Proposal for a COUNCIL REGULATION (EC) laying down general rules for the granting of Community financial aid in the field of trans-European networks
Date: 1994-03-02
Institutions: European Commission
Subjects: EU financial instrument, aid system, energy transport, intra-EU transport, telecommunications, transport infrastructure

COMMISSION  OF  THE  EUROPEAN  COMMUNITIES 

C0M(94) 62  final 

Brussels, 02.03.1994 

94/ 0065(SYN) 

Proposal  for a 

COUNCIL REGULATION  (EC) 

laying down general rules for the granting 
of Community  financial aid in the field 
of trans-European  networks 

(presented  by  the Commission) 

PROPOSAL  FOR A COUNCIL REGULATION 

laying down general  rules for 
the granting of Community  financial  aid  in the 
field of  trans-European networks 

CONTENTS 

Recitals 
DEFINITION AND SCOPE 
Article  1 - Definition and scope 
Article 2 - Eligibility 
FORMS OF AID AND RESOURCES 
Article 3 - Forms of aid 
Article 4 - Budgetary  resources 
Article 5 - Financial  participation 
CRITERIA  FOR SELECTING PROJECTS 
Article 6 - Common criteria  for selecting projects 
Article 7 - Specific criteria: Transport 
Article 8 - Telecommunications 
Article 9 - Energy 
Article  10 - Compatibi lity 
DEC IS ION PROCEDURES 
Article 11 - Submission of appl icat ions for aid 
Article  12 - Assessment  of applications 
Article 13 - Dec is ion-talcing 
OTHER  PROVISIONS 
Article 14 - Financial  provisions 
Article  15 - Financial  control 
Article  16 - Coordination 
Article 17 - Evaluation 
Article  18 -  Information and publicity 
Article 19 - Committee 
FINAL PROVISIONS 
Article 20 - Entry  into force 

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EXPLANATORY  MEMORANDUM 

1. Title XII of  the Union Treaty  defines  the tasks and  instruments of  the 

Community  as regards  the establishment  and  development  of  trans-European 
networks  in the sectors of  transport, telecommunications and  energy 
infrastructure. 

Accordingly, Article  129c of  the Treaty  provides  that  the Community: 

should  establish a series of guidelines and  identify  projects of 
common  interest; 
should  ensure  inter-operabiIity of  the networks; and 
should  support  the financial  efforts made by  the Member  States, 
particularly  through  feasibility studies,  loan guarantess  and 
interest-rate subsidies. 

The Community  may  also help  to coordinate  the policies adopted  by  the 
Member  States and  cooperate with  third countries. 

2. The European Council  in Copenhagen  in June  1993  included  trans-European 
networks among  the measures  to be taken  in the short  term  to promote 
competitiveness, growth  and employment. 

By  approving  the White Paper  put  forward  by  the Commission, the  European 
Council  in Brussels  in December  1993 gave  fresh  impetus to rapid 
implementation»of Title XII of  the Treaty. 

The Brussels  European Council  also  recommended  effective procedures  for 
rapid  implementation of  priority  infrastructure  projects  in the  sectors 
covered  by Title XII of  the Treaty. 

To  this effect  the European Council  asked  the Council  of  the  European 
Union  to make  full  and  rapid use of  the new possibilities offered  by  the 
Treaty.  It also asked  the Commission, with  the help of  a group of 
représentâtives of  the Heads of  State and Government, to act  as promoter 
and coordinator  to ensure proper  implementation of  infrastructure 
programmes  and  to speed up  the  implementation of  priority  projects. 

It  is against  this background  that  the Commission  is presenting  this 
proposal  for  a Regulation  to the Council  and  to the European  Parliament. 

3. The proposal  for a Regulation sets out  to  lay down general  rules  for  the 
granting of Community  financial  aid  to the  infrastructure projects  in the 
sectors of  transport, telecommunications and energy  identified  in the 
Council's guidelines  in the field of  trans-European  networks. 

This Regulation  is thus designed  to provide a  legal  foundation, on the 
basis of Article  129 D.3 of  the Union Treaty, for Community  financial  aid 
to  implement  trans-European  networks. 

3 

-  2 -

The Commission  would  stress  that  adoption of  this Regulation  is 
indispensable  if projects  are  to be  implemented;  otherwise,  it would  be 
impossible  to use  the appropriations entered  in the budget  for  that 
purpose.  Adoption of  the Regulation  is thus a precondition  for 
implementing  the conclusions of  the December  1993 European Council  and 
the priority  projects. 

The Commission  would  also draw  the attention  of  Council  and  Parliament  to 
the  fact  that  the Regulation on  transport  infrastructure  expires at  the 
end of  this year. 

Finally, adoption of  all  the guidelines  in the  field of  trans-European 
networks  for  the various  sectors  could  be held  up  by  the  late  setting-up 
of  the Committee  of  Regions and  the elections  to the European  Parliament 
in June  1994. 

The Commission  takes  the view  that  the  late adoption  of  certain 
guidelines should  not  compromise  the  implementation  of  priority 
infrastructure  projects proposed  by  the  Commission. 

