European Parliament resolution on the Court of Auditors Special Report No 2/2000 on aid given by the European Union to Bosnia-Herzegovina with a view to restoring peace and the rule of law, together with the Commission's replies (C5-0229/2000 — 2000/2131(COS))
Date: 2001-01-16
Institutions: Committee on Budgetary Control, European Parliament
Subjects: Bosnia and Herzegovina, EU aid, audit, budgetary control, democratisation, fraud against the EU, human rights, peacekeeping

18.9.2001

EN

Official Journal of the European Communities

C 262/61

Tuesday 16 January 2001

(cid:1) tackle the present situation according to which support for the cereals sector is concentrated in the

more prosperous regions of the Union,

(cid:1) endeavour to redress the uneven distribution of incomes, whereby in 1995 about 40 % of the com-
pensatory payments were made to less than 3 % of the beneficiaries, while small farmers representing
57 % of the beneficiaries received only 4,5 % (paragraph 4.45 of the Court’s observations);

Special Report No 1/2000 (classical swine fever)

22.
Attaches great importance to the speedy conclusion of the procedure for amending Council Direc-
tive 80/217/EEC on the control of classical swine fever (1), drawing from the experience of the most recent
epidemics, which inflicted heavy losses on the Community budget, Member States and the pig farmers
concerned;

Asks the Commission to ensure that the Animal Movement System (ANIMO) is managed and devel-

23.
oped under the full control of the Commission;

24.
Regrets that three years after consideration of an assessment of the ANIMO system, improvements
have yet to be introduced; asks the Commission to table without delay proposals for the amendment of
Council Directive 90/425/EEC (2), taking into consideration the Court of Auditors’ observations and the
abovementioned assessment undertaken by the Commission itself;

25.
Shares the Commission’s and the Court of Auditors’ view that pig producers should carry a greater
share of the financial burden of measures to combat the epidemic in question, as is the case in other types
of epidemics and as was already pointed out in the context of the 1995 discharge procedure; asks the
Commission to carry out a comparative study of alternative forms of financing measures to combat animal
diseases, such as a private sector fund to which farmers and other interested parties would contribute, or
other types of insurance schemes;

Expects the Commission, through its Food and Veterinary Office, to ensure that Member States

26.
implement effective contingency plans for dealing with classical swine fever;

*

*

*

Instructs its President to forward this resolution to the Council, the Commission and the Court of

27.
Auditors.

(1) OJ L 47, 21.2.1980, p. 11.
(2) OJ L 224, 18.8.1990, p. 29.

9. Court of Auditors’ Special Report: EU aid to Bosnia-Herzegovina

A5-0389/2000

European Parliament resolution on the Court of Auditors Special Report No 2/2000 on aid given
by the European Union to Bosnia-Herzegovina with a view to restoring peace and the rule of law,
together with the Commission’s replies (C5-0229/2000 . 2000/2131(COS))

The European Parliament,

(cid:1) having regard to the Court of Auditors Special Report No 2/2000 (C5-0229/2000) (1),

(cid:1) having regard to Articles 248(4), second subparagraph, and 276(1) and (3) of the EC Treaty,

(1) OJ C 85, 23.2.2000, p. 29.

C 262/62

Official Journal of the European Communities

EN

18.9.2001

Tuesday 16 January 2001

(cid:1) having regard to Rule 47(1) of its Rules of Procedure,

(cid:1) having regard to the report of the Committee on Budgetary Control and the opinion of the Committee

on Foreign Affairs, Human Rights, Common Security and Defence Policy (A5-0389/2000),

A. whereas the reports published by the Court of Auditors constitute a guarantee that expenditure of the
money of the European tax-payer will be closely monitored, and encourage more accountable and
proper administration by the European institutions,

B.

acknowledging the special circumstances and conditions under which the aid was provided,

C. whereas lessons must be learned from the special report, particularly as regards support to new local
or international organisations and cofinancing with other international organisations such as the UN
and OSCE; whereas it looks forward to the special report which has been announced concerning the
work of the European Agency for Reconstruction operating in Thessaloniki and Pristina,

D.

fully aware that the Commission and the other international institutions have had to work under very
difficult conditions, particularly in the first years after the conclusion of the Dayton peace accords,

