Common Position (EC) No 51/2002 of 26 July 2002 adopted by the Council, acting in accordance with the procedure referred to in Article 251 of the Treaty establishing the European Community, with a view to adopting a decision of the European Parliament and of the Council adopting a Community programme to improve the operation of the taxation systems in the internal market (Fiscalis programme (2003 to 2007))
Date: 2002-07-26
Institutions: Council of the European Union
Subjects: EU programme, action programme, administrative cooperation, civil servant, fiscal policy, tax law

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COMMON POSITION (EC) No 51/2002

adopted by the Council on 26 July 2002

with a view to adopting Decision 2002/. . ./EC of the European Parliament and of the Council . . .
adopting a Community programme to improve the operation of taxation systems in the internal
market (Fiscalis programme (2003 to 2007))

(2002/C 228 E/04)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE
EUROPEAN UNION,

but extended to cover taxes on income, on capital and on
insurance premiums.

Having regard to the Treaty establishing the European
Community, and in particular Article 95 thereof,

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

Having regard to the opinion of the Economic and Social
Committee (2),

Acting in accordance with the procedure laid down in Article
251 of the Treaty (3),

Whereas:

in particular

taxation systems,

(1) In the internal market, the effective, uniform and efficient
application of Community law is essential for the func-
tioning of
the
protection of national and Community financial interests
through combating tax evasion and tax avoidance,
avoiding
reducing
burdens on administrations and taxpayers. Achieving
this effective, uniform and efficient application is a
matter for the Community acting in partnership with
the Member States.

competition

distortions

and

for

of

(2) Decision No 888/98/EC of the European Parliament and
the Council of 30 March 1998 establishing a programme
of Community action to ameliorate the indirect taxation
systems of the internal market (Fiscalis programme) (4) has
those
significantly contributed to the achievement of
overall objectives for the period 1998 to 2002.
is
It
therefore considered desirable to continue the Fiscalis
programme for another five-year period.

(3) Efficient, effective and extensive cooperation among the
present and future Member States and between them and
the Commission is important for the functioning of the
taxation systems in the internal market.

(4) The experience gained by the Community from the
Fiscalis programme has shown that exchanges, seminars
and multilateral control exercises could achieve the
objectives of the programme by bringing officials from
different national administrations together in professional
activities. Those activities should therefore be continued,

(1) OJ C 103 E, 30.4.2002, p. 361.
(2) OJ C . . .
(3) Opinion of the European Parliament of 13 June 2002 (not yet
published in the Official
Journal), Council Common Position of
26 July 2002 and Decision of the European Parliament of . . .
(not yet published in the Official Journal).

(4) OJ L 126, 28.4.1998, p. 1.

(5) The establishment and functioning of a communication
and information exchange infrastructure has a vital part
to play in reinforcing the taxation systems within the
Community.
information
exchange system (VIES), referred to in Council Regulation
(EEC) No 218/92 of 27 January 1992 on administrative
cooperation in the field of indirect taxation (VAT) (5), has
shown the value of information technology in protecting
revenue whilst minimising administrative burdens.

the VAT

particular,

In

(6) In order to ensure uniform application of Community
law,
it is essential that officials responsible for taxation
have a high common standard of understanding of
Community law and its implementation in the present
and future Member States. Such a standard can be
achieved only through effective initial and continuing
training provided by the present and future Member
States. Supplementary Community action is useful
to
coordinate and foster such training.

the

that

(7) The experience gained from the Fiscalis programme has
coordinated
and
indicated
common training programme
implementation of
could attain the objectives of
in
particular by achieving a higher common standard of
understanding of Community law.

this programme,

development

a

(8) A sufficient standard of linguistic competence on the part
of taxation officials has proved to be essential to facilitate
cooperation. Participating countries
should therefore
provide the necessary language training for their officials.

rests with

participating

(9) Although the primary responsibility for achieving these
objectives
countries,
the
supplementary Community action is needed for the coor-
dination of such activities as well as for the provision of
an infrastructure and the necessary stimulus. Since the
objectives of the measures laid down in this Decision
cannot all be sufficiently achieved by the participating
countries and can therefore, by reason of the scale and
the effect of the action, be better achieved at Community
level, the Community may adopt measures in accordance
with the principle of subsidiarity as set out in Article 5 of
the Treaty. In accordance with the principle of propor-
tionality, as set out in that Article, this Decision does not
go beyond what is necessary in order to achieve those
objectives.

