Proposal for a Council Regulation establishing an Instrument for Pre-Accession Assistance (IPA)
Date: 2004-09-29
Institutions: European Commission
Subjects: EU aid, EU financial instrument, accession to the European Union, development aid, economic cooperation, pre-accession strategy

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 29.9.2004 
COM(2004) 627 final 

2004/0222 (CNS) 

Proposal for a 

COUNCIL REGULATION 

establishing an Instrument for Pre-Accession Assistance (IPA)  

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1. 

GENERAL INTRODUCTION 

This draft has to be seen in the context of the revision of the External Aid framework for the 
forthcoming financial perspective from 2007 to 2013, which is currently ongoing. While the 
purpose  of  this  exercise  is  to  harmonise  (as  far  as  possible)  the  Community’s  external 
aid instruments, it should also be understood that pre-accession aid operates in a very 
specific framework: 

•  assistance provided by this instrument is driven by the pre-accession process (European 
Partnerships, Accession Partnerships, negotiation by chapters, Regular Reports etc.) and its 
specific  requirements,  in  particular  a  need  for  a  flexible  approach  in  order  to  be  able  to 
accommodate new priorities quickly 

•  due  to  the  fact  that  accession  is  at  least  a  medium  term  goal  for  the  beneficiaries,  the 
assistance also operates in a medium term perspective, and not in a long-term one like 
for traditional development aid; 

•  one of the main characteristics of pre-accession aid is its bridging function, i.e. apart from 
assisting development, more importantly its task is to prepare countries for the time after 
accession; 

The draft Regulation  constitutes a framework regulation, establishing  a  unified  instrument 
for pre-accession assistance. As such, it will replace not only the Phare Regulation, but also – 
among others - the SAPARD, ISPA, Phare CBC and Co-ordination Regulations, as well as the 
Turkey and CARDS Regulations. It will be supported by substantial implementing rules, 
defining more closely the areas of activity identified in the framework Regulation. 

Beneficiary  countries  will  be  divided  into  two  categories,  depending  on  their  status  as 
either  Candidate  Countries  or  potential  Candidate  Countries.  Potential  Candidate 
Countries are listed in Annex I of the Regulation, Candidate Countries in Annex II. 

Potential  Candidate  Countries  will  continue  to  receive  assistance  along  the  lines 
currently laid down in the CARDS-Regulation: Institution Building and Democratisation, 
Economic  and  Social  Development,  Regional  and  Cross-Border  Co-operation  and  some 
alignment with the acquis communautaire, in particular where this is in the mutual interest of 
the EU and the beneficiary country. 

Candidate Countries will receive the same kind of assistance, and will additionally receive 
assistance  in  the  preparation  for  the  implementation  of  Structural  and  Rural 
Development Funds after Accession, as well as concerning the full implementation of the 
acquis communautaire. 

A  country  can  move  from  Annex  I  to  Annex  II  only  after  the  decision  of  the  Council 
giving  it  Candidate  status.  Such  a  decision  would then authorise the move  from  Annex  I  to 
Annex II through a decision of the Council to be adopted under a “light” procedure, provided 
for in Article 17 (q.v.). 

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One of the main characteristics of the Regulation is that, for recognised Candidate Countries, 
it  aims  at  progressively  adopting  the  rules  and  principles  of  Structural  Funds/Rural 
Development  Funds  management,  by  making  available  assistance  for  them  through 
three  separate  components  (Regional  Development,  Rural  Development  and  Human 
Resources Development). The aim of these components is to follow the Structural and Rural 
Development  Funds’  rules  including  their  institutional  framework  (e.g.  Comitology)  as 
closely as possible, while at the same time laying the groundwork for a national framework 
promoting economic and social cohesion as well as viable agricultural structures, which is at 
the same time coherent with a view to European Union membership 

The system of Structural and Rural Development Funds for the period after 2007 is still under 
discussion.  For  this  reason,  the  Structural  Funds-Components  and  the  Rural  Development 
Funds-Component of the Regulation are defined mainly through a dynamic reference to the 
Structural  and  Rural  Development  Funds  Regulations.  The  Commission  is  given  the 
power  to  adopt  implementing  rules  for  these  components  and  to  define  the  framework  of 
assistance  under  each  individual  component  once  the  new  rules  for  Structural  and  Rural 
Development Funds are clear. 

In  summary,  the  regulation  is  building  on  the  main  lessons  learned  in  the  context  of  the 
current pre-accession process, in particular through  

•  streamlining  pre-accession  assistance  by  enhancing  co-ordination  between  the  different 
components,  through  the  creation  of  a  single  framework  for  assistance.  This  single 
framework will integrate the Phare/ISPA/SAPARD structure and complete the framework 
with  other  Structural  Funds  and  Rural  Development  Funds  Components.  It  will  aim  at 
harmonising implementation rules, where possibly taking into account the specificity of the 
Structural  Funds  and  Rural  Development  Regulations,  and  create  a  Comitology  system 
which will ensure a maximum of coordination among the components, 

•  aiming at better preparation for Structural and Rural Development Funds implementation 
after  accession,  through  further  enhancing  emphasis  on  institution  building  as  well  as 
progressive emulation of Structural Funds rules in the run-up to accession. 

2. 

COMMENTS ON SPECIFIC PROVISIONS 

2.1. 

Legal Basis 

The legal basis of the proposal is Art. 181 (a) TEC, and not Art. 179 TEC, despite the fact that 
a  number  of  the  beneficiary  countries  listed  in  the  Annexes  are  considered  developing 
countries by the International community.  

However,  the  simple  fact  that  some  of  the  beneficiary  countries  may  be  considered 
developing countries does not automatically permit the proposal to be based on Article 179. 
That  article  is  used  to  adopt  measures  to  promote  Community  policy  in  the  area  of 
development  policy,  which  is  not  the  main  focus  of  this  proposal,  the  aim  of  which  is  to 
prepare countries for accession. Art. 181 (a) is the only provision in the Treaty which makes 
reference  to  association  agreements  and  agreements  concluded  with  states  which  are 
candidates for accession to the Union.  

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It  must  therefore  be  considered  as  the  correct  legal  base  for  a  regulation  which  deals 
exclusively  with  countries  with  association  agreements  in  place  or  under  preparation,  in 
particular since these countries have been given a membership perspective, as is the case for 
the beneficiary countries listed in the annexes to this Regulation. 

2.2. 

Title 1: Objectives and Principles 

2.2.1.  Article 1: Beneficiaries and overall objective 

Art. 1 states the overall objective – approximation to the European Union, with membership 
as  a  potential  final  goal.  Annex  I  lists  countries  which  are  in  a  state  of  pre-candidateship, 
whereas  Annex  II  lists  those  countries  which  have  been  officially  recognised  as  candidates 
according to Art. 49 TEU. The official acceptance of a country as a Candidate Country will 
entail a change of the Regulation, moving the country from Annex 1 to Annex 2. This system 
seems appropriate, given the fact that both Council and Parliament have repeatedly confirmed 
the  potential  membership  perspective  for  Western  Balkan  countries.  Countries  should, 
however, be kept separate according to their status, so that they can each be judged on their 
individual merits.  

2.2.2.  Article 2: Scope 

Article 2 sets down, in a non-finite matter, the target areas for assistance. These target areas 
are set  up in a way  to  ensure  coherence with earlier Community assistance,  allocated  either 
under  the  CARDS  or  the  Turkey  Regulations  by  globally  targeting  the  same  objectives  set 
down  in  these  two  Regulations.  The  target  areas  listed  in  lit.  paragraph  (1)  (a)  –  (f)  are 
identical  for  both  groups  of  beneficiary  countries,  addressing  in  particular  the  situation  of 
countries emerging from a period of civil war and internal unrest (support for democracy, rule 
of law, public administration reform, economic reform, respect for human and minority rights, 
civil  society,  reconciliation  in  the  widest  sense.  Lit.  (g)  –  also  identical  for  both  groups  of 
beneficiary  countries  –  addresses  the  various  forms  of  regional  cooperation  existing  in  the 
wider European framework. 

However, a split of objectives takes place in paragraphs (2) and (3): For Candidate Countries, 
assistance  shall  target  the  full  implementation  of  the  acquis  communautaire  (see  Art.  2  (3) 
(a)),  whereas  for  countries  which  are  not  yet  candidates,  the  mandate  is  more  limited,  and 
oriented towards the general interests of the Community and the beneficiary country, without 
presupposing full membership (see Art. 2 (2) (a)). Art. 2 (2) (b) targets, for countries which 
are not Candidate Countries, economic and social development in a generic fashion, whereas 
for  Candidate  Countries,  Art.  2  (3)  (b)  is  strongly  oriented  towards  the  support  for 
implementation of the Community’s agricultural and cohesion policy after accession. 

2.2.3.  Article 3: Components 

Art. 3 sets up five Components, under which the different areas of intervention will be dealt 
with: Transition and Institution Building, Regional and Cross-Border Co-operation, Regional 
Development, Human Resources Development and Rural Development. The article also gives 
the  Commission  the  authority  to  adopt  implementing  rules  for  each  Component  as 
appropriate.  For  the  adoption  of  these  implementing  rules,  a  Comitology  procedure 
(Management Committee) is foreseen. 

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to 

the 

framework 

Due 
present  Regulation,  Commission 
of 
Regulations/Decisions  will  have  to  set  down  the  detailed  rules  for  the  implementation  of 
assistance.  Where  this  is  necessary  in  the  interest  of  efficient  and  effective  management  of 
Community funds, implementing rules may differ from one Component to the other.  

character 

the 

2.2.4.  Article 4: Framework for Assistance and Allocation of Funds 

Assistance  will  be  allocated  by  the  Commission  on  the  basis  of  a  multi-annual  indicative 
framework  per  component  and  country.  The  basic  policy  document  for  setting  down  the 
priorities  for  programming  the  assistance  will  be  the  Partnerships  (Accession  Partnerships 
with the Candidate Countries, European Partnerships with the potential Candidate countries in 
Annex 1). 

2.3. 

Title II: Components 

Title II of the Regulation is dedicated to the definition of the Components set up in Art. 3. The 
logic of the Components follows the lessons learned from the current pre-accession process, 
which  has  shown  a  substantial  need  for  support  of  wide-ranging  Institution  Building 
measures,  including  the  investment  associated  therewith,  and  a  definite  need  to  vigorously 
support Candidate Countries in their preparation for the implementation of the Community’s 
structural and cohesion policy. Candidate Countries will have access to all five Components, 
whereas  potential  Candidate  Countries  will  be  limited  to  the  first  and  second  component 
(Transition Assistance/Institution Building and Regional/Cross-Border Co-operation). 

The  rationale  of  three  separate  Components  tackling  Regional,  Rural  and  Human 
Development is that Candidate Countries will be confronted with exactly this situation in the 
Community’s agricultural and cohesion policy after accession.  

As  the  current  enlargement  process  has  shown,  the  early  familiarisation  with  this  complex 
system is of primary importance for the proper implementation and management of Structural 
and  Rural  Development  Funds  after  accession,  and  mastering  it  requires  an  intensive  and 
sustained  learning  process.  Candidate  Countries  will  thus  be  given  the  opportunity  to 
“practise”  the  Community’s  rural  and  cohesion  policies  by  applying  rules  as  closely  as 
possible to the Structural and Rural Development Funds before accession. 

2.3.1.  Article 5: Transition Assistance and Institution Building Component 

This can be considered the crucial component in charge of all Institution Building matters, as 
well as the Transition Assistance made available to the countries listed in Annex 1. It is also 
in  charge  of  all  co-operation  measures  which  are  not  covered  by  the  other  Components.  In 
keeping with this logic, it is also the Component which will co-ordinate the assistance through 
its Committee (see Art. 11 (2)). This subsidiary catch-all function will enable rapid reaction 
and adaptation to changing needs and newly emerging priorities. 