E. whereas in February 2000 the Commission transformed its representation in Sarajevo into a ‘Delega-
tion’ and whereas the regional offices in Mostar and Banja Luka have acquired the status of ‘Represen-
tations’,

F. whereas in 1998, partly as a result of audits by the Court of Auditors, the Commission transferred
(‘devolved’) the financial and operational management of aid measures in Bosnia-Herzegovina from
Brussels to Sarajevo, with a central role for the head of the Commission representation there,

G. whereas the Commission has enhanced the role of its Auditing and Finance Unit in Sarajevo and
ensured that well organised, motivated and in part locally recruited staff are appointed; whereas a
framework of rules on proper financial administration has been drawn up,

H. whereas the Court of Auditors’ remarks on financial management at the Office of the High Represen-

tative (OHR) have resulted in major changes and changes of mentality within the OHR,

I. whereas in its aid programme for the media sector and particularly aid to the Open Broadcasting

Network (OBN), the Commission was faced with a fait accompli,

J. whereas the special report of the Court of Auditors did not provide any particular information about
the programme funded by the European Union with regard to the return of refugees, despite indica-
tions that the management of this programme proved very problematic, partly because of the politi-
cally and socio-economically very difficult circumstances but also because of late payment of the funds
pledged by the European Union,

K. whereas the information requested from the Commission below must be examined and assessed dur-

ing forthcoming discharge procedures,

1.
Supports the ‘devolution’ policy pursued by the Commission in Bosnia-Herzegovina and observes
that this policy has eliminated the large number of late payments and ensured that in principle payments
are made within no more than 60 days;

2. Welcomes the fact that the Commission has increased and improved its staffing in Bosnia-Herzego-
vina; considers that in Sarajevo the Commission responded promptly to the comments of the Court of
Auditors by expanding the Audit and Finance Unit and setting up an audit team to perform on-the-spot
audits, which has already resulted in repayments being demanded;

18.9.2001

EN

Official Journal of the European Communities

C 262/63

Repeats its call, in its resolution of 5 September 2000 on a common Community diplomacy (1), for
3.
the legal status of the Commission delegations and their relations with the Community institutions to be
clarified and detailed quickly; calls on the Commission to submit a detailed overview of the financial rules
and procedures with which its delegations are required to comply;

Tuesday 16 January 2001

4.
Is impressed by the measures which the OHR has adopted since March 1999 to put an end to the
abuses, waste and irregularities mentioned by the Court of Auditors; observes that, since then, considerable
savings have been made on the OHR budget, and encourages the OHR to continue to apply the same
approach;

Expresses its concern at the absence of a separation of duties allowing a minimum of internal control
5.
within the OHR and its utter astonishment at the facts described in paragraph 17 of the special report;
notes the report on this state of affairs made available to the European Parliament by the OHR on 9 Jan-
uary 2001; notes that this report states that ‘neither the external auditors nor the European Court of
Auditors have produced evidence of fraud within the OHR or on the part of the former Finance Director’;
is nevertheless of the opinion that the state of affairs described in paragraph 17 of the special report is
deplorable; calls on the Commission in future to ensure that there is no recurrence of such a situation;

Encourages the Commission to concern itself more with the administration of the OHR; urges that
6.
the OHR’s budget be drafted and implemented more transparently; notes that the policies, procedures and
rules which have been progressively introduced by the new Financial Director of the OHR have been
submitted to the Financial Experts and subsequently approved by the Steering Board; calls for the reports
on the meeting where this approval was given to be forwarded to the Court of Auditors and Parliament;

7.
Urges the Commission pursuant to Article 274 of the EC Treaty, where it contributes substantially to
the budgets of organisations, to take the appropriate measures to safeguard the Community’s financial
interests including if necessary and feasible the adoption and operation by the beneficiary of rules and
procedures which can guarantee proper administration and internal control; urges the OHR to cooperate
optimally; notes with approval the recent introduction of systematic ex post audits of the implementation
of project grants to beneficiaries which are not international organisations; calls on the Commission, at the
beginning of each discharge procedure, to provide the European Parliament with an overview and evalu-
ation of all ex post audits performed; undertakes in connection with the forthcoming discharge procedure
to investigate whether the agreement of 9 August 1999 between the EU and the UN provides adequate
guarantees of proper administration and financial control;

