Proposal for a Council Decision on the system of the European Union's own resources (COM(1999) 333 - C5-0092/1999 - 1999/0139(CNS))
Date: 1999-11-17
Institutions: Committee on Budgets, European Parliament
Subjects: financing of the EU budget, gross national product, interinstitutional relations (EU), own resources

C 189/72

Official Journal of the European Communities

EN

7.7.2000

Wednesday 17 November 1999

2. EU own resources *

A5-0052/1999

Proposal

for a Council Decision on the system of

the European Union’s own resources

(COM(1999) 333 ’ C5-0092/1999 ’ 1999/0139(CNS))

The proposal was amended as follows:

TEXT PROPOSED
BY THE COMMISSION (1)

AMENDMENTS
BY PARLIAMENT

(Amendment 2)

Recital 2

(2) Whereas according to the said Decision the maximum
ceiling of own resources for 1999 was set equal to 1,27 % of
the European Union GNP at market prices and an overall ceil-
ing of 1,335 % of the European Union GNP was set for com-
mitments appropriations;

(2) Whereas according to the said Decision the maximum
ceiling of own resources for 1999 was set equal to 1,27 % of
the European Union GNP at market prices and an overall ceil-
ing of 1,335 % of the European Union GNP was set for com-
mitment appropriations; whereas these rates determine the
maximum proportion of Community GNP that is to be
available for financing the budget; whereas they constitute
the basis for cooperation based on partnership between
the two arms of the budgetary authority that has helped
shape viable financial framework agreements between the
institutions and ensure prudent financial management, and
are to remain as they stand;

(Amendment 1)

Recital 2a (new)

(2a) Whereas on 11 March 1999 the European Parliament
adopted a resolution on the need to modify and reform
the system of the European Union’s own resources (1);

(1) OJ C 175, 21.6.1999, p. 238.

(Amendment 3)

Recital 2b (new)

(2b) Whereas the continuous development and forth-
coming enlargement of
the European Union make a
dynamic reform of the revenue system necessary; whereas
such a reform must be designed to increase the Commu-
nity’s financial autonomy and establish new forms of own
resources without increasing the overall burden of taxes
and charges on the European taxpayer and with due
regard for the economic performance of the Member
States; whereas the planned changes to the system of
own resources must come into effect immediately and
the preparation of further reforms must be speeded up;

(1) OJ C 274 E, 28.9.1999, p. 39.

7.7.2000

EN

Official Journal of the European Communities

C 189/73

TEXT PROPOSED
BY THE COMMISSION

Wednesday 17 November 1999

AMENDMENTS
BY PARLIAMENT

(Amendment 4)

Recital 3a (new)

the

financial perspective

(3a) Whereas
included in
Annex I to the interinstitutional agreement of 6 May
1999 (1) sets the own resources ceiling at 1,27 % of the
GNP of the European Union;

(1) OJ C 172, 18.6.1999, p. 1.

(Amendment 5)

Recital 5

(5) Whereas the system should be equitable, transparent, cost-
effective and simple;

(5) Whereas the system should be equitable, transparent, cost-
effective, simple and readily understandable by the public;

(Amendment 6)

Recital 5a (new)

(5a) Whereas, to ensure this for the future, the EU must
move steadily away from dependence on transfers from
Member States; whereas,
the own
resources system must be modified with a view to achiev-
ing financial autonomy;

in the long term,

(Amendment 8)

Recital 5b (new)

(5b) Whereas a balanced budget is not exclusively a mat-
ter of the revenue side;

(Amendment 31)

Recital 6

(6) Whereas the system should be based on criteria which best
express each Member State’s ability to contribute;

(6) Whereas the system should be based on criteria which
correspond to each Member State’s economic performances
for which GNP is the relevant indicator; whereas,
in
future, the use of compensatory mechanisms on the rev-
enue side should be avoided as a matter of principle;
whereas imbalances must be corrected by a reform of the
expenditure structure;