(5) OJ L 24, 1.2.1992, p. 1. Regulation as last amended by Regulation

(EC) No 792/2002 (OJ L 128, 15.5.2002, p. 1).

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(10) This Decision lays down, for the entire duration of the
programme, a financial framework constituting the prime
reference, within the meaning of point 33 of the Inter-
institutional Agreement of 6 May 1999 between the
European Parliament, the Council and the Commission
on budgetary discipline
the
budgetary procedure (1),
the budgetary authority
during the annual budgetary procedure.

and improvement of

for

(11) The measures necessary for the implementation of this
Decision should be adopted in accordance with Council
Decision 1999/468/EC of 28 June 1999 laying down the
procedures
implementing powers
the exercise of
conferred on the Commission (2),

for

HAVE ADOPTED THIS DECISION:

CHAPTER I

SCOPE AND OBJECTIVES

Article 1

Fiscalis 2007 programme

1.
A multiannual Community action programme (Fiscalis
2003 to 2007), hereinafter referred to as ‘the programme’, is
hereby established for
the period 1 January 2003 to
31 December 2007 to improve the operation of the taxation
systems in the internal market.

2.

The activities of the programme shall consist of:

(a) communication and information-exchange systems;

(b) multilateral controls involving Member States and those
candidate countries which have bilateral or multilateral
agreements either with one another or with Member
States permitting such activity;

(c) seminars;

(d) exchanges;

(e) training activities;

(f) any other working meetings, visits or similar activities in
the context of
the programme's objectives as stated in
Article 3 which shall be decided on a case-by-case basis
in accordance with the procedure referred to in Article
14(2).

Article 2

Definitions

For the purpose of this Decision:

(1) OJ C 172, 18.6.1999, p. 1.
(2) OJ L 184, 17.7.1999, p. 23.

(a)

‘taxation’ shall mean the following taxes applied in the
participating countries:

(i) value added tax;

(ii) excise duties on alcohol and tobacco products and

mineral oils;

(iii) taxes on income and on capital as defined in Article
1(2) of Council Directive 77/799/EEC of 19 December
1977 concerning mutual assistance by the competent
authorities of the Member States in the field of direct
taxation (3);

(iv) taxes on insurance premiums as defined in Article 3 of
Council Directive 76/308/EEC of 15 March 1976 on
mutual assistance for the recovery of claims relating to
certain levies, duties, taxes and other measures (4);

(b) ‘administration’ shall mean the public authorities in the
administering

responsible

countries

for

participating
taxation;

(c)

‘participating countries’ shall mean the Member States and
the countries referred to in Article 4, which effectively
participate in the programme;

(d) ‘official’ shall mean an official of the administration;

(e)

(f)

‘exchange’ shall mean a working visit organised under the
programme of an official from an administration in another
participating country;

‘multilateral control’ shall mean a coordinated control of
the tax liability of one or more related taxable persons,
which is organised by several participating countries and
has a common or complementary interest.

Article 3

Objectives

The overall objective of

1.
the programme shall be to
improve the proper functioning of the taxation systems in
the internal market by increasing cooperation between partici-
pating countries, their administrations and officials.

2.