In practise, the functioning of the first Component as a default will be limited through the fact 
that activities falling under “the preparation for the implementation and management, and the 
policy  development,  of  the  Community’s  Common  Agricultural  and  Cohesion  Policies”  are 
covered by Components III, IV and V (see Art. 7 (1), 8 (1) and 9 (1)). 

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In areas normally covered by Components III, IV and V, the first Component will therefore be 
active only where there are no corresponding activities taking place under Components III to 
V in a given country. 

Given the above, in the case of potential Candidate Countries, Component I would cover the 
entire  range  of  target  areas  defined  in  Art.  2  (1)  with  the  exception  of  lit.  (g)  (regional  and 
cross-border co-operation), the latter being addressed by the Component II (defined in Art. 6). 
Its  range  is  thus  similar  to  the  one  of  Phare,  including  the  Economic  and  Social  Cohesion 
aspect of Phare, but without Phare CBC. 

For Candidate Countries, Component I would normally address the target areas listed in Art. 2 
(2) (a) – (f) and 2 (3) (a). It can thus be said to correspond to Phare, with a particular emphasis 
on the post-conflict scenario, but without Economic and Social Cohesion and CBC. 

For  both  groups  of  countries,  the  assistance  under  Art.  5  will  cover  institution  building 
measures and the investments associated with them. 

Component  I  would  also  cover  beneficiary  countries’  participation 
in  Community 
Programmes,  which  form  an  important  aspect  of  the  acquis  communautaire.  Moreover,  the 
participation  in  Community  Programmes  already  before  accession  can  be  considered  as  an 
institution  building  measure  sui  generis,  because  it  is  conducive  to  the  establishment  of 
administrative  structures  enabling  the  population  of  the  beneficiary  country  in  question  to 
start reaping the full benefit of these Programmes from accession at the latest. 

2.3.2.  Article 6: Cross-Border and Regional Co-operation 

This Component will be open to both groups of beneficiary countries. It will support cross-
border activities among beneficiary countries and between beneficiary countries and Member 
States.  It  would  also  support  beneficiary  countries’  participation  in  transnational  and 
interregional  programmes  including  both  Member  States  and  third  countries  managed  by 
other  instruments  (e.g.  the  ENPI).  In  the  Western  Balkans,  the  component  will  continue  to 
support Regional Co-operation previously supported under CARDS. 

2.3.3.  Article 7: Regional Development Component 

Component  III,  which  is  accessible  only  to  Candidate  Countries  would  be  expected  to 
emulate, to the maximum extent possible, the ERDF and Cohesion Fund, thereby giving the 
beneficiary countries the highest possible approximation to Structural and Rural Development 
Funds practises under External Aid rules.  

This  will,  on  the  one  hand,  create  efficiency  gains  because  in  their  move  from  the  pre-
accession  to  post  accession  phase,  Candidate  Countries  will  not  have  to  change  procedures 
and criteria more than absolutely necessary to comply with the Financial Regulation. On the 
other  hand  it  will  give  them  the  best  possible  preparation  for  the  implementation  of  the 
European Regional Development Fund and the Cohesion Fund after accession. By submitting 
the measures under Component III to the same Comitology rules (including the definition of 
measures to be submitted to the Committee) that apply for the ERDF and the Cohesion Fund 
(see Art. 11 (1) (b)), it will be ensured that the shadowing process is as complete as possible. 

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2.3.4.  Article 8: Human Resources Development Component 

The  purpose  of  Component  IV,  which  is  also  accessible  only  to  Candidate  Countries,  is  to 
prepare them for the programming, implementation and management of the European Social 
Fund, in the framework of the European Employment Strategy. Hereby the objectives of the 
Community in the fields of social inclusion, education and training and equality between men 
and  women  are  to  be  taken  into  account.  The  Component  will  focus  on  the  setting  up  of 
adequate  structures  and  systems  for  policy  and  programming  design,  management  and 
delivery,  and  in  the  implementation  of  ESF-type  activities,  in  line  with  the  agreed  policy 
priorities. 

2.3.5.  Article 9: Rural Development Component 

As is the case for Components III and IV, the administrative objective is to help the countries 
prepare for post-accession EU-funded rural development programmes by implementing  pre-
accession assistance through systems which are as similar as possible to those required post-
accession. 

In order to achieve the operational objective of contributing to the sustainable adaptation of 
the agricultural sector and rural areas, the range of actions supported (to be specified in the 
Implementing  Regulation)  may  not  include  all  those  eligible  under  the  Rural  Development 
Regulation  for  Member  States.  Furthermore,  some  rural  development  measures  no  longer 
considered relevant within EU Member States may still be important within countries whose 
agricultural  and  rural  sectors  are  less  well  developed  and  should  therefore  be  eligible  under 
the IPA. 

2.4. 

Title III: Management and Implementation 

This  title  sets  up  the  institutional  balance  between  the  Council  as  primary  legislator  in  the 
field  of  Art.  181  (a)  TEC,  and  the  Commission,  which  is  acting  in  the  executive  function 
attributed to it by the Council according to Art. 202 (3rd indent) and 211 (4th indent) TEC. 

2.4.1.  Article 10: Management of Assistance 

According  to  Art.  211  of  the  TEC,  the  Commission  exercises  implementation  powers 
conferred to it by the Council. Art. 10 (1) therefore sets down that, vis-à-vis the Council, the 
Commission is responsible for the implementation of the assistance, subject to a Comitology 
procedure  set  up  in  Art.  11.  This  also  confirms  the  Commission’s  responsibility  for  the 
implementation of the budget set down in Art. 48 of the Financial Regulation. 

According to Art. 10 (2), implementation shall take place according to the rules of External 
Aid as set down in the Financial Regulation. This provision gives sufficient flexibility to the 
implementation  process,  because  it  makes  a  whole  continuum  of  implementation  methods 
available for the execution of the tasks at hand. The Commission may thus resort for example 
to  centralised  direct  management,  centralised  indirect  management  (including  agencies, 
Community  bodies  and  national  public-sector  bodies/bodies  with  a  public  service  mission), 
various  stages  of  decentralised  management  and  joint  management  with  international 
organisations.  According  to  the  purposes  they  pursue,  different  Components  may  apply 
different implementation methods where this is justified. In order to co-ordinate cross-border 
cooperation  actions  with  those  taking  place  under  the  European  Neighbourhood  Instrument, 

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the possibility to delegate implementation to Member States has been opened. Such assistance 
could then also be implemented through shared management. 

Art. 10 (3) enables the Commission to manage funds put at its disposal by other donors, e.g. 
Member States or third countries, which will be earmarked in the budget in accordance with 
Art. 18 of the Financial Regulation as assigned revenue. 

Art. 10 (5) foresees the possibility of split commitments. The possibility of using such split 
commitments  is  intended  for  programmes  that  have  a  close  link  to  other  EU  programmes 
which also work with split commitments. 

The  Council’s  authorisation  towards  the  Commission  to  implement  the  measure  is 
counterbalanced  through  the  introduction  of  a  Comitology  system  as  well  as  the 
Commission’s obligation to annually report to Council and Parliament, which is contained in 
Art. 10 (6). 

2.4.2.  Article 11: Committees 

Art. 11 sets down a Comitology system, making use of five already existing Committees: 

•  For Components I and II: a Transition Assistance and Institution Building Committee (the 

successor of the Phare Committee),  

•  For Components III and V: the Committees set up in Art. 47 of Regulation 1260/1999, and 
in  addition  to  that,  for  Component  V,  also  the  Committee  set  up  in  Art.  11  of  Council 
Regulation 1258/1999, and 

•  For Component IV: the ESF Committee set up by Art. 147 of the Treaty. 

The procedure for the successor of the Phare Committee is set up in detail, as this Committee 
will  lose  its  legal  basis  pursuant  to  the  final  provisions  contained  in  Art.  19  (2)  of  the 
Regulation.  

The  procedures  for  the  other  Committees  follow  what  is  already  in  place  for  Structural  and 
Regional  Development  Funds,  although  some  adaptations,  e.g.  of  the  Rules  of  Procedure 
might have to be set down in the implementing rules for the individual component. 

For assistance in the area of agricultural and cohesion policy, Candidate Countries will thus 
be  confronted  with  the  same  Committees  which  will  assess  such  measures  after  accession. 
The  involvement  of  these  Committees  will  enable  them  to  reap  the  full  benefits  of  this 
learning  experience.  This  approach  will  also  ensure  as  close  as  possible  an  alignment  with 
Structural and Rural Development Funds before accession. 

The  article  also  sets  down  the  co-ordination  function  of  the  Committee  in  charge  of 
Component I, and mentions the other standard provisions for Comitology. 

2.4.3.  Article 12: Types of Assistance 

Art. 12 lists, in a non-finite way, the types of assistance and the instruments in use therefore.  

Art. 12 (1) reiterates Art. 231 of the Implementing Rules of the Financial Regulation, which 
list certain actions which may be financed. 

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Article 12 (2) clarifies that certain successful tools which were developed to help Candidate 
Countries  in  the  adoption  and  implementation  of  the  acquis  communautaire,  notably 
Twinning and TAIEX, will continue to be used for the beneficiaries of this regulation. 

Art.  13  gives  a  non-finite  list  of  supporting  activities  to  be  financed  from  the  operational 
budget,  listing  in  particular  expenses  which  could  be  covered  under  the  no  longer  existing 
BA-line. It also aims at covering the range of supporting activities set down in the Structural 
and  Rural  Development  Funds  Regulations,  to  enable  further  alignment  of  actions  and 
eligibility, in particular for Components III to V. 

2.4.4.  Article 14: Implementation of Assistance 

The basis for this provision is the framework for External Actions as set down in Title 4 of 
part II of the Financial Regulation, in particular Art. 163, Art. 166 and 167 (2). 

Consequently,  Art.  14  sets  down  a  general  framework  for  the  relations  between  the 
Commission  and  the  beneficiary  country.  It  will  form  the  basis  for  the  implementation  of 
Community assistance. Detailed provisions in this respect should be left to the implementing 
rules.  Standardised  framework  agreements  containing  general  rules  for  the  implementation 
should be concluded at the beginning of the relationship, setting down the basic structures and 
rules.  (e.g.  implementing  bodies,  financial  flows,  anti-fraud  measures  etc.)  Rules  should  be 
harmonised as far as possible for all Components, but should also leave open the possibility of 
concluding  agreements  including  specific  rules  for  individual  components,  where  this  is 
necessary,  e.g  to  allow  for  the  various  degrees  of  decentralisation  foreseen  by  the  different 
Components. 

2.4.5.  Article 15: Protection of the Community’s financial interests 

The  provisions  contained  in  Art.  15  give  the  Commission  a  mandate  for  concluding  the 
necessary  bilateral  agreements  to  protect  the  Community’s  financial  interests.  The  detailed 
provisions to this effect are set down in the Financial Regulation and the Implementing Rules 
to the Financial Regulation. They do, however, have to be subject of a special agreement with 
beneficiary  countries,  because  beneficiary  countries,  unlike  Member  States,  are  not  duty 
bound  by  the  principle  of  Community  loyalty  set  down  in  Art.  10  TEC,  or  the  acquis 
communautaire derived from it.  

