Proposal for a Council Regulation amending Regulation (EC) No 382/2001 as regards its expiry date and certain provisions related to the execution of the Budget
Date: 2004-12-28
Institutions: European Commission
Subjects: action programme, cooperation policy, industrialised country, project evaluation, third country, trade cooperation, trade promotion

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 28.12.2004 
COM(2004) 840 final 

2004/0288 (CNS) 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 382/2001 as regards its expiry date and certain provisions 
related to the execution of the Budget  

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1. 

INTRODUCTION  

1.1. 

Background 

The  Union  has  consistently  attached  high  importance  to  developing  close  political, 
economic and trade relations with industrialised non-member countries1. In order to 
further reinforce our relations with these countries, it is important for the Community 
to  have  at  its  disposal  an  instrument  enabling  it  to  implement  bilateral  cooperation 
activities. Council Regulation No 382/2001 of 26 February 20012 provides the legal 
basis for this type of activity. This instrument provides a framework for Community 
interventions aimed at: 

–  promoting  cooperation  in  support  to  the  objectives  laid  down  in  the  various 
bilateral  instruments  between  the  European  Union  and  the  partner  countries,  in 
order  to  create  a  more  favourable  environment  for  the  conduct  and  further 
development  of  the  relations  between  the  European  Union  and  the  partner 
countries  and  to  ensure  that  the  EU,  its  institutions  and  its  policies  are  better 
known among the general public and opinion leaders in these countries; 

–  building  stronger  economic,  commercial  and  financial  links  by  assisting  EU 
industry  in  its  efforts  to  get  better  access  to  the  markets  of  these  countries,  in 
particular those where structural impediments make it hard for EU companies to 
consolidate their presence (Japan and Korea). 

Projects  in  these  areas  of  cooperation  and  promotion  of  commercial  links  between 
the  EU  and  the  industrialised  countries  of  North  America,  North  East  Asia  and 
Australasia  have  developed  steadily  in  recent  years  on  the  basis  of  this  Regulation 
and  in  line  with  the  policy  objectives  set  out  in  various  political  instruments 
governing  bilateral  relations  (Framework  Agreements,  joint  Political  Declarations, 
joint Actions Plans, New Transatlantic Agenda, Partnership Agendas …etc) adopted 
in the past decade. 

1.2. 

Cooperation with industrialised countries  

The  Regulation  has  provided  an  integrated  and  coherent  framework  in  which  to 
develop  projects  underpinning  the  EU’s  political  and  economic  relations  with  six 
countries:  the  United  States,  Canada,  Japan,  the  Republic  of  Korea,  Australia  and 
New Zealand (hereinafter referred to as “the partner countries”). It has also usefully 
complemented  specific  bilateral  agreements  between  the  Community  and  some  of 
these countries, such as the cooperation agreements in the field of higher education 
with  the  United  States  and  Canada  or  the  framework  agreement  on  trade  and 
economic cooperation with the Republic of Korea. 

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2 

Within  the  meaning  of  the  Regulation,  “industrialised  non-member  countries”  refers  to:  the  USA, 
Canada, Japan, Australia, New Zealand and South-Korea. 
Council Regulation concerning the implementation of projects promoting cooperation and commercial 
relations between the European Union and the industrialised countries of North America, the Far East 
and Australasia and repealing Regulation (EC) No 1035/1999, published in the OJ L57 of 27.2.2001. 

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The 2001 Regulation covers two overarching themes: a) development of broad-based 
bilateral  co-operation  and  b)  promotion  of  commercial  relations,  the  former 
concerning all the countries covered  by the Regulation, the latter  being  exclusively 
focused on Japan and, to a lesser extent, on Korea. 

(1) 

Projects for the development of bilateral cooperation 

As  regards  co-operation  with  the  partner  countries,  the  2001  Regulation  addresses 
co-operation in the following fields: 

–  Cultural, academic and people-to-people links; 

–  Science and technology, energy, transport and environmental matters; 

–  Bilateral dialogues between political, economic and social partners and NGOs of 

the EU and the partner countries; 

–  Customs co-operation; 

It  also  defines  a  number  of  specific  objectives  and  principles  that  should  guide  the 
award of Community funding: 

–  Educating and informing the public (including decision makers, opinion formers 
and  other  multipliers)  on  the  bilateral  relations  between  the  EU  and  the  partner 
countries; 

–  Enhancing  research  work  and  studies  on  a  broad  range  of  topics  in  order  to 

promote or prepare co-operation initiatives with the partner countries; 

–  Enhancing the visibility of the European Union in the partner countries; 

–  Developing pilot schemes in view of testing out possible new activities; 

Since the entry into force of the 2001 Regulation this co-operation agenda has been 
realised in a number of projects, the most significant of which are: 

–  The consolidation and expansion of a network of EU Centres at universities in the 

United States, Canada, Australia, New Zealand and, in 2004, in Japan; 

–  The support to the New Transatlantic Agenda policy dialogue; 

–  The  support  to  pilot  projects  in  the  field  of  higher  education  with  Australia  and 

New Zealand; 

–  The  development  of  research  work  by  different  think  tanks  and  other 

organisations in the USA and Canada; 

–  The reinforcement of people-to-people links through initiatives such as Business 

or Consumers dialogues; 

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–  The organisation of various events in the partner countries in order to enhance the 
general  understanding  of  the  EU  in  partner  countries  or  to  inform  the  public  on 
specific EU-related topics such as the introduction of the Euro or Enlargement; 

In the field of co-operation, the establishment and development of 23 EU Centres in 
five  out  of  the  six  countries  covered  by  the  Regulation  represents  a  significant 
achievement and is the financially most important initiative under this chapter. 