(Amendment 10)

Recital 7

(7) Whereas it is appropriate that the best quality data are
used for the purposes of the EU budget and its own resources;
whereas the application, upon the entry into force of a new
decision repealing Council Decision 94/728/EC, Euratom, of
the new system of integrated economic accounts in accordance
with Council Regulation 2223/96 (ESA 95) will improve the
quality of measurement of national accounts data; whereas the

(7) Whereas it is appropriate that the best quality data are
used for the purposes of the EU budget and its own resources;
whereas the application, upon the entry into force of a new
decision repealing Council Decision 94/728/EC, Euratom, of
the new system of integrated economic accounts in accordance
with Council Regulation 2223/96 (ESA 95) will improve the
quality of measurement of national accounts data;

C 189/74

Official Journal of the European Communities

EN

7.7.2000

AMENDMENTS
BY PARLIAMENT

Wednesday 17 November 1999

TEXT PROPOSED
BY THE COMMISSION

use of the new system might result in a change in the maximum
amount of resources made available to the EU corresponding to the
GNP ceilings expressed as a percent of GNP; whereas it is appropriate
to adapt the ceiling expressed as a percent of GNP so as to maintain
unchanged the amount of financial resources put at the disposal of the
Union; whereas reliable estimates of EU GNP according to both the
ESA 95 and the ESA second edition will become available with some
delay; whereas it is appropriate to establish a formula for the deter-
mination of the new ceilings to be used in connection with the GNP
calculated according to ESA 95, to be applied at the time of entry
into force of the current Decision;

(Amendment 11)

Recital 11, 1st indent

B the maximum rate of call on the VAT resource will be
reduced to 0,75 % in 2002 and 2003 and to 0,50 % from
2004 onwards,

B the maximum rate of call on the VAT resource will be
reduced to 0,75 % in 2001 and 2002, to 0,50 % in 2003
and 2004 and to 0,25 % from 2005 onwards,

(Amendment 13)

Recital 13

(13) Whereas the budgetary imbalances should be corrected
in such a way as not to affect the own resources available for
European Union policies;

(13) Whereas the budgetary imbalances should be corrected
in such a way as not to affect the own resources available for
European Union policies; whereas this principle must apply
without restriction to all forms of own resources and also
cover refunds to Member States;

(Amendment 32)

Recital 15a (new)

(15a) Whereas the European Union’s system of own
resources ought in future no longer include derogations;
whereas existing correction mechanisms should therefore
be gradually dismantled;

(Amendment 14)

Recital 16

(16) Whereas the monetary reserve, hereinafter referred to as
‘the EAGGF monetary reserve’, the reserve for the financing of
the Loan Guarantee Fund and the reserve for emergency aid in
non-member countries are covered by specific provisions;

(16) Whereas the monetary reserve, hereinafter referred to as
‘the EAGGF monetary reserve’, the reserve for the financing of
the Loan Guarantee Fund and the reserve for emergency aid in
non-member countries are covered by specific provisions;
whereas, in addition, it would make sense to introduce
an EAGGF reserve for market uncertainties;

(Amendment 15)

Recital 17

(17) Whereas the European Council of 24 and 25 March
1999 invited the Commission to submit, before 1 January
2006, a report reviewing the operation of the own resources
in particular, the effects of enlargement on the
system and,

(17) Whereas the European Council of 24 and 25 March
1999 invited the Commission to submit, before 1 January
2006, a report reviewing the operation of the own resources
in particular, the effects of enlargement on the
system and,

7.7.2000

EN

Official Journal of the European Communities

C 189/75

TEXT PROPOSED
BY THE COMMISSION

financing of the budget; whereas the report should also review
the correction of
the budgetary imbalances granted to the
United Kingdom as well as the granting to Austria, Germany,
the Netherlands and Sweden of the reduction in the financing
of the budgetary imbalances in favour of the United Kingdom;
whereas the report should also address the feasibility of creat-
ing new autonomous own resources as well as arrangements
for the possible introduction of a fixed uniform rate applicable
to the VAT assessment bases;