In  order  to  comply  with  the  criteria  of  sound  financial  management,  such  framework 
agreements  would  notably  have  to  contain  provisions  defining  the  notions  of  fraud  and 
irregularity,  measures  in  the  field  of  financial  control  by  the  contracting  authority,  the 
Commission  and  the  Court  of  Auditors,  the  possibility  for  OLAF  to  conduct  on-the-spot 
checks  equivalent  to  the  ones  foreseen  by  Regulation  (EC)  2185/96,  the  obligation  of  the 
contracting authority to take preventive measures in the field of corruption, the procedure for 
the  communication  of  cases  of  suspected  fraud  and  irregularities  to  the  Commission,  the 
procedure  for  the  clearance  of  accounts  in  the  case  of  decentralised  management,  the 
application of administrative and financial sanctions (including the exclusion of non-reliable 
candidates  and  tenderers),  and  the  enforceability  of  Commission  decisions  in  the  area  of 
recovery in case of centralised management. 

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2.4.6.  Article 16: Rules of Participation and Origin, eligibility for grants 

Natural and legal persons from Member States, the European Economic Area, the beneficiary 
countries of the IPA and ENPI Regulations as well as International organisations are eligible 
to  participate  in  tenders  and  contracts.  The  issue  of  the  origin  of  supplies  follows  the  same 
rules.  On  the  basis  of  reciprocity,  participation  can  be  opened  to  others.  Furthermore,  the 
possibility of derogation in duly substantiated cases is foreseen. 

Art  16  (1)  to  (6)  is  a  precise,  if  somewhat  shortened,  replica  of  the  draft  regulation  on  the 
Untying  of  Community  Aid.  Its  principles  are  stated  here  because  as  yet,  the  mentioned 
regulation is not in force, and might in the end be abandoned in favour of an approach which 
integrates its provisions into the future External Aid instruments. 

Natural  persons  (or  groups  of  natural  persons  like  NGOs)  are  specifically  mentioned  as 
possible  recipients  of  grants  in  view  of  Art.  114  of  the  Financial  Regulation,  which  would 
otherwise  exclude  this  at  least  for  centrally  managed  programmes.  Seeing  that  programmes 
such  as  the  Small  Projects  Programme  (SPP)  have  been  very  successful  tools  of  the  pre-
accession strategy in the past, it seems desirable to maintain this possibility. 

Apart  from  this  single  reference,  the  regulation  refrains  from  specifying  potential  final 
beneficiaries.  This  follows  the  logic  of  the  Financial  Regulation,  according  to  which 
Community assistance is action-oriented, and not beneficiary-oriented, i.e. anybody can be a 
beneficiary  of  Community  assistance,  as  long  as  s/he  contributes  to  the  attainment  of  the 
objective pursued by the action. 

2.4.7.  Article 17: Suspension of Assistance 

Art.  17  sets  down  a  clausula  rebus  sic  stantibus  for  the  granting  of  Community  assistance, 
giving  the  Council  –  on  a  proposal  of  the  Commission  –  the  competence  to  make  the 
adaptations  it  considers  necessary  in  case  a  beneficiary  country  violates  fundamental 
principles of democracy, rule of law, human rights, minority right, or where progress with a 
view  to  the  European  Partnerships  or  the  Accession  Partnerships  is  insufficient.  For  the 
Western Balkan countries, it also reiterates, in paragraph 2, the special conditionality hitherto 
contained in Art. 5 (2) of Regulation 2666/2000 (CARDS Regulation). 

2.5. 

Title IV: Transitional and Final Provisions 

2.5.1.  Art. 18: Status of Beneficiary Country 

Art. 18 sets down a simplified procedure for amending the Regulation concerning the status of 
a beneficiary country: In case of Art. 49 TEU, where the Council has decided unanimously to 
grant  applicant  status  to  a  beneficiary  country,  it  can  then  amend  the  annexes  to  this 
Regulation  through  a  simple  Decision  passed  by  qualified  majority,  rather  than  having  to 
engage  in  a  full-sized  legislative  procedure  which  would  require  formally  amending  this 
Regulation through another Regulation. 

2.5.2.  Art. 19: Cross-Instrument Provision 

Art.  19  allows,  on  the  basis  of  reciprocity  foreseen  in  the  other  geographic  external  aid 
instruments,  participation  in  programmes  under  other  legal  bases,  where  a  regional,  cross-
border, transnational or global approach offers an added value. 

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2.5.3.  Article 20: Transitional Provisions 

Art. 20 repeals the Phare Regulation, the CBC Regulation, the Co-ordination Regulation, the 
ISPA-Regulation,  the  SAPARD-Regulation,  the  Cyprus/Malta  Regulation  and  the  Turkey 
Regulation. It is not necessary to repeal the CARDS Regulation, because it has an expiry date 
set at December 31, 2006. Provisions are made to ease the transition from one instrument to 
the  other  (most  relevant  in  the  cases  of  CARDS  and  Turkey),  and  to  ensure  the  repealed 
regulations can still be used as the legal basis for ongoing assistance. 

2.5.4.  Art. 21: Entry into force 

The  entry  into  force  of  this  regulation  is  foreseen  twenty  days  after  its  publication  in  the 
Official Journal, but it will only apply from January 1, 2007. The reason for this decalage is 
that the repealed regulations are still needed until the end of the current financial perspective, 
but in the meantime, the new Regulation can already serve as the legal basis for the drafting 
and decision of the implementing rules, which should take place as soon as possible. 

EN 

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2004/0222 (CNS) 

Proposal for a 

COUNCIL REGULATION 

establishing an Instrument for Pre-Accession Assistance (IPA)  

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, and in particular Article 
181a thereof, 

Having regard to the proposal from the Commission1, 

Having regard to the opinion of the European Parliament2, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

1 
2 
3 

In order to improve the efficiency of the Communty’s External Aid, a new framework 
for programming and delivery of assistance has been envisaged. Regulation (EC) Nr. 
(insert) of  the European Parliament and the  Council of (date) aspires  to put in place 
the  Development  Co-operation  and  Economic  Co-operation  Instrument.  Regulation 
(EC)  Nr.  (insert)  of  the  European  Parliament  and  the  Council  of  (date)  introduces  a 
European  Neigbourhood  and  Partnership  Instrument.  The  present 
instrument 
constitutes  the  third  general  instrument  directly  supporting  European  External  Aid 
policies; 

Article 49 of the Treaty on the European Union states that any European State which 
respects  the  principles  of  liberty,  democracy,  respect  for  human  rights  and 
fundamental  freedoms,  and  the  rule  of  law  may  apply  to  become  a  member  of  the 
Union, 

The  Republic  of  Turkey’s  application  for  membership  to  the  European  Union  was 
accepted  by  the  European  Council  in  Helsinki  in  1999,  and  pre-accession  assistance 
has been made available to the Republic of Turkey since 2002, 

At  its  meeting  at  Santa  Maria  da  Feira  on  20  June,  20003,  the  European  Council 
stressed  that  the  countries  of  the  Western  Balkans  are  potential  candidates  for 
membership of the European Union, 

At  its  meeting  in  Thessaloniki,  on  19  and  20  of  June  2003  4,  the  European  Council 
recalled  the  conclusions  of  its  meetings  in  Copenhagen  in  December  2002  and 

OJ C […], […], p. […]. 
OJ C […], […], p. […]. 
Santa  Maria  da  Feira  European  Council  of  June  19  and  20,  2000;  Conclusions  of  the  Presidency,  
no. 66-67. 

EN 

12 

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Brussels  in  March  2003,  and  reiterated  its  determination  to  fully  and  effectively 
support the European perspective of the Western Balkan countries, indicating that they 
would become an integral part of the European Union, once they met the established 
criteria, 

The Thessaloniki European Council 2003 has also indicated that the Stabilisation and 
Association Process will constitute the overall framework for the European course of 
the Western Balkan Countries all the way to their future accession, 

In  its  resolution  on  the  Thessaloniki  European  Council  Conclusions,  the  European 
Parliament  has  recognised  that  each  of  the  Western  Balkan  countries  is  moving 
towards accession, but at the same time insisted that each country should be judged on 
its own merits5, 

All  Western  Balkan  countries  can  therefore  be  considered  as  potential  Candidate 
Countries,  however,  a  clear  distinction  should  nevertheless  be  made  between 
Candidate Countries and potential Candidate Countries, 

Furthermore, 
recommended that accession negotiations should be opened with Croatia,  

the  Brussels  European  Council  on  June  17th-18th,  20046  has 

In the interest of coherence and consistency of Community assistance, assistance for 
Candidate Countries as well as for the potential Candidate Countries should be granted 
in the context of a coherent framework, taking advantage of the lessons learned from 
earlier pre-accession instruments as well as Regulation (EC) 2666/2000, 

(6) 

(7) 

(8) 

(9) 

(10) 

(11)  Assistance for Candidate Countries as well as for potential Candidate Countries should 
continue to support them in their efforts to strengthen democratic institutions and the 
rule  of  law,  reform  public  administration,  respect  human  as  well  as  minority  rights, 
support the development of civil society and advance regional cooperation as well as 
reconciliation  and  reconstruction,  and  contribute  to  sustainable  development  and 
poverty  reduction  in  these  countries,  and  should  therefore  be  targeted  to  support  a 
wide range of institution building measures,  

(12)  Assistance  for  Candidate  Countries  should  additionally  focus  on  the  adoption  and 
implementation of the full acquis communautaire, and in particular prepare Candidate 
Countries  for  the  implementation  of  the  Community’s  agricultural  and  cohesion 
policy, 

(13)  Assistance  for  potential  Candidate  Countries  may  include  some  alignment  with  the 

acquis communautaire as well as support for investment projects, 

(14)  Assistance should be provided on the basis of a comprehensive multi-annual strategy, 
taking into account the priorities of the Stabilisation and Association process, as well 
as those deriving from the pre-accession process, 

4 

5 

6 

Thessaloniki  European  Council  of  June  19  and  20,  2003;  Conclusions  of  the  Presidency,  11638/03,  
no. 40. 
European  Parliament  resolution  on  the  Thessaloniki  European  Council  of  19-20  June,  Minutes  of 
3.7.2003 – Provisional Edition; P5_TA (2003) 0320; no. 34. 
Brussels European Council of June 17 and 18, 2004, Conclusions of the Presidency, 10679/04, no. 31. 

