Amended proposal for a COUNCIL REGULATION (EC) on operations to promote tropical forests
Date: 1994-06-10
Institutions: European Commission
Subjects: EU environmental policy, EU financing, action programme, forest conservation, tropical forest

**-™^ CQMVTIS SI ON OF THE EUROPEAN  COMMUN ITI ES 
P :: ---- - \ —; 

C0MC94) 153 final - SYN 500 
Brussels, 10.06.1994 

M 

Amended  proposal  for a 

COUNCIL  REGULATION  (EC) 

on operations to promote tropical  forests 

(presented  by  the Commission  pursuant  to Article  189 A (2) 
of  the EC-Treaty) 

EXPLANATORY  MEMORANDUM 

The seriousness  of  the  threat  to tropical  forests  and  the need  for  co-ordinated  international  action 
within  a  perspective  linking  environment  and  development  have  been  emphasised  by  all 
Community  institutions  and  confirmed  during  the recent  Rio de Janeiro  Conference., 

In  this  context,  an  action  at  Community  level,  complementing  Member  States'  actions,  will 
facilitate  a  better  realisation  of  the  objectives  pursued  and  the  mobilisation  of  the  necessary 
resources. 

This  Regulation  lays  down  objectives  and  modalities  of  this  action  that  will  promote  the 
conservation  and  sustainable  management of tropical  forests. 

An  initial  proposal  for  a  Regulation  on  actions  in  favour  of  tropical  forests  was  presented  by  the 
Commission  on 26  February  1993 (see document  COM  (93) 53 final). 

In the light of the  entry  into  force  of the Treaty  on  European  Union,  the opinion  of the  Economic 
and  Social  Committee,  the  amendments  put  down  by  the  European  Parliament,  and  the  current 
state  of  discussions  in  the  Council,  the  Commission  has  drawn  up  a  modified  proposal  for  this 
Regulation. 

The  modified  proposal  largely  reflects  the  amendments  put  down  by  the  European  Parliament. 
These  refer  particularly  to  the protection  of  biodiversity  in tropical  forests  and  the  preservation  of 
ecosystems,  and  they  also  stress  that  local  dimensions  should  be  taken  into  account,  especially 
concerning  the need  for  active participation  by  local  communities. 

However,  like the first version,  the modified  proposal  concentrates on  cooperation  activities  in the 
fields  of  the  environment  and  development,  and  does  not  contain  provisions  for  commercial 
activities. 

In addition,  certain  amendments  concerning  the structure  and  powers  of  the  Commission  have  not 
been  retained. 

Finally,  to  underline  the  continuity  necessary  for  Community  actions  in  this  field,  the  modified 
proposal  does not  contain  any provisions  limiting  its duration. 

-J_ 

Amended  proposal  for  a 

r;pnMCII  REGULATION  (EC)  JL' 

of 

on operations to promote tropical forests 

THE COUNCIL OF THE EUROPEAN UNION 

Having regard to the Treaty establishing the European Community, and in 
particular Articles  130 S and 130 W; 

Having regard to the proposal from the Commission; 

In cooperation with the European Parliament(*); 

Having regard to the opinion of the Economic and Social Committee(2)• 

Whereas the Commission  communication  to the Council  of  16 October  1989 
on  "The  conservation  of  tropical  forests: The  role  of  the  Community" 
(3),  set out broad guidelines  for Community action  in this sphere; 

Whereas  the  resolution  of  the  Council  of  Ministers  for  Development 
Cooperation  of  the  29  May  1990  on  "Tropical  forests:  development 
aspects" established  a basis for the use of development  instruments in 
tropical  forest conservation; 

Whereas the European  Parliament  expressed  concern over  the  destruction 
of  tropical  forests  and  the  consequences  for  forest  peoples  in  many 
parliamentary resolutions; 

Whereas  the  European  Council  of  June  1990  in  Dublin  called  for  a 
programme  of  action  to  be  drawn  up  to  counteract  the  threat  to 
tropical forests; 

Whereas  the  Community  and  its  Member  States  adopted  the  Rio  Forest 
Principles,  the  Agenda  21  action  programme  and  the  Conventions  on 
Biological Diversity and Climate Change; 

Whereas  the  Community's  operations  to  promote  tropical  forests  form 
part of its objectives on conservation of forests; 

Whereas  the  Community  intends  to  expand  its  actions  to  promote  the 
conservation  of  tropical  forests  in  all  appropriate  ways,  within  the 
context  of  its  environment  policy  and  of  its  new  development 
cooperation policy, laid down in articles 130 U ss. of the Treaty; 

