Proposal for a Council Decision concerning the Community position within the Association Council on the participation of Romania in the Community programme Fiscalis
Date: 2001-08-02
Institutions: European Commission
Subjects: EU programme, Romania, action programme, association agreement (EU), indirect tax, tax system

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 2.8.2001
COM(2001) 459 final

Proposal for a

COUNCIL DECISION

concerning the Community position within the Association Council on the
participation of Romania in the Community programme Fiscalis

(presented by the Commission)

EXPLANATORY MEMORANDUM

1.

Introduction

In line with Article 7 of the European Parliament and Council Decision 888/98/EC1,
the existing Fiscalis programme may be opened to the candidate countries of Central
and Eastern Europe (CEECs) and Cyprus. No mention is made of Malta and Turkey
in this provision.

Previously, the European Council, at its meeting in Luxembourg (December 1997),
stressed the importance of the participation of candidate countries in Community
programmes in the context of the pre-accession strategy, as a means to familiarise
them with Community working methods and procedures. The Helsinki European
Council of December 1999 confirmed the enlargement process
launched in
Luxembourg. The enhanced Pre-Accession Strategy defined in 1997 has been
reiterated, which includes the participation of the 13 candidate States in Community
programmes as an important part of such strategy.

As regards the ten candidate countries of Central and Eastern Europe (CEECs),
participation in Community programmes is provided in their respective Europe
Agreements. Pursuant to the Europe Agreements, the conditions and modalities of
these countries’ participation are defined by the respective Association Councils.

In addition to those Community programmes in which candidate countries already
participate, it is now proposed to decide terms and conditions for the participation of
the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland,
Bulgaria,
Romania, Slovakia and Slovenia in the Community programme Fiscalis for the
duration of its remaining lifetime, i.e. till 31 December 2002.

The general objectives of the Fiscalis programme are:

• to enable officials to achieve a high common standard of understanding of
its

taxation and of

in the field of

indirect

Community law,
implementation in Member States;

in particular

• to secure efficient, effective and extensive co-operation among Member States and

between them and the Commission;

• to ensure the continuing improvement of administrative procedures to take account
of the needs of administrations and taxpayers through the development and
dissemination of good administrative practices.

The objective of opening it to the candidate countries will further contribute to their
preparations for accession as a key feature of the pre-accession strategy. It will also
enable these countries to familiarise themselves with the procedures and methods
used in this Community programme.

1

OJ L 126 of 28.04.98, p. 1.

2

2.

Candidate countries of Central and Eastern Europe (CEECs)

The Europe Agreements with these countries entered into force on various dates and
provide for their participation in Community programmes dealing with a wide range
of areas. They provide the possibility that other fields of Community activities may be
added, if considered to be of mutual interest, so that activities in the field of internal
market can be included too.

The decision-making process for this participation requires a decision by the
Association Council of each of these Europe Agreements, which sets up the terms and
conditions for such participation.

According to the provisions of the Europe Agreements or their additional protocols
concerning these countries’ participation in Community programmes, they will meet
the costs resulting from their participation.

the Luxembourg European Council

In this connection,
indicated that candidate
countries should steadily increase their own financial contribution, but agreed that
Phare,
financial
if necessary, would continue to part-finance these countries’
contributions; such support should, however, “remain at around 10% of the Phare
appropriation, not
including participation in the research and development
framework programme”. The European Council also stated that “The applicant States
should be allowed to take part, as observers and for the points which concern them, in
the management committees responsible for monitoring the programmes to which
they contribute financially, under specific arrangements adapted to the case in
question".

The ten CEECs, namely Bulgaria, the Czech Republic, Estonia, Hungary, Latvia,
Lithuania, Poland, Romania,
the Slovakia and Slovenia, confirmed to the
Commission in writing their willingness to participate in the Fiscalis programme as
from 2001, under the terms and conditions of the annexed draft Association Council
Decisions, and to make available the necessary budgetary appropriations, as
calculated by the Commission services.