The creation of these EU Centres was originally initiated in the US from 1998. This 
experience has been pursued and consolidated under the Regulation during the period 
2001-2003 and extended to other partner countries: Canada, Australia, New Zealand, 
and, finally, Japan. All EU Centres are hosted in the partner countries by reputable 
Universities which provide co-financing for their functioning. Their main objective is 
to promote, in the partner countries, a better understanding of the European Union, 
its institutions, its history, its economy and its policies notably by: 

–  Creating and developing EU and Europe-focused teaching ; 

–  Stimulating research on subjects related to the EU and its bilateral relations with 

the partner countries ; 

–  Organising seminars, workshops, conferences and other events EU-related topics; 

–  Developing information tools (Web Sites, publications, newsletters etc…) on the 

European Union 

–  developing visitors’ programmes and academic exchanges ; 

Under  the  Regulation,  Community  support  has  been  provided  to  15  Centres  in  the 
US, 5 in Canada, 1 in Australia, 1 in New Zealand and 1 in Japan. The Initiative has 
provided opportunities for increased understanding of the EU in the partner countries 
through  its  broad  based  research,  teaching  and  outreach  activities.  It  has  helped  to 
develop  EU-studies  as  a  distinct  subject  as  well  as  increased  the  EU-focus  within 
European  Studies.  264  new  EU  certificates  and  courses  were  generated  as  a  result. 
EU  policy-oriented  research  also  increased  of  which  462  PhD  students  and  1,731 
research  publications  are  proof.  Moreover,  it  is  estimated  that  at  least  42,000 
graduates  have  built  up  their  knowledge  about  the  EU  through  the  Centres.  The 
experience  as  a  whole  was  the  subject  of  an  external  evaluation  in  the  course  of 
2003/2004, in compliance with Article 11 of the 2001 Regulation. 

(2) 

Projects for the promotion of commercial relations 

The objective of facilitating market access for EU companies in Japan and Korea and 
improving  their  business  presence  constitutes  the  second  focus  of  the  2001 
Regulation.  In  fact,  the  bulk  (almost  75%)  of  the  Community  funding  under  the 
Regulation during the period 2001-2003 has been directed towards the programmes 
aimed at this objective. 

–  ETP  is  a  human  resources  development  programme  consisting  of  an  intensive 
language course (Japanese or Korean) coupled with a series of business seminars, 
industrial visits, regional visits and home stays. This is followed by a period of in-
house  training  in  Japanese/Korean  companies  where  participants  can  use  their 

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skills  in  a  real  work  environment.  The  Executive  training  programme  in  Japan 
was first established in 1979. Its 22nd intake will graduate in November 2004. The 
23rd  group  is  now  under  training  while  the  24th  group  is  under  recruitment.  To 
date more than 850 European executives have participated in this programme. A 
general  survey  of  the  ETP  population  carried  out  during  the  first  semester  2003 
confirmed that this programme constitutes an excellent base for EU companies to 
develop  their  business  in  Japan  and  for  executives  to  develop  their  management 
skills and enhance their career. In view of the growing importance of the Korean 
economy  for  EU  companies,  the  2001  Regulation  established  the  principle  of 
extending  the  ETP  training  concept  to  Korea.  A  Korean  version  of  the 
programme,  adapted  to  the  circumstances  of  the  Korean  market,  was  therefore 
launched  in  2002.  A  first  group  of  European  executives  graduated  in  October 
2003, a second group is now under training and a third one under recruitment. 

–  The EU Gateway to Japan Campaign entered into its third phase under the 2001 
Regulation.  Gateway  to  Japan  is  an  commercial  promotion  programme  aimed  at 
assisting EU SMEs in their efforts to develop their business and expand their sales 
on  the  Japanese  market.  The  Gateway  to  Japan  concept  was  launched  in  1993, 
followed by a second edition between 1997 and 2001. The current third edition of 
Gateway  to  Japan  started  in  October  2002  and  is  set  to  run  for  four  years.  The 
core  of  the  Gateway  to  Japan  campaign  consists  in  the  organisation  of  group 
participation of EU SMEs in sectoral trade missions to Japan and in trade fairs in 
Japan.  In  the  first  two  editions  of  the  programme  some  1,500  EU  SMEs  have 
taken  part.  Gateway  to  Japan  III  is  intended  to  introduce  an  additional  880  plus 
EU  SMEs  from  8  industry  sectors  to  Japan  through  32  events  (mostly  trade 
missions)  divided  into  four  annual  rounds  organised  to  be  carried  out  over  a 
period of 48 months (2002-2006) with the final events of the Campaign planned 
for the second half of 2006.  

The most important challenge ahead for both these programmes is their geographical 
extension as a result of the Enlargement: they have to be publicised and participants 
will have to be recruited in an enlarged European Union of 25 Member States. The 
two  programmes  were  the  subject  of  an  external  evaluation  in  the  course  of 
2003/2004, in compliance with Article 11 of the 2001 Regulation. 

1.3. 

Financial aspects 

Article 2 of the 2001 Regulation provides that the Community funding necessary for 
the  activities  covered  by  the  Regulation  is  established  annually  by  the  Budget 
Authority.  

The  budget  actually  allocated  was  €15.240.000  in  2001,  €16.025.000  in  2002  and 
€16.800.000 in 2003.  

