Council Regulation (EC) No 1198/2006 of 27 July 2006 on the European Fisheries Fund
Date: 2006-07-27
Institutions: Council of the European Union
Subjects: common fisheries policy, economic and social cohesion, fishery management, fund (EU), sustainable development

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I

(Acts whose publication is obligatory)

COUNCIL REGULATION (EC) No 1198/2006

of 27 July 2006

on the European Fisheries Fund

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Commu-
nity, and in particular Articles 36 and 37 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Parliament (1),

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

Having regard to the opinion of the Committee of the Regions (3),

Whereas:

(1)

(2)

(3)

The development of the Community fishing fleet must be
regulated in particular according to decisions that the
Council and the Commission are called upon to take by
virtue of Chapter
II of Council Regulation (EC)
No 2371/2002 of 20 December 2002 on the conserva-
tion and sustainable exploitation of fisheries resources
under the Common Fisheries Policy (4).

The objective of the common fisheries policy should be
to provide for sustainable exploitation of living aquatic
resources and of aquaculture in the context of sustainable
development, taking account of environmental, economic
and social aspects in a balanced manner.

The scope of the common fisheries policy extends to the
conservation, management and exploitation of
living
aquatic resources and aquaculture, as well as to the pro-
cessing and marketing of fisheries and aquaculture prod-
ucts in so far as those activities are practised on the
territory of Member States, in Community waters or by
Community fishing vessels or nationals of Member States.

(1) Opinion delivered on 6 July 2005 (not yet published in the Official

Journal).

(4)

(5)

(6)

Under Article 33(2) of the Treaty, account must be taken
of the particular nature of the activity which results from
the social structure of the sector and from structural and
natural disparities between the various regions involved in
fishing activities.

The sustainable development component of the common
fisheries policy has been integrated into the rules govern-
ing the Structural Funds since 1993. Its implementation
should be pursued in the context of sustainable develop-
ment by means of the European Fisheries Fund (hereinaf-
ter EFF).

Since the principal objective of this Regulation, namely to
further the common fisheries policy, cannot be sufficiently
achieved by the Member States given the structural prob-
lems encountered in the development of the fisheries sec-
tor and the limits on the financial resources of the Member
States in an enlarged Union, and can therefore be better
achieved at Community level by providing multi-annual
financing focused on the relevant priorities, the Commu-
nity may adopt measures, in accordance with the prin-
ciple of subsidiarity as set out in Article 5 of the Treaty.
In accordance with the principle of proportionality, as set
out in that Article, this Regulation does not go beyond
what is necessary to achieve this objective.

(7)

The common fisheries policy and therefore the EFF must
incorporate the Community’s priorities for sustainable
development as defined in the conclusions of the Lisbon
European Council of 23 and 24 March 2000 and the
Gothenburg European Council of 15 and 16 June 2001.

(8)

Programming should ensure coordination of the EFF with
other funds geared to sustainable development and with
the Structural Funds and other Community funds.

(2) OJ C 267, 27.10.2005, p. 50. Opinion delivered following non-

compulsory consultation.

(3) OJ C 164, 5.7.2005, p. 31. Opinion delivered following non-

(9)

compulsory consultation.
(4) OJ L 358, 31.12.2002, p. 59.

The activity of the EFF and the operations it helps to
finance should be compatible with other Community poli-
cies and comply with all Community legislation.

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(10) Action by the Community should be complementary to
action carried out by Member States or it should seek
to contribute to that action. In order to ensure significant
added value partnership should be strengthened. This part-
nership, with full regard to the national rules and prac-
tices of the Member States, concerns regional, local and
other public authorities, as well as other appropriate bod-
ies, including those responsible for the environment and
for the promotion of equality between men and women,
the economic and social partners and other competent
bodies. The partners concerned should be involved in the
preparation, implementation, monitoring and evaluation
of assistance.

(11) Under Article 274 of the Treaty, Member States are
to cooperate with the Commission to ensure compliance
with the principles of sound financial management. To
that end this Regulation specifies the conditions allowing
the Commission to exercise its responsibilities for the
execution of the general budget of the European Union.

(12)

If the activities of the EFF are to be effective and transpar-
ent, the responsibilities of the Member States and of the
Community should be precisely defined. Those responsi-
bilities should be specified for each stage of programming,
monitoring, evaluation and control. Without prejudice to
the powers vested in the Commission,
implementing
and inspecting assistance should be primarily the respon-
sibility of the Member States.

(13) Articles 2 and 3 of the Treaty provide for the elimination
of inequalities, and the promotion of equality, between
men and women.

(14)

The Commission should establish an indicative break-
down of available commitment appropriations using an
objective and transparent method, with a significant con-
centration on the regions covered by the Convergence
objective.

(15)

The appropriations available under the EFF should be
indexed on a flat-rate basis for programming.

(16)

In order to strengthen the leverage effect of Community
resources by favouring, as far as possible, recourse to pri-
vate sources of financing and to take better account of the
profitability of the operations, the forms of assistance
available from the EFF should be diversified and the rates
of assistance differentiated with a view to promoting the
Community interest, encouraging the use of a wide range
of financial resources and limiting the contribution of the
EFF by encouraging the use of appropriate forms of
assistance.

(17)

(18)

(19)

(20)

(21)

(22)

(23)

To reinforce the strategic content of the common fisher-
ies policy in line with the Community’s priorities for the
sustainable development of
fisheries and aquaculture,
Member State should adopt, following a dialogue with the
Commission, a national strategic plan on all relevant
aspects of the common fisheries policy.

In order to address the need for simplification and decen-
tralisation, programming and financial management
should be carried out at the level of the operational pro-
gramme and priority axes alone, with programme comple-
ments and Community support
frameworks being
discontinued.

The programming system should be simplified. To that
end the activities of the EFF should take the form of one
single operational programme per Member State, in accor-
dance with its national structure. The programming exer-
cise shall cover the period from 1 January 2007 to
31 December 2013.

The adoption by the Council of multi-annual recovery
plans and management plans are an absolute priority and
should be accompanied by fishing-effort adjustment plans
under the EFF.

The non-renewal of a fisheries agreement between the
Community and a third country or a substantial cut in
fishing opportunities under an international arrangement
or other arrangement should also give rise to multi-annual
fishing-effort management plans aimed at adjusting the
Community fishing fleet to the new situation.

Provisions should be laid down for adjusting fishing effort
in connection with the adoption of emergency measures
by the Member States or the Commission as provided for
in Articles 7 and 8 of Regulation (EC) No 2371/2002.

Provisions should also be laid down for adjusting fishing
effort in connection with the adoption of national decom-
missioning schemes as part of the obligations laid down
in Articles 11 to 16 of Regulation (EC) No 2371/2002.

(24)

The Community fishing fleet should be adjusted in order
to adapt it to the available and accessible resources.

(25)

Provisions should be laid down for support for investment
on board, in particular to address the need to restructure
the Community fishing fleet by supporting fishers and ves-
sel owners to replace engines by new engines with the
same or less power.

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(26)

In addition, specific provisions should be laid down in
order to address the specificities of small scale coastal
fisheries.

(27)

Socio-economic accompanying measures are needed
to implement the restructuring of the Community fishing
fleet.

(28) Detailed rules should be laid down for granting allow-
ances and financial compensation to fishers and owners
of fishing vessels in cases of temporary cessation of fish-
ing activities.

(29)

It is vital for the fisheries sector that a sustainable balance
be achieved between aquatic resources and their exploita-
tion, having due regard to environmental impact. Appro-
priate measures should therefore be adopted not only in
order to safeguard the food chain but also for aquaculture
and the processing industry.

(30) Detailed rules should be laid down for granting aid to
aquaculture, inland fishing, processing and marketing of
fisheries and aquaculture products, while ensuring that
these sectors retain economic viability. For that purpose,
it is necessary to identify a limited number of priority
objectives for assistance and to focus the structural aid for
aquaculture, processing and marketing of fisheries and
aquaculture products on micro, small and medium-sized
enterprises with priority given to micro and small-sized
enterprises.

(34)

(35)

(36)

(37)

By way of technical assistance the EFF should provide sup-
port for evaluations, studies and exchanges of experience
in order to facilitate the implementation of the opera-
tional programme and to promote innovative approaches
and practices for simple and transparent implementation.

The implementation of the operations of the EFF by the
Member States through shared management should pro-
vide sufficient guarantees as to the details and quality of
implementation, the results of operations and their evalu-
ation and sound financial management and its supervision.

The effectiveness and impact of the operations of the EFF
also depend on improved and more thorough evaluation.
The responsibilities of the Member States and the Com-
mission in this regard and the arrangements to ensure the
reliability of evaluation should be laid down.

In the interest of a good working partnership and the
proper promotion of Community assistance, the broadest
possible information and publicity about it should be pro-
vided for. The authorities responsible for managing assis-
tance should be responsible for this aspect and for keeping
the Commission informed of measures taken.

(38)

It is appropriate to establish ceilings for public contribu-
tion per operation.

(39)

It is also appropriate to establish ceilings for the contribu-
tion by the EFF in relation to the total public expenditure
per priority axis.

(31) Measures of common interest with a broader scope than
measures normally undertaken by private enterprises
should also be supported by the EFF.

(40)

(32)

There is a need to provide accompanying measures for the
common fisheries policy, in particular, by reducing its
socio-economic impact by implementing local develop-
ment strategies for the sustainable development of fisher-
ies areas.

(33) Having regard to the diversity of situations and areas
throughout the Community, the policy for the develop-
ment of fisheries areas should form part of an integrated
approach based on an appropriate territorial strategy, be
adapted to the local context, be as decentralised as pos-
sible, give preference to the participation of actors on the
ground, be based on a bottom-up approach, allow small-
scale operations and ensure the substantial participation
of private sector actors.

In order to guarantee efficient and correct implementa-
tion, the obligations of the Member States should be laid
down with regard to management and control systems,
the certification of expenditure and the prevention, detec-
tion and correction of irregularities and infringements of
Community law. With respect to management and con-
trol it is necessary, in particular, to establish the modali-
ties by which Member States give the assurance that the
systems are in place and function satisfactorily.

(41) Member States should adopt adequate measures to guar-
antee the proper functioning of management and control
systems. To that end, a managing authority, a certifying
authority and an audit authority should be designated for
each operational programme and their responsibilities
should be specified. These responsibilities should relate
primarily to the sound financial implementation, organi-
sation of evaluation, certification of expenditure, audit
and compliance with Community law. Provision should
be made for regular meetings between the Commission
and the national authorities concerned in order to moni-
tor the assistance.