4.  In proposing  this draft  Regulation,  the Commission  has opted  for  a single 
regulation  for  all  the networks  referred  to  in Article  129c of  the Union 
Treaty. 

This proposal, which  is based  largely on  the  legislation  relating  to the 
Cohesion  Fund,  provides  for  provisions  common  to the  three sectors of 
transport,  telecommunications  and energy  and  for  a single  procedure  for 
implementing  the Regulation  (Management  Committee);  the only  difference 
is  in the project  selection  criteria. 

Nonetheless,  the Commission  proposes  to exclude  from  this Regulation  the 
guidelines  relating  to  trans-European  data  communications  networks 
between  administrations  (IDA),  for which  a proposal  for  a Decision  is 
before  the Council  and  the European  Parliament, because of  its specific 
nature. 

5. The proposal  for  a Regulation defines  the various  types of  aid, 

establishes general  rules on  financial  participation, contains common  and 
specific  criteria  for  the selection  of  projects  and  describes  the 
processing, evaluation  and  follow-up  procedures  for  requests  for  aid. 

6. As  regards  the  types of  aid, where  by way of exception  the other  types 

provided  for  (feasibility  studies,  loan guarantees,  interest-rate 
subsidies) are  inappropriate,  the Commission  provides  for  the possibility 
of  co-financing.  In addition,  the possibility  of  awarding  a  declaration 
of  European  interest, which  is set  out  in a proposal  for  a Regulation 
before  the Council1  and  Parliament,  could  provide  a kind  of  "European 
label",  thereby  facilitating  access  to Community  financial  instruments 
and  enabling  private  capital  to be mobilized. 

7. The  rules governing  financial  participation provide  in particular  for a 
maximum  amount  of  interest-rate  subsidies.  This  is set  at  10% of  the 
total  investment  cost  in net  grant  equivalent,  amounting  to a subsidy  of 
2-3  points over  a period  of  4  to 5 years. 

Proposal  for  a Council  Regulation  introducing  a declaration  of  European 
interest  to  facilitate  the establishment  of  trans-European  networks  ... 

-  3 -

As  regards  loan guarantees, Community  aid would  cover  all  of  part  of  the 
loan guarantee  premiums  granted  by  the  European  Investment  Fund or, where 
appropriate, by other, similar  financial  organizations. 

8. The budgetary  resources  available  were entered  for  trans-European 

networks  in the  1994-99  financial  perspective.  They will  subsequently 
form  part  of  new  financial  perspectives. 

9. The processing,  évaluât ion and  follow-up  procedures  for  requests  for  aid, 

along  with  the  financial  provisions, are based  largely on  similar 
provisions  contained  in the  legislation  relating  to  the Cohesion  Fund. 

In  line with  the conclusions of  the December  1993 European  Council,  the 
proposal  also provides  for  the Commission,  in order  to  facilitate 
implementation of  the projects,  to bring  together  all  the public and 
private  economic  operators  involved  in the projects  submitted  (round 
table  meetings). 

Finally,  the draft  Regulation  lays down  specific  provisions  regarding 
assessment  and  reporting. 

c 

Proposal  for a 

COUNCIL  REGULATION 

laying down general  rules for  the granting 
of Community  financial  aid  in the field 
of  trans-European  networks 

THE COUNCIL OF THE EUROPEAN  UNION, 

Having  regard  to the Treaty  establishing  the European Community, and  in 
particular  the third paragraph of Article  129d  thereof, 

Having  regard  to the proposal  from  the Commission, 

In cooperation with  the European Par Iiament, 

Having regard  to the opinion of  the Economic and Social  Committee, 

Having  regard  to the opinion of  the Committee of  the Regions, 

Whereas under Article 3 of  the Treaty  the 
activities of  the Community  should  include, 
in particular, encouragement  for  the establishment 
and development  of  trans-European  networks; 

Whereas Article  129b of  the Treaty  states that 
to help achieve  the objectives  referred  to 
in Articles 7a and  130a of  the Treaty  the 
Community  should contribute  to the establishment 
and development  of  trans-European  networks  in the 
areas of  transport, telecommunications and 
energy  infrastructures; 

Whereas Article  129c(1), third  indent, provides 
that  the Community  may  support  the  financial 
efforts of  the Member  States  to establish 
trans-European  networks; 

1. 

2. 

3. Article 1 

Whereas general  rules should be  laid down for 
the Community  financing of  trans-European 
networks, thereby permitting  implementation of 
this Article; 

4. 