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To date, commitment credits have been used as follows (in €)3: 

Type of activity 

2001 

2002 

2003 

Total 

% 

EU  Centres 
(USA,  Canada, 
Australia  and  New  Zealand, 
Japan) 

2.986.023 

1.995.503 

3.005.195   7.986.721 

16,8% 

Other Co-operation projects 

1.496.888 

1.179.410 

2.027.016   4.703.314 

9,9% 

ETP 

8.446.872 

6.795.542 

8.990.011   24.232.425 

51,1% 

Gateway to Japan 

2.200.685 

6.024.307 

2.278.514   10.503.506 

22,1% 

Total 

15.130.468 

15.994.762 

16.300.736   47.425.966 

100,0% 

Rate of execution 

99,3% 

99,8% 

97,0% 

98,7% 

99,3% 

2. 

EVALUATION  OF  THE  ACTIONS  AND  PROGRAMMES  FUNDED  UNDER  THE  EXISTING 
REGULATION 

In  compliance  with  article  11.2  of  the  2001  Regulation,  the  Commission  has 
organised an evaluation of actions and programmes funded in this framework. This 
evaluation focused on the most important projects from the perspective of budgetary 
resources,  policy  relevance  and  operational  importance:  the  Executive  Training 
Programme in Japan and Korea, the Gateway to Japan Campaign and the EU Centres 
established in four4 out of the six partner countries were covered by the evaluation. 
These  projects  and  programmes  altogether  total  more  than  90%  of  the  Community 
funding awarded under the Regulation. 

The evaluation was carried out during the period December 2003-June 2004 by two 
independent  evaluation  teams  contracted  following  an  open  call  for  tenders.  Both 
evaluations confirmed the importance of the projects and programmes concerned. 

The main conclusions of the evaluation as regards the appropriateness of continuing 
these initiatives are as follows: 

•  EU Centres in the USA, Canada, Australia and New Zealand 

–  The centre initiative as a whole is progressing well and provides a high level of 

return considering the investment; 

–  It  is  recommended  to  continue  the  initiative  and  where  possible  to  extend  the 

scope of the EU Centres concept to other regions and countries; 

–  It  is  recommended  that  funding  is  organised  in  a  multi-annual  framework  to 

provide more predictability and flexibility to the host institutions 

•  Executive Training Programme and Gateway to Japan 

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More details to be found in the implementation report submitted by the Commission to the European 
Parliament and the Council COM(2004)803. 
The  USA,  Canada,  Australia,  New  Zealand.  The  Japan  Institute,  established  only  at  the  end  of  2003 
was, quite logically, not included in this evaluation exercise. 

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–  Both programmes fit with the objectives of increasing exports to Japan/Korea 

–  Both programmes are found to be appropriate and should be continued; 

–  The effectiveness of both programmes is judged medium/high to high with some 

room for improvement, in particular as regards ETP; 

–  The  ETP  programme  has  still  a  specific  development  potential  if  adapted  to  the 

current needs of the EU business 

–  EU Enlargement provides new development opportunities for both programmes 

The  evaluation  has  validated  therefore  the  approach  taken  by  the  Commission 
services  in  implementing  the  initiatives  concerned.  However  some  adjustments  and 
improvements are suggested by the evaluators and these will be taken into account as 
far as possible.  

The  envisaged  improvements  concern  first  and  foremost  the  Executive  Training 
Programme  for  which  the  services  have  developed  a  substantial  adaptation  plan  in 
order to take account of the evolving business environment in Japan and in the EU. 
In particular the following aspects are under careful examination: 

–  The need to shorten the duration of the programme in order to better correspond to 

the constraints and possibilities of EU companies and executives; 

–  The  need  to  review  the  balance  between  the  language  component  and  the 

management / business component of the programme; 

–  The  desirability  to  create  an  EU-based  inception  training  module  prior  to  the 

Japan (or Korea) based immersion training module 

–  The need to associate reputable education institutions in EU, Japan and Korea to 

programme delivery; 

–  The need to adapt the programme promotion strategy. 

No major overhaul is recommended by the evaluators as regards Gateway to Japan; 
nevertheless, a thorough analysis of the programme and its potential evolution in the 
light of evolving market circumstances will be carried out in the coming year. 

As  far  as  the  EU  Centre  initiative  is  concerned,  the  evaluation  does  not  call  for  a 
major adaptation of the experience. Rather, it suggests that good practices identified 
could  be  generalised  in  view  of  a  new  funding  cycle  and  that  a  more  strategic 
approach  could  be  developed  across  the  various  partner  countries  hosting  EU 
Centres.  

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3. 

SUBSTANCE OF THE PROPOSED MODIFICATION 

3.1. 

Time extension 

The main purpose of this proposal for amending the 2001 Regulation is to extend in 
time its period of validity so that it forms a bridge with the new legal instruments in 
the field of external relations which are expected to enter into force at the beginning 
of 2007, at the same time as the new Financial Perspectives (2007-2013). 

In  its  Communications  of  10  February  and  of  14  July  20045,  the  Commission 
indicated that, for the period of the new Financial Perspectives, the large number of 
legal  instruments  currently  existing  in  the  field  of  External  Relation  will  be 
consolidated  into  a  much  more  limited  (6)  number  of  instruments.  The  type  of 
activities  currently  carried  out  with  industrialised  countries  in  the  framework  of 
Council  Regulation  382/2001  will  therefore  no  longer  be  covered  by  a  stand  alone 
Regulation, but, will be covered by one of the new instruments6. 

In order to ensure continuity between the existing Regulation –which expires at the 
end  of  2005-  and  the  future  instruments  –which  are  expected  to  enter  into  force  in 
2007- the most appropriate solution consists in extending, in almost identical terms, 
the existing Regulation for an adequate period of time. 

In order to avoid any gap between the two bases it is proposed to extend the current 
Regulation for 2 years (until end 2007). In any event, when entering into force, the 
new instrument will repeal the extended Regulation. 

3.2. 