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(42)

(43)

It should be stipulated that the monitoring committee is a
body which is appointed by the Member State for the pur-
pose of ensuring the quality of implementation of an
operational programme.

(50) Detailed transitional provisions should be laid down to
allow preparation of new programming immediately upon
entry into force of this Regulation and to ensure that assis-
tance to Member States is not interrupted pending the
adoption of the operational programme in accordance
with this Regulation,

Indicators and reports on implementation are essential for
monitoring and should be better defined so that they
reflect reliably the progress and the quality of the imple-
mentation of the operational programme.

HAS ADOPTED THIS REGULATION:

(44) Without prejudice to the Commission’s existing powers as
regards financial control, cooperation between the Mem-
ber States and the Commission in this field should be
reinforced.

The rules and procedures governing commitments and
payments should be simplified so that a regular cash flow
is ensured. A pre-financing of 7 % of the contribution
from the EFF would help to speed up the implementation
of the operational programme.

In addition to the suspension of payments where a seri-
ous deficiency is detected in the management and control
systems, there should be measures which allow the autho-
rising officer by delegation to interrupt payments where
there is evidence to suggest a significant deficiency in the
sound operation of these systems or which allow for the
Commission to make a deduction from payments if the
Member State concerned has not implemented all remain-
ing measures in a corrective plan of action.

In order to ensure the sound management of Community
resources, improvements should be made to the forecast-
ing and implementing of expenditure. To that end Mem-
ber States should regularly send the Commission their
forecasts regarding the use of Community resources and
any delays in financial implementation should give rise to
repayment of advances and to automatic decommitments.

Procedures for closure should be simplified by offering the
possibility to those Member States which so wish,
in
accordance with the schedule which they select, to par-
tially close their operational programme with respect to
the operations completed. The appropriate framework for
doing so should be provided.

(45)

(46)

(47)

(48)

(49)

TITLE I

OBJECTIVES AND GENERAL RULES ON ASSISTANCE

CHAPTER I

Scope and definitions

Article 1

Scope

This Regulation establishes the European Fisheries Fund (herein-
after EFF) and defines the framework for Community support for
the sustainable development of the fisheries sector, fisheries areas
and inland fishing.

Article 2

Geographical scope

The measures provided for in this Regulation shall apply

1.
in the entire territory of the Community.

2.
By derogation from paragraph 1, for assistance provided
under Chapter IV of Title IV relating to the sustainable develop-
ment of fisheries areas, Member States shall select the eligible
areas on the basis of the criteria laid down in Article 43(3)
and (4).

Article 3

Definitions

For the purpose of this Regulation, the following definitions shall
apply:

The measures necessary for the implementation of this
Regulation should be adopted in accordance with Council
Decision 1999/468/EC of 28 June 1999 laying down the
procedures for the exercise of implementing powers con-
ferred on the Commission (1) by the management proce-
dure provided for in Article 4 of that Decision. However,
in certain instances and for the sake of efficiency, the con-
sultative procedure provided for in Article 3 of that Deci-
sion is the most adequate one.

(a)

(b)

‘fisheries sector’: the sector of the economy, including all
activities of production, processing and marketing of fisher-
ies and aquaculture products;

‘fisher’: any person engaging in professional fishing on board
an operational fishing vessel, as recognised by the Member
State;

(1) OJ L 184, 17.7.1999, p. 23.

(c)

‘fishing vessel’: any vessel within the meaning of Article 3
point (c) of Regulation (EC) No 2371/2002;

(d)

(e)

(f)

(g)

(h)

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‘aquaculture’: the rearing or cultivation of aquatic organisms
using techniques designed to increase the production of the
organisms in question beyond the natural capacity of the
environment; the organisms remain the property of a natu-
ral or legal person throughout the rearing or culture stage,
up to and including harvesting;

(n)

‘Convergence objective’: the objective of the action for the
least developed Member States and regions according
to Council Regulation (EC) No 1083/2006 of 11 July 2006
laying down the general provisions on the European
Regional Development Fund, the European Social Fund and
the Cohesion Fund and repealing Regulation (EC)
No 1260/1999 (3);

‘fisheries area’: an area with sea or lake shore or including
ponds or a river estuary and with a significant level of
employment in the fisheries sector;

‘micro, small and medium — sized enterprise’: a micro, small
or medium — sized enterprise as defined in Commission
Recommendation 2003/361/EC of 6 May 2003 concerning
the
and medium-sized
enterprises (1);

definition of micro,

small

‘operational programme’: the single document drawn up by
the Member State and approved by the Commission con-
taining a coherent set of priority axes to be achieved with
the aid of the EFF;

‘programming’: the process of organisation, decision-making
and financing in several stages intended to implement, on a
multi-annual basis, the joint action by the Community and
the Member States in order to achieve the priority goals of
the EFF;

(i)

‘priority axis’: one of the priorities in an operational pro-
gramme comprising a group of measures which are related
and have specific measurable goals;

(o)

‘Non-Convergence objective’: the objective covering the
Member States and regions not eligible under the Conver-
gence objective as defined in point (n);

(p)

(q)

‘intermediate body’: any public or private body or service
which acts under the responsibility of a managing or certi-
fying authority, or which carries out duties on behalf of such
an authority vis-à-vis beneficiaries implementing operations;

‘irregularity’: any infringement of a provision of Commu-
nity law resulting from an act or omission by an economic
operator which has, or would have, the effect of prejudicing
the general budget of the European Union by charging an
unjustified item of expenditure to the general budget.

CHAPTER II

Objectives and missions

Article 4

Objectives

(j)

‘measure’: a set of operations aimed at implementing a pri-
ority axis;

Assistance under the EFF shall aim to:

(k)

‘operation’: a project selected according to criteria laid down
by the monitoring committee and implemented by one or
more beneficiaries allowing achievement of the goals of the
priority axis to which it relates;

(l)

‘beneficiary’: a natural or legal person who is the ultimate
recipient of public aid;

(m) ‘public expenditure’: any public contribution to the financ-
ing of operations whose origin is the budget of the State, of
regional and local authorities, of the European Communi-
ties and any similar expenditure. Any contribution to the
financing of operations whose origin is the budget of public-
law bodies or associations of one or more regional or local
authorities or public-law bodies acting in accordance with
Directive 2004/18/EC of the European Parliament and of the
Council of 31 March 2004 on the coordination of proce-
dures for the award of public works contracts, public sup-
ply contracts and public service contracts (2) shall be
regarded as public contribution;

(a)

support the common fisheries policy so as to ensure exploi-
tation of living aquatic resources and support aquaculture
in order to provide sustainability in economic, environmen-
tal and social terms;

(b) promote a sustainable balance between resources and the

fishing capacity of the Community fishing fleet;

(c) promote a sustainable development of inland fishing;

(d)

strengthen the competitiveness of the operating structures
and the development of economically viable enterprises in
the fisheries sector;

(e)

foster the protection and the enhancement of the environ-
ment and natural resources where related to the fisheries
sector;

(1) OJ L 124, 20.5.2003, p. 36.
(2) OJ L 134, 30.4.2004, p. 114.

(3) OJ L 210, 31.7.2006, p. 25.

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(f)

encourage sustainable development and the improvement of
the quality of life in areas with activities in the fisheries
sector;

Article 7

State aid

(g) promote equality between men and women in the develop-

ment of the fisheries sector and fisheries areas.

this Article,
1. Without prejudice to paragraph 2 of
Articles 87, 88 and 89 of the Treaty shall apply to aid granted
by the Member States to enterprises in the fisheries sector.

Article 5

Missions

Support for the fisheries sector shall be provided by the EFF. The
measures implemented under this Regulation shall contribute to
attaining the general objectives set out in Article 33 of the Treaty
and the objectives defined as part of the common fisheries policy.
They shall accompany and supplement, where necessary, other
Community instruments and policies.

Articles 87, 88 and 89 of the Treaty shall not apply to
2.
financial contributions from Member States to operations
co-financed by the EFF and provided as part of an operational
programme.

3.
National provisions setting up public financing going
beyond the provisions of this Regulation concerning financial
contributions, as provided for in paragraph 2, shall be treated as
a whole on the basis of paragraph 1.

CHAPTER III

Principles of assistance

Article 8

Partnership

Article 6

Complementarity, consistency and compliance

1.
The EFF shall provide assistance which complements
national, regional and local actions, integrating into them the pri-
orities of the Community.

2.
The Commission and the Member States shall ensure that
assistance from the EFF is consistent with the policies, priorities
and activities of the Community and complementary to other
the Community. This consistency
financial
and complementarity shall be indicated in particular in the opera-
tional programme.

instruments of

Operations financed by the EFF shall comply with the pro-

3.
visions of the Treaty and of the acts adopted thereunder.

1.
The objectives of the EFF shall be pursued within the frame-
work of close cooperation (hereinafter referred to as partnership)
between the Commission and the Member State. Member States
shall organise, in accordance with the current national rules and
practices, a partnership with the authorities and bodies which it
designates, such as:

(a)

the competent regional, local and other public authorities;

(b)

the economic and social partners;

(c) any other appropriate body.

2. Member States shall establish a broad and effective involve-
ment of all the appropriate bodies, in accordance with national
rules and practices, taking into account the need to promote
equality between men and women and sustainable development
through
and
enhancement.

environmental

integration

protection

of

In accordance with their respective responsibilities, the
4.
Commission and the Member States shall ensure coordination
between assistance from the EFF and the European Agricultural
Fund for Rural Development (EAFRD), established by Council
Regulation (EC) No 1290/2005 (1), the European Regional Devel-
opment Fund (ERDF), the European Social Fund (ESF), the Cohe-
sion Fund and of other Community financial instruments.

Operations financed by the EFF shall not increase fishing

5.
effort.

3.
The partnership shall be conducted in full compliance with
the respective institutional, legal and financial powers of each
partner category as defined in paragraph 1.

4.
The partnership shall cover the preparation, implementa-
tion, monitoring and evaluation of the operational programme.
Member States shall involve all appropriate partners in the dif-
ferent stages of programming within the time limit set for each
stage.

(1) Council Regulation (EC) No 1290/2005 of 21 June 2005 on the
financing of the common agricultural policy (OJ L 209, 11.8.2005,
p. 1).

5.
Each Member State shall organise a consultation on the
national strategic plan, according to the detailed arrangements
that it considers most appropriate.

