2001/777/EC: Council Decision of 6 November 2001 granting a Community guarantee to the European Investment Bank against losses under a special lending action for selected environmental projects in the Baltic Sea basin of Russia under the Northern Dimension
Date: 2001-11-06
Institutions: Council of the European Union
Subjects: EIB loan, European Investment Bank, Russia, credit guarantee, environmental protection, financial loss

9.11.2001

EN

Official Journal of the European Communities

L 292/41

II

(Acts whose publication is not obligatory)

COUNCIL

COUNCIL DECISION

of 6 November 2001

granting a Community guarantee to the European Investment Bank against losses under a special
lending action for selected environmental projects in the Baltic Sea basin of Russia under the
Northern Dimension

THE COUNCIL OF THE EUROPEAN UNION,

(3)

(2001/777/EC)

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

Having regard to the proposal from the Commission (1),

Having regard to the Opinion of the European Parliament (2),

Whereas:

(1)

(2)

The Northern Dimension was launched by the Helsinki
Council of 10-11 December 1999, which invited the
Commission to put forward an Action Plan for the
Northern Dimension. The Feira European Council
in
June 2000 adopted the Action Plan in the external and
cross-border policies of the EU during 2000-2003. The
Northern Dimension covers the geographical area from
Iceland to the west across to North West Russia, from
the Norwegian Barents and Kara Seas in the North to the
Southern coast of the Baltic Sea.

The Northern Dimension aims at addressing the special
regional development challenges in northern Europe.
These include harsh climatic conditions, long distances,
particularly wide disparities in living standards, environ-
mental challenges
including problems with nuclear
waste and waste water management, as well as insuffi-
cient transport and cross border facilities. It aims to
intensify cross border cooperation between the Euro-
pean Union and its neighbouring countries and regions
in northern Europe.

(1) OJ C 240 E, 28.8.2001, p. 295.
(2) Opinion delivered on 24 October 2001 (not yet published in the

Official Journal).

The Community already supports some environmental
projects in Northwest Russia with grants from TACIS,
which, inter alia, pays attention to the need to reduce
environmental risks and pollution, including transboun-
is justified for the Community to
dary pollution.
strengthen its support through limited European Invest-
ment Bank (EIB)
the EIB
would reinforce the impact of Community actions, not
only by increasing the funds available, but also through
the Bank's project
the professional
teams.

loans. The involvement of

involvement of

It

(4)

At the initiative of the Presidency, the Ecofin Council of
12 March 2001 considered a set of criteria for a limited
EIB special action for environmental projects in North
West Russia, notably in the St Petersburg and Kali-
ningrad areas. It was underlined that (a) projects must be
assessed by the EIB and the loans authorised on a case-
by-case basis by its Board of Governors. It is thus not a
question of a general
lending mandate for Russia; (b)
projects must have a strong environmental objective and
be of significant interest for the European Union; (c) the
EIB must cooperate and co-finance with other inter-
national financial initiatives in order to ensure reason-
able risk sharing and appropriate project conditionality;
(d) the aggregate volume of loans is to be subject to an
indicative ceiling of EUR 100 million; (e) Russia must
honour its international financial obligations, including
those to the Paris Club.

(5)

The Stockholm European Council of 23-24 March 2001
concluded that the Union should open up EIB lending
for selected environmental projects in Russia, according
to specific criteria decided by the Council.

L 292/42

EN

Official Journal of the European Communities

9.11.2001

(6)

(7)

(8)

(9)

It is therefore appropriate to provide a guarantee to the
EIB to allow it to sign loan operations under this special
lending action for selected environmental projects in the
Baltic Sea rim of Russia, notably in the St Petersburg and
Kaliningrad areas. The EIB has indicated its ability and
willingness to extend loans from its own resources in
North West Russia in accordance with its Statute.

special

action,

This
separate 100 %
involving
Community guarantee, is of an exceptional nature and is
for any future
not
actions.

to be considered as a precedent

a

The Northern Dimension Environmental Partnership
(NDEP) will provide a framework for the setting of
priorities, involving the Commission, bilateral and multi-
lateral donors, international financial institutions and the
transition countries concerned.

EIB financing in Russia under this Decision should be
managed in accordance with the EIB's usual criteria and
procedures, including appropriate control measures, as
well
and procedures
concerning the Court of Auditors and OLAF.

as with the

relevant

rules

(10)

For the purpose of adopting this Decision, the only
powers provided for by the Treaty are those set out in
Article 308,

HAS DECIDED AS FOLLOWS:

Article 1

Objective

The Community shall grant the European Investment Bank
(hereinafter referred to as ‘the EIB’) a guarantee in respect of all
payments not received by it but due in respect of credits
opened, in accordance with its usual criteria, for investment
projects carried out under this special
lending action in the
Baltic Sea basin of Russia under the Northern Dimension.
Eligible projects shall have a strong environmental objective
and be of significant interest to the European Union.

Article 2

Ceiling and conditions

The overall ceiling of

1.
EUR 100 million.

the credits opened shall be

2.
For the purposes of this specific Decision, the EIB shall
benefit from an exceptional Community guarantee of 100 %
which covers the total amount of credits opened under this
decision and all related sums.

Projects financed by loans to be covered by the guarantee

3.
shall satisfy the following criteria:

(a) eligibility in accordance with Article 1;

(b) cooperation and co-financing by the EIB with other inter-
national financial institutions in order to ensure reasonable
risk-sharing and appropriate project conditionality.

The Board of Governors of the EIB, under Article 18(1),
4.
second paragraph, of the Protocol on the Statute of the Euro-
pean Investment Bank shall approve on a case-by-case basis
each loan to be covered by the Community guarantee.

The Board of Directors of the EIB shall only propose
5.
projects for approval to the Board of Governors if Russia
honours its international financial obligations, including obliga-
tions for its Paris Club debt.

Article 3

Reporting

The Commission shall inform the European Parliament and the
Council each year of the loan operations carried out under this
Decision and shall, at the same time, submit an assessment of
the implementation of
this Decision and of coordination
between the international financial institutions involved in the
projects. The information submitted by the Commission to the
European Parliament and the Council shall include an assess-
ment of the contribution of the lending under this Decision to
the fulfilment of
the
Northern Dimension.

the Community's objectives under

For the purposes of
transmit to the Commission the appropriate information.

the first subparagraph,

the EIB shall

Article 4

Duration

The guarantee shall cover loans signed during a period of three
years from the date of adoption of this Decision. If, on expiry
of those three years, the loans signed by the EIB have not
attained the overall ceiling referred to in Article 2, this period
shall be automatically extended by six months.

Article 5

Final provisions

This Decision shall take effect on the day of its publica-

1.
tion in the Official Journal of the European Communities.

The EIB and the Commission shall fix the terms on which

2.
the guarantee is to be given.

Done at Brussels, 6 November 2001.

For the Council

The President

D. REYNDERS