Compliance with the New Financial Regulation 

On 25th June 2002, the Council adopted a new Financial Regulation applicable to the 
general budget of the European Communities7 which entered into force on 1 January 
2003. Some provisions set out in the Financial Regulation are applicable contingent 
upon being specifically referred to in the basic act. This concerns in particular article 
114  (award  of  grants  to  natural  persons)  and  article  76.3  (possibility  of  breaking 
down budgetary commitments) of the new Financial Regulation.  

Participants in the ETP Japan and Korea programmes at present receive monthly an 
accommodation  and  subsistence  allowance  which,  in  order  to  comply  with  the 
Financial  Regulation  is  assimilated  to  a  training  scholarship.  Similar  circumstances 
can  occur  in  the  framework  of  education  co-operation  projects,  such  as  the 
EU/Australia pilot projects in the field of higher education (mobility scholarships for 
students) or the EU Centre. It is important to note –bearing in mind the objective of 
effective  management  of  programmes  and  projects-  that  a  number  of  financial 
provisions  set  out  in  the  Financial  Regulation  are  waived  in  the  case  of  grants  and 

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COM  (2004)101:  “Building  our  common  future  –  Policy  Challenges  and  Budgetary  Means  of  the 
Enlarged Union 2007-2013)” and COM (2004) 487 on “Financial Perspectives 2007 – 2013”. 
To date, it is envisaged that the activities implemented under the 2001 Regulation will be integrated into 
an instrument dealing with Development cooperation and Economic cooperation with third countries. 
Council  Regulation  (EC,  Euratom)  n°1605/2002  of  25/06/2002  published  in  the  OFEC  L248  of 
16/09/2002. 

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scholarships to natural persons8, hence the need to refer to this possibility in the basic 
act. 

It  is  therefore  proposed  to  take  advantage  of  the  time  extension  of  the  Council 
Regulation 382/2001 in order to bring it in line with the provisions introduced in the 
new Financial Regulation: 

–  In  compliance  with  article  114  of  the  Financial  Regulation,  a  new  provision 
should  be  introduced  to  indicate  that  grants  may  be  awarded  to  natural  persons 
when implementing the co-operation or commercial relations projects referred to 
in articles 4 and 7 of the 2001 Regulation. This is particularly necessary as far as 
the Executive training Programme is concerned (scholarships to trainees); 

4. 

LEGAL BASE 

The  Legal  bases  chosen  for  the  amended  Regulation  are  partly  different  from  the 
ones  used  for  the  initial  Regulation,  reflecting  new  provisions  introduced  with  the 
adoption  of  the  Nice  treaty.  This  proposal  is  therefore  based  on  article  133 
(unchanged) and article 181a (new) of the Treaty (economic, financial and technical 
cooperation with third countries).  

5. 

CONCLUSION 

In  view  of  ensuring  the  continuity  of  cooperation  and  commercial  promotion 
activities between the EU and the industrialised countries of North America, the Far 
East  and  Australasia  until  the  adoption  of  the  new  legal  instruments  in  the  field  of 
external relations under the new Financial perspectives (2007-2013), it is proposed to 
extend  the  period  of  validity  of  Council  Regulation  382/2001  by  a  maximum  of  2 
years, that is to say until 31/12/2007. 

In addition, it is proposed to bring in line this Regulation with certain requirements 
and  possibilities  of  the  new  Financial  Regulation,  notably  by  mentioning  expressly 
the possibility to award grants and scholarships to natural persons. 

The objectives and the substance of the original Regulation are left unchanged by the 
proposed modifications. 

8 

Article  165  §2  of  Commission  Regulation  (EC,  Euratom)  N°2342/2002  of  23  December  2002  laying 
down detailed rules for the implementation of Council Regulation (EC, Euratom) n° 1605/2002 on the 
Financial Regulation applicable to the general budget of the European Communities. 

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2004/0288 (CNS) 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 382/2001 as regards its expiry date and certain provisions 
related to the execution of the Budget  

THE COUNCIL OF THE EUROPEAN UNION, 

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

Having regard to the proposal from the Commission9, 

Having regard to the opinion of the European Parliament10, 

Whereas: 

(1) 

(2) 

Council  Regulation  (EC)  No  382/2001  of  26  February  2001  concerning  the 
implementation of projects promoting cooperation and commercial relations between 
the  European  Union  and  the  industrialised  countries  of  North  America,  the  Far  East 
and  Australasia  and  repealing  Regulation  (EC)  No  1035/199911  provides  a  legal 
framework for the enhancement of co-operation and commercial relations with those 
countries until 31 December 2005. 

In  its  Communication  of  10  February  2004  « Building  our  common  future  –  Policy 
Challenges  and  Budgetary  Means  of  the  Enlarged  Union  (2007-2013) »12  the 
Commission  announced  that  during  the  next  period  of  Financial  Perspectives  (2007-
2013) the Community intervention in the area of external relations will be organised in 
a simplified architecture, based on six instruments, replacing more than thirty different 
instruments.  One  of  those  proposed  instruments,  the  financing  instrument  for 
development cooperation and economic cooperation13, is intended to provide the legal 
framework for Community cooperation with a broad range of countries, including the 
industrialised countries covered by Regulation (EC)  No 382/2001. The promotion of 
cooperation  and  economic  relations  with  industrialised  countries  will  therefore  fall 
under that new instrument once it enters into force. 

