Proposal for a Council Regulation (EC) on development cooperation with South Africa
Date: 1999-03-12
Institutions: European Commission
Subjects: South Africa, action programme, cooperation policy, development aid, financial aid

25.1.2000

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Official Journal of the European Communities

C 21 E/1

II

(Preparatory Acts)

COMMISSION

Proposal for a Council Regulation (EC) on development cooperation with South Africa

(2000/C 21 E/01)

COM(1999) 124 final (cid:151) 1999/0070(SYN)

(Submitted by the Commission on 12 March 1999)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community, and in particular Article 130w thereof,

Having regard to the proposal from the Commission,

Acting in accordance with the procedure laid down in Article
189c,

Whereas, since the elections of April 1994 and the estab-
the Community has
lishment of a democratic government,
turned towards a strategy of support
for the policies and
reforms undertaken by the South African authorities;

Whereas the Council has adopted the Council Regulation (EC)
No 2259/96 of 22 November 1996 on development coop-
eration with South Africa (1);

Whereas this abovementioned Regulation shall expire on 31
December 1999;

Whereas the Agreement on Trade, Development and Coop-
eration between the European Community and the Republic
of South Africa stipulates in its Chapter VII
financial
assistance in the form of grants shall be covered by a special
financial willingness to maintain its financial cooperation with
South Africa at a substantial
level, and that it will take the
necessary decisions in this respect on the basis of a proposal
by the Commission;

that

appropriate

instruments
this Agreement has entered into force,

could be made
Whereas other
available after
in
particular in the framework of the future EC/ACP Cooperation
Agreement and the eligibility of South Africa to the European
Development Fund;

in its
the abovementioned Agreement contains
Whereas
Chapter V provisions on aims, priorities, methods and
implementation of development cooperation with South Africa;

Whereas in the light of the implementation of the Council
Regulation (EC) No 2259/96 of 22 November 1996 abovemen-
tioned, and of the Special Report No 7/98 of the Court of
Auditors in respect of the European Community Development
Aid Programme regarding South Africa (1986-1996),
the
Council Regulation (EC) No 2259/96 of 22 November 1996
has to be adapted, in particular as concerns simplification of
procedures, greater focus on sectoral priorities and decen-
tralised decision-making;

(1) OJ L 306, 28.11.1996.

Whereas assistance provided under this Regulation shall be
implemented in coherence with actions of other donors,
including multilateral institutions;

Whereas Council Decision 87/373/EEC of 13 July 1987 (2) lays
down the procedures for the exercise of implementing powers
conferred on the Commission and the operation of
the
Committee that shall assist the Commission;

Whereas the operation of this Committee should follow the
management procedure or the advisory procedure where the
management procedure is not considered appropriate;

Whereas Council Regulation (EC, Euratom) No 2988/95 of 18
the Communities’
December 1995 on the protection of
framework
interests (3) establishes a common legal
financial
for all the fields of the Communities’ own resources and expen-
diture;

1996

concerning

Whereas Council Regulation (EC, Euratom) No 2185/96 of 11
and
November
to
inspections carried out by the Commission in order
protect the European Communities’ financial interests against
fraud and other irregularities (4) applies to all areas of
the
Communites’ activity without prejudice to the provisions of
the Community rules specific to the different policy areas,

on-the-spot

checks

HAS ADOPTED THIS REGULATION:

Article 1

Aims

The Community shall implement financial and technical coop-
eration with South Africa to support the policies and reforms
carried out by that country’s national authorities in a context
of policy dialogue and partnership.

The aim of the Community cooperation programme, entitled
the (cid:145)European Programme for Reconstruction and Development
in South Africa(cid:146), shall be to contribute to South Africa’s
harmonious and sustainable economic and social development
and to its insertion into the world economy and to consolidate
the foundations laid for a democratic society and a State
governed by the rule of law in which human rights and funda-
mental freedoms are fully respected.

(2) OJ L 197, 18.7.1987.
(3) OJ L 312, 23.12.1995.
(4) OJ L 292, 15.11.1996.

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the Community shall give priority to
Within this context
supporting operations which contribute to the fight against
poverty.

Community financing in local or

foreign currency,
2.
depending on the needs and nature of the operation, may
cover:

Article 2

Areas of cooperation

Development cooperation to be carried out under this Regu-
lation will focus mainly on:

(cid:151) support to policies, instruments and programmes aiming at
the progressive integration of the South African economy
for employment
into the world economy and trade,
creation, development of private sector, regional coop-
special
eration and integration.
latter context,
In this
attention will be given to providing support
to the
adjustment efforts occasioned in the region by the estab-
the free-trade area under the Trade, Devel-
lishment of
opment and Cooperation Agreement, especially in the
SACU. Promotion of mutual general
interest cooperation
between European Union and South African businesses
may be considered as well;

(cid:151) improvement of
social services;

living conditions and delivery of basic

(cid:151) support to democratisation, the protection of human rights,
sound public management,
local
governments and involvement of civil society in the devel-
opment process.

the strengthening of

Dialogue and partnership between public authorities and non-
governmental development partners
and actors will be
promoted.

focus on fight against poverty,

Programmes shall
take into
account the needs of the previously disadvantaged communities
and reflect the gender and environmental dimensions of devel-
opment.

