Council Regulation (EC, Euratom) No 99/2000 of 29 December 1999 concerning the provision of assistance to the partner States in Eastern Europe and Central Asia
Date: 1999-12-29
Institutions: Council of the European Union
Subjects: Central Asia, Central and Eastern Europe, EU aid, cooperation policy, financial aid

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I

(Acts whose publication is obligatory)

COUNCIL REGULATION (EC, EURATOM) No 99/2000

of 29 December 1999

concerning the provision of assistance to the partner States in Eastern Europe and Central Asia

THE COUNCIL OF THE EUROPEAN UNION,

of the indigenous people, and towards market-oriented
economic systems;

Having regard to the Treaty establishing the European
Community, and in particular Article 308 thereof,

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 (1),

Having regard to the opinion of the European Parliament,

(6)

(7)

Further assistance is required to promote nuclear safety
in the partner States;

The continued provision of assistance will contribute to
the attainment of shared objectives, notably in the
context of the Partnership and Cooperation Agreements
and Economic Cooperation Agreements concluded with
the partner States;

Whereas

(1)

(2)

(3)

(4)

in Dublin and in
Pursuant to the European Council
Rome in 1990, the Community introduced a technical
assistance programme in favour of economic reform and
recovery in the former Union of Soviet Socialist Repub-
lics;

Council Regulation (Euratom, EC) No 1279/96 of 25
June 1996 concerning the provision of assistance to
economic reform and recovery in the New Independent
States and Mongolia (2) laid down the conditions for the
provision of such assistance and envisaged such an
operation from 1 January 1996 to 31 December 1999;

Such assistance has already generated significant impact
on reform in the partner States in Eastern Europe and
Central Asia listed in Annex I (‘the partner States’);

A financial reference amount within the meaning of
point 34 of the Interinstitutional Agreement of 6 May
1999 between the European Parliament, the Council and
the Commission on budgetary discipline and improve-
ment of the budgetary procedure (3) is included in this
thereby
Regulation for
affecting the powers of the budgetary authority as they
are defined by the Treaty;

its entire duration, without

(5)

Such assistance will be fully effective only in the context
of progress towards free and open democratic societies
that respect human rights, minority rights and the rights

(1) OJ C 37, 11.2.1999, p. 8.
(2) OJ L 165, 4.7.1996, p. 1.
(3) OJ C 172, 18.6.1999, p. 1.

(8) Where applicable provisions of assistance under this
Regulation will take due account of the Common Strat-
egies adopted by the European Council;

(9)

(10)

(11)

(12)

(13)

(14)

It is appropriate to establish priorities for this assistance
which are determined, inter alia, by the common inter-
ests of the Community and the partner States;

The assistance should take into account the differing
needs and priorities of the principal regions covered by
this Regulation;

Experience has shown that Community assistance will
be all the more effective when it is concentrated on a
restricted number of areas within each partner State;

The development of inter-State economic links and trade
flows conducive to economic reform and restructuring
should be encouraged;

Regional and subregional cooperation, particularly in
relation to the Northern Dimension and in the Black Sea
region, should be encouraged;

Cross-border cooperation, particularly in the context of
borders between the partner States and the European
Union, between the partner States and Central and
Eastern Europe, and between the partner States them-
selves, should be encouraged;

(15)

(16)

(17)

(18)

(19)

(20)

(21)

(22)

(23)

(24)

(25)

(26)

(27)

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The requirements of economic reform and restructuring
now in progress, and the effective management of this
programme, require a multi-annual approach;

The long-term sustainability of reform will require due
emphasis on the social aspects of reform and the devel-
opment of the civil society;

The integration of environmental aspects into the assis-
tance is central to the long term sustainability of the
economic reforms and development;

The development of human resources, including educa-
tion and training, has a significance for reform and
restructuring;

(28) Along with natural and legal persons from the Member
States and the partner States, participation in tenders
should also be open to natural and legal persons from
countries benefiting from the PHARE programme, and,
where specific types of expertise are required,
from
Mediterranean countries;

(29)

(30)

Progress reports on the implementation of the assistance
programme should be established annually;