(3) 

However, the Regulation establishing that instrument will only apply from 1 January 
2007, at the earliest. As it is crucial to ensure continuity in cooperation activities with 
industrialised  countries,  it  is  therefore  necessary  to  avoid  the  potential  absence  of  a 

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12 
13 

OJ C […],[…], p. […]. 
OJ C […],[…], p. […]. 
OJ L 57, 27.2.2001, p.10 
COM(2004)101final 
COM(2004)629final 

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(4) 

(5) 

legal  framework  for  those  activities  between  the  current  expiry  date  of  Regulation 
(EC) No 382/2001 and the date from which the new Regulation will apply. Extending 
the  validity  of  Regulation  (EC)  No  382/2001  for  an  appropriate  period  will  make  it 
possible  to  bridge  any  potential  gap  in  the  legal  framework  governing  cooperation 
with  industrialised  countries  and  will  facilitate  the  transition  between  the  current 
(2000-2006) and the future (2007-2013) Financial Perspectives. 

The extension in time of Regulation (EC) No 382/2001 is all the more justified as the 
evaluation  carried  out  in  2004  of  the  projects  and  programmes  financed  under  that 
Regulation established their effectiveness and continued relevance. 

Article 114 first paragraph (2) of Council Regulation (EC, Euratom) No 1605/2002 of 
25  June  2002  on  the  Financial  Regulation  applicable  to  the  general  budget  of  the 
European  Communities14  provides  for  the  possibility  of  awarding  grants  to  natural 
persons, by way of exception, when provided for by the basic act. Such situations arise 
the  Executive  Training 
regularly 
Programmes  in  Japan  and  in  Korea  and  may  occasionally  arise  in  the  case  of  other 
cooperation  activities  with  industrialised  countries,  in  particular  in  the  framework  of 
education cooperation or people-to-people exchanges. 

in  connection  with 

implementation  of 

the 

(6) 

Council  Regulation  (EC)  No  382/2001  (26.2.2001)  should  therefore  be  amended 
accordingly, 

HAS ADOPTED THIS REGULATION: 

Article 1 

Regulation (EC) No 382/2001 is amended as follows: 

(1) 

In Article 5, the following paragraph is added: 

“When  appropriate,  in  particular  in  the  case  of  education  and  training  projects,  or 
other similar projects from which individuals may benefit, Community support may 
take  the  form  of  grants  to  natural  persons.  These  grants  may  take  the  form  of 
scholarships.” 

(2) 

In Article 7, the following paragraph is added: 

“To this effect, Community support may take the form of grants to natural persons. 
These grants may take the form of scholarships.” 

(3) 

In Article 13, the second paragraph is replaced by the following: 

“It shall expire on 31 December 2007.” 

14 

OJ L 248, 16.9.2002, p.1. 

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Article 2 

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

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

Done at Brussels,  

For the Council 
The President 

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ANNEX  
LEGISLATIVE FINANCIAL STATEMENT 

Policy area(s): External Relations (19) 

Activity: Cooperation with industrialised non-member countries (19 05 02) 

TITLE OF ACTION: TIME EXTENSION OF THE REGULATION GOVERNING THE IMPLEMENTATION 
OF  PROJECTS  PROMOTING  CO-OPERATION  AND  COMMERCIAL  RELATIONS  BETWEEN 
THE  EUROPEAN  UNION  AND  THE  INDUSTRIALISED  COUNTRIES  OF  NORTH  AMERICA, 
THE FAR EAST AND AUSTRALASIA 

1. 

BUDGET LINE + HEADING 

19 05 02 - Cooperation with industrialised non-member countries 

2. 

OVERALL FIGURES  

2.1. 

Total allocation for action (Part B): 17,000 € million for commitment 

2.2. 

Period of application: 

2006-2007 

2.3. 

Overall multi-annual estimate of expenditure: 

As the Regulation does not provide for a global financial envelope deemed necessary 
for its entire duration, figures are provided for 2006 only. 

(a) 

Schedule of commitment appropriations/payment appropriations 

€ Million 

Commitments 

2007 

2006 
17,000  pm 

2008 
- 

2009 
- 

2010 
- 

Payments 

6,2 

5,8 

4 

1 

Total 
17,000 

17,000 

(b) 

Technical and administrative assistance and support expenditure 

Commitments 

Payments 

pm 

pm 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

Subtotal a+b 

Commitments 

2007 

2006 
17,000  pm 

2008 
- 

2009 
- 

2010 
- 

Payments 

6,2 

5,8 

4 

1 

- 

Total 
17,000 

17,000 

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(c) 

Overall  financial  impact  of  human  resources  and  other  administrative  expenditure 

Commitments/ 
payments 

1,594 

pm 

TOTAL a+b+c 

Commitments 

2007 

2006 
18,594  pm 

2008 
- 

2009 
- 

2010 
- 

Payments 

7,794 

5,8 

4 

1 

pm 

Total 
18,594 

18,594 

2.4. 

Compatibility with financial programming and financial perspectives 

[X]  Proposal is compatible with existing financial programming. 

Proposal  will  entail  reprogramming  of  the  relevant  heading  in  the  financial 
perspectives. 

Proposal  may  require  application  of  the  provisions  of  the  Inter-institutional 
Agreement. 

2.5. 

Financial impact on revenue: 

[X]  Proposal has no financial implications on revenue 

3. 

BUDGET CHARACTERISTICS 

Type of expenditure 

New 

EFTA 
contribution 

Contributions 
form applicant 
countries 

Heading in 
financial 
perspective 

Non-comp 

Diff 

NO 

NO 

NO 

No 4 

4. 

LEGAL BASIS  

Treaty articles 133 and 181a 

5. 

DESCRIPTION AND GROUNDS 

5.1. 