Whereas, by virtue of their  special  knowledge, the  forest peoples play 
a  key  role  in managing  the  environment,  in  particular  with  regard  to 
the conservation  of tropical forests; 

(1) PE A3 - 304/93 of 29.10.93 
(2) CES 707-93 ENVI 360 of 30.6.93 
(3)  OJ C264 16.10.89 p.l 

Whereas  the  ecological  and  socio-economic  conditions  of  tropical 
forests vary within regions and countries; 

Whereas  a Community  action, complementing Member  States'  actions, will 
facilitate a better realisation of the objectives pursued; 

Whereas  existing  financial  instruments  available  to  the  Community  for 
supporting  the  conservation  and  sustainable  development  of  forests 
could usefully be complemented; 

Whereas,  in  order  to  have  a  significant  impact  on  the  protection  of 
tropical  forests, provision  should  be made  for  funding  adequately  the 
actions referred  to in this regulation; 

Whereas rules  for implementation,  and in particular the form of action, 
the recipients of the aid, and decision procedures should be laid down; 

HAS ADOPTED THIS REGULATION 

Article 1 

The  Community  shall  support  actions  to  promote  the  conservation  and 
the  sustainable  management  of  tropical  forests  and  the  associated 
biological  diversity  in  accordance  with  the  criteria  and  procedures 
provided  for in this Regulation. 

Article 2 

"Tropical  forests"  shall  be  defined,  for  the  purposes  of  this 
regulation,  as  those  natural  and  semi-natural  tropical  or 
subtropical  forest  ecosystems  in  both  dry  and  humid  areas.  The 
areas  concerned  are  those  found  within  the  tropics  and  subtropics 
delimited by the 30th northern and southern parallels. 

"Conservation"  shall  be  considered,  for  the  purposes  of  this 
regulation,  to  include  all  actions  to  preserve  and  rehabilitate 
tropical  forests, and specifically those actions which are designed 
to  protect  or  restore  the  biological  diversity,  including 
ecological  functions,  of  the  forest  ecosystem  in  question  and  at 
the  same  time  secure  as  far  as  possible  its  current  and  future 
utility value  for mankind and in particular  for forest peoples. 

"Sustainable  forest  management"  is  understood  as  the  stewardship 
and  use  of  forests  and  forest  lands  in a way, and  at  a rate, that 
maintains  their  biodiversity,  productivity,  regeneration  capacity, 
vitality  and  their  potential  to  fulfil,  now  and  in  the  future, 
relevant  ecological,  economic  and  social  functions,  at  local, 
national,  and  global  levels;  and  that  does  not  cause  damage  to 
other ecosystems. 

4.  "Sustainable development" shall be considered  as the  improvement of 
the quality  of  life and welfare of the relevant  populations within 
the  limits of the capacity  of the ecosystem  by maintaining  natural 
assets  and  its biological diversity  for the benefit  of  present and 
future generations. 

5.  "Forest  peoples"  shall  be  defined  as  indigenous  population  groups 
who  live  in tribal  communities  and who  inhabit  the  forest  or claim 
it as their home and any people who live in or near the  forest and 
have traditionally been directly and to a large extent dependent on 
the forest. 

Article 3 

Under  this  Regulation,  the  Community  shall  provide  financial 
support  or  technical  expertise  for  actions  which  support  and 
encourage  the  efforts  of  developing  countries  and  their  regional 
organisations  to  conserve  and  sustainably  manage  their  tropical 
forests,  in  the  context  of  the  sustainable  development  of  those 
countries and regions. 

The  recipients  of  aid  and  partners  in cooperation  may  include  not 
only  states  and  regions  but  decentralised  authorities,  regional 
organisations,  public  agencies,  local  or  traditional  communities, 
private  industries  and  operators,  including  cooperatives  and  non 
governmental  organisations  and  representative  associations  of 
forest peoples, which  include the conservation  of  tropical  forests 
among their stated objectives or regular activities. 

Special  consideration  shall  be given  to  actions  in  support  of  the 
conservation  of  forests  which  are  considered  to  be  of  importance 
for  local  effects  such  as  the  protection  of  watersheds,  the 
prevention  of  soil  erosion  and  the  restoration  of  degraded  areas 
and  for  global  effects,  such  as  climate  change  and  loss  of 
biological diversity. 

