Opinion No 3/99 of the Court of Auditors of the European Communities on an amended proposal for a Council Regulation (EC, ECSC, Euratom) amending the Financial Regulation of 21 December 1977 applicable to the general budget of the European Communities (Proposal presented by the Commission in document COM(1998) 676 final of 20 November 1998)
Date: 1999-04-14
Institutions: European Court of Auditors
Subjects: foreign national, free movement of workers, freedom to provide services, frontier worker, self-employed person

1.6.1999

EN

Official Journal of the European Communities

C 154/5

OPINION No 3/99

of the Court of Auditors of the European Communities on an amended proposal for a Council Regulation
(EC, ECSC, Euratom) amending the Financial Regulation of 21 December 1977 applicable to the general
budget of the European Communities (Proposal presented by the Commission in document COM(1998)
676 final of 20 November 1998)

(1999/C 154/02)

THE COURT OF AUDITORS OF THE EUROPEAN COMMUNITIES,

Whereas, at Parliament(cid:146)s request, the amended proposal has added to
the above three reforms a fourth concerning the creation of a specific
section of the budget for the Ombudsman;

Having regard to the Treaty establishing the European Community,
and in particular Article 209 thereof,

Having regard to the Treaty establishing the European Coal and Steel
Community, and in particular Article 78h thereof,

Having regard to the Treaty establishing the European Atomic Energy
Community, and in particular Article 183 thereof,

Having regard to the Financial Regulation of 21 December 1977 appli-
cable to the general budget of the European Communities (1), which
has been amended on several occasions, and in particular Article 140
thereof,

Whereas since the Commission(cid:146)s presentation of the amended pro-
posal on 20 November 1998 the Council has adopted, on 17 Decem-
ber 1998, Regulation (EC, ECSC, Euratom) No 2779/98, which modi-
fies the Financial Regulation to take account of the introduction of the
euro and the adoption of the Stability and Growth Pact; whereas in
consequence only two reforms are still capable of being adopted: the
one which concerns the abolition of the common organisational
structure and that which concerns the creation of the budget section
for the Ombudsman; whereas attention should therefore be focused
on those provisions of the proposal that apply to the implementation
of the latter two reforms,

HAS ADOPTED THE FOLLOWING OPINION:

Having regard, in particular, to Council Regulation (EC, ECSC, Eura-
tom) No 2779/98 of 17 December 1998 (2), which is the most recent
Regulation to amend the Financial Regulation,

Formal presentation of the amended proposal

Having regard to the Commission(cid:146)s initial proposal of 3 April 1998 (3),

Having regard to the amended Commission proposal of 20 November
1998 (4),

Having regard to the requests for an opinion on the amended pro-
posal, which the Council sent to the Court of Auditors on 10 Decem-
ber 1998 and 9 March 1999,

Referring to Opinion No 9/98 concerning the initial proposal, which
the Court of Auditors delivered on 22 October 1998 (5),

Whereas the object of the initial proposal was to deduce the implica-
tions for the Financial Regulation of the introduction of the euro as
the single currency for some Member States of the Communities, the
abolition of the common organisational structure for the Economic
and Social Committee and the Committee of the Regions and the
adoption of the Stability and Growth Pact (SGP);

(1) OJ L 356, 31.12.1977, p. 1.
(2) OJ L 347, 23.12.1998, p. 3.
(3) Doc. COM(1998) 206 final and OJ C 149, 15.5.1998, p. 21.
(4) Doc. COM(1998) 676 final and OJ C 396, 19.12.1998, p. 18.
(5) OJ C 7, 11.1.1999, p. 1.

1. The proposal is set out in two columns, the first containing the
text of the initial proposal and the second the amended text. Both col-
umns contain numerous blank spaces. The significance of the blank
spaces is totally different from one column to the next. In the first
column the blanks correspond to the absence of any provision. In the
case of the second column they concern parts of the text that have
remained identical from the initial proposal to the amended proposal.
Without examining them carefully one might well assume that these
sections concern provisions of the initial proposal that have been
deleted in the revised proposal. It would have been clearer to specify
(cid:145)Provision unchanged(cid:146).

2. This unusual and elliptical presentation may have been the cause
of one particular omission. From the initial proposal to the amended
proposal Article 126a has become Article 132a. Under the circum-
stances the reference to Article 126a in Article 1(4) of the initial pro-
posal should have been corrected in the amended proposal to a refer-
ence to Article 132a. The second column is, however, blank at this
point.