-  2 -

Whereas under  Article  129c Community  aid  should 
be granted  to projects of  common  interest 
financed  by  the Member  States which  are 
identified  in the  framework  of  the guidelines; 

Whereas  certain  projects were given  priority 
status by  the Brussels  European  Council  in 
December  1993  in the White  Paper  on  growth, 
compet i t i veness and  empIoyment; 

Whereas, pending  adoption of  all  the 
guidelines  referred  to  in Article  129c of  the 
Treaty,  it  is necessary  to be  able  to 
support  priority  projects of  this kind,  since 
they  help  to achieve  the objectives of 
Article  129b of  the Treaty-, 

Whereas  Community  aid may  take  the shape  in 
particular  of  feasibility  studies,  loan 
guarantees or  interest-rate  subsidies; 
whereas  these  subsidies  and  guarantees  take 
the  form  in particular  of  aid  from  the  EIB, 
the other  Community  loan  instruments  and  the 
EIF ; whereas  in exceptional  cases  investment 
projects may  be  co-financed; 

Whereas  loan guarantees will  be granted  by 
the European  Investment  Fund on  a commercial 
basis or, where  appropriate, by other 
financial  organizations; whereas  Community 
financial  aid may  cover  all  or  part  of  the 
premiums paid  by  the beneficiaries of  these 
guarantees; 

5. Article  2(1) 
eligibility 

6. Article  2(2) 
eligibility 

7. Article  2(g) 

eligibility 

8. Article  3: 

forms of  aid 

9. Article 5(3): 

loan guarantees 

Whereas  the Commission  must  assess  the  financial 
arrangements of  the projects with  the  help of 
data  provided  by  the applicants  and  the 
respective analyses so as  to ensure  the 
financial  viability  of  the projects; 

10. Article 5(1): 
financial 
participation 

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Whereas Community  action must  take  account  of 
the potential  economic  viability of  the projects, 
as evaluated  with  the help of  cost/benefit 
analyses  and other  appropriate  criteria; 

Whereas, with  an eye  to profitability,  a detailed 
evaluation  should  be undertaken  before  Community 
resources are committed  so as  to guarantee  that 
the  resources mobilized  generate  the  desired 
socio-economic  benefits; 

Whereas  Community  financial  support  under 
Article  129c(1) of  the Treaty  must  be  compatible 
with Community  policies,  in particular  as  regards 
environmental  protection, competition  and  the 
award  of  public  contracts;  whereas  environmental 
protection  includes an environmental  impact 
assessment ; 

11. Articles 6,  7, 
8, and  9: 
selection 
criteria 

12. Articles 6, 7, 
8  and  9: 
selection 
criteria 

13. Article  10: 

compatibility 

Whereas  the Commission  must  ensure  proper 
coordination  of  all  Community  activities  affecting 
trans-European  networks; 

14. Article  16: 

coordination 

Whereas  provision  should  be made  for  suitable 
methods of  evaluation,  follow-up  and  control  of 
Community  aid; 

15. Article  1^: 

evaluation 

Whereas  there  should  be suitable  information 
and publicity  regarding  the  activities 
financed, 

16. Article ^%: 
information 
pub Iicity 

and 

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HAS ADOPTED THIS REGULATION: 

Article  1:  Definition and scope 

This Regulation defines the conditions and 
procedures for granting Community  aid  to 
projects of common  interest  in the field 
of  trans-European networks  for  transport, 
energy  and  telecommunications 
infrastructures under Article  129c of  the 
Treaty, without  prejudice  to the specific 
rules and  regulations  laid down  in Council 
Decision ...' 

Article 2:  Eligibility 

1. The Community aid granted  in accordance 
with  this Regulation shall  concern  projects 
of common  interest  financed by  the Member 
States and  identified within  the  framework 
of  the guidelines referred  to  in Article 129c 
of  the Treaty. 

2. Projects financed by organizations working 
within an administrative or  legal  framework 
which makes them similar  to public organizations 
shalI also be eligible. 

3. Where  the guidelines referred  to in 
Article  129c, as proposed  by the Commission, 
have not yet been adopted  by the Council other 
infrastructure projects which contribute  to the 
achievement  of  the objectives set out  in 
Article  129b of  the Treaty may be eligible. 

Proposal  for a Council  Decision on a series of guidelines for 
trans-European  data communications networks between administrations 
(IDA) - C0M(93)69 final, OJ C  105, 16.4.1993, p. 10. 

i 

4. Within  the meaning of  this Regulation  ths 
concept of  "project" shal \  inclut»"1 the 
technicaliy and  financially  separate 
stagas of projects which  form a v.i.ole 
designed  to fulfil  an economic and 
technical  function. 

Artie!© 3:  Forms of aid . 

Community  aid may  take one or 
several  of  the following forms: 

(a) co-financing of  feasibility studies, 
including preparatory  studies, evaluation 
studies and other  technical  support 
measures; 

(b) contribution  to the premiums of  loan 
guarantees; 

(c)  interest-rate subsidies; 

(d) where by way of exception the forms of 
financial  aid provided  for above are 
inappropriate, co-finaneing of  investment 
projects. 

U  I 

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Article 4:  Budgetary  resources 

In compliance with Article 203 of  the 
Treaty  the budgetary  authority  shall, 
in accordance with  the financial 
perspective  applicable  in the budgetary 
procedure, set  the amount of  appropriations 
for each  year  and  for each  area  referred  to 
in Article  1. 

Article 5:  Financial  participation 

1.  In general  Community  aid  to feasibility 
studies shall  be subject  to a substantial 
contribution  from  the public authorities. 

The preparatory  studies and  technical 
support measures, for a given project, 
undertaken at  the  initiative 
of  the Commission, may  be 
financed, where necessary, to 100% 
of  the total  cost. 