EN 

13 

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(15)  The  Transition  Assistance  and  Institution  Building  and  Regional  and  Cross-Border 
Co-operation Components should be accessible to all beneficiary countries, in order to 
assist  them  in  the  process  of  transition  and  approximation  to  the  EU,  as  well  as  to 
encourage regional co-operation between them, 

(16)  The  Regional  Development  Component,  the  Human  Resources  Component,  and  the 
Rural  Development  Component  should  be  accessible  only  to  recognised  Candidate 
Countries, in order to help them prepare for the time after accession, in particular for 
the implementation of the Community’s cohesion and rural development policies, 

(17)  Assistance should be managed in accordance with the rules for External Aid contained 
in  Regulation  (EC)  1605⁄2002,  making  use  of  the  structures  that  have  proved  their 
worth in the pre-accession process, such as decentralised management, Twinning and 
TAIEX, but should also allow for innovative  approaches such as the implementation 
through  Member  States  via  shared  management  in  case  of  cross-border  programmes 
on the external borders of the European Union, 

(18)  The  actions  necessary  for  the  implementation  of  the  Transition  Assistance  and 
Institution  Building  Component  as  well  as  the  Regional  and  Cross-Border  Co-
operation  Component  are  management  measures  relating  to  the  implementation  of 
programmes with substantial budgetary implications, they should therefore be adopted 
in  accordance  with  Council  Decision  1999/468  of  28  June  1999  laying  down  the 
procedures for the exercise of implementing powers conferred to the Commission, by 
submitting multi-annual indicative planning documents to a Management Committee, 

the  Human  Resources  Component,  and 

(19)  The  actions  necessary  for  the  implementation  of  the  Regional  Development 
Component, 
the  Rural  Development 
Component are closely aligned to Structural funds practises, they should therefore be 
adopted, in accordance with Council Decision 1999/468 of 28 June 1999 laying down 
the procedures for the exercise of implementing powers conferred to the Commission, 
partly by Advisory and partly by Management Committees, in order to make use as far 
as possible of the decision making procedures in place for Structural Funds, 

(20)  Where the Commission implements this Regulation through centralised management, 
it  will  take  the  utmost  care  to  protect  the  financial  interest  of  the  European 
Community,  in  particular  by  applying  the  rules  and  standards  of  the  acquis 
communautaire in this respect, and where the Commission implements this Regulation 
through  other  forms  of  management,  the  financial  interests  of  the  European 
Communtiy should be safeguarded through conclusion of implementation agreements 
containing sufficient guarantees in this respect, 

(21)  Rules determining the eligibility of participation in tenders and grant contracts, as well 
as  rules  concerning  the  origin  of  supplies  should  be  set  down  in  accordance  with 
recent  developments  within  the  European  Union  concerning  the  Untying  of  Aid,  but 
should leave the flexibility to react to new developments in this field, 

(22)  Where a beneficiary country violates the principles the European Union is founded on, 
or  makes  insufficient  progress  with  respect  to  the  Copenhagen  Criteria  and  the 
priorities set down in the European or Accession Partnership, the Council must, on the 
basis  of  a  proposal  from  the  Commission,  be  in  a  position  to  take  the  necessary 
measures, 

EN 

14 

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(23)  Provisions should be made to enable the Council to amend this Regulation by way of a 
simplified procedure with respect to the position of a beneficiary country in Annex I or 
II, 

(24)  Countries  which  are  beneficiaries  under  the  two  other  regional  External  Assistance 
Instruments should, on the basis of reciprocity, be able to participate in actions under 
this  Regulation,  where  this  offers  an  added  value  on  account  of  the  regional,  cross-
border, transnational or global nature of the action in question, 

(25)  Given that the actions envisaged by this instrument concern the progressive alignment 
with  the  standards  and  policies  of  the  European  Union,  including  where  appropriate 
the  acquis  communautaire,  with  a  view  to  membership,  they  cannot  sufficiently  be 
addressed at Member State level, and are therefore better implemented on Community 
level, in accordance with the subsidiarity principle enshrined in Article 5 paragraph 2 
of the EC Treaty, 

(26)  Given that the actions envisaged by this instrument are limited to what is necessary to 
help the beneficiary countries to progressively align with EU standards and policies, in 
particular  with  a  view  to  accession,  they  are  in  accordance  with  the  proportionality 
principle enshrined in Article 5 paragraph 2 of the EC Treaty, 

(27)  The  institution  of  the  new  system  of  Community  pre-accession  assistance  makes  it 
necessary to repeal  Council  Regulation (EEC) No 3906/89 of 18 December 1989 on 
economic  aid  to  the  Republic  of  Hungary  and  the  Polish  People's  Republic7  , 
Commission  Regulation  (EC)  No  2760/98  of  18  December  1998  concerning  the 
implementation of a programme for cross-border cooperation in the framework of the 
PHARE  programme8,  Council  Regulation  (EC)  No  1266/1999  of  21  June  1999  on 
coordinating  aid  to  the  applicant  countries  in  the  framework  of  the  pre-accession 
strategy  and  amending  Regulation  (EEC)  No  3906/899,  Council  Regulation  (EC)  No 
1267/1999 of 21 June 1999 establishing an Instrument for Structural Policies for Pre-
accession10, Council Regulation (EC) No 1268/1999 of 21 June 1999 on Community 
support  for  pre-accession  measures  for  agriculture  and  rural  development  in  the 
applicant  countries  of  central  and  eastern  Europe  in  the  pre-  accession  period11, 
Council  Regulation  (EC)  No  555/2000  of  13  March  2000  on  the  implementation  of 
operations in the framework of the pre-accession strategy for the Republic of Cyprus 
and the Republic of Malta12, Council Regulation (EC) No 2666/2000 of 5 December 
2000  on  assistance  for  Albania,  Bosnia  and  Herzegovina,  Croatia,  the  Federal 
Republic  of  Yugoslavia  and  the  Former  Yugoslav  Republic  of  Macedonia,  repealing 
Regulation (EC) No 1628/96 and amending Regulations (EEC) No 3906/89 and (EEC) 
No  1360/90  and  Decisions  97/256/EC  and  1999/311/EC13  and  Council  Regulation 

7 

8 

9 
10 
11 
12 
13 

OJ L 375 , 23.12.1989, p. 11. Regulation as last amended by Regulation (EC) No 769/2004 (OJ L 123, 
27.4.2004, p. 1). 
OJ L 345, 19.12.1998, p. 49. Regulation as last amended by Regulation (EC) No 1822/2003 (OJ L 267, 
17.10.2003, p. 9). 
OJ L 161, 26.6.1999, p. 68. 
OJ L 161, 26.6.1999, p. 73. Regulation as last amended by Regulation (EC) No 769/2004. 
OJ L 161, 26.6.1999, p. 87. Regulation as last amended by Regulation (EC) No 769/2004. 
OJ L 68 , 16.3.2000, p. 3. Regulation as last amended by Regulation (EC) No 769/2004. 
OJ  L  306,  7.12.2000,  p.  1.  Regulation  as  amended  by  Regulation  (EC)  No  2415/2001  (OJ  L  327, 
12.12.2001, p. 3). 

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Council  Regulation  (EC)  No  2500/2001  of  17  December  2001  concerning  pre-
accession  financial  assistance  for  Turkey  and  amending  Regulations  (EEC)  No 
3906/89, (EC) No 1267/1999, (EC) No 1268/1999 and (EC) No 555/200014, 

HAS ADOPTED THIS REGULATION: 

TITLE I: GENERAL PROVISIONS 

Article 1 
Beneficiaries and overall objective 

The Community shall assist the countries listed in the Annexes in progressive alignment with 
the  standards  and  policies  of  the  European  Union,  including  where  appropriate  the  acquis 
communautaire, with a view to membership. 

Article 2 
Scope 

(1) 

Assistance  shall,  where  appropriate,  be  used  to  support  in  particular  the  following 
areas: 

(a) 

strengthening democratic institutions and the rule of law, 

(b) 

public administration reform, including the establishment of a system enabling 
de-centralisation  of  assistance  management  to  the  beneficiary  country  in 
accordance with the rules set down in Regulation (EC) 1605/200215, 

(c) 

economic reform, 

(d) 

The promotion and the protection of human rights and fundamental freedoms 
and enhanced respect for minority rights, 

(e) 

the development of civil society, 

(f) 

reconciliation, confidence building measures and reconstruction, 

(g) 

regional and cross-border cooperation, 

(2) 

In  case  of  countries  listed  in  Annex  1,  assistance  shall  also  be  used  to  support  the 
following areas: 

(a) 

progressive alignment with the acquis communautaire, 

(b) 

social and economic development. 

14 
15 

OJ L 342, 27.12.2001, p. 1. Regulation as amended by Regulation (EC) No 769/2004. 
OJ L 248 of 16.9.2002, p. 1. 

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16 

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(3) 

In  case  of  countries  listed  in  Annex  II,  assistance  shall  also  be  used  to  support  in 
particular the following areas:  

(a) 

the adoption and implementation of the acquis communautaire,  

(b) 

the  policy  development  as  well  as  preparation  for 

the 
support  for 
implementation  and  management  of  the  Community’s  common  agricultural 
and cohesion policies. 

Article 3 
Components 

(1) 

Assistance  shall  be  programmed  and  implemented  according  to  the  following 
components: 

(a) 

Transition Assistance and Institution Building 

(b) 

Regional and Cross-Border Co-operation 

(c) 

Regional Development  

(d) 

Human Resources Development 

(e) 

Rural Development 

(2) 

(3) 

(1) 

The Commission shall ensure coordination and coherence between assistance granted 
under the different components. 

Acting  in  accordance  with  the  procedure  set  down  in  Article  11  (1)  (a)  of  this 
Regulation,  the  Commission  shall  adopt  rules  for  the  implementation  of  this 
Regulation.  Where  these  rules  concern  the  implementation  of  Article  7  to  9  of  this 
Regulation,  the  Committees  responsible  for  the  Component  in  question  shall  be 
consulted  first,  following  the  procedure  set  down  in  Article  3  of  Decision 
1999/468/EC, in compliance with Article 7 (3) thereof. 

Article 4 
Framework for Assistance and Allocation of Funds 

The Commission shall, on the basis of a strategic approach, taking into consideration 
the  financial  perspective,  as  well  as  the  European  Partnerships  and  Accession 
Partnerships,  establish  an  indicative  multi-annual  framework  with  an  allocation  of 
funds  by  component  and  country,  and  where  appropriate  per  theme.  This  shall  be 
reviewed annually, taking into account a set of objective criteria including absorption 
capacity, needs assessment, respect of conditionalities, and capacity of management. It 
shall also be reviewed, where appropriate, in view exceptional assistance measures or 
interim response programmes adopted under the Regulation establishing the Stability 
Instrument.  The  funds  allocated  to  cross-border  co-operation  programmes  with 
Member  States  shall  be  at  least  equivalent  to  the  corresponding  financing  from  the 
European Regional Development Fund. 

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(2) 

(3) 

(4) 

(1) 

(2) 

(3) 

(1) 

(2) 

(3) 

The  indicative  multi-annual  framework  shall  be  communicated  annually  by  the 
Commission to the Council and the European Parliament. 

For  countries  listed  in  Annex  I,  assistance  shall  be  based  on  the  European 
Partnerships. Assistance shall be programmed on the basis of a single framework per 
country  and  per  component,  covering  the  priorities  as  defined  in  the  analysis  of  the 
situation in each State on which preparation for further integration into the European 
Union must concentrate, in view of the criteria defined by the European Council, and 
the  progress  made  in  implementing  the  stabilisation  and  association  agreements, 
including the regional cooperation. 

For  countries  listed  in  Annex  II,  assistance  shall  be  based  on  the  Accession 
Partnerships. Assistance shall be programmed on the basis of a single framework per 
country  and  per  component,  covering  the  priorities  as  defined  in  the  analysis  of  the 
situation in each State on which preparations for accession must concentrate, in view 
of  the  political  and  economic  criteria  and  the  progress  made  in  the  adoption  and 
implementation of the acquis communautaire. 

TITLE II: RULES CONCERNING SPECIFIC COMPONENTS 

Article 5 
Transition and Institution Building Component 

The  Transition  Assistance  and  Institution  Building  Component  shall  assist  the  coun-
tries listed in Annexes I and II in the attainment of the objectives set out in Article 2.  

It  may  inter  alia  be  used  to  finance  capacity  and  institution  building  as  well  as 
investment in as far as the latter is not covered by Articles 6 to 9 of this Regulation. 

Assistance under this component may also support the participation of countries listed 
in Annexes I and II in Community programmes and agencies. 

Article 6 
Regional and Cross-Border Co-operation Component 

The  Regional  and  Cross-Border  Co-operation  Component  may  support  the  countries 
listed  in  Annexes  I  and  II  in  regional,  cross-border,  and,  where  appropriate, 
transnational and interregional cooperation among themselves and between them and 
EU Member States.  

Such  co-operation  shall  have  the  objective  of  fostering  stability,  security  and 
prosperity in the mutual interest of all countries concerned, and of encouraging their 
harmonious, balanced and sustainable development. 

Co-operation will be co-ordinated with other Community instruments for cross-border, 
transnational and interregional co-operation where appropriate. In case of cross-border 
co-operation with Member States, this component shall cover the regions on both sides 
of the respective border or borders.  