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Article 9

Proportionality

Article 11

Equality between men and women

Implementation of an operational programme shall be the
1.
responsibility of the Member State. That responsibility shall be
exercised at the appropriate territorial level in accordance with
the institutional arrangements of each Member State and this
Regulation.

The Member States and the Commission shall ensure that equal-
ity between men and women and the integration of the gender
perspective are promoted during the various stages of implemen-
tation of the EFF, including the design, implementation, monitor-
ing and evaluation.

2.
The means employed by the Commission and Mem-
ber States may vary according to the total amount of public
expenditure allocated to the operational programme. Such varia-
tion shall apply in particular to the means used for evaluation,
control, and participation by the Commission in the monitoring
committee provided for in Article 63 and for the annual reports
on implementation of operational programmes.

Article 10

Shared management

The Member States shall ensure that operations to enhance the
role of women in the fisheries sector are promoted.

CHAPTER IV

Financial framework

Article 12

Resources and concentration

1.
The Community budget allocated to the EFF shall be imple-
mented within the framework of shared management between
the Member States and the Commission, in accordance with
Euratom)
Article 53(1)(b) of Council Regulation (EC,
No 1605/2002 of 25 June 2002 on the Financial Regulation
applicable to the general budget of the European Communi-
ties (1), with the exception of the technical assistance referred
to in Article 46(1) of this Regulation which shall be implemented
by the Commission within the framework of direct management.

1.
The resources available for commitments from the EFF for
the period 2007 to 2013 shall be EUR 3 849 million at 2004
prices in accordance with the annual breakdown set out in
Annex I.

2.
0,8 % of the resources referred to in paragraph 1 shall be
allocated to technical assistance for the Commission as defined
in Article 46(1).

The principle of sound financial management shall be applied in
accordance with Article 48(2) of Regulation (EC, Euratom)
No 1605/2002.

3.
For the purpose of programming and subsequent inclusion
in the general budget of the European Union, the amounts
referred to in paragraph 1 shall be indexed at 2 % per year.

2.
The Commission shall exercise its responsibility for imple-
menting the general budget of the European Union in the follow-
ing ways:

4.
The breakdown of budgetary resources provided for in
paragraph 1 and not allocated in accordance with paragraph 2
shall be such as to achieve a significant concentration on the
regions eligible under the Convergence objective.

(a)

(b)

the Commission shall check the existence and proper func-
tioning of management and control systems in the Member
States in accordance with Articles 70 and 73;

the Commission shall interrupt the payment deadline or sus-
pend all or part of payments in accordance with Articles 88
and 89, if the national management and control systems fail,
and shall apply any other financial correction required, in
accordance with the procedures described in Articles 98
and 99;

(c)

the Commission shall check reimbursement of pre-financing
and automatically decommit budget commitments in accor-
dance with Articles 81(2), 90 to 94.

3.
The provisions of Title II of part two of Regulation (EC,
Euratom) No 1605/2002 shall apply to assistance from the EFF.

(1) OJ L 248, 16.9.2002, p. 1.

Article 13

Maximum level of transfers

In order to contribute to the objectives of adequately con-
1.
centrating cohesion funding on the least developed regions and
Member States and reducing disparities in average per capita aid
intensities resulting from capping, the maximum level of trans-
fer from the Funds referred to in paragraph 2 to each individual
Member State pursuant to this Regulation shall be as follows:

— for Member States whose average 2001-2003 GNI per capita
(PPS) is under 40 % of the EU-25 average: 3,7893 % of their
GDP

— for Member States whose average 2001-2003 GNI per capita
(PPS) is equal to or above 40 % and below 50 % of the EU-25
average: 3,7135 % of their GDP

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— for Member States whose average 2001-2003 GNI per capita
(PPS) is equal to or above 50 % and below 55 % of the EU-25
average: 3,6188 % of their GDP

(b)

the scale of adjustment needed to the fishing effort,

and

— for Member States whose average 2001-2003 GNI per capita
(PPS) is equal to or above 55 % and below 60 % of the EU-25
average: 3,5240 % of their GDP

(c)

the level of employment in the fisheries sector,

while taking account of particular situations and needs and past
commitment appropriations.

— for Member States whose average 2001-2003 GNI per capita
(PPS) is equal to or above 60 % and below 65 % of the EU-25
average: 3,4293 % of their GDP

— for Member States whose average 2001-2003 GNI per capita
(PPS) is equal to or above 65 % and below 70 % of the EU-25
average: 3,3346 % of their GDP

— for Member States whose average 2001-2003 GNI per capita
(PPS) is equal to or above 70 % and below 75 % of the EU-25
average: 3,2398 % of their GDP

TITLE II

STRATEGIC APPROACH

CHAPTER I

National strategic plan

Article 15

National strategic plan

— thereafter, the maximum level of transfer is reduced by
0,09 percentage point of GDP for each increment of 5 per-
centage points of average 2001-2003 per capita GNI (PPS)
as compared to the EU-25 average.

1.
Each Member State shall adopt, following an appropriate
consultation with the partners, a national strategic plan covering
the fisheries sector and submit it to the Commission at the latest
when submitting the operational programme.

2.
The ceilings referred to in paragraph 1 include the total
annual allocations from the EFF for any Member State pursuant
to this Regulation, and from the ERDF, the ESF and the Cohe-
sion Fund pursuant to Regulation (EC) No 1083/2006 including
the contribution from the ERDF to the financing of the cross-
border strand of the European Neighbourhood and Partnership
Instrument and of the Instrument for Pre-Accession Assistance
and from the part of the EAFRD originating from the Guidance
Section of the European Agricultural Guidance and Guarantee
Fund.

Calculations of GDP by the Commission shall be based on
3.
the statistics published in April 2005. Individual national growth
rates of GDP for 2007-2013, as projected by the Commission in
April 2005, shall be applied for each Member State separately.

The national strategic plan shall be the subject of a dialogue
between the Member State and the Commission.

2.
The national strategic plan shall contain, where relevant to
the Member State, a summary description of all aspects of the
common fisheries policy, and set out the priorities, objectives,
the estimated public financial resources required and deadlines
for its implementation with particular regard to the strategy for:

(a)

the management and adjustment of the Community fishing
in particular, the adjustment of fishing effort
fleet and,
and capacity with regard to the evolution of
fisheries
resources, the promotion of environmentally-friendly fish-
ing methods and a sustainable development of
fishing
activities;

(b)

the sustainable development of the aquaculture sector;

Article 14

Financial distribution

(c)

the sustainable development of the processing and market-
ing of fisheries and aquaculture products;

The Commission shall make an annual indicative breakdown by
Member State of the commitment appropriations available for
the programming period 2007 to 2013, while separating out the
share contributing to the Convergence objective, using the fol-
lowing objective criteria:

(a)

the size of the fisheries sector in the Member State,

(d)

the sustainable development of inland fishing;

(e)

the sustainable development of fisheries areas, including the
criteria for targeting the priority areas;

(f)

the competitiveness of the fisheries sector, including the
improvement of its structure, organisation and its working
environment;

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(g) preserving human resources in the fisheries sector, in par-
ticular through upgrading professional skills, securing sus-
tainable employment and enhancing the position and the
role of women;

The activities of the EFF shall take the form of one single
2.
operational programme per Member State, in accordance with
its national structure.

(h)

the protection and enhancement of the aquatic environment
related to the fisheries sector.

In addition, the national strategic plan shall contain, where
3.
relevant to the Member State, additional appropriate informa-
tion on the priorities, objectives, the estimated public financial
resources required and deadlines with particular regard to the
strategy for:

(a) meeting the requirements for inspection and control of fish-
ing activities and data and information collection on the
common fisheries policy;

(b)

the supply of fisheries products and the development of fish-
ing activities outside Community waters.

CHAPTER II

Strategic follow up

Article 16

Strategic debate

1.
By 31 December 2011, the Commission shall organise a
debate with Member States on the content and the progress of
the implementation of the national strategic plans, on the basis
of written information submitted by Member States, with a view
to encourage the exchange of best practice among Member
States.

The Commission shall inform the European Parliament, the
2.
Council, the European Economic and Social Committee and the
Committee of the Regions on the outcome of the debate referred
to in paragraph 1.

TITLE III

PROGRAMMING

CHAPTER I

General provisions on the EFF

Article 17

Preparation and approval of the operational programme

3.
The Member State shall draw up its operational pro-
gramme upon completion of close consultations with the
regional, local, economic and social partners in the fisheries sec-
tor and all other appropriate bodies,
in accordance with its
national structure and the partnership provided for in Article 8.

4.
The Member State shall submit a proposal for an opera-
tional programme to the Commission containing all the compo-
nents referred to in Article 20, in due time to allow its adoption
as soon as possible.

The Commission shall appraise the proposed operational
5.
programme to determine whether it contributes to the objec-
tives set out in Article 4, the guiding principles set out in
Article 19 and the relevant part of the national strategic plan,
the ex ante evaluation referred to in
taking into account
Article 48.

When the Commission, within two months following the receipt
of the proposed operational programme, considers that the pro-
gramme is not coherent with the objectives set out in Article 4,
the guiding principles set out under Article 19 or the relevant
part of the national strategic plan, it may request the Member
State to provide all necessary additional information and, where
appropriate, to adapt the proposed programme accordingly.

6.
Thereafter, the Member State shall submit its operational
programme to the Commission which shall adopt a decision
approving it as soon as possible but no later than four months
after the submission.

Article 18

Duration and revision of the operational programme

The operational programme shall cover the period between

1.
1 January 2007 and 31 December 2013.

2.
The operational programme may be re-examined where a
major difficulty has arisen in its implementation or if there have
been significant strategic changes or for reasons of sound man-
agement and, if necessary, revised for the rest of the period on
the initiative of the Member State or the Commission, in agree-
ment with the Member State concerned, after approval by the
monitoring committee provided for in Article 63.

Each Member State shall draw up an operational pro-
1.
gramme to implement
to be
co-financed by the EFF. The operational programme shall be
coherent with the national strategic plan.

the policies and priorities

A revision shall take into account, in particular, the interim evalu-
ation, the annual reports on implementation and the annual
examinations provided for in Article 49, Article 67 and Article 69
respectively and important changes to the common fisheries
policy.

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The Commission shall adopt its decision on a request for
3.
revision of the operational programme as soon as possible but
not later than two months after the submission of the request
by the Member State, provided that the content of the revised
operational programme is in accordance with Article 20. Detailed
rules shall be defined in accordance with the procedure referred
to in Article 101(3).