2. The maximum amount of  interest-rate 
subsidy may  not exceed  10% of  the total 
cost of  the  investment  in net grant 
equivalent. 

These subsidies shall  apply  in particular 
to projects  in receipt of Community  loans. 

3. Community  financial  support may  cover 
all or part of  the  loan guarantee premiums 
granted  by  the European  Investment  Fund or, 
where appropriate, by other, similar 
financial  organizations. 

4. Where, by way of exception, the aid  takes 
the form of a direct  subsidy within  the 
meaning of Article  3(1)(d) above, the 
Commission  shall  make  the  level of  that 
subsidy  such  that  it  is sufficient  to 
mobilize  the requisite  financial  resources. 

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Article 6:  Common  project  selection 
criteria 

1. The projects shall  be of  sufficient 
dimension  to have a significant  impact 
on  the establishment and development  of 
networks. 

Community  aid shall  be granted on a 
priority  basis to projects according  to 
their  degree of contribution 

(a) to the establishment of  trans-European 
networks; 

(b) to the harmonization of  technical 
standards; 

(c) to the  interconnection and  inter 
operability of national  networks; 

(d) to the  improvement of access to 
networks; 

(e) to the  integration of  the various 
networks; 

(f) to the reliability  and safety of  the 
networks. 

2. Projects shall  also be selected  as a 
function of: 

(a) their  contribution 
-  to the smooth  running of  the  internal market 
-  to the economic  and social  cohesion of  the Community, 
in particular  in regard  to the need  to connect  island, 
landlocked  and peripheral  regions  to the 
central  areas of  the Community; 

(b) their  importance  to the development of 
trade at European  level; 

(c) their  contribution  to  increasing  the 
competitiveness of  the European  economy; 

(d) their  compliance with  environmental 
considérât ions; 

(e) their  consistency  with Community 
regional  planning. 

-  8 -

3. Account  shall  also be taken of; 

(a) their  potential  economic  viability: 
extent of  financial  and socio-economic 
profitability,  including  direct or 
indirect effects on employment; 

(b) their  readiness; 

(c) the soundness of  the financial 
package; 

(d) the need  for Community  financial 
aid; 

(e) the promotion of participation of  the 
private sector  as part of  a public/private 
partnership. 

Article 7:  Selection criteria concerning 
transport 

Without  prejudice  to the common criteria 
referred  to  in Article 6, Community  financial 
aid  in the transport  sector  shall  be granted 
on a priority basis according  to the 
contribution of  the projects: 

- 9 -

(a) to the establishment of networks on a 
multimodal  and  transnational  basis, 
notably 

-  establishment of key  links 
-  elimination of physical  and  technical 

frontiers 

-  intermodal  interconnection 
-  connnection to  island and  landlocked 
areas and opening up of peripheral 
regions 

-  better  access to networks; 

(b) to sustainable  development, in 
particular  of  traffic at European  level, 
notably 

-  transfrontier and  long distance  traffic, 

given  its present  and potential  importance, 
within  the Community  and  in neighbouring 
third countries 

-  smooth  flow of  transit  traffic  in and  to 

the Community. 

Article 8:  Selection criteria concerning 
te IecommunIcat 1ons 

Without  prejudice  to the common  criteria 
referred  to  in Article 6, Community  financial 
aid  in the telecommunications sector shall 
be granted on a priority basis to projects 
according  to their  contribution: 

(a) to the establishment of  trans-European 
networks, notably 

-  transfrontier  interconnection between 

physical  networks 

-  interoperability of services; 

/4 

- 10 -

(b) to the opening and extension of new -
markets, permitting network operators and 
the providers and users of services to 
benefit from economies of scale, integrated 
facilities and multimedia services. 

Article 9:  Selection criteria concerning 
energy 

Without prejudice to the common criteria 
referred to in Article 6, Community 
financial aid  in the energy sector shall be 
granted on a priority basis to projects 
according to their contribution: 

(a) to the connection of  isolated electricity 
networks and the interconnection of Member 
States' electricity networks; 

(b) to greater reliability and safety of 
electricity networks or to the supply of 
electricity; 

(c) to the introduction of natural gas to 
areas without supply and to the connection 
of isolated natural gas networks; 

(d) to increased transport capacity 
through natural gas supply, inlet and 
storage pi pelines. 

Article 10:  Compatability 

The projects financed under this Regulation 
shall comply with the provisions of the 
Treaties, with the acts adopted on the basis 
thereof and Community policies, including 
environmental protection, competition and 
the award of public contracts. 

/ç 

- 11 -

Article 11: Submission of applications for 
financial aid 

Applications for financial aid shall be submitted 
to the Commission through the intermediary of the 
Member State concerned, or by the body directly 
concerned with the agreement of the Member State. 