The Treaties have not provided, for the adoption of this
Regulation, powers other than those of Article 308 of
the EC Treaty and Article 203 of the EAEC Treaty,

The quality of the assistance should be improved by
selecting a proportion of projects on a competitive basis;

HAS ADOPTED THIS REGULATION:

it

In order properly to meet the most acute needs of the
partner States at the present stage of their economic
is necessary to permit a certain
transformation,
the financial allocation to be used for
amount of
economically sound investment-financing, notably in the
areas of cross-border cooperation, promotion of small
and medium-sized enterprises (SMEs), environmental
infrastructure and networks of strategic importance to
the Community;

Community assistance could, where appropriate, be
more effective, efficient and visible when it is imple-
mented on a decentralised basis;

Effective competition amongst firms, organisations and
institutions interested in participating in the initiatives
financed by the programme should be ensured;

Community assistance will be all
the more effective
when the commitment of the partner States is ensured;

It is appropriate that the Commission be assisted in the
implementation of Community aid by a committee
made up of Member States' representatives;

The measures necessary for the implementation of this
Regulation should be adopted in accordance with
Council Decision 1999/468/EC of 28 June 1999 laying
down the procedures for the exercise of implementing
powers conferred on the Commission (1);

Procedures for
tenders and the award of contracts
should be in accordance with the Financial Regulation
applicable to the General Budget of the European Union
(the ‘Financial Regulation’);

The provisions concerning tendering and the award of
contracts as well as the principles governing the award
of contracts should be applied until such time as legisla-
tion amending Title IX of the Financial Regulation enters
into force,
in order to provide the basis for imple-
menting provisions that will apply to all Community
external assistance programmes;

(1) OJ L 184, 17.7.1999, p. 23.

Article 1

A programme to promote the transition to a market economy
and to reinforce democracy and the rule of law in the partner
States listed in Annex I (hereinafter called ‘the partner States’)
shall be implemented by the Community from 1 January 2000
to 31 December 2006 in accordance with the criteria laid
down in this Regulation.

Article 2

1.
The programme shall be based on the principles and
objectives set out in the Partnership and Cooperation Agree-
ments and Trade and Economic Cooperation Agreements, in
the context of which the Community, its Member States and
the partner States work together to support
initiatives of
common interest.

2.
The programme shall aim to maximise impact through
concentration on a limited number of significant initiatives, not
precluding small-scale projects where such projects are appro-
priate. To this end,
the indicative and action programmes
referred to below shall cover at most three of the eligible
cross-cutting areas of cooperation listed in Annex II. Where
for nuclear safety shall be provided in
applicable, support
addition to the three areas. The programme shall take into
account
the principal
regions covered by the Regulation and in particular the need to
promote democracy and the rule of law.

the differing needs and priorities of

3.

Particular attention shall be paid:

— to the need to reduce environmental risks and pollution,

including transboundary pollution,

— to the need to promote the sustainable use of natural
including energy resources, and

resources,

— to the social aspects of transition.

4.
The programme shall aim to promote inter-State, inter-
regional and cross-border cooperation between the partner
States themselves, between the partner States and the European
Union and between the partner States and Central and Eastern
Europe.

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Interstate and inter-regional cooperation shall primarily serve
to assist the partner States to identify and pursue actions which
are best undertaken on a multi-country, rather than a national
level such as the promotion of networks, environmental
cooperation and actions in the area of justice and home affairs.

TITLE I

INDICATIVE AND ACTION PROGRAMMES

Cross-border cooperation shall primarily serve to:

Article 3

(a) assist border regions in overcoming their specific develop-

mental problems;

The assistance shall be applied in the framework of

1.
national, multi-country and other programmes.

(b) encourage the linking of networks on both sides of the

border, e.g. border-crossing facilities;

(c) accelerate the transformation process in the partner States
through their cooperation with border regions in the Euro-
pean Union or Central and Eastern Europe;

(d) reduce transboundary environmental risks and pollution.

In the area of nuclear safety, the programme shall focus

5.
on three priorities.