Consequences of abolishing the common organisational structure
for the Economic and Social Committee and the Committee of the
Regions

3. The Court of Auditors is pleased to note that, in accordance with
the latter(cid:146)s recommendation (paragraph 2 of Opinion 9/98), the Com-

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Official Journal of the European Communities

1.6.1999

mission and the Council have correctly followed up the fact that,
unlike the introduction of the euro and the implementation of the Sta-
bility and Growth Pact, where provision for the repercussions on the
Financial Regulation could be adopted without delay (Council Regula-
tion (EC, ECSC, Euratom) No 2779/98), the provisions amending the
Financial Regulation in connection with the abolition of the common
organisational structure could not enter into force until the Treaty of
Amsterdam had been ratified and must, therefore, be the subject of a
separate Council Regulation at a later date (point 4 first indent of the
explanatory memorandum and Article 2 of the amended proposal).

4. Moreover, for obvious practical reasons, it is inconceivable that
the section of the budget common to the two Committees can be split
into two separate sections from one day to the next. Article 2 of the
Regulation amending the Financial Regulation should therefore pro-
vide that the provisions (already mentioned by the Commission in
that Article) which take account of the implications of the disappear-
ance of the common organisational structure will enter into force on
the first day after the entry into force of the Treaty of Amsterdam and,
that notwithstanding, the budget that is in course of implementation
at the time of the aforesaid entry into force will continue to be imple-
mented up to the time of its closure.

Introduction of a separate budget section for the Ombudsman

5. The Court of Auditors has no objection to the principle of creat-
ing a separate section for the Ombudsman. However, it does wish the
reasons for the proposed solution to be stated. This is not the case as
the amended proposal stands at the moment.

6. The explanatory memorandum offers three reasons. The first is
not very convincing, the second is based on a false premise and the
third is rather weak.

(a) The first suggests that since both the Economic and Social Com-
mittee and the Committee of the Regions will, in future, each have

their own specific section of the budget, (cid:145)...this solution can also
be extended to the Ombudsman(cid:146). The Court does not see any rela-
tion between the two cases. The reasons for the establishment of
separate sections for the two Committees do not apply in any way
to the Ombudsman.

(b) The second claims that if the Ombudsman is not given a separate
section it (cid:145)...would otherwise be the only body with a budget
annexed to the section of another institution(cid:146). As it stands, this
assertion is inaccurate. At the moment, the budget of the Publica-
tions Office is still an annex to Part A of the Commission section.
It is true that the Publications Office is a purely technical struc-
ture.

(c) The third points out that, under Article 22(5), the Ombudsman is
treated as an institution for the purposes of the Financial Regula-
tion. However, Article 22(5) specifies (cid:145)...save as otherwise pro-
vided(cid:146). One might easily think, therefore, that, in accordance with
Article 22(5), the Ombudsman is to be treated as an institution in
every respect other than the allocation of a budget section to each
institution.

7. Even if the explanatory memorandum were to give more solid rea-
sons for the creation of a new section, those reasons would need to be
included in a summary form in a recital in the actual text of the pro-
posed Regulation. The function of the recitals is, in fact, not to sum-
marise the provisions which follow, which is all too often what hap-
pens, but to provide the main elements of the reasons justifying them.
In this respect the proposed third recital provides no explanation as
to the purpose of the Ombudsman section.

8. All unnecessary words should be deleted. In Article 20(2) instead
of (cid:145)In the section for each institution(cid:146), write (cid:145)In each section(cid:146). In actual
fact, every section corresponds to an institution, or, at least, a (cid:145)quasi-
institution(cid:146) and the shorter form of words is, in fact, sufficient because,
according to Article 22(5) of the Financial Regulation, quasi-institutions
are treated as institutions for the purposes of that Regulation, unless
otherwise provided (which in this case is not so). For the same reason
the words (cid:145)the Economic and Social Committee, the Committee of the
Regions and the Ombudsman(cid:146) should be deleted from the third sub-
paragraph of Article 26(4).

This Opinion was adopted by the Court of Auditors in Luxembourg at the Court meeting on 14 and 15 April 1999.

For the Court of Auditors

Jan O. KARLSSON

President