Article 12: Information required for the assessment 
and identification of applications 

1. In addition to the information specified in 
Article 6, and, where appropriate, Articles 7, 8 
and 9 above, each appIication for financial aid 
shall  include the following information to identify 
the project and to enable the Commission to assess 
the appIication: 

(a) the body responsible for carrying out the 
project; 

(b) the type of assistance envisaged and a 
description of the project concerned; 

(c) if the application relates to a feasibility 
study, the study's objective and purpose and the 
methods and techniques envisaged; 

(d) if the application relates to a project: 
-  the results of the cost/benefit analyses, 

including the results of the financial viability 
ana lysis: 

-  where necessary, the position of the projects on 

the network concerned; 

-  a summary description of environmental  impact, 

based on the assessments carried out in 
accordance with Council Directive 85/337/EEC of 
27 June 1985 on the assessment of the effects of 
certain public and private projects on the 
environment;2 

2  O J N oL  175, 5.7.1985, p. 40. 

fe 

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(e) a financial  plan  listing,  in ecus, all  the 
components of  the financial  package,  including the 
financial  aid  requested  from  the Community  and the 
aid already  granted; 

(f) a work schedule. 

2. Applicants shall  supply  the Commission with any 
additional  information  it requires. 

3.  In order  to facilitate  implementation of a 
project, the Commission may hold a meeting of all 
the public and private operators and  financial 
agencies  involved  in the project. 

4. The Commission may seek any specialist advice  it 
requires  in order  to assess  the application, 
including  the opinion of  the EIB. 

Article  13: Taking  the decision 

The Commission  shall  decide  to grant  financial  aid 
under  this Regulation according  to  its assessment 
of  the applications  in accordance with  the 
selection  criteria and  the procedure specified  in 
Article  18(2) below.  It shall  notify  its decision 
directly  to the beneficiaries and to the 
Member  States concerned. 

Article 14: Financial  provisions 

1. Aid may be granted  in respect of project-related 
expenditure  incurred by the beneficiaries or by 
third parties responsible  for  implementation of  the 
project. 

2. Aid may not be granted  in respect of expenditure 
incurred before the date on which  the Commission 
received  the application for financial  aid. 

n 

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3. Commitments and payments shall  be expressed  and 
paid  in ecus. 

4. As a general  rule, payments shall  be made  in the 
form of  advances and a final  paymont.  The first 
advance shall  be paid once  the application for aid 
has been approved.  Subsequent  payments shall  be 
made on the basis of  requests for payment, taking 
account of  the progress made  in  implementing  the 
project. 

5. The Commission  shall make  the final  payment 
after  approval  of  the report on the project or 
study submitted  by  the beneficiary  and  itemizing 
all  the expenditure actually  incurred. 

6. With  regard  to  interest-rate subsidies and 
guarantee premium  subsidies, the Commission shall 
determine  the procedures and  timetable for 
payments. 

Article 15: Financial  control 

1. Member  States shall  take the necessary  steps to 
check  the projects financed, to prevent  fraud and 
to  initiate  legal  proceedings  to recover  any money 
lost through  fraud.  They shall  keep  the Commission 
informed of any such measures taken.. 

2. Without  prejudice  to any control  measures 
carried out by  the Member  States  in accordance with 
national  laws, regulations and administrative 
provisions and without  prejudice  to the provisions 
of Article  188a of  the Treaty  and control  measures 
carried out  in accordance with Article 209(c) of 
the Treaty, Commission officials or staff may carry 
out spot checks on projects financed. 

/• 

- 14 -

3. Where  implementation of a project  appears not  to 
Justify either  part or all of  the financial  aid 
allocated, the Commission shall  investigate the 
case thoroughly and ask the Member  State or other 
bodies concerned  to submit  their  comments within a 
given per iod of  t ime. 

4. Fol lowing this  investigation, as referred  to in 
paragraph  3 above, the Commission may  reduce or 
suspend  financial  aid  for  the project  concerned  if 
it decides that  fraud  has been committed or  that 
one of  the conditions specified  in the decision 
granting  the financial  aid has not been met, or  if 
there have been substantial  changes affecting the 
nature or  implementing conditions of  the project 
for which  the Commission's approval  was not sought. 

Article 16: Coordination 

1. The Commission shall  be responsible for 
coordination between the projects undertaken under 
this Régulât ion and projects undertaken with  the 
help of contributions from  the Community budget, 
the European  Investment Bank and other  Community 
financial  instruments, and  for ensuring  that  they 
are compat ible. 

2. The Commission and  the Member  States shall 
ensure that  the combination of subsidies  (including 
interest-rate subsidies) and  loans (including 
guarantees) from  the Community  is the most 
effective way of guaranteeing  the financial 
viability of projects. 

-  15 

Article  17: Evaluation 

1.  In order  to ensure  that  Community  aid  is used 
efficiently, the Commission  and  the Member  States 
concerned  shall  systematically  evaluate  progress 
with  projects,  if necessary  with  the cooperation of 
the European  Investment  Bank.  To  this end, 
Member  States  shall  inform  the Commission  each  year 
on  the progress of  projects  approved. 

2. Before  the end of  1997, the Commission  shall 
verify  the  results achieved  with Community 
assistance  in the different  fields of  application 
in terms of  the original  objectives. 

This will  entail  defining  appropriate  indicators  as 
a means of measuring  the extent  to which  the 
original  objectives  have been  achieved. 

Article  18:  Information  and  publicity 

1. Every  two years  the Commission  shall  submit  a 
report  on  the activities  carried  out  under  this 
Regulation  to Parliament, the Council,  the  Economic 
and  Social  Committee and  to the Committee of 
Regions  for  their  appraisal. 