(a) Supporting the promotion of an effective nuclear safety
culture in line with the principles of the Convention on
nuclear safety, in particular through continuous support for
regulatory bodies and, at the plant level, through on site-
assistance, including equipment supplies, where such assis-
tance is most needed;

(b) Supporting the development and implementation of spent
fuel, decommissioning and nuclear waste management
strategies, including in Northwest Russia in the context of
wider international cooperation;

(c) Contributing to relevant EU supported international initia-
tives such as the G7/EU initiative on the closure of Cher-
nobyl.

The programme shall also support the application of efficient
safeguards of nuclear materials.

6.

The programme shall take into account:

— the evolving and differing needs and priorities of partner
States, individually and as regions, and among other consid-
erations, the context of enlargement,

— absorptive capacity of partner States,

— progress towards democratic and market-oriented reform in

partner States.

Measures
following criteria:

shall be implemented taking into account

the

— the need for sustainable economic development,

— the social

impact of reform measures,

— the promotion of equal opportunities for women,

— the sustainable use of natural resources and respect for the

environment.

The national

2.
comprise indicative and action programmes.

and multi-country programmes

shall

3.
Indicative programmes covering three to four year
periods shall be established in accordance with the procedure
referred to in Article 13(2). These programmes shall define the
principal objectives of, and guidelines for, Community assis-
tance in the areas of cooperation set out in Annex II and
would, as far as possible, include indicative financial estimates.
Before
the
Commission shall discuss with the Committee referred to in
Article 13(1) the priorities to be identified with the partner
States.

indicative programmes,

establishment of

the

4.
Action programmes based on the indicative programmes
referred to in paragraph 3 shall be adopted on an annual or
biannual basis in accordance with the procedure referred to in
Article 13(2). These action programmes shall include a list of
the projects to be financed within the areas of cooperation set
out in Annex II. The content of the programmes shall be
determined in sufficient detail, so as to enable the Committee
referred to in Article 13(1) to deliver its opinion.

5.
The measures outlined in the national action programmes
shall be reflected in financing memoranda agreed between the
Commission and each partner State. These shall be based on a
dialogue addressing the joint interests of the Community and
the partner States, particularly in the context of the Partnership
and Cooperation Agreements.

If

circumstances

6.
indicative and action
programmes may be amended in accordance with the proce-
dure referred to in Article 13(2) during the period of their
application.

require,

the

Article 4

1.
In addition to the national action programmes, an incen-
tive scheme is established to introduce an element of
competition into the allocation of resources,
in order to
promote quality.
In order to ensure concentration, projects
financed under this scheme should be linked to the cross-
cutting areas of cooperation established in the national indic-
ative programmes referred to in Article 3.

The scheme shall be introduced gradually and take into
2.
account the administrative capacity of the different partner
States. In the first year of operation, the size of the scheme
shall not exceed 10 % of the overall budget of the programme.
In subsequent years, this proportion might be increased by up
to 5 % per year.

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Taking into account the experience of the preceding years
3.
including geographical distribution, special efforts shall be
made to promote the participation in this scheme of all the
partner States, especially those experiencing most difficulties in
achieving success in this scheme.

4.
The annual incentive scheme programme, including the-
criteria for the selection of projects and its size, shall be agreed
in accordance with the procedure referred to in Article 13(2).

TITLE II

MEASURES TO BE SUPPORTED

TITLE III

FINANCIAL PROVISIONS

Article 6

The financial reference amount for the implementation of
the period 2000 to 2006 shall be

1.
this programme for
EUR 3 138 million.

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

A maximum of 20 % of the annual budget could be
2.
allocated to investment financing as described in Annex III. A
maximum of 20 % of the annual budget could be allocated to
the ‘Incentive scheme’ as outlined in Article 4.

Article 5

Article 7

In the framework of the programmes referred to in Title I
1.
which consists primarily of technical assistance, the following
shall be supported:

— transfer of expertise and know-how,

including training,

— industrial cooperation and partnerships

institution
building based on cooperation between public and private
organisations from the European Union and partner States,

for

— on a case by case basis, the reasonable cost of supplies
required in the implementation of the assistance. In partic-
ular cases, including nuclear safety, justice and home affairs
and cross-border cooperation, a significant supply element
may be included,

— investment and investment-related activities. Assistance
may include technical assistance to catalyse and support
investments. Assistance may also include
investment
financing as described in Annex III, notably in the areas of
cross-border cooperation, promotion of small and medium-
sized
and
environmental
networks.

infrastructure

enterprises,

The assistance shall also cover costs related to the prepa-
2.
ration, implementation, monitoring, audit and evaluation of the
programme, as well as costs concerning information.

