Amended proposal for a Council Decision establishing the measures necessary for the implementation of the Protocol, annexed to the Treaty of Nice, on the financial consequences of the expiry of the ECSC Treaty and on the Research Fund for Coal and Steel (COM(2001) 121 final — 2001/0061(CNS)) (Text with EEA relevance)
Date: 2001-03-08
Institutions: European Commission
Subjects: ECSC Treaty, European Community, economic consequence, management, validation of expenditure

C 180 E/4

EN

Official Journal of the European Communities

26.6.2001

Amended proposal for a Council Decision establishing the measures necessary for the implemen-
tation of the Protocol, annexed to the Treaty of Nice, on the financial consequences of the expiry
of the ECSC Treaty and on the Research Fund for Coal and Steel (1)

(2001/C 180 E/02)

(Text with EEA relevance)

COM(2001) 121 final (cid:151) 2001/0061(CNS)

(Submitted by the Commission pursuant to Article 250(2) of the EC Treaty on 8 March 2001)

(1) OJ C 180 E, 26.6.2001, p. 1.

INITIAL PROPOSAL

AMENDED PROPOSAL

THE COUNCIL OF THE EUROPEAN UNION,

Unchanged

Having regard to the Treaty establishing the European
Community,

Having regard to the Protocol, annexed to the Treaty of Nice,
on the financial consequences of the expiry of the ECSC Treaty
and on the Research Fund for Coal and Steel, and in particular
Article 2 thereof,

Having regard to the Commission proposal,

Having regard to the opinion of the European Parliament,

Whereas:

Unchanged

(1) Under Article 97 of the Treaty establishing the European
Coal and Steel Community (ECSC), the Treaty will expire
on 23 July 2002.

(2) The Protocol annexed to the Treaty of Nice, hereinafter
referred to as (cid:145)the Protocol(cid:146), transfers the assets of the
ECSC to the European Community and allocates the net
worth of these assets, as they appear in the balance sheet
of the ECSC of 23 July 2002, to research in the sectors
related to the coal and steel industry. This use of the assets
resolution on growth and
is
its
employment adopted by the European Council at
meeting in Amsterdam on 16 and 17 June 1997 (1), and
with the resolutions of the Council and the Represen-
tatives of
the Member States,
meeting within the Council, of 20 July 1998 (2) and 21
June 1999 (3).

the Governments of

consistent with the

(3) It

is necessary to determine the distribution of

research
concerned.

appropriations

between

the

two

___________
(1) Publication reference to be inserted.
(2) OJ C 247, 7.8.1998, p. 5.
(3) OJ C 190, 7.7.1999, p. 1.

the
sectors

26.6.2001

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Official Journal of the European Communities

C 180 E/5

INITIAL PROPOSAL

AMENDED PROPOSAL

(4) It is necessary to establish the rules for implementing the
Protocol, and in particular the decision-making procedures
for
for adopting the multiannual
managing the assets of the Research Fund for Coal and
Steel and the multiannual
technical guidelines for the
research programme of the Fund.

financial guidelines

(5) certain financial operations, involving both revenue and
expenditure, will at that date still be outstanding, and
resulting from the implementation of ECSC operating
for earlier years and ECSC borrowing and
budgets
lending activities.

(5) When the Treaty expires, certain financial operations,
involving both revenue and expenditure, will still be
outstanding, resulting from the implementation of ECSC
operating budgets for earlier years and ECSC borrowing
and lending activities.

(6) It is necessary to designate the institution responsible for
winding up these operations
the
procedures needed to do so. It would be appropriate to
entrust
the Commission with the winding-up and to
decide that the procedures to be followed will be those
in force at 23 July 2002, in accordance with the ECSC
Treaty and secondary legislation.

and establishing

Unchanged

(7) At its meeting of 11 September 1996, the Commission
concluded that reserves should be kept to cover, after
2002, 100 % of the outstanding loans not covered by a
Member State guarantee. The ex-ECSC funds administered
will total approximately EUR 1.6 billion on 23 July 2002.
The amount will vary depending on the financial activities
still to be carried out before and after the expiry of the
Treaty.