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18 

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(4)  Within the objectives of this article, this component may inter alia be used to finance 

capacity and institution building as well as investment. 

Article 7 
Regional Development Component   

(1) 

The  Regional  Development  Component  shall  support  countries  listed  in  Annex  II  in 
policy development as well as preparation for the implementation and management of 
the Community’s cohesion policy, in particular in their preparation for the European 
Regional Development Fund and the Cohesion Fund. 

(2) 

It may in particular contribute towards the financing of the type of actions provided for 
under Regulation [(EC)1783/199916] and Regulation [(EC) 1164/199417]. 

Article 8 
Human Resources Development Component 

(1) 

The  Human  Resources  Development  Component  shall  support  Candidate  Countries 
listed in Annex II in policy development as well as preparation for the implementation 
and  management  of  the  Community’s  cohesion  policy,  in  particular  in  their 
preparation for the European Social Fund. 

(2) 

It may in particular contribute towards the financing of the type of actions provided for 
under Regulation [(EC) 1784/199918]. 

Article 9 
Rural Development Component 

(1) 

The Rural Development Component shall support Candidate Countries listed in Annex 
II  in  policy  development  as  well  as  preparation  for  the  implementation  and 
management  of  the  Community’s  common  agricultural  policy.  It  shall  in  particular 
contribute to the sustainable adaptation of the agricultural sector and rural areas and to 
the  acquis 
the  Candidate  Countries’  preparation  for 
communautaire concerning the Common Agricultural Policy and related policies. 

implementation  of 

the 

(2) 

It may in particular contribute towards the financing of the type of actions provided for 
under the Regulation (EC) 1257/199919. 

16 
17 
18 
19 

OJ L 213 of 13.8.1999, p. 1. 
OJ L 130 of 25.5.1994, p. 1. 
OJ L 213 of 13.8.1999, p. 5. 
OJ L 160 of 26.6.1999, p. 80. 

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19 

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TITLE III: MANAGEMENT AND IMPLEMENTATION 

Article 10 
Management of Assistance, Reporting 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

The Commission shall be responsible for the implementation of this Regulation, acting 
in accordance with the procedure referred to in Article 11.  

Actions  under  this  Regulation  shall  be  implemented  in  accordance  with  Regulation 
(EC) 1605/200220. Community financing can take in particular the form of financing 
agreements  between  the  Commission  and  the  beneficiary  country,  procurement 
contracts  or  grant  agreements  with  national  or  international  public  sector  bodies  or 
natural  or  legal  persons  responsible  for  carrying  out  the  action,  or  employment 
contracts. For cross-border programmes with Member States according to Article 6 of 
this  Regulation,  implementation  tasks  shall  in  principle  be  delegated  to  Member 
States,  in  which  case  they  shall  be  implemented  through  shared  management  in 
accordance  with  the  relevant  provisions  of  Regulation  (EC)  1605/2002.  In  case  of 
shared  management,  the  managing  authority  shall  operate  in  accordance  with  the 
principles and rules laid down in Council Regulation (EC) 1260/1999 

The  Commission  may  also  receive  and  manage  funds  from  other  donors  in  order  to 
implement  actions,  as  assigned  revenue  in  accordance  with  Article  18  of  Regulation 
1605/2002, with these donors. 

The Commission may, in accordance with Article 54 of Regulation (EC) 1605/2002, 
decide  to  entrust  tasks  of  public  authority,  and  in  particular  budget  implementation 
tasks  to  the  bodies  listed  in  Article  54  (2)  of  said  Regulation.  The  bodies  defined  in 
Article 54 (2) (c) of said Regulation may be entrusted with tasks of public authority if 
they are of recognised international standing, comply with internationally recognised 
systems of management and control, and are supervised by public authority. 

Budgetary commitments for actions extending over more than one financial year may 
be broken down over several years into annual instalments.  

Each  year  the  Commission  shall  send  to  the  European  Parliament  and  the  Council  a 
report  on  the  implementation  of  Community  assistance  under  this  instrument.  The 
report  shall  contain  information  on  the  actions  financed  during  the  year  and  on  the 
findings of monitoring work, and shall give an assessment of the results achieved in 
the implementation of the assistance. 

20 

OJ L 248 of 16.9.2002, p. 1. 

EN 

20 

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Article 11 
Committees 

(1) 

The  Commission  shall  be  assisted  by  the  following  Committees,  which  shall  be 
composed of representatives of Member States and chaired by a representative of the 
Commission:  

(a) 

(b) 

(c) 

(d) 

its  opinion  on  multi-annual 

A  Transition  Assistance  and  Institution  Building  Committee  shall  be 
established,  and  give 
indicative  planning 
documents  based  on  the  strategic  approach  and  priorities  established  in  the 
European  Partnerships  and  Accession  Partnerships  which  are  prepared  in  the 
context of Article 5 and 6. Where reference is being made to this paragraph, the 
management procedure laid down in Article 4 of Decision 1999/468/EC shall 
apply, in compliance with Article 7 (3) thereof. The period laid down in Article 
4(3) of Decision 1999/468 shall be set at six weeks. The Committee shall adopt 
its rules of procedures. 

The Committee established according to Article 47 (1) (a) of Regulation (EC) 
1260/199921  shall  give  its  opinion  on  assistance  provided  in  the  context  of 
Article 7, according to the rules set down in the said Regulation, in particular 
Article 47 (2) and (3) thereof. 

The Committee established according to Article 147 of the Treaty establishing 
the  European  Community  shall  give  its  opinion  on  assistance  provided  in  the 
context  of  Article  8  according  to  the  rules  set  down  in  Regulation  (EC) 
1260/199922, in particular Article 49 thereof. 

The Committees established according to Article 47 (1) (c) of Regulation (EC) 
1260/199923  and  Article  11  of  Regulation  (EC)  1258/199924  shall  give  their 
opinion on assistance provided in the context of Article 9 according to the rules 
set  down  in  those  two  Regulations,  in  particular  Article  47  (2)  and  (3)  of 
Regulation  (EC)  1260/1999  and  Article  12  to  15  of  Regulation  (EC) 
1258/1999. 

(2) 

(3) 

The Institution Building Committee shall be in charge of co-ordinating the assistance 
as required by Article 3 (2) of this Regulation. 

An  observer  from  the  European  Investment  Bank  shall  take  part  in  the  Committees’ 
proceedings with regard to questions concerning the Bank. 

21 
22 
23 
24 

OJ L 161 of 26.6.1999, p. 1. 
OJ L 161 of 26.6.1999, p. 1. 
OJ L 161 of 26.6.1999, p. 1. 
OJ L 160 of 26.6.1999, p. 103. 

EN 

21 

   EN 

 
                                                 
Article 12 
Types of Assistance 

(1) 

Assistance  under  this  Regulation  may,  inter  alia,  finance  investments,  procurement 
contracts,  grants,  including  interest  rate  subsidies,  special  loans,  loan  guarantees  and 
financial assistance, budgetary support, and other specific forms of budgetary aid, and 
the  contribution  to  the  capital  of  international  financial  institutions  or  the  regional 
development  banks.  Budgetary  support  is  contingent  on  the  administration  of  public 
finances  of  the  Partner  Country  being  sufficiently  transparent,  reliable  and  efficient, 
and  on  well-defined  sectorial  or  macroeconomic  policies  approved  by  international 
financing institutions having been put in place. 

(2) 

Assistance  may  also  be  implemented  through  administrative  co-operation  measures 
involving public-sector experts dispatched from Member States. Such projects shall be 
implemented according to implementing rules laid down by the Commission. 

Article 13 
Implementation of Assistance 

Assistance  may  also  be  used  to  cover  the  costs  of  actions  linked  to  preparation,  follow-up, 
control, audit and evaluation directly necessary for the administration of the programme and 
the  attainment  of  its  objectives,  in  particular  studies,  meetings,  information  and  publicity, 
expenses linked to informatics networks aiming at information exchange, as well as any other 
expenses for administrative and technical assistance of which the Commission can avail itself 
for the administration of the programme. It also covers the cost of the administrative support 
for the purposes of devolved programme management in the Commission delegations in non 
member countries. 

Article 14 
Implementation of Assistance 

(1) 

(2) 

(1) 

The Commission and the beneficiary countries shall conclude framework agreements 
on the implementation of the assistance. 

Subsidiary  agreements  concerning  implementation  of  assistance  shall  be  concluded 
between the Commission and the beneficiary country or its implementing authorities 
as required. 

Article 15 
Protection of the Community’s financial interests 

Any  agreements  resulting  from  this  Regulation  shall  contain  provisions  ensuring  the 
protection  of  the  Community’s  financial  interest,  in  particular  with  respect  to  fraud, 
corruption  and  any  other  irregularities  in  accordance  with  Council  Regulations  (EC, 
Euratom) No 2988/1995, (EC, Euratom) 2185/1996 and (EC, Euratom) 1073/1999. 

EN 

22 

   EN 

 
(2) 

(3) 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

Agreements shall expressly provide for the Commission and the Court of Auditors to 
have  the  power  of  audit,  on  the  basis  of  documents  and  on  the  spot,  over  all 
contractors and subcontractors who have received Community funds. They shall also 
expressly authorise the Commission to carry out on-the-spot checks and inspections as 
those set down in Regulation (EC, Euratom) 2185/1996. 

All contracts resulting from the implementation of assistance shall ensure the right of 
the  Commission  and  the  Court  of  Auditors  as  provided  for  in  paragraph  2  of  this 
Article during and after the implementation of contracts. 

Article 16 
Rules of participation and origin, eligibility for grants 

Participation  in  the  award  of  procurement  or  grant  contracts  financed  under  this 
Regulation  shall  be  open  to  all  natural  or  legal  persons  from  Member  States  of  the 
European Community coming within the scope of the Treaties, 

Participation  in  the  award  of  procurement  or  grant  contracts  financed  under  this 
Regulation shall also be open to all natural and legal persons from 

–  any country that is a beneficiary of the present Regulation, 

–  any country that is a beneficiary of the European Neighbourhood and Partnership 

Instrument, 

–  any Member State of the European Economic Area,  

–  any  other  country  in  cases  where  the  Commission  has  decided  that  reciprocal 

access to external assistance is guaranteed. 

Participation  in  the  award  of  procurement  or  grant  contracts  financed  under  this 
Regulation shall also be open to all international organisations.  

Experts  proposed  in  the  context  of  procedures  for  the  award  of  contracts  are  not 
required to comply with the nationality conditions listed above. 

All supplies and materials purchased under a contract financed under this Regulation 
must originate  from  the  Community  or a country eligible according to paragraph (2) 
above.  

The  Commission  may,  in  duly  substantiated  cases,  authorise  the  participation  of 
natural and legal persons from other countries, or the use of supplies and materials of 
different origin. 

In  conformity  with  Article  114  of  Regulation  (EC)  1605/2002  natural  persons  may 
receive grants. 

EN 

23 

   EN 

 
Article 17 
Suspension of assistance 

(1) 

Respect  for  the  principles  of  democracy,  the  rule  of  law  and  for  human  rights  and 
minority rights and fundamental freedoms is an essential element for the application of 
this  Regulation  and  the  granting  of  assistance  under  it.  Community  assistance  for 
Albania,  Bosnia-Herzegovina,  Croatia,  former  Yugoslav  Republic  of  Macedonia  and 
Serbia and Montenegro shall also be subject of the conditions defined by the Council 
in its Conclusions of 29 April 1997, in particular as regards the recipients’ undertaking 
to carry out democratic, economic and institutional reforms. 

(2)  Where  a  beneficiary  country  fails  to  respect  these  principles  or  the  commitments 
contained  in  the  relevant  Partnership  with  the  European  Union  or  progress  toward 
fulfilment  of  the  accession  criteria  is  insufficient,  the  Council,  acting  by  qualified 
majority on a proposal from the Commission, may take appropriate steps with regard 
to any assistance granted under this Regulation. 