Article 3

Eligibility of cooperation partners

Cooperation partners eligible for financial assistance under this
Regulation shall be national, provincial and local authorities
and public bodies, non-governmental organisations
and
regional and international
Community-based organisations,
organisations,
institutions and public or private operators.
Any other body could be eligible if so designated by both
parties.

Article 4

Means, nature of expenses, information on the
programme and coordination

1.
The means that may be deployed under the cooperation
operations referred to in Article 2 shall include in particular
studies, technical assistance, training or other services, supplies
and works, and also evaluation and monitoring audits and
missions.

(cid:151) government budget expenditures to support reforms and
policy implementation in the priority sectors identified
through a policy dialogue, under
the form of direct
sectoral budget support:

(cid:151) investment and equipment;

(cid:151) in certain cases, and in particular where a programme is
implemented by a non-government partner,
taking into
account the fact that the programme has to aim as much
long-term sustainability, recurrent expen-
as possible at
diture
and
administrative, maintenance
operating costs).

(including

Part of the financing may be channelled, in a targeted manner
(e.g. emerging entrepreneurs),
in the form of risk capital or
interest rate subsidies to European Investment Bank loans.

3.
A financial contribution from the partners referred to in
Article 3 shall in principle be required for each cooperation
operation. That contribution will be requested in accordance
with the possibilities of the partners concerned and depending
on the nature of each operation. It may be in kind. In specific
cases where the partner is either a non-governmental organi-
sation or a Community-based organisation, the contribution
may not be required.

4.
The Commission may take any appropriate step to ensure
that the Community character of aid provided under this Regu-
lation is made known.

Opportunities may be sought for potential co-financing

5.
with other donors, particularly the Member States.

6.
In order to achieve the objectives of coherence and
complementarity referred to in the Treaty and with the aim
of
the
Commission may take all necessary coordination measures,
notably:

guaranteeing optimal

effectiveness of

aid,

the

(a) the establishment of a system for the systematic exchange
information on actions financed or planned to be

of
financed by the Community and the Member States;

(b) on-the-spot coordination of

these actions by means of
regular meetings and exchange of
information between
the representatives of the Commission and the Member
States in the beneficiary country.

7.
The Commission, in liaison with the Member States, may
take any steps necessary to ensure adequate coordination with
other donors concerned.

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Article 5

Form of financial support

been taken. The Commission shall subsequently update the
project profiles and forward them to the Member States.

Financial support under this Regulation shall take the form of
grants.

Article 6

Programming

Tri-annual

shall be carried out

indicative programming based on specific
1.
objectives
in the context of close
contacts with the South African Government and taking
account of
the coordination referred to in
Article 4(6) and (7). Such a programming should result in
aid being focused each year in a limited number of sectors
identified amongst those areas referred to in Article 2.

the results of

In order to prepare for each programming exercise, in the
2.
context of
increased coordination with the Member States,
including on-the-spot, the Commission shall draw up a recap-
itulative document on cooperation strategy (Strategy Paper) to
be examined by the Committee referred to in Article 8
hereafter referred to as the Committee. This Strategy Paper
shall take into account the results of the most recent overall
evaluation of operations financed under Regulation (EC) No
2259/96 and under this Regulation, of other regular evalu-
ations of operations. This document will be discussed at the
the Commission or one or more Committee
request of
In that case, where it is not possible to reach a
members.
desirable consensus on the Strategy Paper,
the Committee
shall give its opinion in accordance with the procedure
referred to in Article 8.

forward a tri-annual

The Commission shall

3.
indicative
programme to be signed by the Commission and the South
African Government, drawn up on the basis of that examin-
ation, to the Committee for information. An exchange of views
shall take place once a year, on the basis of a presentation by
the Commission’s representative of the general guidelines for
the operations to be carried out in the year ahead.

Article 7

Procedures

The Commission shall be responsible for appraising,
1.
taking decisions on and managing operations conducted
under this Regulation, in accordance with the budgetary and
other procedures in force, notably those laid down in the
Financial Regulation applicable to the general budget of the
European Communities.

this

In the specific case of contribution of

2.
the EPRD to
regional programmes in the SADC area financed from the
contribution may be utilised following LomØ
EDF,
Convention modalities, provided that
the
Financial Regulation applicable to the general budget of the
European Communities are respected.

the provisions of

3.
In order to ensure transparency and achievement of the
objectives referred to in Article 4(6), the Commission shall
forward project profiles to the Member States and their local
representatives as soon as the decision to appraise them has

4.
All financing agreements or contracts concluded under
this Regulation shall provide for on-the-spot checks by the
Commission and the Court of Auditors in accordance with
the usual
established by the Commission
pursuant to the rules in force, in particular those laid down
in the Financial Regulations applicable to the general budget of
the European Communities.

arrangements

In addition, the Commission may carry out on-the-spot checks
and inspections
in conformity with Regulation (EC) No
2185/96.