The specific objectives of the programme shall be:

(a)

for value added tax and excise duties:

(i) to enable officials to achieve a high common standard
its
of understanding of Community law and of
implementation in Member States;

(ii) to secure efficient, effective and extensive cooperation

among Member States;

(3) OJ L 336, 27.12.1977, p. 15. Directive as last amended by the

1994 Act of Accession.

(4) OJ L 73, 19.3.1976, p. 18. Directive as last amended by Directive

2001/44/EC (OJ L 175, 28.6.2001, p. 17).

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(iii) to ensure the continuing improvement of adminis-
tration procedures to take account of the needs of
administrations and taxpayers
through the devel-
opment and dissemination of good administrative
practice;

functioning of
paragraph;

the other

systems

referred to in this

(b) the VAT information exchange system (VIES) and its

messaging systems;

(b) for direct taxation:

to provide support for information exchange in the field of
mutual assistance and to raise awareness of Community
law applicable in the field of direct taxation;

(c)

for taxes on insurance premiums:

to improve cooperation between Member States, ensuring
better application of the existing rules;

(d) for the candidate countries:

to meet the special needs of candidate countries so that
they take the necessary measures for accession in the
field of tax legislation and administrative capacity.

3.
The action plan of the programme shall be established
annually in accordance with the procedure referred to in
Article 14(2).

Article 4

Participation of candidate countries

The programme shall be open to the participation of:

(a) the associated countries of central and eastern Europe, in
accordance with the conditions laid down in the Europe
Agreements, in the additional Protocols thereto and in the
decisions of the respective Association Councils;

(b) Cyprus, Malta and Turkey, on the basis of bilateral
agreements on this matter concluded with these countries.

CHAPTER II

PROGRAMME ACTIVITIES

Article 5

(c)

the excise movement verification system;

(d) the early-warning system for excise;

(e)

the excise duty tables system;

(f) any other new communication and information-exchange
systems designated in accordance with the procedure
referred to in Article 14(2), when Community legislation
requires them to be introduced.

2.
The Community components of the communication and
information-exchange systems shall be the hardware, software
and network connections, which shall be common to all
participating countries so as to ensure the interconnection
and interoperability of the systems, whether they be installed
at the premises of the Commission (or a designated subcon-
tractor) or at the premises of participating countries (or a
designated subcontractor). The Commission shall conclude
the necessary contracts to assure the operational nature of
these components on behalf of the Community.

these

systems,

forming part of

3.
The non-Community components of the communication
and information-exchange systems shall comprise the national
databases
the network
connections between the Community and non-Community
components and such software and hardware as each partici-
pating country shall deem appropriate for the full operation of
those systems throughout its administration. The participating
countries shall ensure that the non-Community components
are kept operational and shall ensure the interoperability of
these components with the Community components.

The Commission shall coordinate,

in cooperation with
4.
the participating countries, those aspects of the establishment
and functioning of
the Community and non-Community
elements of
the systems and infrastructure referred to in
paragraph 1.

Article 6

Multilateral controls

Communications and information-exchange systems

1.
The Commission and the participating countries shall
ensure that the following communications and information-
exchange systems are operational in so far as their operation
is necessary under Community legislation:

Participating countries shall choose, from among the multi-
lateral controls organised by them, those whose costs are to
be borne by the Community in accordance with Article 11.
include at all events control of the tax
Such controls shall
liability in respect of value added tax and/or excise duties.

(a) the common communications network/common systems
interface (CCN/CSI) to the extent necessary to support the

The participating countries shall send annual
evaluations concerning such controls to the Commission.

reports and

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Article 7

Seminars

The Commission and the participating countries shall together
organise seminars to be attended by officials from the adminis-
trations, Commission representatives and, if appropriate, other
experts.

Participating countries shall also ensure that their officials
2.
receive the initial and continuing training necessary to acquire
the common professional skills and knowledge in accordance
with the common training programmes and the linguistic
training necessary for those officials to attain a sufficient
standard of linguistic competence.