The measures can be carried out, where appropriate, on a
3.
decentralised basis. The final recipients of Community assis-
tance shall be closely involved in the preparation and execution
of the projects. Wherever possible, the identification and prepa-
ration of the projects shall be carried out at regional and local
level.

4.
Projects will, where appropriate and in such a way that
avoids disrupting the continuity of actions, be implemented in
phases. Support for subsequent phases will depend upon the
successful

implementation of previous phases.

The involvement of local experts in project implementa-

5.
tion will be encouraged.

1. Measures
referred to in this Regulation which are
financed from the general budget of the European Union shall
be administered by the Commission in accordance with the
Financial Regulation applicable thereto.

The Commission shall abide by the principles of sound
2.
financial management and, in particular, those of economy and
cost-effectiveness referred to in the Financial Regulation.

Article 8

1.
Community assistance shall in general be in the form of
grants. They may generate funds that can be used for financing
other cooperation projects or measures.

2.
Financial decisions and contracts resulting therefrom shall
expressly provide for the monitoring and financial supervision
and control by the Commission and the Court of Auditors to
be carried out on the spot,

if necessary.

Article 9

The cost of the project in local currency shall be covered

1.
by the Community only to the extent strictly necessary.

The co-financing of projects by the partner States shall be

2.
actively encouraged.

Taxes, duties and the purchase of immovable property

3.
shall not be funded by the Community.

Article 10

The following provisions concerning tendering and the award
of contracts as well as the principles governing the award of
contracts set out in Annex IV shall be applied until such time
as legislation amending Title IX of the Financial Regulation
enters into force,
in order to provide the basis for imple-
menting provisions that will apply to all Community external
assistance programmes.

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Article 11

1.
The Commission shall implement operations in accord-
ance with the action programmes referred to in Article 3(4)
and in accordance with Title IX of the Financial Regulation as
well as Article 12 of this Regulation.

The Commission shall provide the partner States with a

2.
set of rules on project definition.

Supply and works contracts shall be awarded by means
3.
of open invitations to tender except in the cases provided for in
Article 116 of the Financial Regulation.

4.
Participation in invitations to tender and contracts shall
be open on equal terms to all natural and legal persons in the
Member States, in the partner States, and in countries bene-
fiting from the Phare programme. Participation by natural and
legal persons from Mediterranean countries with traditional
economic, trade or geographical links may be authorised by the
Commission on a case-by-case basis if the programmes or
projects concerned require specific forms of expertise specifi-
cally available in such countries.

In the case of co-financing, the participation of third
5.
countries concerned in invitations to tender and contracts may
be authorised by the Commission, but on a case-by-case basis.
In these cases the participation of undertakings from third
countries shall be acceptable only if reciprocity is granted.

tive coordination of the assistance efforts undertaken by the
Community and individual Member States, in order to increase
the coherence and complementarity of
their cooperation
programmes.

Regular coordination shall be established between the Commis-
sion and the Member States; including on-the-spot coordina-
tion in their contacts with the partner States, both in the
programme-definition and the programme-implementation
stage.

of

the

cross

implementation

In
cooperation
programmes involving Member States, PHARE countries and
partner States, the Commission shall seek effective coordina-
tion and consistency with programmes financed through the
structural funds, Community external assistance programmes
and bilateral assistance initiatives.

border

In addition, the Commission shall ensure coordination and
cooperation with the international financial
institutions and
other donors.

In the framework of the assistance provided pursuant to this
Regulation, the Commission shall promote cofinancing with
public or private bodies in the Member States.

Article 12

Article 15

Open invitations to tender for the award of supply contracts in
accordance with Article 114 of the Financial Regulation shall
allow for a time limit to submit an offer of not less than 52
days from the date of dispatch of the notice to the Official
Journal of the European Communities.