The measures taken by the Commission in accordance with the
in Article 8 shall provide for adequate
procedure set out
European
the
protection of
Community in conformity with Regulation (EC) No 2988/95.

interests of

financial

the

5. Where the operations give rise to financing agreements
between the Community and South Africa, such agreements
shall stipulate that
taxes, duties and charges shall not be
borne by the Community.

Participation in invitations to tender and contracts shall
6.
be open on equal terms to all natural and legal persons in the
Member States, South Africa and the other ACP States. Partici-
pation may be extended to include thrid countries in duly
substantiated cases and in order to ensure the best cost-effec-
tiveness ratio.

7.
the
Supplies shall originate in the Member States of
European Community, South Africa or the other ACP States.
In duly substantiated exceptional cases, they may originate in
other countries.

8.
Except as otherwise in the present Regulation, contracts
shall be signed by the South African Government. In addition,
if a contract is not covered by a financing agreement, contracts
shall be concluded by the Commission.

the Financial Regulation
In application of Article 111 of
applicable to the general budget of the European Communities,
payments will be made through a local paying agent which will
be established by agreement between the South African auth-
orities and the Commission, and by whom bank accounts in
local currency and euro will be opened. The paying agent must
keep a full account of operations on these accounts and submit
to the control of the Commission and the Court of Auditors.

the Financial Regulation
In application of Article 109 of
applicable to the general budget of the European Communities,
a National Authorising Officer may be appointed.

Article 8

Comitology

1.
The Commission shall be assisted by a Committee,
composed of the representatives of the Member States and
chaired by the representative of the Commission.

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to be

submit

the measures

The Commission representative shall

to the
2.
Committee a draft of
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. The opinion shall be delivered by
the majority laid down in Article 148(2) of the Treaty in the
case of decisions which the Council is required to adopt on a
proposal from the Commission. The votes of the represen-
tatives of the Member States within the Committee shall be
weighted in the manner set out in that Article. The chairman
shall not vote.

opinion of

The Commission shall adopt measures which shall apply
immediately. However, if these measures are not in accordance
be
with the
communicated by the Commission to the Council forthwith.
In that event, the Commission may defer application of the
measures which it had decided for a period of not more
than one month from the date of such communication.

the Committee,

shall

they

The Council, acting by a qualified majority, may take a different
decision within the time limit referred to in the previous para-
graph.

a

concerning any operation at

3.
By way of derogation to paragraph 2 above, for financing
cost of over
decisions
EUR 5 million and below EUR 25 million, or any adjustment
of such an operation involving an increase of more than 20 %
initially agreed, and proposals arising for
in the amount
for
substantive amendments in the execution of a project
which a commitment has already been made, 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.

4.
The Commission shall inform the Committee succinctly
of financing decisions it intends to take concerning projects
and programmes of a value of under EUR 5 million. Such
information shall be given at
least one week before the
decision is taken.

5. Where the increase referred to in paragraph 3 above is
more than EUR 5 million but less than 20 % of the original
commitment,
the Committee’s opinion shall be sought by
simplified and accelerated procedures.

6.
In case of programmes approved by the Committee and
financed through tranches relating to more than one financial
year, the Commission will take yearly subsequent financing
decisions, not exceeding the determined maximum expenditure
financial
for the approved programme and in the limit of

resources made available by the budgetary authority, without
further communication to the Committee.

Article 9

Monitoring and evaluation

After each financial year the Commission shall submit an
annual report on implementation of this Regulation to the
European Parliament and the Council. The report shall set
turnout with regard to commitments and
out
payments and the projects and programmes financed in the
course of
It shall contain statistics on contracts
awarded for implementing projects and programmes.

the budget

the year.

In addition the Commission shall monitor progress against
each operations’
and
objectives
outcomes, using objectively verifiable indicators.

of outputs

in terms

The Commission shall regularly evaluate operations financed by
those operations’
the Community to determine whether
objectives have been reached and to establish guidelines for
improving the effectiveness of future operations. Summaries
of evaluation reports
shall be forwarded to the Member
States. Full reports shall be made available to Member States
which request them.

this Regulation,

the Commission shall

By 31 October 2003 and eighteen months prior to the expiry
of
to the
European Parliament and the Council an overall evaluation of
the operations financed by the Community forming the tri-
annual programme 2000-2002 under this Regulation, accom-
panied if necessary by proposals for amendments to it and in
the latter case by suggestions for the future of the Regulation.

submit

Article 10

Annual appropriations

The annual appropriations shall be authorised by the budgetary
authority within the limits of the financial perspective.

Each year the budgetary description will fix a ceiling within the
annual appropriation for technical assistance contracts to be
concluded by the Commission for the carrying out of joint
operations
European
Communities and of the beneficiary.

the mutual

benefit

the

for

of

Article 11

Duration

This Regulation shall enter
into force on the third day
following that of its publication in the Official Journal of the
European Communities and shall expire on 31 December 2006.

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