Article 4 

The priority given to specific actions will be determined  according 
to the needs of each country  as reflected  in regional  and  national 
development  and  environment  policies  relating  to  forests  and 
according 
Particular 
cooperation 
consideration, however, shall be given to actions that  promote the 
following: 

to  Community 

priorities. 

(a) conservation of primary tropical  forests and their biodiversity 
and  regeneration  of  tropical  forest  which  have  been  damaged, 
supported by analysis of the underlying  causes of deforestation 
and  taking  into  account  differences  between  countries  and 
regions and measures to address them; 

(b) sustainable management of forests designated  for the production 
of timber  and other products, but  excluding  commercial  logging 
operations  in primary tropical forests; 

(c) the  definition  of  s  certification  system  for  timber  produced 
from  tropical  forests  according  to  sustainable  forest 
management principles; 

(d) participation  by  and  support  from  forest  peoples  in  the 

identification, planning and implementation of actions; 

(e) capacity-building to address the needs for training schemes for 
local  populations,  forest  managers  and  researchers,  for 
legislation,  increased  political  and  social  support  and 
institutional 
and 
associations active in forest conservation 

for  . organisations 

strengthening 

and 

(f) a strategic and adaptive research policy aimed at supplying the 
knowledge  required  for  the  conservation  and  sustainable 
management  of  forests  and  also  for  the  implementation  of 
research  monitoring  activities  in  the  framework  of  projects 
and programmes; 

(g) development  of  buffer  zones  to  assist  the  conservation  or 
regeneration  of  tropical  forests,  as  part  of  a  broader  land 
utilisation plan; 

(h) development and implementation of forest management plans aimed 
at  conserving  tropical  forests  and  promoting  sustainable 
exploitation of timber and other forest products. 

2.  The  Community  shall  require  actions  carried  out  under  this 
regulation  to be  preceded  by  reports  on their  ecological, social, 
economic  and  cultural  impact,  with  specific  qualitative  or 
quantitative  objectives, where  applicable, these  actions  shall  be 
evaluated with the participation of local people. 

3.  The  Community  shall,  in  respect  of  the  various  Community  policy 
areas which  have  a potential  direct  impact on  the  conservation  of 
tropical  forests,  develop  and  apply  the  instruments  required  to 
prevent the policy pursued or planned from having a negative impact 
and, where possible, to contribute to the conservation  of  tropical 
forests. 

4.  Actions carried out under this regulation shall be coordinated with 
and may provide  support  for national  and  international  programmes 
and  actions  concerned  with  conservation  of  tropical  forests, such 
as the Tropical  Forest Action Plan  and the  International  Tropical 
Timber  Organisation,  provided  these programmes  and  actions  are  in 
accordance  with  the  principles  and  objectives  laid  down  in  the 
present regulation. 

5.  Wherever  possible,  operations  shall  be  carried  out  within  the 
framework of regional organisations and international programmes of 
cooperation  in the  context  of  a global policy  on the  conservation 
of forests. 

Article 5 

Cofinancing with Member States, or with multilateral, regional or other 
organisations  shall be  sought  through  greater  coordination. As  far  as 
possible, the Community nature of the aid shall be maintained. 

Community  funding  shall be in the form of non-reimbursable grants. 

Article 6 

Article 7 

Financial and technical assistance may cover all foreign currency costs 
and  local  costs  for  carrying  out  projects  and  programmes,  including, 
whenever necessary,  integrated programmes and sectoral projects. 

Maintenance and operating expenses for economic cooperation operations, 
training  and  research  programmes  and  development  projects  and 
programmes may, in particular, be covered. However, except  for training 
and research programmes, such expenses may be covered as a general rule 
only at the launching  stage and in gradually decreasing amounts. 

Systematic efforts shall be made to seek contributions, particularly  in 
financial 
(countries,  local  communities, 
undertakings,  individual  recipients)  as  far  as their  means  permit  and 
according to the nature of each operation. 

form,  from  partners 

The  payment  of  taxes,  duties  and  charges  shall  be  excluded  from 
Community  financing. 

Study  costs  and  the  short- and  long-term  use of  experts  to  assist  the 
recipients and the Commission  in devising general policies, identifying 
and  preparing  operations  and  monitoring  and  evaluating  them  shall 
normally be covered by Community  funds, either as part of the financing 
for individual operations or separately. 

Article 8 

Participation  in  invitations  to  tender  and  purchasing  and  other 
contracts  shall be open on equal  terms to all natural or  legal persons 
of the Member States. 