The main issues addressed in these draft Decisions between the EC and, respectively,
the above-mentioned 10 countries adopting the terms and conditions for their
participation in the Fiscalis programme are the following:

• conditions for submission, assessment and selection of applications will be as far
as possible in conformity with those prevailing for the Member States of the Union

• CEECs will contribute financially to the Community budget of the programme.
The financial contributions have been calculated with a view to approximating
CEEC conditions as far as possible to those applied to Member States. The annual
contribution from each CEEC may be financed partly from its own budget and
partly from its national Phare allocation, which should not exceed the above-
mentioned 10% limit

• they will be invited as observers and for the points which concern them to the

meetings of the programme committee

3

• these countries will be associated to the monitoring of their participation in the

programme

• the Decisions shall apply for

the programme.
Nevertheless, should the Community decide to extend the lifetime without any
substantial change within the programme, the Decisions may also be extended
correspondingly and automatically if no Party denounces them.

the remaining lifetime of

3.

Conclusions

The adoption of the Association Council Decisions for the ten CEECs, allowing these
candidate countries to participate in the Community’s Fiscalis programme as from
2001, will offer them the opportunity to actively integrate in the Community’s
policies in this area, as part of the pre-accession strategy. It will also contribute to
reinforce their institutional and administrative capacity (“Institution Building”). It is,
therefore, of considerable political importance.

In order to allow the participation of Bulgaria,
the Czech Republic, Estonia,
Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Slovenia in the
Community Fiscalis programme as from 2001, the Council is invited to take the
respective Community position within the corresponding Association Council as set
up in the ten annexed draft Council Decisions.

4

Proposal for a

COUNCIL DECISION

concerning the Community position within the Association Council on the
participation of Romania in the Community programme Fiscalis

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular
Article 95 in connection with Article 300(2), second indent thereof,

Having regard to the proposal from the Commission,

Whereas:

(1)

(2)

(3)

(4)

The Additional Protocol2 to the Europe Agreement establishing an association
between the European Communities and their Member States, of the one part,
and Romania, of the other part, has been concluded by decision of the Council
and the Commission;

According to Article 1 of the Additional Protocol, Romania may participate in
Community framework programmes, specific programmes, projects or other
actions dealing with a wide range of areas; it also provides that other fields of
Community activities to those listed can be included too;

to Article 2,

Pursuant
the terms and conditions for the participation of
Romania in the activities referred to in Article 1 shall be decided by the
Association Council,

Decision No 888/98/EC of the European Parliament and of the Council of
30 March 19983 establishing a programme of Community action to ameliorate
the indirect
taxation systems of the internal market (Fiscalis programme)
provides in Article 7 that this programme shall be open to the participation of
the candidate countries of Central and Eastern Europe (CEECs), in accordance
with the terms laid down in the Europe Agreements and the Additional
Protocols relating to their participation in Community programmes and insofar
as Community law on indirect taxation so permits,

2

3

OJ L 317 of 30.12.95, p. 40.
OJ L 126 of 28.04.98, p. 1.

5

HAS DECIDED AS FOLLOWS:

The position to be taken by the Community within the Association Council
established by the Europe Agreement between the European Communities and their
Member States, of the one part, and Romania, of the other part, concerning the
participation of Romania in the Community Programme Fiscalis, is that set out in the
attached draft decision of the Association Council.

Done at Brussels,

For the Council
The President

6

Decision n° ..../2001 of the Association Council between the European
Communities and their Member States, of the one part,
and Romania, of the other part,

of ..........2001

adopting the terms and conditions for the participation of Romania
in the Community programme Fiscalis

THE ASSOCIATION COUNCIL,

Having regard to the Europe Agreement between the European Communities and
their Member States, of the one part, and Romania, of the other part4;

Having regard to the Additional Protocol5 to the Europe Agreement establishing an
association between the European Communities and their Member States, of the one
part, and Romania, of
the other part, concerning Romania’s participation in
Community programmes, and in particular Articles 1 and 2 thereof;

Whereas:

(1)

(2)

(3)

According to Article 1 of the said Additional Protocol, Romania may
participate in Community framework programmes, specific programmes,
projects or other actions dealing with a wide range of areas;

It also provides that other fields of Community activities to those listed can be
included too;

According to Article 2 of the said Additional Protocol
the terms and
conditions for the participation of Romania in the activities referred to in
Article 1 are to be decided by the Association Council,

HAS DECIDED AS FOLLOWS:

Article 1

Romania shall participate in the European Community programme Fiscalis according
to the terms and conditions set out in Annexes I and II which shall form an integral
part of this Decision.