Article 19

Guiding principles for the operational programme

In the preparation of the operational programme provided for
in Article 17 and the implementation of the operational pro-
gramme, Member States shall take into account the following
guiding principles:

(a)

consistency with the principles of the common fisheries
policy and the national strategic plan in order to achieve, in
particular, a stable and enduring balance between fishing
capacity and fishing opportunities;

(b) enhancement of a harmonious, balanced and sustainable
jobs and human
development of economic activities,
resources, as well as protection and the improvement of the
environment;

(c) an appropriate allocation of the available financial resources
between the priority axes and, particularly, where relevant,
an appropriate level of financing for operations under Chap-
ter I of Title IV (Priority axis 1: measures for the adaptation
of the Community fishing fleet);

(g) encouragement of operations with high added value through
the development of innovative capacities that provide for
high quality standards and meet consumer needs for fisher-
ies and aquaculture products;

Operations promoting transparency of environmentally
friendly production methods
shall be
encouraged;

to consumers

(h) contribution to a better supply to, and to a sustainable devel-
opment of, the community market of fisheries and aquacul-
ture products;

(i) promotion, during the various stages of the implementation
of the operational programme, of gender balance in the fish-
in particular, at
eries sector through operations aiming,
reducing gender based segregation in the labour market;

(j) promotion of an integrated sustainable development of the
inherent potential

areas by fostering their

fisheries
and improving quality of life;

(k) where relevant, improvement of the institutional and admin-
istrative capacities aiming at a good governance of the com-
mon fisheries policy and an efficient implementation of the
operational programme.

Article 20

Content of the operational programme

(d) promotion of the operations contributing to the Lisbon

1.

The operational programme shall contain:

strategy;

Operations aiming at promoting a sustainable level of
employment in the fisheries sector in particular through
enhancing the quality of jobs, providing access to the pro-
fession for young people and stimulating innovation
throughout the sector shall be encouraged;

(e) promotion of the operations contributing to the Gothen-
burg strategy and particularly those enhancing the environ-
mental dimension in the fisheries sector;

Operations aiming at reducing the impact of activities in the
fisheries sector on the environment and promoting environ-
mentally friendly production methods shall be encouraged;

(a) a synthesis of the situation of the policy areas eligible for

support in terms of strengths and weaknesses;

(b) a description and a justification of the priority axes chosen,
having regard to the relevant part of the national strategic
plan and the guiding principles set out under Article 19, as
well as the expected impact resulting from the ex ante evalu-
ation referred to in Article 48;

(c)

specific targets set for each priority axis. Those targets shall
be quantified, where they lend themselves to quantification,
using a limited number of indicators taking into account the
principle of proportionality. The indicators must make it
possible to measure progress in relation to the baseline situ-
ation and the effectiveness of the specific targets set for each
priority axis;

(f)

improvement of the situation of the human resources in the
fisheries sector through operations aiming at upgrading and
diversifying professional skills, developing lifelong learning
and improving working conditions and safety;

(d) a summary description of the principal measures envisaged

for implementing the priority axes;

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(e)

(f)

information on complementarity with the measures under
the EAFRD, the Structural Funds and the Cohesion Fund,
where relevant;

a financing plan containing two tables, each showing sepa-
rately, where relevant, the appropriations earmarked for the
Convergence objective and the Non-Convergence objective:

(i)

a table breaking down for each year the amount of the
total financial allocation envisaged for the contribution
from the EFF;

(ii) a table specifying, for the whole programming period
and for each priority axis, the amount of the financial
allocation envisaged for the Community contribution
and the national public contributions, the rate of con-
tribution from the EFF for each priority axis and the
amount allocated to technical assistance;

TITLE IV

PRIORITY AXES

CHAPTER I

Priority axis 1: measures for the adaptation of the
Community fishing fleet

Article 21

Scope

Support from the EFF targeting the adaptation of the Commu-
nity fishing fleet shall concern:

(g)

the implementing provisions for the operational pro-
gramme, including:

(a) public aid for owners of fishing vessels and fishers affected
by fishing effort adjustment plans where these form part of
the following:

(i)

designation by the Member State of the entities pro-
vided for in Article 58;

(i)

recovery plans as referred to in Article 5 of Regulation
(EC) No 2371/2002;

(ii) a description of evaluation and monitoring systems as
well as the composition of the monitoring committee
provided for in Article 63;

(ii) emergency measures as referred to in Articles 7 and 8

of Regulation (EC) No 2371/2002;

(iii) information about the competent body for receiving the
payments made by the Commission and the body or
bodies
to the
responsible for making payments
beneficiaries;

(iii) the non-renewal of a fisheries agreement between the
Community and a third country or a substantial cut in
fishing opportunities under an international agreement
or other arrangement;

(iv) a definition of procedures for mobilisation and circula-
to ensure their

in order

financial

flows

tion of
transparency;

(v)

the elements aiming at ensuring the information and
publicity of the operational programme as referred to in
Article 51;

(vi) a description of the procedures agreed between the
Commission and the Member State for the exchange of
computerised data to meet the payment, monitoring
and evaluation requirements
laid down by this
Regulation;

(h)

information on the application of Article 8.

2.
For each of the priority axes provided for in Title IV, the
Member State shall determine in its operational programme the
conditions and procedures for their application. The programme
shall in particular indicate clearly the purpose of each priority
axis planned.

(iv) management plans as referred to in Article 6 of Regu-

lation (EC) No 2371/2002;

(v) measures as referred to in Articles 9 and 10 of Regula-

tion (EC) No 2371/2002;

(vi) national decommissioning schemes as part of the obli-
gations laid down in Articles 11 to 16 of Regulation
(EC) No 2371/2002 on the adjustment of fishing capac-
ity of the Community fishing fleet;

(b) public aid for temporary cessation of fishing activities in

accordance with Article 24(1)(vii);

(c)

investments on board fishing vessels and selectivity in accor-
dance with Article 25;

(d) public aid for small-scale coastal fishing in accordance with

Article 26;

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(e)

socio-economic compensation for the management of the
Community fishing fleet in accordance with Article 27;

(c)

its reassignment for the purpose of the creation of artificial
reefs. Member States shall ensure that such operations are
preceded by an environmental impact assessment and con-
tribute to the objectives referred to in Article 38(2)(a).

(f) public aid in the framework of rescue and restructuring plans
in accordance with the Community Guidelines on State aid
for rescuing and restructuring firms in difficulty (1).

Article 22

Content of fishing effort adjustment plans

1.
Each Member State shall lay down in its national strategic
plan its policy for adjusting fishing effort, with a view to fulfil
the obligations laid down in Article 11(1) of Regulation (EC)
No 2371/2002. It shall accord priority to the financing of the
operations referred to in Article 21(a)(i).

Fishing effort adjustment plans may include all the relevant

2.
measures provided for in this Chapter.

3.
In the cases provided for in Article 21(a)(i), (ii) and (iv), the
fishing effort adjustment plans shall be adopted by the Member
States within six months following the date of the Council
or Commission decision.

In the cases provided for in Article 21(a)(iii), the Member States
shall adopt the fishing effort adjustment plans for the fishing ves-
sels and fishers affected, within six months following the notifi-
cation by the Commission.

4.
Each year the Member States shall communicate in the
annual and final reports on implementation referred to in
Article 67 the results achieved in implementing their fishing
effort adjustment plans. The results shall be measured using the
relevant indicators defined in the operational programmes.

Public aid for permanent cessation of fishing activities paid to
the owners of fishing vessels shall apply to the vessel’s fishing
capacity and, where appropriate, to the fishing licence associ-
ated with it.

2.
The permanent cessation of fishing activities of fishing ves-
sels shall be programmed in the form of national decommission-
ing schemes which shall not exceed two years from the date of
their entry into force.

3.
To facilitate the implementation of fishing effort adjust-
ment plans, the Member States may make public calls for ten-
ders or calls for proposals.

The Member States may also set the level of public aid taking
into account the best cost/effectiveness ratio on the basis of
objective criteria, such as:

(a)

the price of the fishing vessel recorded on the national mar-
ket or its insurance value;

(b)

the turnover of the fishing vessel;

(c)

the age of the fishing vessel and its tonnage expressed in GT
or engine power expressed in kW.

Article 23

Public aid for temporary cessation of fishing activities

Article 24

Public aid for permanent cessation of fishing activities

1.
The EFF shall contribute to financing of the permanent ces-
sation of fishing activities of fishing vessels, provided that such
cessation forms part of a fishing effort adjustment plan referred
to in Article 21(a). The permanent cessation of fishing activities
of a fishing vessel may be achieved only by:

1.
The EFF may contribute to the financing of aid measures
for the temporary cessation of fishing activities for fishers and
the owners of fishing vessels for a maximum duration, during
the period 2007 to 2013, of:

(a)

the scrapping of the fishing vessel;

(i)

12 months, which may be extended by up to 12 months,
in the context of the fishing effort adjustment plans referred
to in Article 21(a)(i);

(b)

its reassignment, under the flag of a Member State and reg-
istered in the Community for activities outside fishing;

(ii)

(1) OJ C 244, 1.10.2004, p. 2.

three months in the event of Member States emergency mea-
sures as referred to in Article 8 of Regulation (EC)
No 2371/2002, in the context of the fishing effort adjust-
ment plans referred to in Article 21(a)(ii);

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(iii) six months in the event of Commission emergency mea-
sures as referred to in Article 7 of Regulation (EC)
No 2371/2002, in the context of the fishing effort adjust-
ment plans referred to in Article 21(a)(ii);

(iv) six months, which may be extended by up to six months,
in the context of the fishing effort adjustment plans referred
to in Article 21(a)(iii);

(v)

eight months, in the context of the fishing effort adjustment
plans referred to in Article 21(a)(iv), and of management
plans adopted at national level within the framework of
Community conservation measures, and where such plans
provide for gradual reductions of fishing effort;

(vi)

three months, in the context of rescue and restructuring
plans referred to in Article 21(f) during the period of
replacement of engines;

The EFF may contribute to one replacement of the engine

3.
per vessel, provided that:

(a)

for vessels as defined in Article 26(1) the new engine has
the same power as the old one or less;

(b)

for vessels up to 24 metres in overall length other than those
referred to in point (a), the new engine has at least 20 % less
power than the old one;

(c)

for trawlers of more than 24 metres in overall length, the
new engine has at least 20 % less power than the old one,
the vessel is subject to a rescue and restructuring plan as
referred to in Article 21(f) and changes to a less fuel-
intensive fishing method.