Wednesday 17 November 1999

AMENDMENTS
BY PARLIAMENT

financing of the budget; whereas the report should also review
the correction of
the budgetary imbalances granted to the
United Kingdom as well as the granting to Austria, Germany,
the Netherlands and Sweden of the reduction in the financing
of the budgetary imbalances in favour of the United Kingdom;
whereas the report should also address the feasibility of creat-
ing new autonomous own resources as well as arrangements
for the possible introduction of a fixed uniform rate applicable
to the VAT assessment bases; whereas the Commission will
submit that report before 1 January 2004; whereas, on the
basis of that report, the Commission will submit, before
1 January 2005, a proposal for a Council decision which
will replace this Decision on 1 January 2007; whereas
that decision is to include provisions concerning the
replacement of the VAT resource by new, autonomous
own resources; whereas those new resources should be
directly connected with ordinary citizens and not increase
the tax burden they bear; whereas, furthermore, provi-
sions should be included for the gradual phasing-out of
the compensatory mechanism established in favour of the
United Kingdom; whereas,
it should enter into force
simultaneously with the beginning of the new financial
perspective from 2007 with a view to improving consis-
tency between the revenue and expenditure sides of bud-
getary policy;

(19) Whereas the European Council provided that this Decision
should take effect on 1 January 2002;

(19) Whereas this Decision should take effect on 1 January
2001;

(Amendment 16)

Recital 19

(Amendment 17)

Article 2(3), 2nd subparagraph (new)

In so far as the provision of services by the customs
authorities of the Member States is paid for out of the
Union budget, the Commission shall submit, not later
than 31 January 2003, a report on its own initiatives and
those by the Member States to make the activities of the
customs authorities in the Union more coherent and inte-
grated and analyse progress recorded in the area of com-
bating fraud against the Union budget, as well as the
results obtained in the area of the recovery of sums frau-
dulently obtained from the budget.

(Amendments 18 and 34)

Article 2(4)

The uniform rate referred to in paragraph 1(c) shall cor-

4.
respond to the rate resulting from the difference between:

The uniform rate referred to in paragraph 1(c) shall cor-

4.
respond to the rate resulting from the difference between:

(a)

the maximum rate of call of the VAT resource which is
fixed at
B 0,75 % in 2002 and 2003
B 0,50 % from 2004 onwards, and

(a)

the maximum rate of call of the VAT resource which is
fixed at
B 0,75 % in 2001 and 2002
B 0,50 % in 2003 and 2004
’ 0,25 % for 2005 and 2006, and

C 189/76

Official Journal of the European Communities

EN

7.7.2000

Wednesday 17 November 1999

TEXT PROPOSED
BY THE COMMISSION

AMENDMENTS
BY PARLIAMENT

(b) a rate (‘frozen rate’) equivalent to the ratio between the
amount of the compensation referred to in Article 4 and
the sum of the VAT assessment bases (established in accor-
dance with Article 2(1)(c)) of all Member States, taking
into account the fact that the United Kingdom is excluded
from the financing of its correction and that the share of
Austria, Germany,
the Netherlands and Sweden in the
financing of the UK correction is reduced to one fourth
of its normal value.

(b) a rate (‘frozen rate’) equivalent to the ratio between the
amount of the compensation referred to in Article 4 and
the sum of the VAT assessment bases (established in accor-
dance with Article 2(1)(c)) of all Member States, taking
into account until further notice the fact that the United
Kingdom is excluded from the financing of its correction
and that the share of Austria, Germany, the Netherlands
and Sweden in the financing of
the UK correction is
reduced to one fourth of its normal value.