Need for Community intervention  

5.1.1.  Objectives pursued 

The  objectives  pursued  are  essentially  based  on  the  joint  policy  statements  and  instruments 
(joint declarations, joint action plans, framework agreements, New Transatlantic Agenda and 
other Partnership Agendas…) between the EU and the partner countries concerned. These are 
major economic players and important commercial and political partners for the EU and it is 

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vital  that  the  bilateral  political  dialogue  wit  them  is  underpinned  and  enhanced  by  concrete 
cooperation  actions.  The  overall  objective  of  the  Community  intervention  is  therefore 
twofold: 

–  to  contribute  to  the  creation  of  a  more  favourable  environment  for  the  conduct  and 
development  of  the  political  relations  between  the  EU  and  the  partner  countries  thus 
strengthening the determination of the EU and the partner countries to build stronger links 
in all relevant areas; 

–  to enhance the commercial relations between the EU and the partner countries, in particular 

Japan and Korea, by stimulating the EU business presence there; 

The  specific  objectives  of  cooperation  and  commercial  promotion  initiatives  towards  the 
partner countries include among others: 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

The promotion of a better understanding of EU related matters (institutions, policies, 
positions on global issues…) in the partner countries; 

The education and information of decision makers, opinion leaders, futures elites, the 
business  communities  and,  more  generally,  the  general  public  on  the  bilateral 
relations between the EU and the partner countries; 

Both  objectives  can  be  attained  notably  through  the  consolidation  and  further 
development  of  EU  Centres  establishing  themselves  as  centres  of  academic 
excellence  as  well  as  research  and  information  reference  points  on  EU  matters  in 
partner countries. 

The enhancement of people-to-people, cultural and academic exchanges between the 
EU  and  the  partner  countries,  notably  through  support  to  projects  in  the  field  of 
higher education; 

The  promotion  of  the  dialogue  between  political,  economic  and  social  partners, 
NGOs and the civil society in all relevant sectors; 

The further development of cooperation in various fields of common interest for the 
EU  and  partner  countries,  such  as:  the  environment,  science  and  technology, 
customs, transport and energy; 

The  facilitation  of  exports,  investment  and  market  access  for  EU  goods  and 
companies  in  Japan  and  Korea  through  human  resource  development  (Executive 
Training  programme)  or  through  direct  product  exposure  on,  and  business  contacts 
with, the relevant market segments and actors; 

5.1.2.  Measures taken in connection with ex ante evaluation  

In 2004, the main initiatives implemented during the period 2001-2004 have been the subject 
of an external evaluation. Two separate evaluation exercises have been carried out in parallel, 
one  focused  on  the  EU  Centre  initiative,  the  other  focused  on  the  initiatives  relating  to  the 
promotion  of  commercial  relations  (ETP  and  Gateway  to  Japan).  During  the  period  2001-
2003  this  set  of  initiatives  has  mobilised  slightly  over  90%  of  the  Community  funding 
awarded  under  the  budget  line  concerned  (B7-665  and  then  19  05  02,  cooperation  with 
industrialised  non-member  countries).  The  evaluation  carried  out  is  therefore  believed  to  be 

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fully  representative  of  the  results  achieved  under  the  Regulation  for  the  period  2001-2004. 
This  evaluation  was  designed  to  both  assess  the  results  achieved  and  the  impact  of  the 
initiatives  and  to  assess  their  continued  relevance.  It  therefore  fulfils  at  the  same  time  the 
objectives of an ex-post and an ex-ante evaluation. 

The evaluation studies were conducted in parallel during the period December 2003 – August 
2004  by  two  independent  firms  identified  following  an  open  call  for  tenders.  In  addition  to 
these evaluation studies a survey of all the beneficiaries (response rate close to 20%) of the 
Executive Training Programme since its inception in 1979 was carried out during the first half 
of 2003. The results of this survey were fuelled into the evaluation work undertaken in 2004. 

The conclusions of both evaluations are overwhelmingly positive and call for a continuation 
and consolidation of the initiatives. The main findings, conclusions and recommendations are 
as follows: 

•  EU Centres in the USA, Canada, Australia and New Zealand 

–  The  centre  initiative  as  a  whole  is  progressing  well  and  provide  a  high  level  of 

return considering the relatively small investment; 

–  The  “EU  brand”  is  one  of  the  strongest  potential  factors  contributing  to  the 

strength of the Centres;  

–  It  is  recommended  to  continue  the  initiative  and  where  possible  to  extend  the 

scope of the EU Centre concept to other regions and countries; 

–  It  is  recommended  that  a  more  strategic  approach  is  adopted  in  renewing  the 

funding cycle; 

–  It  is  recommended  that  funding  is  organised  in  a  multi-annual  framework  to 

provide more predictability and flexibility to the host institutions; 

•  Executive Training Programme and Gateway to Japan 

–  Both programmes fit with the objectives of increasing exports to Japan/Korea; 

–  Both programmes are found to be highly appropriate and should be continued; 

–  Market  circumstances  an  business  practices  in  Japan  /  Korea  have  evolved  but 

continue to justify specific support to EU companies; 

–  The effectiveness of both programmes is judged medium/high to high with some 

room for improvement, in particular as regards ETP 

–  The  ETP  programme  has  still  a  specific  development  potential  if  adapted  to  the 

current needs of the EU business; 

–  The  Community  initiatives  complements  well  the  initiatives  existing  at  Member 

State level; 

–  The  EU  Enlargement  provides  new  development  opportunities  for  both 

programmes; 

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5.1.3.  Measures taken following ex post evaluation 

The evaluation has validated most of the lines taken by the responsible department as 
regards the implementation of the initiatives concerned. However some adjustments 
and  improvements  are  suggested  by  the  evaluators  and  will  be  taken  into  account 
where deemed appropriate and feasible. 

The  envisaged  modifications  concern  first  and  foremost  the  Executive  Training 
Programme, and, to a lesser extent the EU Centre initiative. 