Service contracts shall, as a general rule, be awarded by
restricted invitations to tender and by private treaty for opera-
tions up to EUR 200 000.

TITLE IV

GENERAL PROVISIONS

Article 13

1.
The Commission shall be assisted by the Committee for
assistance to the New Independent States and Mongolia (here-
inafter referred to as ‘the Committee’).

2. Where reference is made to this paragraph, Articles 4 and
7 of Decision 1999/468/EC shall apply.

The period laid down in Article 4(3) of Decision 1999/468/EC
shall be set at three months.

3.

The Committee shall adopt its rules of procedure.

Article 14

Each year the Commission shall present a progress report
1.
the assistance programme. This
on the implementation of
report shall
include an evaluation of the assistance already
provided including the effectiveness of the programme as well
as information on the results of
the monitoring activities
undertaken during the course of the year. The report shall be
addressed to the Member States, the European Parliament, the
Council,
and the
Committee of the Regions.

and Social Committee

the Economic

In the light of these reports, the Commission may make

2.
proposals to the Council to amend this Regulation.

3.
In addition, the Commission shall make available statist-
ical information to the bodies referred to in paragraph 1 on the
award of the contracts. The content and form of statistical
information to be provided will be discussed with the
Committee referred to in Article 13(1).

Article 16

When an essential element for the continuation of cooperation
through assistance is missing, in particular in cases of violation
of democratic principles and human rights, the Council may,
on a proposal from the Commission, acting by a qualified
majority, decide upon appropriate measures concerning assis-
tance to a partner State.

The Commission shall, together with the Member States and on
the basis of a reciprocal and regular exchange of information,
including exchange of information on the spot, seek the effec-

The same procedure may apply as a last resort in cases of a
serious violation of the obligations of the partner States as set
out in the Partnership and Cooperation Agreements.

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

Article 17

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

Done at Brussels, 29 December 1999.

For the Council

The President

K. HEMILÄ

ANNEX I

PARTNER STATES REFERRED TO IN ARTICLE 1

Armenia

Azerbaijan

Belarus

Georgia

Kazakhstan

Kyrghyzstan

Moldova

Mongolia

Russian Federation

Tajikistan

Turkmenistan

Ukraine

Uzbekistan

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AREAS OF COOPERATION REFERRED TO IN ARTICLE 2(2) AND ARTICLE 3(3) AND (4)

ANNEX II

1. Support for institutional,

legal and administrative reform:

— development of the rule of law,

— support for effective policy making,

— reform of public administration at national, regional and local

level,

— support for executive and legislative bodies (national, regional,

local),

— support for justice and home affairs activities,

— reinforcement of the legal and regulatory framework,

— support for the implementation of international commitments,

— support for the civil society,

— support for education and training.

2. Support to the private sector and assistance for economic development:

— promotion of small and medium-sized enterprises,

— development of the banking and financial services systems,

— promotion of private entrepreneurship including joint ventures,

— industrial cooperation,

including research,

— privatisation,

— enterprise restructuring,

— promotion of market-orientated framework for trade and investment.

3. Support in addressing the social consequences of transition:

— reform of the health, pension, social protection and insurance systems,

— assistance to alleviate the social

impact of industrial restructuring,

— assistance for social reconstruction,

— development of employment services,

including re-training.

4. Development of infrastructure networks:

— transport networks,

— telecommunication networks,

— energy pipelines and transmission networks,

— border-crossings.

5. Promotion of environmental protection and management of natural resources:

— development of sustainable environmental policies and practices,

— promotion of harmonisation of environmental standards with European Union norms,

— improvement of energy technologies in supply and end use,

— promotion of sustainable use and management of natural resources, including energy, saving, efficient energy usage

and improvement of environmental

infrastructure.

6. Development of the rural economy:

— legal and regulatory framework,

including land privatisation,

— increasing access to finance and promotion of training,

— improvement of distribution and access to markets.

Where applicable, support for nuclear safety shall be provided in accordance with the priorities outlined in Article 2(5).