Article 8

Exchanges of officials

countries

The Commission and participating

shall
1.
organise exchanges of officials. The length of exchanges may
not exceed one month. Each exchange shall be targeted on a
particular professional activity and shall be sufficiently prepared
and subsequently evaluated by the officials and administrations
concerned. Provided that it states its reasons for doing so, the
host administration may limit the number of participants in the
exchange if the volume of applications received impedes its
preparation and proper operation.

CHAPTER III

FINANCIAL PROVISIONS

Article 10

Financial framework

framework for

The financial
the
programme for the period 1 January 2003 to 31 December
2007 is hereby set at EUR 44 million. The annual appro-
shall be authorised by the budgetary authority
priations
within the limits of the financial perspective.

the implementation of

2.
The participating countries shall take the necessary steps
to enable exchange officials to play an effective part in the host
administration's activities. To this end, such officials shall be
authorised to carry out the tasks relating to the duties entrusted
to them by the host administration in accordance with its legal
system.

During the exchange, the civil liability of the exchange
3.
official in the performance of his duties shall be treated in the
same way as that of officials of
the host administration.
Exchange officials
shall be bound by the same rules of
professional secrecy as national officials.

Article 11

Expenditure

1.
The expenditure necessary for the implementation of the
programme shall be shared by the Community and the partici-
pating countries in accordance with paragraphs 2, 3, 4 and 5.

2.

The Community shall bear the following expenditure:

(a) the cost of the development, purchase, installation, main-
the Community
the communications and information-

tenance and day-to-day operation of
components of
exchange systems described in Article 5;

4.
Participating countries may restrict the scope of these
exchanges to officials responsible for value added tax and/or
excise duties.

(b) the cost of the travel and subsistence expenses relating to
multilateral controls, seminars, exchanges of officials and
training activities;

Article 9

Training activities

1.
In order to encourage structured cooperation between
national training bodies and officials responsible for training
in taxation in administrations, participating countries shall, in
cooperation with the Commission:

(a) develop

existing

training

and, where
necessary, devise new programmes to provide a common
core of training for officials so as to enable them to acquire
the necessary common professional skills and knowledge;

programmes

(c)

the cost relating to the organisation of seminars and the
development of training tools;

(d) the cost of evaluation studies to be carried out by third
parties on the impact of the programme, while guaran-
teeing the confidentiality of the data;

(e)

the cost of the other activities referred to in Article 1(2)(f).

3.
The Commission shall, in accordance with the Financial
Regulation of 25 June 2002 applicable to the general budget of
the European Communities (1), determine the rules relating to
the payment of expenses and shall communicate them to the
participating countries.

(b) where appropriate, open the training courses in taxation
provided by each participating country for its own officials
to officials from all participating countries;

The Commission shall adopt any necessary measures for
4.
the budget management of the programme in accordance with
the procedure referred to in Article 14(2).

(c) develop the necessary common tools for taxation training.

(1) OJ L 29, 31.1.2002, p. 1.

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The participating countries

5.
expenditure:

shall bear

the following

(a) the cost of the development, purchase, installation, main-
tenance and day-to-day operation of the non-Community
the communications and information-
components of
exchange systems described in Article 5;

(b) the costs relating to the initial and continuing training,

including linguistic training, of their officials.

Article 12

Financial control

Community financing decisions
contracts resulting from this Decision shall be subject
financial control
financial and budgetary control.

and any agreements or
to
in accordance with Community law on

CHAPTER IV

OTHER PROVISIONS

Article 13

Implementation

The measures necessary for the implementation of Article
1(2)(f), Article 3(3), Article 5(1)(f) and Article 11(4) shall be
adopted in accordance with the procedure referred to in Article
14(2).

Article 14

Committee procedure

The Commission shall be assisted by a committee to be

1.
known as the ‘Fiscalis Committee’.

2. Where reference is made to this paragraph, Articles 4 and
7 of Decision 1999/468/EC shall apply, having regard to the
provisions of Article 8 thereof.