1

5

OJ L 357 of 31.12.94, p. 2.
OJ L 317 of 30.12.95, p. 40.

7

Article 2

This Decision shall apply for the duration of the remaining lifetime of the Programme.
Nevertheless, should the Community decide to extend the duration without any
substantial change within the Programme, this Decision would also be extended
correspondingly and automatically if no Party denounces it.

Article 3

This Decision shall enter into force the day of its adoption by the Association
Council.

Done at Brussels,

For the Association Council
The President

8

ANNEX I

TERMS AND CONDITIONS FOR THE PARTICIPATION OF ROMANIA IN THE
FISCALIS PROGRAMME.

As stated in Article 7 of Decision No 888/98/EC6 of the European Parliament
and of the Council of 30 March 1998 establishing a programme of
Community action to ameliorate the indirect taxation systems of the internal
market - the Fiscalis programme (hereinafter called “the Programme”) –
Romania’s participation in the Programme shall be in accordance with the
conditions laid down in the Europe Agreement, the Additional Protocol and
insofar as Community law on indirect taxation so permits. Accordingly,
Romania’s participation in the Programme’s activities shall be under the
following conditions:

– Activities

foreseen in Article 4 (communication and information-
exchange systems, manuals and guides) will be allowed insofar as
Community indirect taxation provisions make it possible;

– Activities foreseen in Article 5 (1) (exchanges of officials) and (2)
(seminars) as well as those foreseen in Article 6 (common training
initiative) will be allowed under the conditions laid down in these articles;

– Activities foreseen in Article 5 (3) (multilateral controls) would not be
allowed as the Community legal framework7 for co-operation in this
domain is only applicable to countries which are Member States of the
EU.

The terms and conditions for the submission, assessment and selection of
applications for seminars and exchanges related to officials of Romania shall
be the same as those applicable to officials of the 15 national administrations
of the Member States of the European Union.

Annex II establishes the financial contribution to the general budget of the
European Union that Romania will have to pay at the beginning of every
financial year to cover the costs resulting from its participation in the
Programme, from 2001 to 2002. The Association Committee is entitled to
adapt this contribution whenever necessary in accordance with the principles
laid down in Article 110 (2) of the Europe Agreement between the European
Communities and their Member States, of the one part, and the Republic of
Romania, of the other part.

Representatives of Romania will participate, as observers and for the points
which concern them, in the Standing Committee on Administrative Co-
operation in the field of Indirect Taxation foreseen in Article 11 (1) of
Decision No 888/98/EC. This Committee shall meet without the presence of
representatives of Romania for the rest of the points, as well as at the time of
voting.

OJ L 126 of 28.04.98, p.1.
Directive 77/799/EEC and Regulation 218/92/EEC.

9

1.

2.

3.

4.

6

7

5.

6.

7.

8.

The Member States of the European Union and Romania will make every
effort, within the framework of the existing provisions, to facilitate the free
movement and residence of all eligible persons to the Programme moving
between Romania and the EU Member States for the purpose of participating
in activities covered by the Decision.

Without prejudice to the responsibilities of the Commission of the European
Communities and the Court of Auditors of the European Communities in
relation to the monitoring and evaluation of the Programme pursuant to the
Decision concerning Fiscalis, the participation of Romania in the Programme
will be continuously monitored on a partnership basis involving Romania
the necessary reports to the
and the Commission. Romania will submit
Commission and take part
in other specific activities set out by the
Community in that context.

The language to be used as regards the application process, contracts, reports
to be submitted and other administrative arrangements for the Programme,
will be one of the official languages of the European Community.

The Community and Romania may terminate activities under this Decision at
any time upon twelve months’ notice in writing. Activities in progress at the
time of termination shall continue until their completion under the conditions
laid down in this Decision.

10

1.

2.

3.

4.

5.