TITLE IV: TRANSITIONAL AND FINAL PROVISIONS 

Article 18 
Status of Beneficiary Country 

If a beneficiary country listed in Annex I of this Regulation is, pursuant to a decision of the 
Council  acting  under  Art.  49,  paragraph  1,  first  sentence  of  the  Treaty  on  European  Union, 
granted Candidate status, the Council, acting by qualified majority on the basis of a proposal 
from the Commission will transfer that country from Annex I to Annex II. 

Article 19 
Cross-Instrument Provision 

In order to ensure consistency and efficiency of Community assistance, the Commission can 
decide  that  other  countries,  territories  and  regions  can  benefit  from  actions  under  this 
Regulation, if the project or programme in question has a regional, cross border, transnational 
or global character. 

Article 20 
Transitional Provisions 

(1) 

As of January 1, 2007, the following Regulations are repealed: 

–  Regulation (EEC) No 3906/1989 

–  Regulation (EC) No 2760/1998  

–  Regulation (EC) No 1266/1999  

–  Regulation (EC) No 1267/1999  

EN 

24 

   EN 

 
–  Regulation (EC) No 1268/1999 

–  Regulation (EC) No 555/2000  

–  Regulation (EC) No 2500/2001. 

(2) 

(3) 

The repealed Regulations, as well as Regulation 2666/2000, shall continue to apply for 
legal acts and commitments implementing the budget years preceding 2007. 

Should  specific  measures  be  necessary  to  facilitate  the  transition  from  the  system 
established  by  Regulations  (EC)  3906/1989,  (EC)  2760/1998,  (EC)  1266/1999,  (EC) 
1267/1999,  (EC)  1268/1999,  (EC)  555/2000,  (EC)  2666/2000  or  (EC)  2500/2001  to 
the  one  established  by  this  Regulation,  such  measures  shall  be  adopted  by  the 
Commission  in  accordance  with  the  procedures  laid  down  in  Article  11  of  this 
Regulation. 

Article 21 
Entry into force 

This Regulation shall enter into force on the twentieth day following that of its publication in 
the Official Journal of the European Union.  

It shall apply from 1 January, 2007. 

This Regulation shall be binding in its entirety and directly applicable in all Member States. 

Done at Brussels, 

For the Council 
The President 

EN 

25 

   EN 

 
 
 
ANNEX 1 

e.g.: 

–  Albania 

–  Bosnia and Herzegovina 

–  Serbia and Montenegro 

–  the former Yugoslav Republic of Macedonia 

EN 

26 

   EN 

 
ANNEX 2 

e.g.: 

–  Croatia 

–  Turkey 

EN 

27 

   EN 

 
LEGISLATIVE FINANCIAL STATEMENT 

Policy area: Enlargement 

Activity: Pre-accession assistance 

TITLE OF ACTION: INSTRUMENT FOR PRE-ACCESSION (IPA) 

1. 

BUDGET LINES + HEADINGS (AS IN PDB 2005) 

05 01 

ADMINISTRATIVE  EXPENDITURE  OF  POLICY  AREA
‘AGRICULTURE’ 

05 01 04 03 

The  SAPARD  pre-accession 
administrative management 

Instrument  –  Expenditure  on

05 05 

SPECIAL 
FOR
AGRICULTURE AND RURAL DEVELOPMENT (SAPARD) 

PROGRAMME 

ACCESSION 

05 05 01 01 

The SAPARD pre-accession Instrument 

05 05 01 02 

The  SAPARD  pre-accession  Instrument  –  Completion  of  the
SAPARD  pre-accession  assistance  relating  to  eight  applicant
countries 

05 49 

EXPENDITURE  ON  ADMINISTRATIVE  MANAGEMENT
OF  PROGRAMMES  COMMITTED  IN  ACCORDANCE
WITH THE FORMER FINANCIAL REGULATION 

05 49 04 03 

The  SAPARD  Pre-accession 
administrative management 

Instrument  –  Expenditure  on

06 01 

ADMINISTRATIVE  EXPENDITURE  OF  POLICY  AREA
‘ENERGY AND TRANSPORT’ 

06 01 04 09 

Intelligent  energy  –  Europe  programme  (2003  to  2006):  external
strand – Coopener - Expenditure on administrative management 

06 04 

CONVENTIONAL AND RENEWABLE ENERGIES 

06 04 02 

07 01 

07 01 04 05 

Intelligent  energy  –  Europe  programme  (2003  to  2006):  external
strand – Coopener (in part) 

ADMINISTRATIVE  EXPENDITURE  OF  POLICY  AREA
‘ENVIRONMENT’ 

LIFE  (European  Financial  Instrument  for  the  Environment  –  2000
to 2006 – Operations outside Community territory – Expenditure on
administrative management (in part) 

EN 

28 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
07 02 

GLOBAL ENVIRONMENTAL AFFAIRS 

07 02 02 

13 01 

LIFE  (European  Financial  Instrument  for  the  Environment  –  2000
to 2006 – Operations outside Community territory (in part) 

ADMINISTRATIVE  EXPENDITURE  OF  POLICY  AREA
‘REGIONAL POLICY’ 

13 01 04 02 

Instrument  for  structural  policies  for  pre-accession  (ISPA)  –
Expenditure on administrative management 

13 05 

PRE-ACCESSION  INTERVENTIONS  RELATED  TO  THE
STRUCTURAL POLICIES 

13 05 01 01 

Instrument for structural policies for pre-accession 

13 05 01 02 

Instrument for structural policies for pre-accession – Closure of pre-
accession assistance relating to eight applicant countries 

13 49 

EXPENDITURE  ON  ADMINISTRATIVE  MANAGEMENT
OF  PROGRAMMES  COMMITTED  IN  ACCORDANCE
WITH THE FORMER FINANCIAL REGULATION 

13 49 04 02 

Instrument  for  structural  policies  for  pre-accession  –  Expenditure
on administrative management 

14 03 

14 03 02 

19 01 

INTERNATIONAL  ASPECTS  OF  TAXATION  AND
CUSTOMS 

Customs co-operation  and international assistance (Customs 2007)
(in part) 

ADMINISTRATIVE  EXPENDITURE  OF  POLICY  AREA
‘EXTERNAL RELATIONS’ 

19 01 04 08 

Assistance  for  the  countries  of  the  western  Balkans  –  Expenditure
on administrative management 

19 01 04 11 

Development and consolidation of democracy and the rule of law –
Respect for human rights and fundamental freedoms – Expenditure
on administrative management (partially) 

19 04 

EUROPEAN 
HUMAN RIGHTS (EIDHR) 

INITIATIVE  FOR  DEMOCRACY  AND

19 04 02 

Support for the victims of human rights’ abuses (partially) 

19 04 03 

Development and consolidation of democracy and the rule of law –
Respect for human rights and fundamental freedoms (partially) 

EN 

29 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
19 04 04 

Support for the activities of international criminal tribunals and the
International Criminal Court (partially) 

19 07 

RELATIONS WITH THE WESTERN BALKANS 

19 07 01 

Assistance for the countries of the western Balkans 

19 07 02 

Assistance to Serbia and Montenegro 

19 07 03 

Aid for the reconstruction of Kosovo 

19 07 04 

Interim civilian administrations 

19 49 

EXPENDITURE  ON  ADMINISTRATIVE  MANAGEMENT
OF  PROGRAMMES  COMMITTED  IN  ACCORDANCE
WITH THE FORMER FINANCIAL REGULATION 

19 49 04 07 

Assistance  for  the  countries  of  the  western  Balkans  –  Expenditure
on administrative management 

19 49 04 10 

Development and consolidation of democracy and the rule of law –
Respect for human rights and fundamental freedoms – Expenditure
on administrative management (partially) 

22 01 

ADMINISTRATIVE  EXPENDITURE  ON  POLICY  AREA
‘ENLARGEMENT’ 

22 01 04 01 

Pre-accession assistance for countries of central and eastern Europe
– Expenditure on administrative management  

22 01 04 02 

Pre-accession  strategy  for  Turkey  –  Expenditure  on  administrative
management 

22 01 04 03 

Phasing-out  of  pre-accession  assistance  for  new  Member  States  –
Expenditure on administrative management 

22 01 04 05 

Technical  Assistance  Information  Exchange  Office  (TAIEX)
actions  in  the  framework  of  the  pre-accession  instruments  –
Expenditure on administrative management 

22 02 

PRE-ACCESSION ASSISTANCE INSTRUMENTS 

22 02 01 

Pre-accession assistance for countries of central and eastern Europe 

22 02 02 

Cross-border co-operation for central and eastern Europe 

22 02 03 

Completion of the Phare pre-accession assistance 

22 02 04 01 

Pre-accession assistance for Turkey 

22 02 04 02 

Completion of the former co-operation with Turkey 

EN 

30 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
22 02 05 

Pre-accession assistance for Malta and Cyprus 

22 02 06 

Technical  Assistance  Information  Exchange  Office  (TAIEX)
actions in the framework of the pre-accession instruments 

22 02 07 

Impact of enlargement in EU border regions – Preparatory actions 

22 02 08 

Subsidy  for  organising  traineeships  for  young  diplomats  from  the
applicant countries 

22 02 09 

Pilot project on demining activities in Cyprus 

22 02 10 

Pre-accession multi-country horizontal programmes 

22 04 

INFORMATION AND COMMUNICATION STRATEGY 

22 04 01 

Prince - Information and communication strategy 

22 49 

EXPENDITURE  ON  ADMINISTRATIVE  MANAGEMENT
OF  PROGRAMMES  COMMITTED  IN  ACCORDANCE
WITH THE FORMER FINANCIAL REGULATION 

22 49 04 01 

Pre-accession assistance for countries of central and eastern Europe
– Expenditure on administrative management 

22 49 04 02 

Pre-accession 
assistance 
administrative management 

for  Turkey  –  Expenditure  on

22 49 04 03 
administrative management 

Pre-accession  strategy  for  Malta  and  Cyprus  –  Expenditure  on 

In  addition,  under  title  4  (Employment  and  social  affairs),  a  new  chapter  will  have  to  be 
created  to  host  the  Human  Resources  Development  Component  of  the  IPA,  with  a 
corresponding “support administrative expenditure” item in the article 04 01 04 XX. 

2. 

OVERALL FIGURES 

2.1. 

Total allocation for action (Part B): € million for commitment 

€ 14 653 million euros 

2.2. 

Period of application: 

2007-2013 

(start and expiry years) 

EN 

31 

   EN 

 
 
 
 
 
 
 
2.3. 

Overall multi-annual estimate of expenditure: (current prices) 

(a) 

Schedule  of  commitment  appropriations/payment  appropriations 
intervention) (see point 6.1.1) 

(financial 

2007 

2008 

2009 

2010 

2011 

2012 

€ million 

2013 
*and 
following 

Total 

Commitments 

1.426  1.631

1.734

1.977

2.294

2.441 

2.564  14.067

Payments 

285 

754

1.264

1.690

1.898

2.116 

6.060  14.067

(b1) 

Technical and administrative assistance: of which staff (see point 6.1.2) 

Commitments 

Payments 

28 

28 

31

31

34

34

39

39

47

47

52 

52 

55 

55 

286

286

(b2) 

Technical  and  administrative  assistance:  of  which  support  expenditure  (see  point 
6.1.2) 

Commitments 

Payments 

32 

32 

37

37

38

38

43

43

48

48

50 

50 

52 

52 

300

300

Subtotal a+b 

Commitments 

1.486 

1.699

1.806

2.059

2.389

2.543  2.671  14.653

Payments 

345 

822

1.336

1.772

1.993

2.218  6.167  14.653

(c) 

Overall  financial  impact  of  human  resources  and  other  administrative  expenditure 
(see points 7.2 and 7.3) 

65 

76

82

95

113

122 

130 

683

Commitments/ 
payments 

TOTAL a+b2+c 

Commitments 

1.523 

1.744

1.854

2.115

2.455

2.613  2.746  15.050

Payments 

382 

867

1.384

1.828

2.059

2.288  6.242  15.050

* following years only applies to payment appropriations 

EN 

32 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.4. 