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 15

Follow-up and evaluation

1.
Each year the Commission shall submit to the Committee
referred to in Article 14(1) a follow-up report setting out the
progress of all
in terms of
implementation and results in relation to the annual action
plan. This report shall also be forwarded to the European
Parliament.

the programme's activities

administrations

The
the
information necessary for follow-up reports to be drawn up
as efficiently as possible.

send the Commission all

shall

2. Mid-term and final evaluations of the programme shall be
carried out under the Commission's responsibility using the
follow-up reports and the reports drawn up by the partici-
pating countries. The programme's effectiveness and efficiency
shall be evaluated in terms of the objectives set out in Article
3. Evaluations shall be conducted using the reports referred to
in paragraph 3 as follows:

— the mid-term evaluation shall review the initial results and
impact of the programme's activities. It shall also assess the
use of
follow-up and
implementation,

funding and the progress of

— the final evaluation shall assess the effectiveness and effi-

ciency of the programme's activities.

3.

The participating countries shall send the Commission:

(a) by 31 March 2005, a mid-term evaluation report on the

programme's effectiveness and efficiency;

(b) by 31 March 2008, a final evaluation report on the

programme's effectiveness and efficiency.

The Commission shall

4.
Parliament and the Council:

present

to

the

European

(a) by 30 June 2005, a mid-term evaluation report on the
programme's effectiveness and efficiency and a communi-
cation on the desirability of continuing the programme,
accompanied, where relevant, by a suitable proposal;

(b) by 30 June 2008, a final evaluation report on the

programme's effectiveness and efficiency.

The reports referred to in (a) and (b) shall also be sent to the
Economic and Social Committee and the Committee of the
Regions for their information.

5.
The evaluation reports referred to in paragraph 4 shall be
based mainly on the reports referred to in paragraph 3, and on
the follow-up reports referred to in paragraph 1.

Article 16

Entry into force

This Decision shall enter into force on the day of its publi-
cation in the Official Journal of the European Communities.

It shall apply from 1 January 2003.

Article 17

Addressees

This Decision is addressed to the Member States.

Done at . . .

For the European Parliament

The President

For the Council

The President

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STATEMENT OF THE COUNCIL'S REASONS

I. INTRODUCTION

1. On 17 January 2002, the Commission transmitted to the Council a communication (1) to the
European Parliament and to the Council on the desirability of continuing a programme of action
to ameliorate the taxation systems of the internal market, with a proposal for a decision of the
European Parliament and of the Council adopting a Community programme to improve the
operation of taxation systems in the internal market (Fiscalis 2007 programme). This proposal is
based on Article 95 of the Treaty.

2. The European Parliament delivered its opinion (2) on that proposal at first reading on 16 June 2002.

3. The Economic and Social Committee delivered its opinion (2) on . . .

4. The Council adopted a Common Position pursuant to Article 251 of the Treaty on 26 July 2002.

II. OBJECTIVE OF THE PROPOSAL

The purpose of the proposal is to provide for the continuation of the current Fiscalis programme (3) for
a new five-year period (1 January 2003 to 31 December 2007) as well as for its extension, in particular
to direct taxation. Furthermore, the programme will now be open to Member States and candidate
countries.

The overall objective of the programme is to improve the operation of the taxation systems in the
internal market and to do so through an increased cooperation between the administrations and
officials of the participating countries.

Specific objectives of the programme are:

— with regard to indirect

taxation (value added tax and excise duties):

in substance,

the same

objectives as in the existing programme,

— with regard to direct taxation: to support the information exchange in the field of mutual assistance

and to raise awareness of Community law applicable in the field of direct taxation,

— with regard to taxes on insurance premiums: to ensuring a better application of the existing rules

through an improved cooperation between Member States, and

— with regard to the candidate countries: to meet their specific needs in order to reinforce their
administrative capacity and to help them to implement the necessary legislative, administrative,
organisational and technical measures in the field of tax legislation.