8.
Draws attention to the important role of the OHR anti-fraud unit in combating fraud and corruption,
developing the free market economy and establishing government institutions which function democrati-
cally; regrets that due to the annual nature of the OHR’s budget the maximum contract for staff is twelve
months and urges that efforts be made to ensure maximum staff continuity in this unit; considers that staff
should be employed at this unit for at least 24 months so that they can gain sufficient knowledge of the
local situation to combat fraud efficiently;

Endorses the observations of the Court of Auditors concerning the delay in making available funding
9.
for organisations which promote respect for human rights; draws attention to the very useful work per-
formed by the ‘Human Rights Commission’ in settling disputes about real estate; notes that the Ombuds-
man intends to carry out an audit of contributions from major donors for this year and awaits the results
of this audit; welcomes the extension of the Human Rights Commission’s legal mandate beyond 14 Decem-
ber 2000 and urges that it be provided with better material resources;

Hopes that the Commission will give more precise replies in January 2001 to the criticisms made
10.
by the Court of Auditors in paragraphs 29-35 of the special report concerning support for civil society,
particularly regarding the relationship between the ‘Europe for Sarajevo’ programme, the programme for
democracy and the Tempus programme;

(1)

‘Texts Adopted’, Item 4.

C 262/64

Official Journal of the European Communities

EN

18.9.2001

Tuesday 16 January 2001

11.
Expresses serious doubts about the way in which, in the media sector, expenditure of ECU 2 million
on non-subsidisable equipment was financed in relation to OBN; calls on the OHR and the Commission to
draw up a detailed report giving precise answers to the criticisms made by the Court of Auditors and to
account for the lax manner in which this project was supervised; acknowledges however that, by means of
its information programmes, OBN provided high-quality and balanced reporting; wishes nonetheless to be
informed annually about media policy in Bosnia-Herzegovina and the further development of the Public
Broadcasting Service (PBS);

12.
Endorses the Court of Auditors’ criticisms of support for the electoral process; notes that discussions
to clarify the international legal capacity of the OSCE are taking place within that organisation and must
be completed before a long-term arrangement such as a framework agreement between the OSCE and the
Commission can be signed; notes that future contractual relations between the Commission and the OHR
will be governed by the new model contract for international organisations which the Commission has
developed; calls on the Commission, following the elections of 11 November 2000 in Bosnia-Herzegovina,
to draw up an evaluation report describing experience of the organisation and financing of all elections
held since 1996 and to draw the necessary conclusions therefrom and forward the results of this study to
the European Parliament;

Endorses the recommendation that civil society be promoted by means of more purposeful policies
13.
and clearly formulated priorities for the Balkans; welcomes the ‘Road Map’ drawn up by the Commission
in March 2000 as a set of specific measures which the European Union wishes Bosnia-Herzegovina to
carry out in the short term; notes that progress in the implementation of the Road Map which it is
hoped should be completed by the end of the first six months of 2001 is constantly monitored by the
Commission, and calls on the Commission to submit the result of this assessment to the European Parlia-
ment before 1 July 2001;

Stresses the need for on-going financial and logistic support

14.
in expanding customs services
(Customs and Fiscal Assistance Office (CAFAO)) and further support for mine clearance; in connection
with the CARDS Regulation, wishes Bosnia-Herzegovina to be allocated sufficient funding to facilitate the
country’s reconstruction and the return of refugees and make it possible to render the State politically and
economically viable;

15.
Calls on the Commission, before the end of the discharge procedure for 1999, to provide Parlia-
ment with an overview of the funds deployed and the results attained by means of the programme for
return of refugees financed in Bosnia-Herzegovina since 1996;

16.
Asks the Commission, before 1 July 2001, to report whether, and to what extent, corruption in the
structures of civil society in Bosnia-Herzegovina has jeopardised financial support for the reconstruction of
the region and, consequently, the financial interests of the Union;

Instructs its President to forward this resolution to the OHR, OSCE, Council, Commission and Court

17.
of Auditors.