Compatibility with financial programming and financial perspective 

Proposal is compatible with the 2007-2013 financial programming of heading 4, as 
set out in the Communication from the Commission “Building our common Future: 
Policy challenges and Budgetary means of the Enlarged Union 2007-2013” – COM 
(2004) 101 of 10 February 2004. 

2.5. 

Financial impact on revenue: 

Proposal  has  no  financial  implications  (involves  technical  aspects  regarding 
implementation of a measure) 

3. 

BUDGET CHARACTERISTICS 

Type of expenditure 

New 

EFTA 
contribution 

Contributions 
form applicant 
countries 

Heading in 
financial 
perspective 

Non comp 

Diff 

YES 

NO 

NO 

 4 

4. 

LEGAL BASIS  

Article 181a of the Treaty 

5. 

DESCRIPTION AND GROUNDS 

5.1. 

Need for Community intervention  

5.1.1.  Objectives pursued 

The Instrument is intended to facilitate the entry into the Union of those countries deemed to 
be candidates or potential candidates for membership. This covers Turkey and the countries of 
the Western Balkans.  

The  intention  is  that  future  candidate  countries  should  be  treated  broadly  the  same  as  past 
candidate countries. As the countries of the Western Balkans become candidate countries, it is 
proposed that they will receive per capita per year about the level of assistance established in 
the financial perspective 2000-2006, under heading 7, for the 10 candidate countries in central 
and eastern Europe. For Turkey, taking  into account the size and absorption capacity of the 
country, it is proposed that there will be a gradual increase in assistance over the period 2007-
2013,  towards  this  level.  After  the  accession  of  8  of  the  central  and  eastern  European 
candidate countries in 2004, assistance to the remaining countries, Bulgaria and Romania, was 
increased  by  20%,  30%  and  40%  over  the  years  2004-2006,  in  the  run  up  to  their  planned 
accession in 2007. Such an enhanced level of funding is not proposed under IPA. 

The Instrument will focus on two main priorities: 

•  helping  countries  to  fulfil  the  political,  economic  and  acquis-related  criteria  for 
membership (the Accession Criteria) and to build up administrative and judicial capacity 

EN 

33 

   EN 

 
 
 
•  helping countries prepare for EU Structural, Cohesion and Rural Development Funds (EU 
Funds)  after  accession  (both  by  preparing  the  necessary  structures  and  systems  and  by 
financing projects) 

To do this, the Instrument will have five Components: 

•  Transition  Assistance  and  Institution  Building  (both  “soft”,  in  terms  of  know-how,  and 
“hard”, in terms of physical investment) to help countries meet the Accession Criteria and 
improve their administrative and judicial capacity 

•  Regional and Cross-Border Co-operation 

•  Regional  Development  (to  help  prepare  for  Structural  Funds  ERDF  programmes  -  and 

Cohesion Funds) 

•  Human Resources Development (to help prepare for Structural Funds ESF programmes) 

•  Rural Development (to help prepare for Agriculture and Rural Development). 

There  will  be  a  clear  differentiation  within  the  Instrument  between  assistance  to  potential 
candidates  (or  “pre-candidates”),  listed  in  Annex  I  of  the  Regulation,  and  to  recognised 
candidate countries, listed in Annex II of the Regulation. 

For pre-candidate countries, the assistance will consist of institution building, in particular to 
strengthen the Copenhagen political criteria, enhance administrative and judicial capacity and 
selectively promote some alignment with the acquis in areas of mutual advantage. This will be 
complemented  by  regional  and  cross-border  co-operation,  investment  to  promote  economic 
and social development and other transition measures to foster stabilisation and reconciliation 
throughout  the  Western  Balkans.  The  pre-candidate  countries  will,  therefore,  benefit  only 
from the Transition and Institution Building Component and the  Regional and Cross-border 
Co-operation Components of the Instrument. They will, therefore, receive a level of funding 
less than that proposed for candidate countries. 

For the candidate countries, the full pre-accession package will apply. The institution building 
effort will, therefore, focus on full rather than selective alignment with the acquis, and these 
countries will also benefit from the other three components of the Instrument designed to help 
prepare candidate countries for EU Funds after accession.  

The  assistance  to  pre-candidate  countries  will  also  be  designed  to  bring  them  step  by  step, 
within a coherent framework, closer to candidate country status, and ultimately membership. 

Decisions  on  when  pre-candidate  countries  will  become  candidate  countries  and  when 
candidate countries will join the Union are for the European Council and this Regulation will 
respond to the implications of those decisions. 

The  objectives  of  this  Instrument  will  also  embrace  the  objectives  for  sustainable 
development outlined in COM (2004) 101final. 

Specific objectives to target specific sectoral objectives for preparation for accession will be 
fixed for each Component. 

EN 

34 

   EN 

 
The development and consolidation of democracy and the rule of law, and respect for human 
rights and fundamental freedoms constitute key objectives of the European Union’s external 
policies.  Within  the  framework  of  the  present  Regulation  and  its  geographical  scope,  the 
European Community will contribute to the implementation of operations advancing respect 
for  human  rights  and  fundamental  freedoms,  promoting  and  strengthening  democratic 
processes,  [including  where  appropriate  through  election  observation  and  assistance,]  and 
developing and consolidating the rule of law and good governance. 

5.1.2 and 5.1.3 

Ex post and ex ante evaluation  

The Commission carried out in the second half of 2003 an extensive high-level review of the 
whole range of European Community external instruments, in the context of the preparation 
of  its  proposals  for  the  new  financial  perspectives.  The  Commission  established  the  “Peace 
Group” which was tasked with leading the identification of the future priorities for external 
relations and the instruments needed to serve those priorities. This Group functioned at both 
the level of the external relations Commissioners and the services. It met regularly between 
April  and  December  2003  and  developed  the  principles,  which  were  set  out  in  the 
Communication “Building our Common Future, Policy Challenges and Budgetary Means of 
the Enlarged Union 2007-2013”25. The need to align objectives and instruments more closely 
to European Union values and interests was identified as being fundamentally important. 

In particular, the “Peace Group” underlined that the European Union’s values, reflected by its 
democratic tradition, social model and integration experience, include human dignity, the rule 
of  law,  human  rights,  solidarity,  equality  between  the  sexes,  adherence  to  the  multilateral 
system  of  the  United  Nations  and  support,  within  the  multilateral  economic  system,  for 
regionalism as a force for development and stability. It emphasised that its interests drive the 
European Union to promote stable international growth founded on sustainable development. 
In  this  way  it  guarantees  itself  increasing  outlets  and  quality  jobs  on  competitive,  open  and 
regulated  markets.  Finally,  the  “Peace  Group”  recommended  that  the  European  Union 
promotes its values and interests by operating simultaneously as a continental power, and as a 
global economic and political player. 

As far as external community instruments are concerned, the “Peace Group” recognised that 
the European Union's co-operation and assistance policy is the result of 50 years of successive 
sedimentation, which results in a multiplication of assistance instruments and a fragmentation 
of  aid  management  both  in  terms  of  programming  and  implementation  functions  (even  if 
recent policy and structural reforms have helped to improve coherence and consistency of the 
European Union's co-operation and assistance policy). 

The “Peace Group” put forward that the European Union’s framework for external assistance 
should be rationalised and simplified by a reduction in the number of legal bases, the number 
of budget lines, and the number of programmes. More precisely, it recommended that: 

–  the  complex  structure  of  existing  aid  programs  (EDF,  ALA,  MEDA,  TACIS,  CARDS, 
etc…)  covering  a  wide  range  of  interventions  (peacekeeping  and  post-crisis  operations; 
rehabilitation;  economic  reforms;  projects;  human  rights  programs;  budgetary  support) 
should be significantly streamlined; 

25 

COM(2004) 101 du 10 février 2004. 

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35 

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–  European  Community  and  Member  States  policies  and  implementation  should  be 

harmonised. 

Furthermore, the “Peace Group” underlined the following points: 

–  Large geographic programmes based on the principles of ownership and partnership with 
partner countries and regions and thematic programmes allowing for policy initiatives by 
the Community should be maintained; 

–  Strategy  papers,  subject  to  regular  reviews,  are  the  right  tool  to  ensure  overall  policy 
coherence and to respect external policy objectives in the different areas as well as in the 
external aspects of internal policies; 

–  Resources  should  be  allocated  to  partner  countries  according  to  expected  and  measured 
performances  and  strategy  papers  process,  backed  up  by  stronger  analytical  capabilities, 
should confront goals and achievements; 

–  Performance-based allocations do not mean increased conditionality in the traditional sense 
and  the  issue  of  political  conditionality  should  be  approached  cautiously,  on  the  basis  of 
lessons drawn from experience; 

–  Though this is not necessarily a solution in each and every case, such concerns for results, 
namely the political and economic reforms in the partner countries, leads the Commission 
to suggest, where possible, moving further financial and technical assistance from projects 
towards  sector  programmes,  budget  support  and  macro-economic  financial  assistance 
which  facilitate  both  the  absorption  by  the  partner  country  since  its  own  budgetary 
procedures  are  used,  and  donors’  co-ordination  as  well  as  quick  disbursement  subject  to 
compliance though. 

The  current  proposal  also  takes  account  of  the  vast  literature  of  work  on  development,  the 
practice of other international and bi-lateral donors, as well as of the principles and objectives 
of the reform of the management of external assistance launched by the Commission in May 
2000.  

In addition, the inter service group which prepared this legislative proposal looked in detail at 
the  lessons  that  could  be  learned  from  past  pre-accession  assistance,  and  this  work  is  also 
reflected in the proposal. 

5.2. 

Action envisaged and budget intervention arrangements 

There  will  be  two  principal  types  of  actions  –  one  focusing  on  assistance  to  pre-candidate 
countries, to continue the work started under CARDS and to help prepare them for candidate 
country status and one focusing on candidate countries, to help prepare them for membership 
of the Union. 

The  detailed  planning  of  these  actions  will  fall  within  a  Reinforced  Pre-accession  Strategic 
Approach.  This  will  start  with  the  system  of  European  Partnerships  and  Annual  Reports, 
introduced for pre-candidate countries, and of Accession Partnerships and Regular Reports, in 
place for candidate countries. From these a multi-annual framework, to be reviewed annually, 
with an allocation of funds by Component and by country will be prepared. These allocations 
will  be  made  on  the  basis  of  certain  criteria,  whilst  providing  for  flexibility  to  adapt  to  the 
specific pre-accession needs of the individual countries. 

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As set out in the thematic strategy, measures receiving Community support in pursuit of the 
present Regulation’s objectives in the field of promoting democratisation and the rule of law, 
and respect for human rights and fundamental freedoms shall include  

–  pertinent  global,  regional  and  country  projects  and  programmes  of  local  and  EU  non-

governmental and civil society based organisations, 

–  co-operation  with  international  organisations  in  the  field  of  democratisation  and  human 

rights. 

Until  beneficiary  countries  are  able  to  participate  in  the  Community  Programme  ‘Erasmus’, 
under Article 5.3 of the Regulation, this Instrument will continue to provide access for those 
countries to the TEMPUS Plus programme. 