2. Beneficiaries shall  ensure  that  suitable 
publicity  is given  to assistance  granted  under  this 
Regulation  in order  to  inform  the public of  the 
role played  by  the Community  in the  implementation 
of  the projects.  They  shall  consult  the  Commission 
oh  how  this should  be  done. 

<?>-

-  16 -

Article  19: Committees 

1.  In  implementing  this Regulation, the Commission 
shall  be assisted, depending on the sector 
concerned, by: 
-  the  Infrastructure Committee set up by 

Council  Decision 78/174/EEC3 
-  the Energy Committee set up by 

Council  Decision  ... of 

4 

-  the Telecommunications Committee set up by 

Council Decision  ... of 

5 

The decisions required by  this Regulation shall  be 
taken  in accordance with  the procedure set out  in 
paragraph  2 of  this Article. 

2. The Commission  representative shall  submit a 
draft of  the Decision  to be taken  to the Committee. 
The Committee shall  deliver  its opinion on the 
draft within a time  limit specified  by the Chairman 
depending on the urgency of the matter  concerned. 
The opinion shall  be adopted by qualified majority * 
as specified  in Article 148(2) of  the Treaty for 
the adoption of Commission Decisions.  When votes 
are taken  in the Committee, the votes of the 
representatives of  the Member  States shall be 
weighted  as defined  in that Article.  The Chairman 
shalI not vote. 

The Commission shall  adopt  the measures which shall 
become  immediately  applicable.  However, where they 
do not correspond with  the opinion delivered by the 
Committee, these Decisions shall  be notified by the 
Commission  to the Council  immediately. 

In this case, the Commission may postpone 
application of  the measures  it has decided upon by 
a maximum of one month as of  the date of 
notification. 

3  O JL  54, 25.2.1978, p.16. 
4  Proposal  for a Council  Decision on Community guidelines on  trans-European 

energy networks and proposal  for a Decision on a series of measures -
C0M(93)685 of 19.1.1994. 

5  Proposal  for a Council  Decision on a series of guidelines  for the 

development  of  ISDN as a trans-European network - C0M(93)347 (OJ C 259, 
23.09.1993, p.4.) 

- 17 -

The Council may, acting by qualified majority, 
take a different  decision within the period 
specified  in the previous  subparagraph. 

Article 20: Entry  into force 

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

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

*********** 

'77 

FINANCIAL  STATEMENT 

Item B5-7 

1. TITLE OF OPERATION 

Trans-European networks 

2. BUDGET HEADINGS CONCERNED 

B5-700 
B5-710 
B5-720 

3. LEGAL BASIS 

Pursuant  to the new Title XII, Articles 129B, C and D of  the Treaty, the 
Community  shall  contribute  to the establishment and development of 
transport, telecommunications and energy networks. 

4. DESCRIPTION OF OPERATION 

4.1  General  objectives 

The action by  the Community  is intended  to promote the 
interconnection and  interoperability of  the national  networks and 
access to those networks, taking  into account  the need  to connect 
island,  landlocked and peripheral  regions to the central  areas of 
the Community.  The establishment of networks will  therefore 
contribute to the effective and harmonious operation of  the  internal 
market  and  the strengthening of economic and social  cohesion. 

To achieve  these objectives, the Community  shall  lay down guidelines 
identifying projects of common  interest, with each Member  State 
approving  the master  plans and projects of common  interest 
concerning  its own territory. 

The financial  support  from the Community will  be aimed primarily at 
the definition and  launching of projects of common  interest by 
promoting studies of  the feasibility of such projects and/or, where 
appropriate,  in the project  implementation phase by means of an 
interest subsidy or a  loan guarantee. 

4.2 

Period covered by  the operation and arrangements  for extension 

As this will  be a very  long term operation  it  is not possible at 
this stage to specify  the period of validity of  the Regulation. 
Before  the end of  1997 the Commission wi11  submit  an evaluation of 
the results  in order  to establish  the financial  implications of 
extending  the operation beyond 1999. 

5. CLASSIFICATION OF EXPENDITURE 

5.1  Non-compulsory expenditure 

5.2  Differentiated appropriations 

6. TYPE OF EXPENDITURE 

-  FeasibiIity studies 

-  Interest subsidy: 

YES, ordinary measure 

11 

-  Loan guarantee 

-  2 -

-  Subsidy  for  joint  financing with other  public or private sector sources: 

YES, by way of exception  (see Article  3(d)) 

-  100% subsidy: by way of exception  for other  studies carried out  at the 

Commission's  instigation and  for  technical  support measures. 

7. FINANCIAL  IMPLICATIONS 

7.1  Method of calculation of  the cost of  the operation  for  1995 

The work carried out  at Community  level  by all  the parties  involved 
by a specific trans-European  network  has made  it possible to 
estimate  the amounts needed  to establish  the networks and  in 
particular  the amounts for  the projects of Community  interest. 