As  far  as  the  Executive  Training  programme  –which  over  the  past  3  year  has 
represented  alone  roughly  50%  of  the  budget  allocated  to  cooperation  with 
industrialised non-member countries- is concerned, the reflection of services is well 
advanced  (a  roadmap  for  the  adaptation  of  the  programme  has  already  been 
prepared)  and,  as  a  matter  of  fact,  the  evaluation  confirms  most  of  the  adaptations 
envisaged. These adaptations concern in particular: 

–  The need to shorten the duration of the programme in order to better correspond to 

the constraints and possibilities of EU companies and executives; 

–  The  need  to  review  the  balance  between  the  language  component  and  the 

management / business component of the programme; 

–  The  desirability  to  create  an  EU-based  inception  training  module  prior  to  the 

Japan (or Korea) based immersion training module 

–  The need to associate reputable education institutions in EU, Japan and Korea to 

programme delivery; 

–  The need to adapt the programme promotion strategy; 

Proposals  in  this  regard  are  under  preparation  and  will  be  submitted  to  the 
programme committee in the autumn of 2004. 

As far as the EU Centre initiative is concerned, the evaluation does not call for an in-
depth  adaptation  of  the  experience.  Rather,  it  suggests  that  the  different  good 
practices identified in the various projects are taken into account when drafting the 
terms  of  reference  for  the  new  funding  cycle  so  that  they  can  benefit  to  the  entire 
network in the future. The evaluation recommends that more flexibility is introduced 
in the way the Commission awards grants to Centres. This is why it is proposed, in 
the amendment of the Regulation, to introduce a specific reference to the mechanism 
of  budgetary  commitment  splitting  which  is  established  in  article  76.3  of  the 
Financial Regulation. This will allow the shift from an annual grant award exercise 
which  is  extremely  time  and  work-consuming  for  Commission  services  and 
beneficiary  institutions  whilst  not  giving  any  predictability  or  flexibility  beyond  an 
annual horizon. 

5.2. 

Actions envisaged and budget intervention arrangements 

EU Centres 

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–  Target population: leading universities in the partner countries. An indicative number of 20 
to  25  Centres  across  the  partner  countries  could  be  envisaged,  in  compliance  with  the 
recommendations by the evaluators. 

–  Specific  objectives  (and  indicators):  curriculum  development  (number  of  EU  related 
courses  created,  number  of  students  enrolled  in  EU-related  modules);  research  work 
(number of publications, number of research fellows and scholarships); outreach (number 
of workshops and conferences; number and type of attendees; media coverage); 

–  Implementation  measures:  calls  for  proposals.  Community  support  will  take  the  form  of 

grants with a funding rate in the 50-75% range. 

–  Outputs: enhanced understanding of the EU, its policies, its institutions and what it stands 

for by the present and future elites as well as the general public; 

Other  cooperation  projects  (Policy  advice,  Public  diplomacy,  People-to-people  exchanges, 
public outreach),  

–  Target  population:  foundations,  think-tanks,  NGO’s,  education  institutions,  research 

institutions. An average of 15/20 beneficiaries per year is envisaged. 

–  Specific  objectives  (and 

indicators):  reinforced  people-to-people 

links  (academic 
exchanges, joint courses developed; student mobility; faculty mobility); research work and 
policy  advice  (number  of  publications  and  other  forms  of  providing  policy  advice); 
outreach  (number  of  workshops  and  conferences;  number  and  type  of  attendees;  media 
coverage); dialogues (relevance of sectors; number and quality of stakeholders involved); 

–  Implementation  measures:  calls  for  proposals.  Community  support  will  take  the  form  of 

grants with a funding rate in the 50-75% range. 

–  Outputs: enhanced understanding of the EU, its policies, its institutions and what it stands 
for by the present and future elites as well as the general public; enhancement of bilateral 
links between the EU and partner countries; 

Commercial Relations 

–  Target population: EU companies and EU executives. ETP targets 40 participants per year 
for  Japan  and  15  for  Korea.  Gateway  aims  to  bring  around  220  companies  per  year  in 
Japan. 

–  Specific objectives (and indicators): trade missions and fairs (number of EU participating 
companies;  number  of  Japanese  attendees;  number  of  business  leads;  sales  figures 
evolution); development of a pool of EU executives able to work in the Japanese / Korean 
market  (number  of  candidates;  number  of  graduates;  career  development  of  alumni; 
proportion of graduate settling in Japan/Korea); 

–  Implementation  measures:  Procurement  procedures  for 

the 
programme components. Calls for proposals for the selection and award of scholarships to 
ETP participants.  

the  establishment  of 

–  Outputs: enhanced EU business presence on the Japanese / Korean market; increased EU 
exports  and  investment  to  Japan  and  Korea;  improved  market  access  and  regulatory 

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framework  in  Japan  for  EU  products  and  services;  Consolidated  EU  business  lobbying 
force in Japan and Korea; 

5.3.  Methods of implementation 

The Commission will continue to implement the projects under direct management. This will 
involve both headquarters and the delegations concerned, under a deconcentration model. 

6. 

FINANCIAL IMPACT 

6.1. 

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

6.1.1.  Financial intervention 

Commitments (in € million to three decimal places) 

Breakdown 

2006 

2007 

Total 

Cooperation 

6,500 

pm 

Commercial relations 

10,500 

pm 

TOTAL  17.000 

6.1.2.  Technical  and  administrative  assistance,  support  expenditure  and  IT  expenditure 

(commitment appropriations) 

2006 

2007 

Total 

1) 
administrative assistance 

Technical 

and 

- 

Technical 

a) 
offices

assistance 

- 

b)  Other 
administrative assistance: 

technical 

and 

- intra muros: 

- extra muros: 

of  which  for  construction 
and 
of 
maintenance 
computerised  management 
systems 

Subtotal 1 

2) Support expenditure 

a) Studies 

b) Meetings of experts 

c) Information and 
publications 

- 

- 

- 

- 

- 

- 

Subtotal 2 

- 

- 

- 

- 

- 

- 

- 

- 

- 

- 

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TOTAL 

- 

- 

6.2. 