ANNEX II

FINANCIAL CONTRIBUTION OF ROMANIA
TO THE FISCALIS PROGRAMME

The financial contribution of Romania will be added to the amount available
each year in the general budget of the European Union for commitment
appropriations to meet the Commission’s financial obligations stemming
from work to be carried out for the implementation, management and
operation of the Fiscalis programme.

The financial contribution has been calculated considering an average daily
allowance of EURO 146 and an average travel allowance of EURO 695
representing costs incurred for participating in seminars and exchanges. It is
estimated for the calculation of the financial contribution that Romania will
participate in 15 seminars and 25 exchanges as an average number of
activities per year. The financial contribution may be adjusted at
the
beginning of each year to take into account the actual number of activities in
which Romania plans to participate during that year. The adjustment will
take place by means of the required call for funds that Romania will receive
from the Commission, as referred to under item 6 below.

Romania’s contribution will be of EURO 109 638 for every single year of
participation, unless determined otherwise within the conditions under item
2. From this sum, an amount of EURO 7 173 will cover supplementary costs
of an administrative nature related to the management of the Programme by
the Commission stemming from Romania’s participation.

Romania will pay the annual supplementary costs of an administrative nature
referred to under item 3 from its national budget.

Romania will pay 50% of the annual remaining cost of its participation from
its national budget for year 2001 and 60% for year 2002.

Subject to Phare separate programming procedures, the remaining 50% will
be paid from Romania’s annual Phare allocations – subject to the availability
of the relevant budgetary appropriations for year 2001; 40% for year 2002.
The requested Phare funds will be transferred to Romania by means of a
separate Financing Memorandum. Together with the part coming from
Romania’s State budget,
these funds will constitute Romania’s national
contribution, out of which it will make payments in response to annual calls
for funds from the Commission.

6.

The financial regulation applicable to the general budget of the European
Union will apply, notably to the management of the contribution of Romania.

Upon entry into force of this Decision, the Commission will send to Romania
one or more call for funds corresponding to its contribution to the costs of the
activities for the current year. The contribution will be expressed in EURO
and paid into an EURO bank account of the Commission.

11

Romania will pay its contribution according to the call for funds:

• for the part financed from its national budget, at the latest three months

after the call for funds is sent out;

• for the part financed from Phare, at the latest in a period of 30 days after

the corresponding Phare funds have been sent to the country.

Any delay in the payment of the contribution shall give rise to the payment
of interest by Romania on the outstanding amount from the due date. The
interest rate corresponds to the rate applied by the European Central Bank,
on the due date, for its operations in EURO, increased by 1.5 percentage
points.

The daily subsistence allowances are applicable to all participants in the
Programme and are determined on a country per country basis by the
Commission. Romania will
receive a first budget advance from the
Commission at the beginning of every year. A second advance may be paid
at the middle of the year depending on the actual participation of Romania in
the Programme activities and on the expected participation for the rest of the
year. The Romanian department concerned will use these advances to pay for
the travel tickets and daily subsistence allowances for Romanian participants.

Travel costs and subsistence costs incurred by representatives and experts of
Romania for the purposes of taking part as observers in the work of the
committee referred to in Annex I, point 4 shall be reimbursed by the
Commission on the same basis as the Member States of the European Union.

7.

8.

12

FINANCIAL STATEMENT

1.

TITLE OF OPERATION

Opening of Community Programme Fiscalis to Romania

2.

BUDGET HEADING(S) INVOLVED

Revenue: 6091 Revenue accruing from the participation of candidate countries in
Community programmes

Expenditure: B7-030 Economic aid to the associated countries of Central and Eastern
Europe

3.

LEGAL BASIS

Treaty establishing the European Community, and in particular Article 95,
conjunction with Article 300(2), second indent thereof.

in

Additional Protocol8 to the Europe Agreement with Romania of 30 December 1995
providing for the opening-up of Community programmes.

Decision No 888/98/EC9 of the European Parliament and of the Council of 30 March
1998 establishing a programme of Community action to ameliorate the indirect
taxation systems of the internal market.

4.

4.1

1.

2.

3.

4.