(vii) six months, in the event of a natural disaster, closures of
fisheries decided by Member States for reasons of public
health or other exceptional occurrence which is not the
result of resource conservation measures.

The reduction of engine power referred to in para-
4.
graph 3(b) and (c) may be achieved by a group of vessels for each
category of vessels referred to in points (b) and (c) of that
paragraph.

2.
The financial contribution from the EFF to the measures
referred to in points (i) to (vi) of paragraph 1 per Member State
for the entire period 2007 to 2013 may not exceed the higher
of the following two thresholds: EUR 1 million or 6 % of the
Community financial assistance allocated to the sector in the
Member State concerned.

However, these thresholds may be exceeded in accordance with
the procedure referred to in Article 101(3).

A recurrent seasonal suspension of fishing shall not be
3.
taken into account for the grant of allowances or payments under
this Regulation.

Article 25

Investments on board fishing vessels and selectivity

1.
The EFF may contribute to the financing of equipment and
the modernisation of fishing vessels of five years of age or more
only under the conditions of this Article and in accordance with
the provisions of Chapter III of Regulation (EC) 2371/2002.

2.
Such investments may concern improvements of safety on
board, working conditions, hygiene, product quality, energy effi-
ciency and selectivity, provided that it does not increase the abil-
ity of the vessels to catch fish.

No aid shall be granted for the construction of fishing vessels
nor for the increase of fishholds.

5.
The conditions for the implementation of the operations
provided for in paragraph 4 may be set out in accordance with
the procedure referred to in Article 101(3).

The EFF may contribute to the financing of equipment and

6.
modernisation works:

(a) making it possible for catches the discarding of which is no

longer authorised to be kept on board;

(b) as part of projects covering the preparation or trial of new
technical measures for a limited period to be set by the
Council or the Commission;

(c)

for reducing the impact of fishing on non-commercial
species;

(d)

for reducing the impact of fishing on ecosystems and the
sea bottom;

(e)

for the protection of catches and gear from wild predators,
including through changes to the material of parts of fish-
ing gear, provided that it does not increase fishing effort or
undermine the selectivity of the fishing gear and that all
appropriate measures are introduced to avoid physically
damaging the predators.

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The EFF may contribute to the financing of investments to
7.
achieve the selectivity of fishing gear,
including up to two
replacements of fishing gear over the entire period 2007 to 2013,
provided that:

The EFF may contribute to the payment of premiums for
4.
fishers and owners of fishing vessels involved in small-scale
coastal fishing in order to:

(a)

the fishing vessel concerned is affected by a fishing effort
adjustment plan as referred to in Article 21(a)(i), is chang-
ing its fishing method and is leaving the fishery concerned
to go to another fishery where the state of the resource
makes fishing possible,

(a)

improve management and control of access conditions
to certain fishing areas;

(b) promote the organisation of the production, processing and

marketing chain of fisheries products;

or

(b)

the new gear is more selective and meets recognised envi-
ronmental criteria and practices which go beyond existing
regulatory obligations under Community law.

The EFF may contribute to the funding of the first replace-

8.
ment of fishing gear:

(a)

for the purpose of guaranteeing compliance with new tech-
nical requirements on selectivity under Community law. Aid
may be granted until the date when such requirements
become mandatory or exceptionally for a short period after
that date which may be fixed by the Community law
concerned;

(b)

for reducing the impact of fishing on non-commercial
species.

Article 26

Small-scale coastal fishing

For the purpose of this Article, ‘small-scale coastal fishing’
1.
means fishing carried out by fishing vessels of an overall length
of less than 12 metres and not using towed gear as listed in
Table 3 in Annex I of Commission Regulation (EC) No 26/2004
of 30 December 2003 regarding the fishing vessels register of
the Community (1).

2. Where the EFF provides financing for measures under
Article 25 in favour of small-scale coastal fishing the private
financial participation rate shown in Group 2 of the Table in
Annex II may be reduced by 20 percentage points.

3.
The EFF may contribute to the financing of socio-economic
measures provided for under Article 27 in favour of small-scale
coastal fishing.

(1) OJ L 5, 9.1.2004, p. 25.

(c)

encourage voluntary steps to reduce fishing effort for the
conservation of resources;

(d) encourage the use of technological innovations (more selec-
tive fishing techniques which go beyond existing regulatory
obligations under Community law or innovations to pro-
tect the gear and catches from predators) that do not increase
fishing effort;

(e)

improve professional skills and safety training.

Article 27

Socio-economic compensation for the management of the
Community fishing fleet

The EFF may contribute to the financing of socio-economic
1.
measures proposed by Member States for fishers affected by
developments in fishing and which involve:

(a)

the diversification of activities with a view to promoting
multiple jobs for fishers;

(b) upgrading professional skills in particular for young fishers;

(c)

schemes for retraining in occupations outside sea fishing;

(d) early departure from the fishing sector,

including early

retirement;

(e) non-renewable compensation to fishers who have worked
on board a vessel for at least 12 months as fishers, provided
the fishing vessel on which the beneficiaries have worked
has been the object of permanent cessation of fishing activi-
ties within the meaning of Article 23. This compensation
shall be refunded on a pro rata temporis basis where the ben-
eficiaries return to their work as fishers within a period of
less than one year after receiving it.

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The EFF may contribute to individual premiums to fishers
2.
younger than 40 years who can demonstrate that they have
worked at least five years as fishers or have equivalent profes-
sional training and who acquire for the first time part or total
ownership of a fishing vessel of less than 24 metres in overall
length which is equipped to go fishing at sea and is between 5
to 30 years old.

For operations provided for in Annex II of Council
6.
Directive 85/337/EEC of 27 June 1985 on the assessment of the
effects of certain public and private projects on the environ-
ment (1), aid shall be granted only when the information laid
down in Annex IV of that Directive has been provided.

The premium shall not exceed 15 % of the cost of acquisi-

3.
tion of ownership nor exceed the amount of EUR 50 000.

Article 29

Measures for productive investments in aquaculture

4.
The conditions set out in paragraphs (1)(e) and (2) may be
modified in accordance with the procedure referred to in
Article 101 (3).

CHAPTER II

Priority axis 2: aquaculture, inland fishing, processing and
marketing of fishery and aquaculture products

Article 28

Scope of intervention in aquaculture production

Support

1.
granted for the following:

for targeting aquaculture production may be

1.
The EFF may support investments in the construction,
extension, equipment and modernisation of production installa-
tions, in particular with a view to improving working conditions,
hygiene, human or animal health and product quality, reducing
negative impact or enhancing positive effects on the environ-
ment. Investments shall contribute to one or more of the follow-
ing objectives:

(a) diversification towards new species and production of spe-

cies with good market prospects;

(b)

implementation of aquaculture methods substantially reduc-
ing negative impact or enhancing positive effects on the
environment when compared with normal practice in the
aquaculture sector;

(a) measures for productive investments in aquaculture;

(c)

support for traditional aquaculture activities important for
preserving and developing both the economic and social fab-
ric and the environment;

(b) aqua-environmental measures;

(c) public health measures;

(d) animal health measures.

(d)

support for the purchase of equipment aiming at protecting
the farms from wild predators;

(e)

improvement of the working and safety conditions of aquac-
ulture workers.

Transfer of ownership of a business shall not be eligible for

2.
Community aid.

2.

Investment aid shall be limited to:

Support under paragraph 1 may contribute to lifelong

3.
learning.

(a) micro, small and medium-sized enterprises,

4. With regard to operations provided for under Articles 29,
31 and 32 when realised for the purpose of guaranteeing com-
pliance with standards under Community law on the environ-
ment, human or animal health, hygiene or animal welfare, aid
may be granted until the date on which the standards become
mandatory for the enterprises.

and

(b) enterprises that are not covered by the definition in
Article 3(f), with less than 750 employees or with a turn-
over of less than EUR 200 million.

5. Member States shall ensure that adequate mechanisms exist
to avoid counterproductive effects, particularly the risk of creat-
ing surplus production capacity or adversely affecting the policy
for conservation of fishing resources.

(1) OJ L 175, 5.7.1985, p. 40. Directive as last amended by Directive
2003/35/EC of the European Parliament and of the Council (OJ L 156,
25.6.2003, p. 17).

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By way of derogation from paragraph 2, in the outermost
3.
regions and the outlying Greek islands, aid may be granted to all
enterprises.

4. Member States shall calculate compensation on the basis
of one or more of the following criteria:

4. Member States shall ensure that priority is given to micro
and small-sized enterprises.

(a)

the loss of revenue incurred;

Article 30

Aqua-environmental measures

(b)

the additional cost which may result from the application
of aqua-environmental methods;

(c)

the need to provide financial support for carrying out the
project;

The EFF may support granting compensation for the use
aquaculture production methods helping to protect

1.
of
and improve the environment and to conserve nature.

(d)

the specific disadvantages or investment costs for units
located inside or near NATURA 2000 areas.

2.

The purpose of the support is to promote:

5.

A one-off compensation shall be allocated:

(a)

forms of aquaculture comprising protection and enhance-
ment of the environment, natural resources, genetic diver-
sity, and management of the landscape and traditional
features of aquaculture zones;

(b) participation in the Community eco-management and audit
scheme created by Regulation (EC) No 761/2001 of the
European Parliament and of the Council of 19 March 2001
allowing voluntary participation by organisations in a Com-
munity eco-management and audit scheme (EMAS) (1);

(c) organic aquaculture within the meaning of Council Regula-
tion (EEC) No 2092/91 of 24 June 1991 on organic produc-
tion of agricultural products and indications referring thereto
on agricultural products and foodstuffs (2);

(d)

sustainable aquaculture compatible with specific environ-
resulting from the designation of
mental constraints
NATURA 2000 areas
accordance with Council
Directive 92/43/EEC of 21 May 1992 on the conservation
of natural habitats and of wild fauna and flora (3).

in

In order to receive compensation under this Article, benefi-
3.
ciaries of compensation must commit themselves for a minimum
of five years to aqua-environmental requirements which go
beyond the mere application of normal good aquaculture prac-
tice. For the support provided for under paragraph 2(a), the envi-
ronmental benefits of such commitments must be demonstrated
by a prior assessment conducted by competent bodies designated
by the Member State.

(1) OJ L 114, 24.4.2001, p. 1. Regulation as last amended by Commis-

sion Regulation (EC) No 196/2006 (OJ L 32, 4.2.2006, p. 4).

