Proposal for a Council Regulation (EC, Euratom) amending Council Regulation (EC, Euratom) No 2728/94 establishing a guarantee fund for external actions
Date: 1998-03-18
Institutions: European Commission
Subjects: Community loan, credit guarantee, financial management, fund (EU), third country

6.2.1999

EN

Official  Journal  of  the  European  Communities

C  32/11

Proposal  for  a  Council  Regulation  (EC,  Euratom)  amending  Council  Regulation  (EC,  Euratom)
No  2728/94  establishing  a  Guarantee  Fund  for  external  actions

(1999/C  32/12)

COM(1998)  168  final  -  98/0117(CNS)

(Submitted  by  the  Commission  on  18  March  1998)

THE  COUNCIL  OF  THE  EUROPEAN  UNION,

Having  regard  to  the  Treaty  establishing  the  European
Community,  and  in  particular  Article  235  thereof,

Whereas  the  Treaties  do  not  provide  any  powers  other
than  those  pursuant  to  Article  235  of  the  EC  Treaty  and
Article  203  of  the  Euratom  Treaty  for  the  adoption  of
this  Regulation,

Having  regard  to  the  Treaty  establishing  the  European
Atomic  Energy  Community,  and  in  particular  Article  203
thereof,

Having  regard  to  the  proposal  from  the  Commission,

Having 
Parliament,

regard 

to 

the  opinion  of 

the  European

Having  regard  to  the  opinion  of  the  Court  of  Auditors,

Whereas  the  Guarantee  Fund  is  endowed  by  payments
from  the  general  budget  of  the  European  Communities,
by  the  interest  on  its  invested  resources  and  by  the
amounts  recovered  from  defaulting  debtors  where  the
Fund  has  already  honoured  the  guarantee;

Whereas  experience  of  the  functioning  of  the  Guarantee
Fund  indicates  that  a  ratio  of  8(cid:216)%  between  the  Fund’s
resources 
in  principal,
increased  by  unpaid  interest  due,  would  be  adequate;

guaranteed 

liabilities 

and 

Whereas  payments  to  the  Guarantee  Fund  equal  to  6(cid:216)%
of  the  amount  of  each  operation  would  seem  sufficient
to  attain  the  target  amount;

Whereas  the  Guarantee  Fund  attained  its  target  amount
on  31  December  1997  and  the  provisioning  rate  should
be  reviewed;

Whereas 
if  the  Guarantee  Fund  exceeds  the  target
amount  the  surplus  is  paid  back  to  the  general  budget  of
the  European  Communities;

Whereas  experience  has 
Commission  departments  are  closely 
functioning  of  the  Guarantee  Fund;

shown 

that 

the  various
in  the

involved 

in 

these 

Whereas, 
financial
management  of  the  Guarantee  Fund  should  be  entrusted
to  the  Commission;  whereas  the  financial  management
of  the  Fund  is  subject  to  audit  by  the  Court  of  Auditors;

circumstances, 

the 

HAS  ADOPTED  THIS  REGULATION:

Article  1

Regulation 
amended  as  follows:

(EC,  Euratom)  No  2728/94 

is  hereby

1.(cid:217)In  Article  3  the  second  paragraph  is  replaced  by  the

following:

"The  target  amount  shall  be  8(cid:216)%  of  the  Community’s
total  outstanding  capital  liabilities  arising  from  each
operation,  increased  by  unpaid  interest  due.’

2.(cid:217)Article  4(1)  is  replaced  by  the  following:

"The  payments  provided  for  under  the  first  indent  of
Article  2  shall  be  equivalent  to  6(cid:216)%  of  the  capital
value  of  the  operations.’

3.(cid:217)In  Article  5  the  first  paragraph  is  replaced  by  the

following:

the  activation  of  guarantees
"If,  as  a  result  of 
following  default,  resources  in  the  Fund  stand  below
75(cid:216)%  of  the  target  amount,  the  rate  of  provisioning
on  new  operations  shall  be  raised  to  7(cid:216)%  until  the
target  amount  has  once  more  been  reached.’

4.(cid:217)Article  6  is  replaced  by  the  following:

"The  financial  management  of  the  Fund  shall  be
entrusted  to  the  Commission.’

5.(cid:217)Article  9  is  replaced  by  the  following:

"The  Commission  shall,  before  31  December  2006,
submit  a  comprehensive  report  on  the  functioning  of
the  Fund.’

Article  2

This  Regulation  shall  enter  into  force  on  1  January  1999.

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

in 

its  entirety  and