Calculation  of  costs  by  measure  envisaged  in  Part  B  (over  the  entire 
programming period) 

Commitments (in € million to three decimal places) 

Breakdown  

Type  
of outputs 
(projects, files ) 

Number of 
outputs 

Average unit 
cost 

(total for year 
2006)  

Total cost 

(total for year 
2006)  

1 

2 

3 

4=(2X3) 

Cooperation 

- EU Centres (annual cost) 

-  Political  dialogues,  education 
cooperation,  public  diplomacy  and 
other cooperation projects 

Commercial relations with Japan & 
Korea 

- ETP 

- Gateway to Japan 

Projects 

Projects 

22 

15 

0.200 

0.140 

4.400 

2.100 

Participant 

Participating 
company 

60 

220 

0.120 

0.015 

7.200 

3.300 

TOTAL COST 

17.000 

7. 

IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE  

The  needs  for  human  and  administrative  resources  shall  be  covered  within  the 
allocation  granted  to  the  managing  DG  in  the  framework  of  the  annual  allocation 
procedure. 

7.1. 

Impact on human resources 

Staff to be assigned to management of the 
action using existing resources 

Description of tasks deriving from the 
action 

Types of post 

Total 

Number of 
permanent posts 

Number of 
temporary posts 

Officials 
temporary staff 

or 

A 

B 

C 

4 

6 

3 

Other human resources 

Total 

7.2. 

13 

Overall financial impact of human resources 

Programming and policy formulation, 
operational implementation, financial 
and contractual management, 
monitoring and evaluation 

4 

6 

3 

13 

Type of human resources 

Amount (€) 

Method of calculation *  

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Officials  

Temporary staff 

1.404.000 

13 * 108.000 (cost per unit) 

Other human resources 

- 

(specify budget line) 

Total  1.404.000 

The amounts are total expenditure for twelve months. 

7.3. 

Other administrative expenditure deriving from the action 

Amount € 

Method of calculation 

120.000 

20.000 

50.000 

(10missions to Japan / Korea @ 5.000€ 
+15 missions to US / Canada @ 3.000€ 
+ 
intra-community  missions 
@1.000€  +  2  missions  to  AUS/NZ  @ 
7.500€) 

10 

Experts meetings 2*10*1000€ 

Two meetings per year of Advisory 
Committee : 2*25*1.000€ 

Budget line 

(number and heading) 

Overall allocation (Title A7) 

A0701 – Missions 

A07030 – Meetings 

A07031 – Compulsory 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) 

Total  190.000 

The amounts are total expenditure for twelve months. 

I. 

II. 

Annual total (7.2 + 7.3) 

Duration of action 

III. 

Total cost of action (I x II) 

1.594.000 

2 years 

3.188.000 

8. 

FOLLOW-UP AND EVALUATION 

8.1. 

Follow-up arrangements 

The  monitoring  of  projects  is  ensured  by  the  desks  and  the  delegation  concerned  through 
regular contacts / meetings with and reports from beneficiaries and contractors. 

As  far  as  ETP  and  Gateway  to  Japan  in-built  performance  indicators  are  regularly  updated 
making  it  possible  to  follow  progress  in  implementation,  measure  users’  satisfaction  rate, 
identify  potential  weaknesses  and  take  the  appropriate  remediation  measures.  Follow-up 
questionnaires and survey of participants are organised on a regular basis to measure medium-
term business impact and career development. 

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As  far  as  EU  Centres  are  concerned,  planning  and  work  programme  approval  mechanisms 
make  it  possible  to  the  Delegation  to  ensure  compliance  of  the  activities  effectively  carried 
out  with  the  overall  and  specific  objectives  of  the  initiatives.  Beneficiaries  report  to  the 
Commission on a regular basis. In this regards, best practices have been identified during the 
evaluation  exercises  and  could  be  generalised  for  the  next  funding  cycles  (activity-based 
reporting  and  accounting).  Standards  indicators  such  as  student  enrolment;  number  of 
scholarships; number of teaching modules or courses; number of outreach event and related 
participants;  number  of  publications…  can  be  included  in  the  reporting  obligations  of  the 
beneficiaries for monitoring and impact measurement purposes. 

8.2. 

Arrangements and schedule for the planned evaluation 

An ex-post evaluation may be organised, if deemed necessary, in 2006 or 2007. However, it 
should  be  noted  that  the  time  span  between  this  new  evaluation  and  the  most  recent  one 
(2004) would only be in the range of 2 to 3 years. 

9. 

ANTI-FRAUD MEASURES 

Projects and programmes will be implemented directly by the Commission both in Brussels 
and,  in  the  case  of  cooperation  with  USA  and  Japan,  in  Washington  and  Tokyo  by  the 
respective Delegations under a deconcentrated model for parts of the programme.  

The  European  Commission  and  the  European  Court  of  Auditors  may  conduct  on-the-spot 
checks  and  inspections  of  the  projects  and  programmes,  in  order  to  safeguard  the  European 
Communities’ financial interests. 

Control provisions (submission of reports, submission of justifying documents, on-site control 
by  the  Commission,  by  any  entity  mandated  by  the  Commission  or  by  the  Court  of 
Auditors…) are therefore included in all contracts and grant agreements. 

On-the-spot audits may be carried out if deemed necessary. 

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