(2) OJ L 198, 22.7.1991, p. 1. Regulation as last amended by Commis-
sion Regulation (EC) No 780/2006 (OJ L 137, 25.5.2006, p. 9).
(3) OJ L 206, 22.7.1992, p. 7. Directive as last amended by Regulation
of the European Parliament and of the Council (EC) No 1882/2003
(OJ L 284, 31.10.2003, p. 1).

(a) under paragraph 2(a), on the basis of a maximum amount
per hectare of the area of the enterprise to which aqua-
environmental commitments apply;

(b) under paragraph 2(c), for a maximum of two years during
the period of the conversion of the enterprise to organic
production;

(c) under paragraph 2(d), for a maximum of two years subse-
quent to the date of the decision establishing the NATURA
2000 area and only for aquaculture units existing prior to
that decision.

Article 31

Public health measures

The EFF may contribute to compensation to mollusc farmers for
the temporary suspension of harvesting of farmed mollusc. The
compensation may be granted where contamination of molluscs
owing to the proliferation of toxin-producing plankton or the
presence of plankton containing biotoxins entails, for public
health protection reasons, suspension of the harvest:

— for more than four months consecutively;

or

— where the loss suffered as a result of suspension of the har-
vest amounts to more than 35 % of the annual turnover of
the business concerned, calculated on the basis of the aver-
age turnover of the business over the preceding three years.

The maximum duration for which compensation may be granted
shall be 12 months over the entire programming period.

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Article 32

Animal health measures

Investments shall not be eligible for assistance if they are
7.
likely to jeopardize the equilibrium between the fleet size and the
corresponding fish resources available.

The EFF may contribute to the financing of the control and eradi-
cation of diseases in aquaculture under the terms of Council
Decision 90/424/EEC of 26 June 1990 on expenditure in the vet-
erinary field (1).

8.
The management authority shall take all measures neces-
sary in order to ensure that vessels receiving financial assistance
from the EFF under this Article shall continue to operate exclu-
sively in inland waters.

Article 33

Inland fishing

Article 34

Investments in processing and marketing

1.
For the purpose of this Article ‘inland fishing’ means fish-
ing carried out for commercial purposes by vessels operating
exclusively in inland waters or by other devices used for ice
fishing.

2.
Support for inland fishing may cover investments for the
construction, extension, equipment and modernisation of inland
fishing facilities, with a view to improving safety, working con-
ditions, hygiene and product quality, human or animal health,
impact on the
or to reducing negative or having beneficial
environment.

Investments on board vessels may be supported in accordance
with the relevant provisions laid down in Article 25.

The EFF may support investments in processing and mar-

1.
keting of fisheries and aquaculture products.

Transfer of ownership of a business shall not be eligible for

2.
Community aid.

3.

The EFF may also support lifelong learning.

4.
Investments shall not be eligible for assistance where they
concern fisheries and aquaculture products intended to be used
and processed for purposes other than human consumption, with
the exception of investments exclusively for the treatment, pro-
cessing and marketing of fisheries and aquaculture product waste.

The EFF may support the reassignment of vessels operat-
3.
ing in inland fishing to other activities outside fishing. National
authorities shall take the appropriate measures to ensure that
vessels receiving assistance from the EFF under this paragraph
shall not return to operate in fishing.

5. Where operations are realised for the purpose of guaran-
teeing compliance with the standards under Community law on
the environment, human or animal health, hygiene or animal
welfare, aid may be granted until the date on which the stan-
dards become mandatory for the enterprises.

4. Where measures for the recovery of species occurring in
inland waters are provided for in a Community legal act, the EFF
may grant support for measures for the temporary cessation of
inland fishing activities for fishers and the owners of vessels oper-
ating exclusively in inland waters. Support shall be limited to a
maximum total duration of 12 months over the entire program-
ming period for the vessels concerned.

Article 35

Eligible measures in processing and marketing

1.
The EFF may support the construction, extension, equip-
ment and modernisation of enterprises while concentrating, in
particular, on achieving one or more of the following objectives:

Transfer of ownership of a business shall not be eligible for

5.
Community aid.

(a)

improving working conditions;

6. Without prejudice to the provisions of paragraphs 3 and 4,
permanent or temporary cessation of fishing activities and con-
struction of vessels operating in inland waters shall not be eli-
gible for assistance.

(b)

improving and monitoring public health and hygiene condi-
tions or product quality;

(c) producing high quality products for niche markets;

(1) OJ L 224, 18.8.1990, p. 19. Decision as last amended by Decision

2006/53/EC (OJ L 29, 2.2.2006, p. 37).

(d)

reducing negative impacts on the environment;

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(e)

improving the use of little-used species, by-products and
waste;

(e) pilot projects;

(f) producing or marketing new products, applying new tech-
nologies, or developing innovative production methods;

(f) modification for reassignment of fishing vessels.

(g) marketing products mainly originating from local landings

and aquaculture.

Article 37

Collective actions

Investments shall aim overall

2.
employment in the fisheries sector.

to promote sustainable

3.

Investment aid shall be limited to:

(a) micro, small and medium-sized enterprises,

The EFF may support measures of common interest which are
implemented with the active support of operators themselves or
by organisations acting on behalf of producers or other organi-
sations recognised by the Member State and which aim, in par-
ticular, to:

and

(a)

contribute sustainably to better management or conserva-
tion of resources;

(b) enterprises that are not covered by the definition in
Article 3(f), with less than 750 employees or with a turn-
over of less than EUR 200 million.

(b) promote selective fishing methods or gears and reduction of

by-catches;

By way of derogation from paragraph 3, in the outermost
4.
regions and the outlying Greek islands, aid may be granted to all
enterprises.

(c)

remove lost fishing gear from the sea bed in order to com-
bat ghost fishing;

5. Member States shall ensure that priority is given to micro
and small-sized enterprises.

(d)

improve working conditions and safety;

Community aid shall not be granted to investments relat-

6.
ing to the retail trade.

(e)

contribute to the transparency of markets in fisheries and
aquaculture products including traceability;

CHAPTER III

Priority axis 3: measures of common interest

(f)

improve quality and food safety;

(g) develop, restructure or improve aquaculture sites;

Article 36

Scope of intervention

1.
The EFF may support measures of common interest with a
broader scope than measures normally undertaken by private
enterprises and which help to meet the objectives of the com-
mon fisheries policy.

2.

These measures may concern:

(a)

collective actions;

(b) protection and development of aquatic fauna and flora;

(c)

fishing ports, landing sites and shelters;

(h)

investments concerning production, processing or market-
ing equipment and infrastructure including for waste
treatment;

(i) upgrade professional skills, or develop new training meth-

ods and tools;

(j) promote partnership between scientists and operators in the

fisheries sector;

(k) networking and exchange of experience and best practice
equal opportunities

among organisations promoting
between men and women and other stakeholders;

(d) development of new markets and promotional campaigns;

(l)

contribute to the objectives laid down for small-scale coastal
fishing in Article 26(4);

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(m) improve management and control of access conditions to
fishing areas, in particular through the drawing up of local
management plans approved by the competent national
authorities;

Article 39

Fishing ports, landing sites and shelters

(n) create producer organisations recognised under Council
Regulation (EC) No 104/2000 of 17 December 1999 on the
common organisation of the markets in fishery and aquac-
ulture products (1), their restructuring and the implementa-
tion of their plans to improve quality;

(o) carry out feasibility studies relating to promotion of partner-

ships with third countries in the fisheries sector.

Aid referred to in point (n) shall be granted for a maximum of
three years following the date of recognition or following the
date of the decision on restructuring of the producer organisa-
tion and shall be degressive over these three years.

Article 38

Measures intended to protect and develop aquatic fauna
and flora

The EFF may support investments in existing public or pri-
1.
vate fishing ports, which are of interest to fishers and aquacul-
ture producers using them, with the aim of improving the
services offered.

The EFF may also support investments to restructure landing sites
and to improve the conditions for fish landed by coastal fishers
in existing fish landing sites designated by the competent national
authorities.

2.

The investments shall relate, in particular, to:

(a)

improving the conditions under which fisheries and aquac-
ulture products are landed, processed, stored in the ports
and auctioned;

(b)

the provision of fuel, ice, water and electricity;

1.
The EFF may support measures of common interest
intended to protect and develop aquatic fauna and flora while
enhancing the aquatic environment.

(c)

repair equipment and the maintenance of fishing vessels;

2.

These measures shall relate to:

(d) construction, modernisation and extension of quays improv-

ing safety during landing or loading;

(a)

the construction or installation of static or movable facili-
ties intended to protect and develop aquatic fauna and flora,

(e)

computerised management of fishing activities;

or

(f)

improving safety and working conditions;

(b)

the rehabilitation of
grounds and migration routes for migratory species,

inland waters,

including spawning

(g)

the storage and treatment of waste;

or

(h) measures to reduce discards.

(c)

the protection and enhancement of the environment in the
framework of NATURA 2000 where its areas directly con-
cern fishing activities, excluding operational costs.

3.
In order to improve the safety of fishers, the EFF may also
support safety related investments for the construction or mod-
ernisation of small fishing shelters.

Direct restocking shall not be eligible for aid, unless explicitly
foreseen as a conservation measure by a Community legal act.

The action must be implemented by public or semi-public
3.
bodies, recognised trade organisations or other bodies appointed
for that purpose by the Member State.

(1) OJ L 17, 21.1.2000, p. 22. Regulation as last amended by the 2003

Act of Accession.

Article 40

Development of new markets and promotional campaigns

1.
The EFF may support measures of common interest
intended to implement a policy of quality and value enhance-
ment, development of new markets or promotional campaigns
for fisheries and aquaculture products.

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The operations may not be aimed at commercial brands or
2.
make reference to specific countries or geographical areas, except
in case of products recognised under the terms of Council Regu-
lation (EC) No 510/2006 of 20 March 2006 on the protection
of geographical indications and designations of origin for agri-
cultural products and foodstuffs (1).

(b) enable tests to be carried out on management plans and fish-
ing effort allocation plans, including, if necessary, the estab-
lishment of no-fishing zones,
in order to evaluate the
biological and financial consequences, and experimental
restocking;

3.

The measures shall, in particular, relate to:

(a)

conducting regional, national or transnational promotion
campaigns for fisheries and aquaculture products;

(b)

the supply to the market of surplus or underexploited spe-
cies which are normally discarded or of no commercial
interest;

(c)

implementation of a quality policy for fisheries and aquac-
ulture products;

(d) promotion of products obtained using methods with low

impact on the environment;

(e) promotion of products recognised under the terms of Regu-

lation (EC) No 510/2006;

(f) quality certification, including label creation and the certifi-
cation of products caught or farmed using environmentally
friendly production methods;

(g) campaigns to improve the image of fisheries and aquacul-

ture products and the image of the fisheries sector;

(h)

implementation of market surveys.