In the White Paper on growth, competitiveness and employment 
submitted  to the European Council  in December  1993, the Commission 
put  the total  amount  for  the operation at ECU 400 billion  for the 
period  1994-99  (ECU 162 billion  for priority  projects).  Compared 
with  this amount, the Community  contribution  is ver*y  limited: 
approximately  ECU 400 million per annum of appropriations in 
Headings B5-700, 710 and 720, with  the exception of Structural  Fund 
assistance which will  be far more significant. 

The proposed  funding of  ECU 2 395 million  (1994-99) should be 
earmarked  as a matter of priority  for projects of Community  interest 
which, without  this assistance, would not be carried out or would be 
carried out much  less quickly.  The rate of  return on the projects 
to be funded will  also be decisive  for  triggering  the funding. 

The  level of  funding will  be particularly significant  in the case of 
prior  studies which are always difficult  to fund but are absolutely 
essential  in order  to determine  feasibility. 

In 1994 following  the conclusions of  the European Council  on the 
White Paper  and  the work  in progress within  the working parties set 
up by  the same European Council,  it may be considered  that many 
feasibility  studies will  be needed  to determine  the feasibility and 
impact of specific projects, while certain more advanced  projects 
may be funded or assisted  through  interest  subsidies or  loan 
guarantees, and exceptionally by means of subsidies. 

7.2  Financial  implications 

Indicative amounts 
in ECU mi 11 ion 

1994 

1995 

1996 

1997 

1998 

1999 

Total 

B5-700 Transport 

200 

216 

250 

331 

406 

465 

1868 

B5-710 Energy 

6 

15 

20 

24 

24 

2! 

105 

B5-720 
Telecommunications 
infrastructures* 

Î 4~ 

20 

55 

70 

ÏTÔ 

153 

422~ 

Total 

214 

251 

325 

425 

540 

640 

2395 

*  IDA-TNA excluded 

ïh 

-3-

8. 

ANTI-FRAUD ARRANGEMENTS (AND RESULTS OF THEIR IMPLEMENTATION) 

Anti-fraud arrangements (monitoring, reports, etc.) are provided in all agreements or 
contracts between the Commission and the beneficiaries. 

Verification of expenditures is normally carried out by the Member States and,  when 
necessary, by the Commission, taking full account of contractual obligations as well 
as economic principles and sound financial management. 

9. 

COST-BENEFIT ANALYSIS 

9.1 Quantifiable objectives, intended population 

This  action  is  directly  linked to  the  establishment  of  trans-European  networks, 
which is considered essential to the smooth running of the Internal Market and to 
economic and social cohesion (Article 129 B, C, and D of the Treaty, Title XII). 

It  shall  primarily  concern  transport,  telecommunications  and  energy  transport 
infrastructure. 

This  policy  constitutes  an  essential  contribution  to  the  implementation  of  the 
Single Market and, in the shorter term, it constitutes a central component of the 
White Paper on Growth, Competitiveness and Employment of December 1993. 

The  population  expected  to  benefit  from  this  action  is  the  whole  of  the 
Community, notably the cohesion countries, and neighbouring countries linked by 
interconnection projects. 

9.2 Justification 

Placing  transport,  telecommunications  and  energy  transport  networks  at  the 
disposition  of  the  Internal  Market  and  to  the  needs  of  European  industry, 
necessitates -  at Community level -  an impulsion and a coordination of Member 
States' and private sector action.  An alternative  attaining the  same  objectives 
does not exist at another level of competence. 

The  networks  are  currently  far  from  homogenous  and  include  many  "missing 
links", bottlenecks and insufficient  modernisation.  These are found especially in 
border  areas,  less-developed  regions,  around  natural  barriers  and  in  third 
countries which serve as transit points. 

-  The  development  of  a  policy 

transport, 
telecommunications  and energy transport  implies  the  use  of  specific  budgetary 
means. 

to  encourage  networks 

in 

Over several years, the Commission, in different Communications, has underlined 
the  need to  find  solutions  to  financing  problems  as well  as to  find  a  financial 
framework  that,  based  on  Community  budgetary  resources,  would  mobilise 
private capital in favour of investment in these sectors.  Among these formulae, 
one must cite not only grants, interest rebates, budgetary guarantees, but also the 
improvement  of  the  fiscal  climate  and  formulae  allowing  an  increase  in  the 
capacity to self-finance projects. 

In  order  to  assure  the  effectiveness  of  Community  action,  the  most  recent 
Commission  Communications  have  highlighted  the  pluriannual  nature  of 
budgetary allowance and have emphasised programming and the concentration of 
resources. 

EG 

4/3/94 

ENGFF.DOC 

-4-

9.3 Monitoring and evaluation 

The  implementation  of the Treaty  on European  Union presupposes a  permanent 
monitoring  and  evaluation  of  the  action  as  it  is  inscribed  in  the  framework 
previously  approved  by  the  Council  (  Treaty  Art.  129  B).  Following  the 
conclusions of the European Council in Brussels, each year the Commission shall 
present to the Council a synthetic report on the achievement of the networks. 

Methods and timing of evaluation 

- 

- 

The  Commission  and  the  beneficiary  Member  State  shall  proceed  to  a 
systematic  monitoring  of  the  state  of  advancement  of  the  projects,  when 
necessary with the technical assistance of the European Investment Bank. 