(Amendment 19)

Article 2(6)

If, at the beginning of the financial year, the budget has
6.
not been adopted, the previous uniform VAT rate and rate
applicable to Member States’ GNPs, without prejudice to the
provisions adopted in accordance with Article 8(2) as regards
the EAGGF monetary reserve, the reserve for financing the
Loan Guarantee Fund and the reserve for emergency aid in
third countries, shall remain applicable until the entry into
force of the new rates.

If, at the beginning of the financial year, the budget has
6.
not been adopted, the previous uniform VAT rate and rate
applicable to Member States’ GNPs, without prejudice to the
provisions adopted in accordance with Article 8(2) as regards
the EAGGF monetary reserve, the EAGGF reserve for market
uncertainties, the reserve for financing the Loan Guarantee
Fund and the reserve for emergency aid in third countries,
shall remain applicable until the entry into force of the new
rates.

(Amendment 20)

Article 2(7)

7.
For the purposes of applying this Decision, the Council,
ruling unanimously on a Commission proposal and after con-
sultation with the European Parliament, will adopt by means of
a Regulation the definition of GNP which must be incorporated
in Regulation 2223/96/EC as well as a new GNP Directive
which will replace Directive 89/0130/EC, Euratom.

7.
For the purposes of applying this Decision, the Council,
ruling unanimously on a Commission proposal and after con-
sultation with the European Parliament, will adopt by means of
a regulation the definition of GNP which must be incorporated
in Regulation 2223/96/EC as well as a new GNP Directive
which will replace Directive 89/0130/EC, Euratom. Pending
publication of this regulation and directive, the rules cur-
rently in force shall apply.

(Amendment 21)

Article 3

1.
The total amount of own resources assigned to the Union
to cover payments appropriations may not exceed a certain
percentage of the total GNPs of the Member States. This percen-
tage, expressed in two decimal places, will be determined by the Com-
mission in December 2001 on the basis of the following formula:

Maximum own resources = 1,27 % * ((1998 + 1999 + 2000 GNP
ESA 2nd edition) / (1998 + 1999 + 2000 GNP ESA 1995))

The commitment appropriations entered in the general bud-
2.
get of the Union must follow an orderly progression resulting
in a total amount, which does not exceed a certain percentage of
the total GNPs of the Member States. This percentage, expressed in
two decimal places, will be determined by the Commission in Decem-
ber 2001 on the basis of the following formula:

Maximum commitment resources = 1,335 % * ((1998 + 1999 +
2000 GNP ESA 2nd edition) / (1998 + 1999 + 2000 GNP
ESA 1995))

1.
The total amount of own resources assigned to the Union
to cover appropriations for payments may not exceed
1,27 % of the GNPof the European Union.

The appropriations for commitments entered in the
2.
general budget of the Union must follow an orderly progres-
sion resulting in a total amount, which does not exceed
1,335 % of the GNP of the European Union.

7.7.2000

EN

Official Journal of the European Communities

C 189/77

TEXT PROPOSED
BY THE COMMISSION

Wednesday 17 November 1999

AMENDMENTS
BY PARLIAMENT

An orderly ratio between commitment appropriations and payment
appropriations shall be maintained to guarantee their compatibil-
ity and to enable the ceilings mentioned in paragraph 1 to be
respected in subsequent years.

An orderly ratio between appropriations for commitments
and appropriations for payments shall be maintained to
guarantee their compatibility and to enable the ceilings men-
tioned in paragraph 1 to be respected in subsequent years.

The Commission shall communicate to the budgetary authority

3.
the new ceilings for own resources before 31 December 2001.

The same procedure described in this Article, paragraphs 1 and
4.
2, will be followed in the case of modifications of the European sys-
tem of integrated economic accounts (ESA) which result in significant
changes in the level of GNP.

(Amendment 23)

Article 4, 4th paragraph (new)

The Commission shall notify the European Parliament and
the Court of Auditors of each annual adjustment.