Article 41

Pilot projects

1.
The EFF may support pilot projects, including the experi-
mental use of more selective fishing techniques, aimed at acquir-
ing and disseminating new technical knowledge and carried out
by an economic operator, a recognised trade association or any
other competent body designated for that purpose by the Mem-
ber State, in partnership with a scientific or technical body.

2.

The pilot projects provided for in the paragraph 1 may:

(a)

test, under near-actual conditions in the production sector,
the technical or economic viability of an innovative technol-
ogy with the aim of acquiring and disseminating technical
or economic knowledge of the technology tested;

(c) develop and test methods to improve gear selectivity, reduce
by-catches, discards or the impact on the environment, in
particular on the sea bottom;

(d)

test alternative types of fishing management techniques.

A pilot project shall always include adequate scientific follow-up
in order to yield significant results.

The results of pilot projects financed under paragraph 1

3.
shall be the subject of technical reports available to the public.

Article 42

Modification for reassignment of fishing vessels

The EFF may support the modification of fishing vessels for their
reassignment, under the flag of a Member State and registered in
the Community for training or research purposes in the fisheries
sector or for other activities outside fishing. These operations
shall be limited to public or semi-public bodies.

CHAPTER IV

Priority axis 4: sustainable development of fisheries areas

Article 43

Scope of assistance

1.
The EFF may provide assistance, complementary to the
other Community instruments, for the sustainable development
and improvement of the quality of life in fisheries areas eligible
as part of an overall strategy which seeks to support the imple-
mentation of the objectives of the common fisheries policy, in
particular taking account of its socio-economic effects.

The measures for sustainable development of fisheries areas

2.
shall seek to:

(1) OJ L 93, 31.3.2006, p. 12.

(a) maintain the economic and social prosperity of these areas

and add value to fisheries and aquaculture products;

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(b) maintain and develop jobs in fisheries areas through sup-
port for diversification or the economic and social restruc-
turing of areas facing socio-economic difficulties as a result
of changes in the fisheries sector;

(c) diversifying activities through the promotion of multiple
employment for fishers through the creation of additional
jobs outside the fisheries sector;

(c) promote the quality of the coastal environment;

(d) adding value to fisheries products;

(d) promote national and transnational cooperation between

fisheries areas.

3.
A fisheries area selected for assistance shall be limited in
size and, as a general rule, shall be smaller than NUTS level 3 of
the common classification of territorial units for statistics within
the meaning of Regulation (EC) No 1059/2003 of 26 May 2003
of the European Parliament and of the Council of 23 May 2003
on the establishment of a common classification of territorial
units for statistics (NUTS) (1). The area should be sufficiently
coherent from a geographical, economic and social point of view.

(e)

supporting small fisheries and tourism related infrastructure
and services for the benefit of small fisheries communities;

(f) protecting the environment in fisheries areas to maintain its
attractiveness, regenerating and developing coastal hamlets
and villages with fisheries activities and protecting and
enhancing the natural and architectural heritage;

4.

Assistance should target, as a priority, areas with:

(g)

re-establishing the production potential in the fisheries sec-
tor when damaged by natural or industrial disasters;

(a)

low population density,

or

(b)

fishing in decline,

or

(h) promoting inter-regional and trans-national cooperation
among groups in fisheries areas, mainly through network-
ing and disseminating best practice;

(i)

acquiring skills and facilitating the preparation and imple-
mentation of the local development strategy;

(c)

small fisheries communities.

(j)

contributing to the running costs of the groups.

The Member State shall inform the Commission of the areas
5.
selected for funding under this priority axis and include this infor-
mation in the forthcoming annual report on implementation
referred to in Article 67.

Article 44

Eligible measures

Support for sustainable development of fisheries areas may

1.
be granted for:

(a)

strengthening the competitiveness of fisheries areas;

(b)

restructuring and redirecting economic activities, in particu-
lar by promoting eco-tourism, provided that these activities
do not result in an increase in fishing effort;

2.
The EFF may also finance up to a maximum of 15 % of
the priority axis involved, measures such as the promotion
and improvement of professional skills, worker adaptability and
access to employment, particularly in favour of women, provided
that these measures are an integral part of a sustainable develop-
ment strategy and that they have a direct link with the measures
described in paragraph 1.

3.
Support granted under paragraph 1 may include measures
provided for in Chapters I, II and III with the exception of mea-
sures provided for in Articles 23 and 24. When support is
granted for operations corresponding to these measures, the rel-
evant conditions and the scales of contribution per operation laid
down respectively in Chapters I, II and III and Annex II shall
apply.

(1) OJ L 154, 21.6.2003, p. 1. Regulation as amended by Regulation (EC)

No 1888/2005 (OJ L 309, 25.11.2005, p. 1).

4.
Beneficiaries of support provided for in points (b) and (c)
of paragraph 1 and in paragraph 2 should be either workers in
the fisheries sector or persons with a job linked to the sector.

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Running costs for groups may not exceed, as a general rule,
5.
10 % of the total budget allocated to a fisheries area. By way of
derogation, Member States may decide to exceed this threshold
on a case by case basis, in particular when the groups cannot be
established on the basis of existing experienced organisations.

CHAPTER V

Priority axis 5: technical assistance

Article 46

Technical assistance

If a measure under this Article is also eligible under another
6.
Community support instrument, the Member State shall make
clear in drawing up its operational programme whether it is sup-
ported by the EFF or by another Community support instrument.

1.
At the initiative of and/or on behalf of the Commission,
subject to a ceiling of 0,8 % of its annual allocation, the EFF may
finance the preparatory, monitoring, administrative and techni-
cal support, evaluation and audit measures necessary for imple-
menting this Regulation.

Article 45

Participation in the sustainable development
of fisheries areas

These measures are executed in accordance with Article 53(2) of
Regulation (EC, Euratom) No 1605/2002 and any other relevant
provisions of that Regulation and of its implementing rules appli-
cable to this form of execution of the general budget of the Euro-
pean Union.

1. Measures to support sustainable development of fisheries
areas shall be implemented on a given territory by local entities
or groups (the group) representing public and private partners
from the various local relevant socio economic sectors and,
according to the principle of proportionality, with adequate
administrative and financial capacity to administer the assistance
and ensure that the operations are completed successfully. The
group should, whenever possible, be based on existing experi-
enced organisations.

2.
The group shall propose and implement an integrated local
development strategy based on a bottom-up approach in agree-
ment with the managing authority.

The territory covered by one group should be coherent and
3.
have sufficient critical mass in terms of human, financial and
economic resources to support a viable local development
strategy.

Those measures shall include:

(a)

evaluations, expert reports, statistics and studies, including
those of a general nature concerning the operation of the
EFF;

(b) measures aimed at the partners, the beneficiaries of assis-
tance from the EFF and the general public, including infor-
mation measures;

(c) measures to disseminate information, networking, raise
awareness, promote cooperation and exchange experiences
throughout the Community;

(d)

the installation, operation and interconnection of computer-
ised systems for management, monitoring, inspection and
evaluation;

(e)

improvements in evaluation methods and the exchange of
information on practices in this field;

4.
The operations under the local development strategy shall
be chosen by the group and shall correspond to the measures
provided for in Article 44. The majority of the operations shall
be led by the private sector.

(f)

the establishment of trans-national and Community net-
works of actors in the sustainable development of fisheries
areas with a view to encouraging the exchange of experi-
ence and best practice, stimulating and implementing trans-
regional
the
dissemination of information.

trans-national

cooperation

and

and

5. Member States or regions, depending on the specific nature
of their institutional structure, may encourage networking aim-
ing at disseminating information and, in particular, exchanging
best practice.

2.
At the initiative of the Member State, the EFF may finance
under the operational programme actions relating to the prepa-
ration, management, monitoring, evaluation, publicity, control
and audit of the operational programme, as well as networking,
up to a limit of 5 % of its total amount. By exception, and in
duly justified circumstances, this threshold may be exceeded.

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At the initiative of the Member State, the EFF may also
3.
finance actions under the operational programme relating to the
improvement of administrative capacities of the Member State
all of whose regions are eligible under the Convergence objective.

The evaluation methods and standards to be applied shall
5.
be established in accordance with the procedure referred to in
Article 101(3).

4.
Types of technical assistance provided for in paragraph 1
shall be adopted in accordance with the procedure referred to in
Article 101(2).

TITLE V

EFFECTIVENESS AND PUBLICITY OF ASSISTANCE

CHAPTER I

Evaluation of the operational programmes

6.
Evaluations shall be carried out by assessors independent
of the authorities referred to in Article 58. The results shall be
published, unless the authority responsible for the evaluation
expressly objects, in accordance with the provisions of Regula-
tion (EC) No 1049/2001 of the European Parliament and of the
Council of 30 May 2001 regarding public access to European
Parliament, Council and Commission documents (1).

7.
Evaluations shall be financed from the budget for technical
assistance of the operational programme if they are carried out
under the responsibility of the Member State and from the bud-
get for technical assistance of the Commission if they are carried
out under its responsibility.

Article 47

General provisions

Article 48

Ex ante evaluation

The operational programme shall be subject to ex ante,
1.
interim and ex post evaluations in accordance with the provisions
of Articles 48, 49 and 50.

Evaluations shall aim to improve the quality and effectiveness of
the assistance from the EFF and the implementation of the opera-
tional programme. They shall also appraise their impact with
respect to the guiding principles set out in Article 19, the rel-
evant part of the national strategic plans and the specific prob-
lems affecting the Member States, while taking account of the
needs of sustainable development in the fisheries sector and the
environmental impact.

The ex ante evaluation shall aim to ensure the coherence
1.
between the guiding principles set out in Article 19, the relevant
part of the national strategic plan and the operational pro-
gramme as well as to optimise the allocation of budgetary
resources under the operational programme and to improve pro-
gramming quality.

2. Member States shall carry out an ex ante evaluation at the
level of the operational programme in accordance with the prin-
ciple of proportionality, and in conformity with the evaluation
methods and standards to be defined in accordance with the pro-
cedure provided for in Article 47(5).

The effectiveness of assistance from the EFF shall be

2.
appraised on the basis of the following criteria:

3. Member States shall present the ex ante evaluation at the
latest when submitting the operational programme.

(a)

the overall impact of the EFF on the objectives set out in
Article 4;

(b)

the impact of the priority axes incorporated in the opera-
tional programme.