8

9

DESCRIPTION OF OPERATION

General objective

To enable officials to achieve a high common standard of understanding of
its
in the field of
Community law,
implementation in Member States.

taxation and of

in particular

indirect

To secure efficient, effective and extensive co-operation among Member States and
between them and the Commission.

To ensure the continuing improvement of administrative procedures to take account
of the needs of administrations and taxpayers through the development and
dissemination of good administrative practices.

Romania's participation in the Community programme Fiscalis will
further
contribute to its preparation for accession as a key feature of a reinforced pre-
accession strategy. It will also enable Romania to familiarise itself with the
procedures and methods used in this Community programme.

OJ L 317 of 30.12.95, p. 40.
OJ L 126 of 28.04.98, p. 1.

13

5.

6.

The decision-making process for this participation requires a decision by the
Association Council of the Europe Agreement. This decision sets up the terms and
conditions for such participation.

The additional Protocol to the Europe Agreement with Romania of 30 December
1995 provides for Romania’s participation in Community Programmes dealing with
a wide range of areas. Since it also provides for addition of other Community areas,
activities in the field of internal market can be included too.

4.2

Period covered and arrangements for renewal

From the entry into force of this Decision until
programme, i.e. 31.12.2002.

the end of this Community

5.

5.1

5.2

5.3

CLASSIFICATION OF EXPENDITURE OR REVENUE

Non-compulsory expenditure

Differentiated appropriations

Type of revenue involved

Since Article 3 of the Additional Protocol stipulates that Romania itself will meet the
costs of its participation, it will be invited to transfer its contribution to item 6091 of
the EU's budget receipts. However, as the Community may supplement Romania’s
contribution (through its national Phare allocation), Romania will contribute only
part of its national budget. The remaining part of this contribution will be taken from
its National Phare Programme. The required Phare funds will be charged to heading
B7-030 and transferred to Romania by means of a separate Financing Memorandum.
Together with the part coming from Romania’s State budget, these funds will
constitute Romania’s national contribution out of which it will make payments in
response to annual calls for funds from the Commission.

6.

TYPE OF EXPENDITURE OR REVENUE

Expenditure comprises reimbursement of participants’ travel expenses and daily
subsistence allowances, organisational costs and costs incurred through seminars and
exchanges.

As far as revenue is concerned, provision for Romania's contribution to cover the
costs of its participation is made under item 6091. The revenue will be allocated to
the items for expenditure on the programme concerned and, where appropriate, to the
relevant items of operating expenditure.

The total revenue expected is given under item 7.4.

14

7.

7.1

FINANCIAL IMPACT

Method of calculating total cost of operation (relation between individual and
total costs)

The calculation is based on the following preconditions:

– Romania’s contribution to the financing of the activities referred to in the
is calculated according to the
Additional Protocol to the Europe Agreement
principle that the country bears the costs of participation itself. Heading 6091 has
been created in the statement of budget revenue for that purpose.

– Based on the Additional Protocol to the Europe Agreement with Romania, the
financial and budgetary arrangements for the programme concerned are as
follows: the costs have been calculated on the basis of various assumptions related
to the participation in a number of 15 seminars and 25 exchanges per year,
including average costs of travel of EURO 695 from Romania to the country of
the host administration, the duration of exchanges or seminars and average daily
subsistence allowance of EURO 146.

On the basis of these assumptions, the total cost of Romania's participation will be
EURO 109 638 per year.

From the above-mentioned figure, the supplementary cost of an administrative nature
of EURO 7 173 per year is to be borne exclusively by Romania.

Of the remaining sum, Romania shall pay 50% from its national budget for year
2001; 60% for year 2002.

Subject to the Phare programming procedures, the remaining 50% will be paid from
Romania’s Phare national allocation for year 2001; 40% for year 2002.