5.3.  Methods of implementation 

Implementation (From Centralised to Decentralised Management) 

•  Experience  has  shown  that  it  is  vital,  for  the  broad  approach  needed  for  pre-
accession aid, to have available the whole range of implementation methods (from 
centralised  to  full  decentralisation  of  financial  management  to  the  beneficiary 
countries,  as  well  as  joint  management  with  international  organisations)  offered 
by the Financial Regulation. This approach will, therefore, be maintained in this 
Instrument.  The  Regulation  also  leaves  open  the  possibility  for  programme 
implementation under indirect centralised management arrangements by national 
public  sector  bodies  or  bodies  governed  by  private  law  with  a  public  service 
mission, or by an executive agency. 

•  It  is  likely  that  different  modalities  will  apply  for  different  Components  of  this 
Instrument,  with  full  decentralisation  as  the  ultimate  objective.  Moreover  the 
speed  at  which  beneficiary  countries  are  able  to  move  down  the  road  of 
decentralisation  is  also  likely  to  vary  from  Component  to  Component.  An 
appropriate mix of centralised and decentralised management structures will need 
to be put in place, taking into account the quality of the management and control 
systems  of  beneficiary  countries,  in  line  with  the  requirements  of  the  Financial 
Regulation. 

•  It is, nonetheless, important that the highest level of decentralisation possible for 
the  individual  beneficiary  country  concerned  should  be  pursued  as  soon  as 
feasible, without delaying the flow of assistance. A start on the process of moving 
to  partially  decentralised  management  will,  therefore,  be  made  at  the  earliest 
possible  point,  starting  with  pre-candidate  countries.  For  Components  where  the 
only  realistic  approach  is  to  proceed  to  full  decentralisation  from  the  start  of 
programme  implementation,  preparation  for  the  implementation  of  a  limited 
number  of  key  measures  could  facilitate  an  early  start  of  programme 
implementation. 

•  In addition, there is, at present, a large European Agency for Reconstruction in the 
Western  Balkans.  The  Commission  will  reflect  on  how  best  to  handle  these 
ongoing  tasks  within  the  IPA,  bearing  in  mind  the  political  and  technical 
complexities of the EU’s operations in the Western Balkans. 

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6. 

FINANCIAL IMPACT 

6.1. 

Total  financial  impact  on  Part  B  -  (over  the  entire  programming  period)  (current 
prices) 

6.1.1.  Financial intervention 

Commitments (in € million) 

Breakdown 

2007 

2008 

2009 

2010 

2011 

2012 

2013 and 
subs. Years 

Total 

TOTAL  1.426 

1.631 

1.734 

1.977 

2.294 

2.441 

2.564 

14.067 

6.1.2.  Technical  and  administrative  assistance,  support  expenditure  and  IT 

expenditure (commitment appropriations) 

2007 

2008 

2009 

2010 

2011 

2012 

2013 and 
subs. years 

Total 

TOTAL  60 

68 

72 

82 

95 

102 

107 

586 

As the progressive move to partial and then to full decentralisation is achieved, some transfer 
of funds from 6.1.2 to 6.1.1 will be possible. The allocation of funds by component shall take 
into account the cost of administrative support  for  devolved  programme  management  in  the 
Commission delegations referred to in Article 12(3) of this Regulation. 

7. 

IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE  

7.1. 

Impact on human resources 

Types of post 

Staff to be assigned to management of the 
action using existing and/or additional 
resources 

Number of 
permanent posts 

Number of 
temporary posts 

Total 

Description of tasks deriving from 
the action 

Officials 
temporary staff 

or 

HQ: 275 

Del.: 84 

A 

B 

C 

Other human resources 

Total 

EN 

HQ : 
END:  
AUX:  
INT:  
Ex BA-lines : 
ATA:  
Delegations : 
Ex BA-lines 

359 

15 
18 
7 

69 

418 

886 

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7.2. 

Overall financial impact of human resources (2004 prices) 

Type of human resources 

Amount (€) 

Method of calculation *  

Officials 

Temporary staff 

HQ:  
END 
AUX 
INT 
Ex BA-lines: 
ATA 
Delegations: 
ExBA-lines:  
ALAT / AL 

29,700,000 

16,309,272 

668,160 
1,021,680 
441,630 

3,977,574 

275 x € 108,000 

84 x € 194,158 

15 x € 44,544 
18 x € 56,760 
7x € 63,096 

69 x € 57,646 

31,972,820 

418 x € 76,490 

The amounts are total expenditure for twelve months. 

Total 

84,091,136 

7.3. 

Other administrative expenditure deriving from the action (2004 prices) 

Overall allocation (Title A7) 

A0701 – Missions 

A07030 – Meetings 
A07031  –  Compulsory  committees  (ex-PHARE),  UPI 
Committees 

A07032 – Non-compulsory committees  

A07040 – Conferences 

A0705 – Studies and consultations 

Other expenditure (specify) 

Information systems (A-5001/A-4300) 

Other expenditure – Part A (specify) 

Amount € 

Method of calculation 

600,000 

100,000 

500,000 

4 Committees meeting 5 times a year at  

€ 25,000 per meeting 

50,000 

50,000 

200,000 

The amounts are total expenditure for twelve months. 

Total 

1,500,000 

(2004 prices) 

I. 

II. 

Annual total (7.2 + 7.3) 

Duration of action 

III. 

Total cost of action (I x II) 

€ 85,591,136

7 years

€ 599,137958

Human and adminstrative resource needs will be covered from within the allocation made to 
the DG managing the activities under the annual allocation procedure.  

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The allocation of posts will depend on the one hand on the internal organisation of the next 
Commission, and on the other hand on a possible reallocation of posts between the services, 
following the new financial perspectives. 

8. 

FOLLOW-UP AND EVALUATION 

8.1. 

Follow-up arrangements 

Art. 27 (4) of the Financial Regulation obliges the Commission to undertake both ex ante and 
ex  post  evaluations,  to  be  applied  to  all  programmes  and  activities  which  entail  significant 
spending.  Evaluation  results  are  to  be  disseminated  to  spending,  legislative  and  budgetary 
authorities. Due to the fact that the obligation is already in place, the Regulation itself does 
not mention either monitoring or evaluation. 

Provisions  will  be  made  within  Framework  Agreements  to  ensure  the  beneficiary  countries 
make  the  necessary  arrangements  to  enable  independent  monitoring  and  evaluation.  In 
outline, the system is envisaged as follows: 

•  Project implementation will be monitored through the Joint Monitoring Committee (JMC). 
This includes the NAO, the NAC and the Commission services. The JMC will meet at least 
once a year to review all IPA-funded programmes in order to assess their progress towards 
meeting  the  objectives  set  out  in  the  Financing  Agreements  and  the  Accession/European 
Partnership.  The  JMC  may  recommend  a  change  of  priorities  and/or  reallocation  of  IPA 
funds.  

•  The  JMC  will  be  assisted  by  Sectoral  Monitoring  Sub-Committees  (SMSC)  for  each 
component  and  sector,  which  will  include  all  relevant  institutions  and  partners  involved, 
including  the  Commission  Services,  in  accordance  with  the  specific  monitoring 
arrangements  that  will  be  established  for  each  component.  The  SMSC,  inter  alia,  will, 
review in detail the progress made towards achieving the objectives set out in its relevant 
programme  and  will  report  to  the  JMC  on  all  IPA  financed  actions  in  its  component  or 
sector.  

•  The  Commission  services  shall  ensure  that  an  ex-post  evaluation  is  carried  out  after 

completion of the programme. 

8.2. 

Arrangements and schedule for the planned evaluation 

In  application  of  current  rules  and  in  view  of  the  vast  scope  of  the  activities  foreseen,  an 
evaluation  system  covering  the  different  levels  of  intervention  and  types  of  instruments  has 
been set up. 

Notably,  the  financial  regulation,  as  well  as  the  internal  control  standards,  calls  for  regular 
evaluation of all (sizable) activities. This is translated into the evaluation of single operations 
(e.g. development projects), of programmes (e.g. national programmes) and policy sectors or 
themes  (e.g.  transport  or  gender  issues).  Evaluations  of  are  also  necessary  and  ongoing  of 
wider legal obligations such as the 3 Cs (Coherence, Complementarity, Coordination). 

As  set  out  above,  project  implementation  will  be  monitored  through  the  Joint  Monitoring 
Committee  (JMC)  in  each  beneficiary  country,  assisted  by  Sectoral  Monitoring  Sub-
Committees  (SMSC)  for  each  component  and  sector.  Each  Component  will  have  its  own 

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40 

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specific  evaluation  scheme.  For  Institution  Building,  there  is  an  ongoing  scheme  of  Interim 
Evaluation, and these interim evaluations, prepared by independent evaluators, are reviewed 
by the JMC. This Interim Evaluation scheme generates over 130 individual country, sectoral 
and  thematic  reports  a  year.  Thematic  reports  covering  such  issues  as  nuclear  issues,  civil 
society,  public  administration,  justice  and  home  affairs,  national  aid  coordination,  twinning, 
SMEs, and statistics have been prepared. 

These  works  will  be  complemented  by  relevant  works  on  databases,  meta-analyses, 
methodology and training. 

9. 

ANTI-FRAUD MEASURES 

The  protection  of  the  Community’s  financial  interests  and  the  fight  against  fraud  and 
irregularities form an integral part of this Regulation. 

Administrative  monitoring  of  contracts  and  payments  will  be  the  responsibility  of  the  EC 
Delegations in beneficiary countries. 

Each  of  the  operations  financed  under  this  regulation  will  be  supervised  at  all  stages  in  the 
project cycle through the delegations. Supervision will take account of contractual obligations 
as well as of the principles of cost/benefit analysis and sound financial management. 

For Cross Border co-operation programmes operating under shared management the Member 
State where the joint managing authority is located is responsible for ensuring sound financial 
management and the legality and regularity of the transactions. 

Moreover,  any  agreement  or  contract  concluded  pursuant  to  this  Regulation  shall  expressly 
provide for monitoring of spending authorised under the projects/programmes and the proper 
implementation  of  activities  as  well  as  financial  control  by  the  Commission,  including  the 
European Anti-Fraud Office (OLAF), and audits by the Court of Auditors, if necessary on the 
spot.  They  shall  authorise  the  Commission  (OLAF)  to  carry  out  on-the-spot  checks  and 
inspections  in  accordance  with  Council  Regulation  (Euratom,  EC)  No  2185/96  of  11 
November  1996  concerning  on-the-spot  checks  and  inspections  carried  out  by  the 
Commission in order to protect the European Communities’ financial interests against fraud 
and irregularities. 

Particular  attention  will  be  paid  to  the  nature  of  expenditure  (eligibility  of  expenditure),  to 
respect  for  budgets  (actual  expenditure)  and  to  verify  supporting  information  and  relevant 
documentation (evidence of expenditure). 

In  practise,  this  would  mean  that  framework  agreements  would  contain  provisions  making 
reference notably to the following: 

•  Definitions of the notions of irregularity, fraud, active and passive corruption and conflict 

of interest; 

•  Measures in the filed of financial control by the contracting authority, the Commission and 

the Court of Auditors; 

•  The possibility for OLAF to conduct on-the-spot checks equivalent to the ones foreseen by 

Regulation (EC) 2185/96 

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•  The obligation of the contracting authority of the third country to take preventive measures 

in the field of corruption 

•  The procedure for the communication of cases of suspected fraud and irregularities to the 

Commission; 

•  The procedures for the clearance of accounts in the case of decentralised management 

•  The application of administrative and financial sanctions (including the exclusion of non-

reliable candidates and tenderers) 

•  Enforceability  of  Commission  decisions  in  the  area  of  recovery  in  case  of  centralised 

management. 

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