With  regard  to  financial  and  technical  assistance,  such  participation 
shall  usually  be  extended  to  the  recipient  state  and  may  also  be 
extended, case by case, to other developing countries. 

In  exceptional  cases  which  are  duly  justified,  other  countries  of 
origin may be allowed  for specific components. 

Article 9 

Projects  and  programmes  for  which  Community  funding  exceeds  ECU  2 
million  and  any  substantial  modifications  which  exceed  20%  of  the 
amount  initially  agreed,  shall  be  adopted  according  to  the  procedure 
laid down  in Article  10(2). 

Article 10 

1.  The  Commission 
activities. 

shall  administer  tropical  forest  cooperation 

2.  The Commission  shall be assisted  by  an advisory  committee  composed 
of  Member  States  representatives,  experts  in  tropical  forest 
issues, and chaired by the representative of the Commission. 

The representative  of the Commission  shall  submit  to the  committee 
a  draft  of  the  measures  to  be  taken.  The  committee  shall  deliver 
its  opinion  on  the  draft, within  a  time  limit  which  the  chairman 
may  lay  down  according  to  the  urgency  of  the  matter,  if  necessary 
by taking a vote. 

The  opinion  shall  be  recorded  in  the  minutes;  in  addition,  each 
Member  State  shall  have  the  right  to  ask  to  have  its  position 
recorded  in the minutes. 

The  Commission  shall  take  the  utmost  account  of  the  opinion 
delivered  by  the  committee.  It  shall  inform  the  committee  of  the 
manner  in which  its opinion has been taken  into account. 

3.  Where the Commission  finds it necessary or appropriate to establish 
further  procedures  for  the  execution  of  relevant  actions,  those 
measures  should  be  adopted  according  to  procedure  laid  down  under 
par. 2. 

Article 11 

The Commission  shall  submit to the European  Parliament  and  the Council 
an  annual  report  with  an  assessment  of  the  implementation  of  this 
Regulation.  The  report  shall  set  out  the  results  of  implementation  of 
the  budget  as  regards  commitments  and  payments  and  presenting  the 
projects  and  programmes  financed  during  the  year.  The  report  shall 
contain,  as  far  as  possible,  information  on  the  funds  committed  at 
national  level  during  the  same  financial  year.  It  shall  also  contain 
specific, detailed  information  (undertakings, nationality, etc.) on the 
contracts  awarded  for  the  implementaiton  of  the  projects  and 
programmes. 

Evaluation  reports  will  be  submitted  to  the  Committee  mentioned  in 
article 10. 

Article 12 

This  regulation  shall  be  implemented  under  an  approach  coherent  with 
the  general  principles  laid  down  in  Council  Regulation  No.  443/92  on 
financial and technical  assistance to and economic  cooperation with the 
developing  countries  of  Latin  America  and  Asia  and  in  the  fourth  Lomé 
Convention  and under common criteria at all stages of the project cycle 
from identification to evaluation. 

Article 13 

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. 

Done at Brussels 

FINANCIAL  STATEMENT 

1.  TITLE OF OPERATION: operations  to promote  tropical  forests 

2.  BUDGET HEADING  INVOLVED: B7-5041 

3.  LEGAL  BASIS: Council  Regulation  (EC) No  .../94 on operations to 

promote  tropical  forests 

4.  DESCRIPTION OF OPERATION 

4.1 

General  objective of operation:  in the context  of  commitments 
entered  into by the Community  at  the Rio Conference and 
elsewhere,  the operation  is  intended  to promote  the 
conservation  and sustainable management  of  tropical  forests. 

4.2 

Duration of operation  and arrangements  for  renewal or 
extension:  indefinite duration, but  the Regulation  would be 
updated  in 1995-1996. 

5.  CLASSIFICATION OF EXPENDITURE OR  REVENUE 

5.1 

Non-compulsory expenditure 

5.2 

Differentiated appropriations 

6.  TYPE OF  EXPENDITURE OR REVENUE 

-  100% subsidy 

-  Subsidy  for  joint  financing with other  sources  in the public 

and/or  private sector 

Interest  subsidy: none 

-  Should  the operation prove an economic  success,  is there provision 
for all or  part of  the Community  contribution  to be reimbursed? No 

3 

FINANCIAL  IMPACT 

7.1 

Method  of  calculating  total  cost  of operation  (definition of 
unit  costs) 

The  level  of appropriations  reflects  requirements  identified 
and  management  capabilities,  within  the  limits of what  has been 
made  available  by the budget  authority;  the cost  of  each 
project  will  be determined  on a case-by-case  basis,  following 
identification  and appraisal.  Staffing  costs  will  be  calculated 
on  the basis of unit  pricing;  equipment,  operating and 
transport  costs  will  be calculated  at  cost  prices  and paid out 
on  the basis of supporting  documents. 