(7) At its meeting of 11 September 1996, the Commission
concluded that reserves should be kept to cover, after
2002, 100 % of the outstanding loans not covered by a
Member State guarantee. The ex-ECSC funds administered
will total approximately 1.6 billion euro on 23 July 2002.
The amount will vary depending on the financial activities
still to be carried out before and after the expiry of the
Treaty.

(8) In order

to distinguish ECSC assets

from other
Community Funds, after expiry of the Treaty, they shall
be referred to as the (cid:145)ECSC in liquidation(cid:146). To the same
end, once the liquidation has been completed, they will be
referred to as the (cid:145)assets of the Coal and Steel Research
to differentiate between net
Fund(cid:146). Finally,
in order
the
revenue and the assets generating that
former
the (cid:145)Coal and Steel
shall be referred to as
Research Fund(cid:146).

revenue,

Deleted

(9) It is necessary to decide on the future use of these assets.
It should be pointed out in this connection that they
derive primarily from the
levy on coal and steel
production set up pursuant to Article 49 of the ECSC
Treaty;
the assets should
therefore seems right
benefit the two economic sectors in question.

that

it

(10) The most suitable use for the assets which would benefit
the coal and steel sectors is research. It is also necessary to
determine the distribution of the research appropriations
between the two sectors.

C 180 E/6

EN

Official Journal of the European Communities

26.6.2001

INITIAL PROPOSAL

AMENDED PROPOSAL

(11) The most appropriate way of doing this is to assign the
assets to the European Community and to establish rules
and procedures to ensure that the assets and the revenue
they generate are used solely for the abovementioned
purpose.

(12) This use and this procedure are consistent with the
resolution on growth and employment adopted by the
European Council at its meeting in Amsterdam on 16
and 17 June 1997 and the resolutions of the Council
and the Representatives of
the
Member States, meeting within the Council, of 20 July
1998 (1) and 21 June 1999 (2).

the Governments of

(8) Where debtors default during the liquidation period after
23 July 2002 and in order to guarantee the annual
stability of the coal and steel research instrument, any
default by an ECSC debtor should first be charged to
the capital and then to the revenues funding research.

Unchanged

It is also necessary to define the ownership of the other
ECSC assets,

Deleted

(9) This Decision respects

and
the
observes the principles recognised in particular by the
Charter of Fundamental Rights of the European Union
as general principles of Community law,

fundamental

rights

HAS ADOPTED THIS DECISION:

Article 1

Unchanged

The Commission shall be entrusted with winding up the
1.
Steel
financial operations of
Community which are still in progress when the ECSC Treaty
expires. Where an ECSC debtor defaults during the liquidation
period, the resulting loss shall be charged first to the existing
capital and then to the revenue of the current year.

European Coal

and

the

2.
The liquidation shall be conducted in accordance with the
rules and procedures applying to these operations, with the
Community enjoying the existing powers and prerogatives
provided for by the ECSC Treaty and secondary legislation in
force on 23 July 2002.

2.
The liquidation shall be conducted in accordance with the
rules and procedures applying to these operations, with the
Community institutions enjoying the existing powers and
prerogatives provided for by the ECSC Treaty and secondary
legislation in force on 23 July 2002.

Article 3

Article 2

1.
The assets shall be managed by the Commission in such a
manner as to ensure a long-term return. The management of
the liquid assets should be aimed at the highest possible yield
that is compatible with security.

1.
The assets shall be managed by the Commission in such a
manner as to ensure a long-term return. The investment of the
liquid assets should be aimed at the highest possible yield that
is compatible with security.