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ANNEX III

INVESTMENT FINANCING

Investment financing shall be justified by the following criteria:

— the multiplier effect, according to which Community assistance would be accompanied by a multiple of investment

from other sources,

— additionality, when Community assistance would encourage investment which would not otherwise have taken place,

— areas of interest to the Community.

Investment financing can take the form of co-financing with other sources of investment financing or, on an exceptional
basis,

investing alone.

Priority sectors for investment financing would include: cross-border cooperation including border infrastructure, promo-
tion of SMEs, environmental infrastructure and networks. Direct funding of equity and stakes in individual companies
shall be excluded.

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ANNEX IV

PRINCIPLES GOVERNING THE AWARD OF CONTRACTS BY MEANS OF TENDERING, IN PARTICULAR
RESTRICTED TENDERING

1. All necessary information shall be made available with the ‘Invitation to tenderers’ to each of the tenderers which
have been registered on the short-list or which so request in reply to the publication of a notice of an open tender.
This information shall contain, in particular, the evaluation criteria. The technical evaluation of the tender may
include interviews with the persons proposed in the tender.

2. The Commission shall chair all evaluation committees and shall appoint a sufficient number of evaluators before the
tenders are launched. One evaluator should come from the recipient institution of the beneficiary countries. All
evaluators shall sign a declaration of impartiality.

3. The tender is evaluated on the basis of a weighing of technical quality against price. The weighing of the two criteria
shall be announced in each invitation to tender. The technical evaluation shall be carried out according, in particular,
to the following criteria: organisation, time schedule, methods and plan of work proposed for providing the services,
the qualifications, experience, skills of the staff proposed for the provision of the services and the use made of local
companies or experts, their integration into the project, and their contribution to the sustainability of the project
results. Specific experience of the tenderer in TACIS shall not be taken into account.

4. Unsuccessful tenderers shall be informed by letter, including an indication of the reasons for their failure and the

name of the successful tenderer.

5. Any natural or legal person involved in the preparation of a project shall be excluded from participation in the
project implementation. If any participating tenderer employs such persons, in any capacity, within six months of the
termination of their involvement in the tender process, that tenderer may be excluded from participation in the
project. Any tenderer included on a short-list shall be excluded from participation in the evaluation of that tender.

6. The Commission shall ensure that all commercially sensitive information relating to a proposed tender remains

confidential.

7. Whenever a firm, organisation or institution has serious reasons to ask for review of a tender, there will always be the

possibility of adressing the Commission. In that event, a reasoned reply should be given to this request.

8. In the cases of award of contracts after restricted invitations to tender as referred to in Article 116 of the Financial
Regulation, all written expressions of interest shall be registered by the Commission, which will use this registration
when drawing up the short-list.

In addition, other information, in particular from the TACIS central consultancy register, may be considered when the
short-list is drawn up. This register shall be open to all interested firms, organisations and institutions for registration.

9. When drawing up the short-list, the Commission shall be guided by qualifications, interest and availability of the
firm, organisation or institution. The number of firms, organisations and institutions on a short-list shall depend on
the size and the complexity of the project and should offer the widest possible choice.

Firms, organisations and institutions which have expressed their interest in writing in a project shall be informed
whether or not they have been included on the short-list.

10. Each year the Commission shall give to the Committee referred to in Article 13(1) a list of the firms, organisations

and institutions which have been selected.

11. In highly complex projects, the Commission may suggest to firms, organisations and institutions which have been
retained on a short-list the formation of consortia among them. In these cases this suggestion, as well as the complete
short-list, shall be transmitted to all firms, organisations and institutions having been retained on it.

12. In restricted tendering there shall be a minimum period of 60 calendar days between the final opinion delivered by
the Committee referred to in Article 13(1) and the launching of the tender. Nevertheless, in case of urgency this
period may be shortened by the Commission, provided that a detailed explanation is forwarded to that Committee.

An invitation to a restricted tender shall allow for a time limit of 60 calendar days from the date of delivery of the
letter of invitation. In urgent cases this period may be reduced, but it may never be less than 40 calendar days. In
exceptional cases this time limit may be extended by the Commission, provided that a detailed explanation is
forwarded to the Committee referred to in Article 13(1). All changes of time limit must be duly notified to the firms,
organisations or institutions concerned.