7.2 

Breakdown  of operation  components 

Indicative  breakdown 

1994  Budget  n 

-  Studies 
-  Projects 
-  Publications,  seminars 

TOTAL 

8 
38 
4 

50 

7.3 

Indicative  schedule  of  appropriations 

7.3.1  Schedule  to be completed  in the event  of a proposal  for a new 

operat ion 

n 
1994 

n + 1 
1995 

n + 2 
1996 

n + 5 

TOTAL 

and after 

Commi tment 
appropr iat ions 

Payment 
appropr iat ions 

n 

1994 

n + 1 

1995 

n + 2 

1996 

n + 5 and after 

50 

50 

50 

15 

10 

25 

15 

35 

25 

25 

50 

-

-

-

-

-

_ 

TOTAL 

50 

50 

State  whether  amounts  are in ECU at constant  or  current  values  (basis of 
caIculat ion) 

|o 

8.  WHAT  ANT I-FRAUD  MEASURES  ARE  PLANNED  (AND  RESULTS  OF  SUCH  MEASURES)? 

Recipients  must  accept  the  general  conditions  applicable  to 
contracts,  including  an  audit  by  the  Commission  and  the  Court  of 
Audi tors. 

9.  COST-EFFECTIVENESS  ANALYSIS 

9.1 

Specific  quantifiable  objectives,  target  population 

-  specific  objectives:  linked  to  general  objective:  the 

conservation  and  sustainable  management  of  tropical  forests 
involve  the  upgrading  of  operational,  training  and  research 
capacity,  in close  collaboration  with  the  national  authorities 
and  local  bodies  concerned; 

-  target  population:  directly,  local  communities  living  in or 
near  forests;  indirectly,  via  global  effects  (biodiversity, 
carbon  reserves),  people  throughout  the  world.  Direct 
recipients  include  not  only  states  and  regions  but  also 
decentralized  authorities,  regional  bodies,  public-sector 
agencies,  local  or  traditional  communities  and  NGOs. 

9.2 

Grounds  for  the  operation 

Need  for  support  from  Community  budget:  the  Community-financed 
operation  will  back  up  Member  States' measures  in  countering 
the  threat  to  tropical  forests  by  providing  support  for  the 
efforts  of  developing  countries  themselves. 

-  Choice  of  this  operation: 

(a)  this  Regulation  is a  key  component  of  the  strategy  for 

tropical  forests,  which  also  includes  the  development  of 
trade  incentives  and  encouragement  for  investment  and 
technology  transfers; 

(b)  the  operations  will  be  carried  out  consistently  with  ALA 
development  programmes  and  the  provisions  of  the  Lomé 
Convent ion; 

(c)  the  planned  cooperation  measures  should  act  as  catalysts, 

particularly  as  pilot  schemes  and  demonstration  projects 
will  be  developed  alongside  specific  measures  to  help 
tropical  forests-, 

-  Main  factors  of  uncertainty  which  could  affect  the  specific 

results  of  the  operation:  delayed  awareness  of  the  importance 
of  conserving  tropical  forests  and  poor  operational  resources 
in  the  developing  countries. 

~n 

9.3 

Monitoring  and  evaluation  of  the  operation 

Performance  indicators  selected:  the  main  indicators  are: 
area  of  tropical  forest  covered 
establishment  of  protected  zones 
development  and  implementation  of  management  plans  and 
operational  capacity 
participation  by  local  communities 
consistency  with  measures  taken  at  local,  national  and 
internat ional  level. 

-  Details  and  frequency  of  planned  evaluation:  operations  will  be 

monitored  by  the  Commission  in  close  cooperation  with  external 
delegations,  using: 

periodical  reports 
inspect ion  visits 
individual  mid-term  evaluations  for  some  pilot  projects 
ex-post  evaluation  of  representative  projects. 

-  Assessment  of  results 

The  proposed  Regulation  requires  the  Commission  to  submit  an 
annual  report  with  an  assessment  of  implementation. 

At 

ISSN 0254-1475 

COM(94) 153 final 

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