___________
(1) OJ C 247, 7.8.1998, p. 5.
(2) OJ C 190, 7.7.1999, p. 1.

26.6.2001

EN

Official Journal of the European Communities

C 180 E/7

INITIAL PROPOSAL

AMENDED PROPOSAL

The Council, acting by qualified majority as provided for
from the
the European
financial guidelines for

2.
under Article 205 of
Commission after
Parliament, shall adopt multiannual
management of the assets.

receiving the Opinion of

the EC on a proposal

2.
The Council, acting by qualified majority as provided for
under Article 205 of the EC Treaty on a proposal from the
the European
Commission after
Parliament, shall adopt multiannual
financial guidelines for
management of the assets.

receiving the Opinion of

Article 4

Article 3

Each year a profit-and-loss account, balance sheet and
1.
financial report shall be drawn up to show, separately from
the other financial operations of the remaining Communities,
the liquidation operations provided for in Article 1 and the
investment transactions under Article 3.

Each year a profit-and-loss account, balance sheet and
1.
financial report shall be drawn up to show, separately from
the other financial operations of the remaining Communities,
the liquidation operations provided for in Article 1 and the
investment transactions under Article 2.

statements

These financial
shall be incorporated into the
financial statements drawn up by the Commission annually
under Article 275 of the EC Treaty and the Financial Regu-
lation applicable to the general budget of
the European
Communities.

Unchanged

2.
The powers of the Parliament, the Council and the Court
of Auditors concerning control and discharge as set out in the
Treaties and the Financial Regulation shall apply to the
operations referred to in paragraph 1.

2.
The powers of the European Parliament, the Council and
the Court of Auditors concerning control and discharge as set
out in the Treaties and the Financial Regulation applicable to
the general budget of the European Communities shall apply to
the operations referred to in paragraph 1.

Article 5

Article 4

Net revenue from the investments provided for under
1.
the
Article 3 shall constitute revenue in the budget of
European Communities. Within the meaning of the second
indent of Article 4(3) of
the Financial Regulation, This
revenue shall be earmarked for a specific purpose, namely
financing research projects in the the coal and steel sectors
not covered by the framework programme. It shall form the
Coal and Steel Research Fund and shall be managed by the
Commission.

Net revenue from the investments provided for under
1.
the
Article 2 shall constitute revenue in the budget of
European Communities. This revenue shall be earmarked for
a specific purpose, namely financing research projects in the
sectors related to the coal and steel industry not covered by the
programme. It shall form the Coal and Steel Research Fund and
shall be managed by the Commission.

2.
The amounts yielded by the Fund shall be distributed,
27,2 % being allocated to the coal sector and 72,8 % to the
the Council, acting
steel sector. Should it prove necessary,
unanimously on a proposal
shall
modify the breakdown between coal-related research and steel-
related research.

from the Commission,

Unchanged

The multiannual

technical guidelines for the research
3.
programmes
shall be adopted by the Council acting by
qualified majority under Article 205 of the EC on a proposal
from the Commission after
the
European Parliament.

receiving the opinion of

The multiannual

technical guidelines for the research
3.
programmes
shall be adopted by the Council acting by
qualified majority under Article 205 of the EC Treaty on a
proposal from the Commission after receiving the opinion of
the European Parliament.

C 180 E/8

EN

Official Journal of the European Communities

26.6.2001

INITIAL PROPOSAL

AMENDED PROPOSAL

In accordance with the provisions contained in the
4.
Financial Regulation, unused revenue
and appropriations
deriving from this revenue still available on 31 December in
any given year shall be carried over automatically to the
following year. These appropriations may not be transferred
to other budget items.

4.
In accordance with the provisions contained in the
Financial Regulation applicable to the general budget of the
European Communities, unused revenue and appropriations
deriving from this revenue still available on 31 December in
any given year shall be carried over automatically to the
following year. These appropriations may not be transferred
to other budget items.

