains committed to sexual and reproductive health and rights, in this context. Having that in mind, the Instrument shall support the Union commitment to the promotion, protection and fulfilment of the right of every individual to have full control over, and decide freely and responsibly on matters related to their sexuality and sexual and reproductive health, free from discrimination, coercion and violence. It shall also support the need for universal access to quality and affordable comprehensive sexual and reproductive health information, education, including comprehensive sexuality education, and health-care services. 5. The Union shall support, as appropriate, the implementation of bilateral, regional and multilateral cooperation and dialogue, association and trade agreements, partnership agreements and triangular cooperation. The Union shall promote a multilateral and rules-based and values-based approach to global goods and challenges and shall cooperate with Member States, partner countries, international organisations and other donors in that respect. The Union shall promote effective multilateralism in fostering cooperation with international organisations and other donors. The Union shall take into account and take up in the regular political dialogue with partner countries their track record in implementing obligations and commitments, including the 2030 Agenda, international human rights conventions, and other conventions, including those on nuclear safety standards, international agreements, in particular the Paris Agreement, and contractual relations with the Union, in particular association agreements, partnership and cooperation agreements and trade agreements. 6. Cooperation between the Union and the Member States, on the one hand, and partner countries, on the other, shall be based on and shall promote the development effectiveness principles, where applicable, across all modalities, namely: ownership of development priorities by partner countries, a focus on results, inclusive development partnerships, transparency and mutual accountability. The Union shall promote effective and efficient resource mobilisation and use. In line with the principle of inclusive partnership and transparency, where appropriate, the Commission shall ensure that relevant stakeholders of partner countries, including civil society organisations and local authorities, are duly consulted and have timely access to relevant information allowing them to be adequately involved and play a meaningful role in the design, implementation and associated monitoring processes of programmes. Where appropriate, the Commission shall also ensure that an enhanced dialogue is pursued with the private sector. In line with the principle of ownership, the Commission, where appropriate, shall favour the use of partner countries’ institutions and systems for the implementation of programmes. 7. In order to promote the complementarity and efficiency of their action and initiatives, the Union and the Member States shall ensure the coordination of their policies and shall regularly consult each other on their assistance programmes, including in international organisations and during international conferences. The Union and the Member States shall coordinate their respective support programmes with the aim of increasing effectiveness and efficiency. The Union shall foster inclusiveness in the implementation of the Instrument and collaboration with Member States, seeking to maximise added value and taking into account experience and capacities, thus reinforcing shared interests, values and common goals. The Union shall encourage the exchange of best practices and knowledge sharing among Member States’ bodies and experts. 8. Programmes and actions under the Instrument shall mainstream the fight against climate change, environmental protection, human rights, democracy, gender equality and, where relevant, disaster risk reduction, and shall address interlinkages between the SDGs, to promote integrated actions that can create co-benefits and meet multiple objectives in a coherent way. Those programmes and actions shall be based on a comprehensive multi-disciplinary analysis of context, capacities, risks and vulnerabilities, integrate a resilience approach and be conflict sensitive, taking into account conflict prevention and peacebuilding. They shall be guided by the principles of ‘do no harm’ and of ‘leaving no-one behind’. 9. The Instrument shall promote the use of digitalisation as a powerful enabler for sustainable development and inclusive growth. 10. A more coordinated, holistic and structured approach to migration shall be pursued with partners, taking into account the importance of addressing the root causes of irregular migration and forced displacement. It shall maximise synergies and build comprehensive partnerships, while paying specific attention to countries of origin and transit. That approach shall combine all appropriate tools and the necessary leverage through a flexible incitative approach with, as appropriate within this context, possible changes in allocation of funding related to migration in accordance with the programming principles of the Instrument. It shall take into account effective cooperation and implementation of Union agreements and dialogues on migration. Those actions shall be implemented in full respect of international law, including international human rights and refugee law, Union and national competences. The effectiveness of that approach shall be assessed annually or as necessary. Migration-related actions pursuant to the Instrument shall be implemented in support of Union migration policy objectives through a flexible funding mechanism. 11. The Commission shall ensure that actions adopted under the Instrument in relation to the fight against terrorism and organised crime, cyber security and the fight against cybercrime, and capacity building of military actors in support of development and security for development are implemented in accordance with international law, including international human rights and humanitarian law. To that end, the Commission shall establish an appropriate risk assessment and monitoring framework. In that framework, the Commission shall develop operational guidance to ensure that human rights are taken into consideration in the design and implementation of those actions. Such actions shall be based on regular and robust conflict analysis to ensure conflict sensitivity and to implement a security sector reform approach that contributes to democratic governance, accountability and human security, including benefits for the local population. Those measures shall be embedded, where relevant, in the context of longer term assistance aimed at reforming the security sector. 12. The Commission shall regularly inform the European Parliament and the Council and, at the initiative of any of those three institutions, have exchanges of views with them, including on the incentive-based approach responding to performance in key areas, referred to in Article 20. The European Parliament may hold regular exchanges of views with the Commission regarding its own assistance programmes, on matters such as capacity-building, including related mediation and dialogue, and election observation. 13. The Commission shall exchange information on a regular basis with civil society. 14. Where appropriate, the Commission shall develop and follow risk management frameworks, including assessment and mitigation measures. 15. Union funding under the Instrument shall not be used to finance the procurement of arms or ammunition, or operations having military or defence implications.