(Amendment 24)

Article 5(3), 2nd subparagraph (new)

A Council implementing regulation adopted on a proposal
from the Commission and after consulting the European
Parliament and the Court of Auditors shall specify the cri-
the correction is
teria on which the calculation of
required to be based.

(Amendment 25)

Article 6

The revenue needed to cover in full or in part the EAGGF
monetary reserve, the reserve for the financing of the Loan
Guarantee Fund and the reserve for emergency aid in third
countries, entered in the budget shall not be called up from
the Member States until the reserves are implemented. Provi-
sions for the operation of those reserves shall be adopted as
necessary in accordance with Article 8(2).

The revenue needed to cover in full or in part the EAGGF
monetary reserve, the EAGGF reserve for market uncertain-
ties, the reserve for the financing of the Loan Guarantee Fund
and the reserve for emergency aid in third countries, entered in
the budget shall not be called up from the Member States until
the reserves are implemented. Provisions for the operation of
those reserves shall be adopted as necessary in accordance
with Article 8(2).

(Amendment 26)

Article 7, 2nd paragraph

Any surpluses generated by a transfer from EAGGF Guarantee
Section chapters, or surplus from the Guarantee Fund arising
from external measures, transferred to the revenue account in
the budget, shall be regarded as constituting own resources.

Any surpluses generated by a transfer from EAGGF Guarantee
Section chapters and the reserve for market uncertainties,
or surpluses from the Guarantee Fund arising from external
measures, transferred to the revenue account in the budget,
shall be regarded as constituting own resources.

C 189/78

Official Journal of the European Communities

EN

7.7.2000

Wednesday 17 November 1999

TEXT PROPOSED
BY THE COMMISSION

AMENDMENTS
BY PARLIAMENT

(Amendment 27)

Article 8(2)

2. Without prejudice to the auditing of the accounts and to
they are lawful and regular as laid down in
checks that
Article 248 of the Treaty establishing the European Commun-
ity and Article 160c of the Euratom Treaty, such auditing and
checks being mainly concerned with the reliability and effective-
ness of national systems and procedures for determining the
base for own resources accruing from VAT and GNP and with-
out prejudice to the inspection arrangements made pursuant to
Article 279(c) of the EC Treaty and Article 183(c) of the Eura-
tom Treaty, the Council shall, acting unanimously on a propo-
sal from the Commission and after consulting the European
Parliament, adopt the provisions necessary to apply this Deci-
sion and to make possible the inspection of the collection, the
making available to the Commission and payment of the rev-
enue referred to in Articles 2 and 5.

2. Without prejudice to the auditing of the accounts and to
they are lawful and regular as laid down in
checks that
Article 248 of the Treaty establishing the European Commun-
ity and Article 160c of the Euratom Treaty, such auditing and
checks being concerned in particular with the reliability and
effectiveness of national systems and procedures for determin-
ing the base for own resources accruing from VAT and GNP,
and without prejudice to the inspection arrangements made
pursuant to Article 279(c) of the EC Treaty and Article 183(c)
of the Euratom Treaty, the Council shall, acting unanimously
on a proposal from the Commission and after consulting the
European Parliament, adopt the provisions necessary to apply
this Decision and to make possible the inspection of the collec-
tion, the making available to the Commission and payment of
the revenue referred to in Articles 2 and 5.

(Amendment 28)

Article 9

The Commission shall submit, before 1 January 2006, a report
reviewing the operation of the own resources system and, in
particular, the effects of enlargement on the financing of the
budget. The report shall also review the correction of budget-
ary imbalances granted to the United Kingdom as well as the
granting to Austria, Germany, the Netherlands and Sweden of the
reduction referred to in Article 5(1).The report shall also address
the possibility of modifying the structure of the own resources
by creating new autonomous own resources as well as arrange-
ments for the possible introduction of a fixed uniform rate applicable
to the VAT base.