III. ANALYSIS OF THE COMMON POSITION

Although the Council supports the general aim of the Commission's proposal, the Common Position
differs from the latter on a number of points:

— the planned activities should be clearly defined and, in particular, ‘any other activities’ which now

have been precisely worded using the terms of the explanatory memorandum (Article 1),

— the reference to taxes on insurance must be in fact to taxes on insurance premiums (Article 2),

(1) OJ C 103 E, 30.4.2002, p. 361.
(2) Not yet published in the Official Journal.
(3) Decision No 888/98 of the European Parliament and of the Council (OJ L 126, 28.4.1998, p. 1).

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— it should be clear that the overall objective of the programme is to improve the proper functioning
of the taxation systems in the internal market by increasing cooperation between administration
and officials, and to avoid giving the impression that legislative powers were being conferred on the
programme (Article 3(1)),

— since the proposal foresees a continuation of the current programme, the objectives for indirect

taxation should be the same (Article 3(2)(a)),

— as regards direct

taxation,
programme (Article 3(2)(b)),

the objectives have been brought

in line with the scope of

the

— no new communication and information-exchange system may be introduced unless required by

Community legislation (Article 5(1)(f)),

— multilateral controls should pay particular attention to indirect taxation (VAT and/or excise duties)

since it affects the Community's own resources (Article 6),

— the number of participants in the exchanges of officials may be limited for practical reasons and, in
line with the amendment on multilateral controls, the exchanges may be restricted to officials in
respect of indirect taxation (Article 8),

— the financial framework for the implementation of the programme may not exceed EUR 44 million

for the period 1 January 2003 to 31 December 2007 (Article 10),

— the wording concerning the expenditure has been brought in line with the current programme and
a new provision has been introduced in order to provide for an efficient and equitable annual
budget management of the programme (Article 11),

— it has to be made clear that any provision in Community law on financial and budgetary control is

applicable (Article 12),

— the provisions concerning the implementation of the Decision and the Committee have been
adapted in accordance with the ‘Comitology’ decision (1) (1999/468/EC) (Articles 13 and 14),

— the provisions concerning the follow-up and evaluation have been recast together and with a view
to have a solid basis of information, the dates for the participant countries to send information to
the Commission have been slightly delayed (Article 15),

— Decision 888/98/EC is not repealed in order to maintain the obligation for the Commission to
submit to the European Parliament and to the Council a final report on the implementation and
impact of the current programme by 30 June 2003 at the latest.

IV. AMENDMENTS PROPOSED BY THE EUROPEAN PARLIAMENT

The Council's Common Position includes as such or in substance three of the seven amendments
adopted by the European Parliament, i.e. Amendments 1, 2 and 5. In particular:

— Amendments 1 and 2 on the funding of the programme beyond 2006 being subject to the approval
of the budgetary authority have to be considered in the light of point 33 of the Interinstitutional
Agreement of 6 May 1999 between the European Parliament, the Council and the Commission on
budgetary discipline (2). This is already provided for in recital 10 and Article 10, second sentence.
Furthermore, Article 12 makes it clear that any provision in Community law on financial and
budgetary control is applicable,

(1) OJ L 184, 17.7.1999, p. 23.
(2) OJ C 172, 18.6.1999, p. 1.

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— Amendment 5: submission of a report to the European Parliament;

it has been introduced (see

Article 15(1), second sentence).

The Council rejected Amendments 3, 4, 6 and 7.

— Amendments 3 and 4 go beyond the scope of the proposal,

— Amendment 7: details of the objectives of the future decision were not considered necessary since

these should be provided for under paragraph 3 of Article 3,

— Amendment 6: the obligation for the Commission to study how best to develop synergy between
similar Community programmes. It was considered that there was a risk that this might interfere
with the proper implementation of the programme and, as regards the last part of the proposed
amendment, that it did not respect the Commission's right of initiative.