The Commission shall proceed, by the  end of  1997, to evaluate the results 
attained  by Community  intervention,  in the  various fields,  according to the 
initial objectives. 

This monitoring shall  involve the development  of  indicators to  measure the 
achievement  of these objectives, as well as to establish  a  baseline position 
that presents the state of the situation of trans-European Networks benefiting 
from Community intervention. 

EG 

4/3/94 

ENGFF.COC 

lé-

IMPACT EVALUATION SHEET 

IMPACT OF THE PROPOSITION ON BUSINESS, 
ESPECIALLY SMALL AND MEDIUM-SIZED ENTERPRISES 

Tide of proposed regulation:  Proposal for a Council Regulation Laying Down the Rules for 
die Granting of Community Financial Aid in the Field of Trans-
European Networks 

Reference number: 

COM(94)62  24 February  1994 

Proposal 

1. 

Taking account of the principle of subsidiarity, why is Community level legislation 
necessary in this field and what are the principle objectives? 

The establishment of Trans-European Networks in transport, telecommunications and 
energy necessitates action at European level.  Article 129b of the Treaty Establishing the 
European Community states that to help achieve the objectives referred to in Article 7a 
and  130a of the Treaty the Community should contribute to die establishment and 
development of trans-European networks in the areas of transport, telecommunications 
and energy  infrastructures. 

While the primary actors in die development of networks shall be the Member States, the 
Community may take action to promote networks.  This action shall aim to encourage 
die interconnection and interoperability of national networks, to fill in "missing links" 
and to improve access to these networks in taking account of the need to link isolated and 
peripheral regions. 

Article 129c of the Treaty further provides that die Conununity may support the 
financial  efforts  of the Member States to establish networks. 

The proposal for a regulation sets out to lay down general rules for the granting of 
Community financial aid to infrastructure  projects of Community interest which fell 
within the guidelines established by the Community and approved by the Member States 
concerning their own territory. 

Financial support may take the form of financing feasibility studies, interest rebates or 
loan guarantees.  In exceptional circumstances, and where deemed necessary by die 
Commission, projects may receive co-financing. 

Impact on enterprises 

2.  What groups will be affected by the proposal?  (business sectors, sizes, geographic 

>.  zones...) 

While die financial assistance granted in the framework of this regulation shall 
concentrate primarily on the three sectors of transport, telecommunications and energy, 
the overall benefit of the realisation of networks and the increase in competitiveness  -

EG/SME.DOC 

4/3/94 

2? 

due to the increased access and lower cost of transport, energy and telecommunications 
to businesses -  shall have indirect but strong effects  for businesses of all types and sizes. 
In the granting of assistance, the Commission shall give special consideration to 
underdeveloped and peripheral regions. 

3. 

4 

What must enterprises do to conform to the proposition?  Nothing 

Economic effects  of the proposal 

What economic effects are expected (on employment,  investment, creation of new 
enterprises, competitiveness...)? 

The European Council of June  1993 in Copenhagen called for the achievement of trans-
European networks to be used as a short term measure to stimulate employment and 
growth, as well as competitiveness. 

Community financial assistance in the establishment of networks is expected to give a 
spur to the realisation of projects, creating employment in the short term.  In the  1994-
1999 financial perspective, an average of 400 mécu per year shall be devoted to this 
action.  The impetus of the action should accelerate large infrastructure  works, especially 
in the transport and energy sectors, which shall have an immediate and positive impact 
on employment.  These large projects shall in turn involve the subcontracting of small 
and medium-sized enterprises. 

The knock-on effects  of the achievement of networks shall stimulate the competitive 
environment of European business in general and create longer term growth in the 
specific network sectors.  This shall in turn provide fertile ground for the birth of new 
businesses and new investments. 

5. 

Does the proposal contain measures aimed at taking account of the special situation of 
small and medium-sized enterprises (reduced or changed demand) ? 

The large scale of the projects in question necessitate a global approach.  The specific 
arrangements set out in the regulation do not pertain to the situation of small and 
medium-sized businesses.  Nevertheless, the effects  of the legislation should have a 
positive effect on the environment for small and medium-sized enterprises. 

Consultation 

6. 

List the organisations consulted on this proposition  and the main points  of their 
position. 

This regulation comes as a result of many years of the Community's refinement of the 
Trans-European network policy, culminating in the White Paper on growth, 
competitiveness and employment.  Throughout this process, many external organisations 
have been consulted and provided input: trade unions, professional  associations, private 
investors and industry groups have all supported this direction.  No external 
organisations were consulted for this specific piece of legislation.  However, many 
anxiously await its inception.  Without it, Community financing in this field will be 
impossible after  1994, when the current regulation, concerning the financing of transport 
infrastructure  projects, shall expire. 

EG/SME.DOC 

4/3/94 

2 

1 

ISSN 0254-1475 

COM (94) 62 final 

DOCUMENTS 

EN 

15 

Catalogue number : CB-CO-94-072-EN-C 

ISBN 92-77-65804-5 

Office  for Official  Publications of the European Communities 

L-2985 Luxembourg