Article 9 Capacity building of military actors in support of development and security for development 1. In order to contribute to sustainable development, which requires the achievement of stable, peaceful and inclusive societies, Union assistance under the Instrument may be used in the context of a wider security sector reform or to build the capacity of military actors in partner countries, under the exceptional circumstances set out in paragraph 3, to deliver development activities and security for development activities. 2. Assistance pursuant to this Article may cover in particular the provision of capacity building programmes in support of development and security for development, including training, mentoring and advice, as well as the provision of equipment, infrastructure improvements and services directly related to that assistance. 3. Assistance pursuant to this Article shall be provided only: (a) where requirements cannot be met by recourse to non-military actors to adequately reach Union objectives under the Instrument and there is a threat to the existence of functioning State institutions or to the protection of human rights and fundamental freedoms and State institutions cannot cope with that threat; and (b) where a consensus exists between the partner country concerned and the Union that military actors are key for preserving, establishing or re-establishing the conditions essential for sustainable development, including in crises and fragile or destabilised contexts and situations. 4. Union assistance pursuant to this Article shall not be used to finance capacity building of military actors for purposes other than the delivery of development activities and security for development activities. In particular, it shall not be used to finance any of the following: (a) recurrent military expenditure; (b) the procurement of arms and ammunition, or any other equipment designed to deliver lethal force; (c) training which is designed to contribute specifically to the fighting capacity of the armed forces. 5. When designing and implementing measures pursuant to this Article, the Commission shall promote ownership by the partner country. It shall also develop the necessary elements and the good practices required to ensure sustainability and accountability in the medium and long term and shall promote the rule of law and established international law principles.

TITLE II

IMPLEMENTATION OF THE INSTRUMENT

CHAPTER I

Programming

Article 10 Scope of the geographic programmes 1. In order to attain the objectives of the Instrument geographic programmes shall be drawn up from the following areas of cooperation: (a) good governance, democracy, the rule of law and human rights, including gender equality; (b) eradicating poverty, fighting against inequalities and discrimination, and promoting human development; (c) migration, forced displacement and mobility; (d) environment and climate change; (e) inclusive and sustainable economic growth and decent employment; (f) peace, stability and conflict prevention; (g) partnership. 2. Further details on each of the areas of cooperation referred to in paragraph 1 are set out in Annex II.

Article 11 Scope of the thematic programmes 1. In order to attain the objectives of the Instrument, thematic programmes shall cover the following areas of intervention: (a) Human Rights and Democracy: advancing: (i) the fundamental values of democracy; (ii) the rule of law; (iii) the universality, indivisibility and interdependence of human rights; (iv) respect for human dignity; (v) the principles of non-discrimination, equality and solidarity; (vi) respect for the principles of the Charter of the UN and international human rights law; (b) Civil Society Organisations: (i) inclusive, participatory, empowered and independent civil society and democratic space in partner countries; (ii) inclusive and open dialogue with and between civil society actors; (iii) awareness, understanding, knowledge and engagement of European citizens regarding development issues; (c) Peace, Stability and Conflict Prevention: (i) assistance for conflict prevention, peacebuilding and crisis preparedness; (ii) assistance in addressing global and trans-regional threats and emerging threats; (d) Global Challenges: (i) health; (ii) education; (iii) gender equality and women’s and girls’ empowerment; (iv) children and youth;