7.2

Itemised breakdown of costs in EURO

EXCHANGES

FINANCIAL CONTRIBUTION

Number of exchanges*

Length of exchanges (days)

Number of participants per exchange

Subsistence allowances**

Travel expenses***

TOTAL

PER YEAR

25

14

1

51 100

17 375

68 475

15

SEMINARS

FINANCIAL CONTRIBUTION

PER YEAR

Number of seminars*

Number of participants in each seminar

Length of seminar (days)

Subsistence allowances**

Travel expenses***

TOTAL

TOTAL SEMINARS+EXCHANGES

7% administrative costs

15

2

3

13 140

20 850

33 990

102 465

7 173

109 638

TOTAL PER YEAR
*

number of exchanges and seminars yearly attended by Member States with the same population as
Romania
€
€

146/day (average daily subsistence allowance)
695 (average travel allowance)

**
***

7.3

Operational expenditure for studies, experts etc. included in Part B of the
budget

None

7.4

Schedule for multi-annual operations:

TOTAL EXPENDITURE:

Item 6091

2001

2002

TOTAL

Seminars
exchanges

+

102 465

102 465

204 930

7%
administrative
costs
TOTAL

7 173

7 173

14 346

109 638

109 638

219 276

16

PHARE CONTRIBUTION:

Item

TOTAL

2000
50% of
operational
expenditures
B7-030

2001
40% of
operational
expenditures
B7-030

51 232.5

40 986

92 218.5

8.

FRAUD PREVENTION MEASURES; RESULTS OF MEASURES TAKEN

All the Commission's contracts, agreements and other legal commitments provide for
on-the-spot checks by the Commission and Court of Auditors. Among other things,
the beneficiaries of the operations are obliged to file reports and financial statements.
These are analysed from the point of view of their content and the eligibility of the
expenditure in line with the objective of Community financing.

The anti-fraud provisions of the basic budget headings apply to this heading too
when adapted to the case of Romania.

9.

9.1

ELEMENTS OF COST-EFFECTIVENESS ANALYSIS

Specific and quantified objectives; target population

The main objectives of the Programme are to contribute to the achievement of a high
common standard of understanding of Community legislation in the field of indirect
taxation, secure efficient co-operation among Member States and the Commission
and improve administrative procedures.

The Fiscalis programme allows exchanges of officials involved in implementing
Community legislation and the organisation of seminars.

The aim of opening up the Community programme Fiscalis is to bring to Romania
the same benefits as the Member States of the European Union already enjoy from
the Programme. The objective for each year is to have Romanian officials participate
in an average number of 25 exchanges by a placement in one of the 15 EU members
and in an average number of 15 seminars.

The integration of Romanian officials in Community networks will make a definite
contribution to preparing Romania for future membership.

9.2

Monitoring and evaluation of the operation

The monitoring and evaluation procedures included in the Fiscalis programme will
also cover Romanian participants.

17

10.

ADMINISTRATIVE EXPENDITURE (SECTION III, PART A OF THE BUDGET)

Actual mobilisation of the necessary administrative resources will depend on the
Commission’s annual decision on the allocation of resources, taking into account the
number of staff and additional amounts authorised by the budgetary authority.

10.1

Effect on the number of posts

Type of post

Staff required to manage
the operation

Source

Duration

Per year

Permanent
posts

Temporary
posts

Additional
resources

Existing
of
resources
the DG or
department
concerned

0.02

0.02

0.02

Officials
temporary staff

or

A

B

C

Other resources
(Technical
assistance,
A-7002)

item

0.02

0.02

0.02

TOTAL

0.06

0.06

10.2

Overall financial impact of additional human resources

(in EURO)

Total

Method of calculation (total cost
of the action per year)

EURO

6 480 0.06 man/year x 108 000 EURO

Officials *

Temporary staff

Other
assistance, item A-7002)

resources

(Technical

TOTAL
*

By using existing resources required to manage the operation (calculation based on A-1, A-2, A-4, A-5, A-7).

6 480

18

10.3

Increase in other administrative expenditure as a result of the operation

2001

2 200

2002

2 200

TOTAL

4 400

A-701
(missions)*

A-7031

4 973

4 973

9 946

(compulsory
committees)**

TOTAL

7 173

7 173

14 346

*
**

Average cost for a 2-day mission of 2 officials per year in Romania
Participation of Romania in SCAC meetings

The above expenditure will be met from the receipts (art. 4 § 2 third indent of the
financial regulation) received from Romania (see point 5.3 and 7.4 of the financial
statement).

19