1.
The Commission shall submit, before 1 January 2004,
a report reviewing the operation of the own resources system
and, in particular, the effects of enlargement on the financing
of the budget. The report shall also review the correction of
budgetary imbalances granted to the United Kingdom with a
view to its gradual phasing-out. The report shall also address
the possibility of modifying the structure of the own resources
by creating new autonomous own resources which are
directly connected with ordinary citizens and which will
not increase the tax burden they bear, as well as the repla-
cement of revenue in accordance with Article 2(1)(c) by
such new autonomous resources.

2.
Before 1 January 2005, the Commission shall submit
a proposal for a decision on the European Union’s system
of own resources which will replace this Decision by
1 January 2007. The proposal shall
include provisions
relating to the replacement of the VAT resource by new
autonomous own resources which meet the criteria laid
down in paragraph 1 and provisions relating to the gra-
dual phasing-out of the corrective mechanism established
in favour of the United Kingdom.

(Amendment 29)

Article 10 (1), 3rd subparagraph

This Decision shall enter into force on the first day of the
month following receipt of the last of the notifications referred
to in the second subparagraph. It shall take effect on 1 January
2002 except for Article 2(3) and (4), which shall take effect on 1 Jan-
uary 2001.

This Decision shall enter into force on the first day of the
month following receipt of the last of the notifications referred
to in the second subparagraph. It shall take effect on 1 January
2001.

7.7.2000

EN

Official Journal of the European Communities

C 189/79

TEXT PROPOSED
BY THE COMMISSION

Wednesday 17 November 1999

AMENDMENTS
BY PARLIAMENT

(Amendment 30)

Article 10(2)(a)

2 (a)

Subject to (b), Decision 94/0728/EC, Euratom shall be
repealed as of 1 January 2002. Any references to the
Council Decision of 21 April 1970 on the replacement of
financial contributions from Member States by the Com-
munities’ own resources, to Council Decision 85/0257/
EEC, Euratom of 7 May 1985 on the Communities’ system
of own resources, to Decision 88/0376/EEC, Euratom, or
to Decision 94/0728/EC, Euratom shall be construed as
references to this Decision.

2 (a)

Subject to (b), Decision 94/0728/EC, Euratom shall be
repealed as of 1 January 2001. Any references to the
Council Decision of 21 April 1970 on the replacement of
financial contributions from Member States by the Com-
munities’ own resources, to Council Decision 85/0257/
EEC, Euratom of 7 May 1985 on the Communities’ system
of own resources, to Decision 88/0376/EEC, Euratom or
to Decision 94/0728/EC, Euratom shall be construed as
references to this Decision.

European Parliament legislative resolution on the proposal for a Council Decision on the system
of the European Union’s own resources (COM(1999) 333 ’ C5-0092/1999 ’ 1999/0139(CNS))

(Consultation procedure)

The European Parliament,

B having regard to the Commission proposal to the Council (COM(1999) 333) (1),

B having been consulted by the Council pursuant to Article 269 of the EC Treaty and Article 173 of the

Euratom Treaty (C5-0092/1999),

B having regard to Rule 67 of its Rules of Procedure,

B having regard to the report of the Committee on Budgets and the opinion of the Committee on

Budgetary Control (A5-0052/1999),

1.

Approves the Commission proposal as amended;

Calls on the Commission to alter its proposal accordingly, pursuant to Article 250(2) of the EC

2.
Treaty and Article 119, second paragraph, of the Euratom Treaty;

If the Council intends to depart from the text approved by Parliament, calls on the Council to notify

3.
Parliament;

Calls for the conciliation procedure to be initiated should the Council intend to depart from the text

4.
approved by Parliament;

5.

Asks to be consulted again if the Council intends to amend the Commission proposal substantially;

6.

Instructs its President to forward its position to the Council and Commission.

(1) OJ C 274 E, 28.9.1999, p. 39.