5.
Budgetary appropriations corresponding to cancellations
of commitments shall automatically lapse at the end of each
financial year. Provisions for commitments released as a result
of the cancellations shall be entered profit-and-loss account
provided for in Article 4 (1) and shall return initially to the
the (cid:145)ECSC in liquidation(cid:146) and subsequently, when
assets of
liquidation has been completed,
the Coal
and Steel Research Fund(cid:146). Amounts recovered shall similarly
be entered profit-and-loss account.

to the (cid:145)Assets of

5.
Budgetary appropriations corresponding to cancellations
of commitments shall automatically lapse at the end of each
financial year. Provisions for commitments released as a result
of the cancellations shall be entered in the balance sheet and
the profit-and-loss account provided for in Article 3(1) and
shall return initially to the assets of the (cid:145)ECSC in liquidation(cid:146)
and subsequently, when liquidation has been completed, to the
the Coal and Steel Research Fund(cid:146). Amounts
(cid:145)Assets of
recovered shall similarly be entered in the balance sheet and
the profit-and-loss account.

Article 6

Article 5

Unchanged

1.
Net revenue available to finance research projects for year
n+2 shall be recorded in the balance sheet of the (cid:145)ECSC in
liquidation(cid:146) of year n, and once liquidation has been completed,
in the balance sheet of
the Coal and Steel
Research Fund(cid:146).

the (cid:145)Assets of

2.
In order to eliminate fluctuations in research funding due
to movements on the financial markets, a smoothing shall be
effected and a provision made for contingencies. Details of the
calculations for smoothing and determining the size of the
contingency reserve are contained in the Annex.

Article 7

Article 6

Administrative expenditure resulting from the liquidation and
from the investment and management of the Coal and Steel
Research Fund, which replaces that laid down in Article 20 of
the Treaty establishing a
single
Commission of the European Communities of 8 April 1965,
the amount of which was adjusted by the Council Decision of
21 November 1977, shall be met by the Commission from the
general budget of the European Communities.

single Council

and a

Unchanged

Article 8

Article 7

New Member States may, during accession negotiations,
acquire a share of the (cid:145)Assets of the Coal and Steel Research
Fund(cid:146), and, where appropriate, the (cid:145)ECSC in liquidation(cid:146) or the
Fund, once they have made the necessary contributions, due
regard being had to decisions adopted in the past in similar
situations.

Unchanged

26.6.2001

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Official Journal of the European Communities

C 180 E/9

INITIAL PROPOSAL

Article 9

The Commission shall determine the amount of the assets of
the ECSC in a balance sheet closed at 23 July 2002.

Unchanged

Article 10

This Decision shall enter into force on 24 July 2002.

Unchanged

AMENDED PROPOSAL

Article 8

Article 9

PROCEDURES TO BE FOLLOWED TO ESTABLISH THE AMOUNT OF NET REVENUE TO BE ALLOCATED
TO COAL AND STEEL RESEARCH

ANNEX

1. Introduction

Net revenue which may be used to finance research projects corresponds to the annual net result of the (cid:145)ECSC in
liquidation(cid:146) and subsequently, when liquidation has been completed, to the annual net result of the (cid:145)Assets of the Coal
and Steel Research Fund(cid:146). The method employed consists of establishing the funding for coal and steel research for
year n+2 when producing the balance sheet for year n, taking into account half of the increase or decrease in the net
result in relation to the last level of funding adopted for coal and steel research.

2. Definition

n:

Rn

Pn

reference year

net result for year n

contingency provision for year n

Dn+1 allocation for research for year n+1 (established when the balance sheet for year n-1 is produced)

Dn+2 allocation for research for year n+2

3. Algorithms used

The algorithms used to establish the size of the contingency provision and the allocations for research for year n+2,
which will appear in the balance sheet for year n, are as follows:

3.1. Size of contingency provision:

Pn = Pn-1 + 0,5 * (Rn (cid:151) Dn+1)

3.2. Allocations for research for year n+2 (rounded up or down to the nearest hundred thousand euros. If the
calculation gives a result exactly halfway, the allocation shall be rounded up to the nearest hundred thousand
euros):

Dn+2 = Dn+1 + 0,5 * (Rn (cid:151) Dn+1)

Where appropriate, the amount needed for rounding up (or the amount left over from rounding down) will be taken
from (or returned to) the contingency provision.