Evaluations provided for in the first subparagraph of para-
3.
graph 1 shall be carried out under the responsibility of the Mem-
ber State or the Commission, as appropriate, in accordance with
the principle of proportionality and in partnership with the Com-
mission and the Member State.

4.
The Member States shall provide the human and financial
resources necessary for carrying out evaluations, organise the
production and gathering of the necessary data and use the vari-
ous types of information provided by the monitoring system.

Article 49

Interim evaluation

1.
The interim evaluation shall aim to examine the effective-
ness of all or part of the operational programme with the aim of
adjusting it
to improve the quality of assistance and its
implementation.

2.
Interim evaluations shall be performed for an operational
programme in accordance with the principle of proportionality
on the basis of a calendar which makes it possible to take account
of the findings in order to establish the strategic debate referred
to in Article 16.

(1) OJ L 145, 31.5.2001, p. 43.

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Interim evaluations shall be organised under the responsi-
3.
bility of the Member States and on the initiative of the managing
authorities in consultation with the Commission in accordance
with the evaluation methods and standards to be defined in
accordance with the procedure provided for in Article 47(5).
Interim evaluations are forwarded to the Monitoring Committee
of the operational programme and to the Commission.

Article 50

Ex post evaluation

1.
Ex post evaluation shall examine the degree of utilisation of
resources, the effectiveness and efficiency of the operational pro-
gramme and its impact in relation to the objectives set out in
Article 4 and the guiding principles set out in Article 19. It shall
identify the factors which contributed to the success or failure of
the implementation of the operational programme, including
from the point of view of sustainability, and best practice.

2.
The ex post evaluation shall be performed at the initiative
and under the responsibility of the Commission in consultation
with the Member State and the managing authority, which shall
collect the information necessary for its implementation.

(b)

it shall inform the beneficiaries of the amount of the Com-
munity contribution;

(c)

it shall inform the general public about the role played by
the Community in the operational programme and the
results thereof.

3.
The Member States shall notify the Commission each year
of the initiatives undertaken for the purpose of this Article in the
framework of the annual and final reports on implementation
referred to in Article 67.

TITLE VI

FINANCIAL CONTRIBUTION FROM THE EFF

CHAPTER I

Contribution from the EFF

Article 52

Public aid intensity

The ex post evaluation shall be completed not later than

3.
31 December 2015.

The maximum intensity of public aid is set out in the Table in
Annex II.

CHAPTER II

Information and publicity

Article 51

Information and publicity

1.
The Member States shall provide information on and pub-
licise the operational programme and operations and the Com-
munity contribution. The information shall be addressed to the
general public. It shall aim to highlight the role of the Commu-
nity and ensure the transparency of assistance from the EFF.

Article 53

Contribution from the EFF

1.
The Commission’s decision adopting an operational pro-
gramme shall fix the maximum rate and the maximum amount
of the contribution from the EFF separately for the Convergence
and the Non-Convergence objective for each priority axis.

The contribution from the EFF shall be calculated in rela-

2.
tion to the total public expenditure.

3.
The contribution from the EFF shall be established per pri-
ority axis. The contribution from the EFF shall be subject to the
following ceilings:

The managing authority for the operational programme

2.
shall be responsible for its publicity as follows:

(a) 75 % of the total public expenditure co-financed by the EFF
in regions eligible under the Convergence objective, subject
to paragraphs 7, 8 and 9.

(a)

it shall inform potential beneficiaries, organisations involved
in the fisheries sector, professional organisations, economic
and social partners, bodies involved in promoting gender
equality and non-governmental organisations concerned,
including environmental organisations, of the possibilities
offered by the programme and the rules and methods gov-
erning access to financing;

(b) 50 % of the total public expenditure co-financed in regions
not eligible under the Convergence objective, subject to para-
graphs 7, 8 and 9.

Notwithstanding this, Member States may apply in the opera-
tional programme a uniform rate by region at the level of
measures.

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The minimum contribution from the EFF per priority axis

4.
shall be 20 % of the total public expenditure.

Article 54

Non-Accumulation

The minimum amount of support granted to an operation
5.
by the EFF shall be 5 % of the total public expenditure allocated
for assistance to the operation.

Expenditure co-financed by the EFF shall not receive assistance
from another Community financial instrument.

6.
The overall amount of support granted to an operation by
the EFF shall not exceed 95 % of the total public expenditure
allocated for assistance to the operation.

Article 55

Eligibility of expenditure

7. When operations financed by the EFF fall under Articles 24
or 27, where these form part of a fishing effort adjustment plan
referred to in Article 21(a)(i), or fall under Articles 26(3) or (4),
the ceiling for the EFF contribution for priority axis 1 shall be
increased by up to 10 percentage points in the regions eligible
under the Convergence objective and by up to 15 percentage
points for the regions not eligible under the Convergence
objective.

1.
Expenditure shall be eligible for a contribution from the
EFF if it has actually been paid by the beneficiaries between the
date of submission of the operational programme to the Com-
mission or from 1 January 2007, whichever is earlier, and
31 December 2015. Operations co-financed must not have been
completed before the starting date for eligibility.

This increase is proportional to the ratio of the total expenditure
for the operations in the first sub-paragraph to the total expen-
diture for priority axis 1.

2.
By way of derogation from paragraph 1, in-kind contribu-
tions, depreciation costs and overheads may be treated as expen-
diture paid by beneficiaries in implementing operations under
the following conditions:

8. When operations financed by the EFF fall under Article 23,
the ceiling for the EFF contribution for priority axis 1 shall be
increased by up to 10 percentage points in the regions eligible
under the Convergence objective and by up to 25 percentage
points for the regions not eligible under the Convergence
objective.

(a)

the eligibility rules laid down under paragraph 4 provide for
the eligibility of such expenditure;

(b)

the amount of the expenditure is justified by accounting
documents having a probative value equivalent to invoices;

This increase is proportional to the ratio of the total expenditure
for the operations in the first sub-paragraph to the total expen-
diture for priority axis 1.

(c)

in the case of in-kind contributions, the co-financing from
the EFF does not exceed the total eligible expenditure,
excluding the value of such contributions.

9. When operations are financed by the EFF in the outlying
Greek islands which are under a handicap due to distant loca-
tion and in the outermost regions, the ceiling for the contribu-
tion from the EFF for each priority axis shall be increased by up
to 10 percentage points in the regions eligible under the Conver-
gence objective and by up to 35 percentage points for the regions
not eligible under the Convergence objective.

For each priority axis, this increase is proportional to the ratio
of the total expenditure for the operations in the first sub-
paragraph to the total expenditure within the priority axis.

3.
Expenditure shall be eligible for a contribution from the
EFF only where incurred for operations decided on by the man-
aging authority in accordance with criteria fixed in advance by
the Monitoring Committee.

New expenditure, added at the moment of the revision of an
operational programme referred to in Article 18, shall be eli-
gible from the date of the submission to the Commission of the
request for revision of the operational programme.

10.
Technical assistance measures implemented at the initia-
tive of the Commission or on its behalf shall be financed by the
EFF at 100 %.

4.
The rules on the eligibility of expenditure shall be laid down
at national level subject to the exceptions provided for in this
Regulation. They shall cover the entirety of expenditure declared
under the operational programme.

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The following expenditure shall not be eligible for a con-

5.
tribution from the EFF:

The managing authority shall inform the Commission in
2.
the annual and final report on implementation referred to in
Article 67 of any such modification referred to in paragraph 1.

(a) a value added tax, except for a non recoverable value added
tax when it is genuinely and definitively borne by a benefi-
ciary other than non-taxable persons referred to in the first
subparagraph of Article 4(5)of the Sixth Council Directive
77/388/EEC of 17 May 1977 on the harmonisation of the
laws of the Member States relating to turnover taxes —
Common system of value added tax: uniform basis of
assessment (1);

(b)

interest on debt, without prejudice to paragraph 8;

Sums unduly paid shall be recovered in accordance with

3.
Title VIII, Chapters II and III.

The Member States and the Commission shall ensure that
4.
undertakings which are or have been subject to a procedure of
recovery in accordance with paragraph 3 following the transfer
of a productive activity within a Member State or to another
Member State do not benefit from a contribution from the EFF.

(c)

the purchase of land for an amount exceeding 10 % of the
total eligible expenditure for the operation concerned;

TITLE VII

MANAGEMENT, MONITORING AND CONTROL

(d) housing.

Paragraphs 1, 3 and 4 shall be without prejudice to the

6.
provisions of Article 46(1).

7.
As regards operations not implying expenditure for the
beneficiary, the expenditure eligible for a contribution from the
EFF shall be the public aid paid to the beneficiary.

8.
Notwithstanding paragraph 5(b), the contribution from the
EFF may be in a form other than a non-repayable direct assis-
tance. Detailed rules shall be defined in accordance with the pro-
cedure referred to in Article 101(3).

CHAPTER I

Management and control systems

General principles of the management and control systems

Article 57

The management and control systems of operational pro-

1.
grammes set up by Member States shall provide for:

(a)

the definition of the functions of the bodies concerned in
management and control and the allocation of functions
within each body;

Article 56

Durability of operations

(b) compliance with the principle of separation of functions

between and within such bodies;

1.
The Member State or managing authority shall ensure that
an operation retains the contribution from the EFF only if that
operation does not, within five years of the date of the financing
decision of the competent national authorities or the managing
authority, undergo a substantial modification:

(a) affecting its nature or its implementation conditions or giv-

ing to a firm or a public body an undue advantage;

or

(b)

resulting either from a change in the nature of ownership of
an item of infrastructure or the cessation or relocation of a
productive activity.

(c) procedures for ensuring the correctness and regularity of
expenditure declared under the operational programme;

(d)

reliable accounting, monitoring and financial reporting sys-
tems in computerised form;

(e) a system of reporting and monitoring where the responsible
body entrusts the execution of tasks to another body;

(f)

arrangements for auditing the functioning of the systems;

(g)

systems and procedures to ensure an adequate audit trail;

(1) OJ L 145, 13.6.1977, p. 1. Directive as last amended by Directive

2006/18/EC (OJ L 51 22.2.2006, p. 12).

(h)

reporting and monitoring procedures for irregularities and
for the recovery of amounts unduly paid.

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The measures laid down in points (e) and (f) shall be pro-
2.
portionate to the total amount of public expenditure allocated
to the operational programme concerned.

Article 58

Designation of authorities

(b) verifying that the co-financed products and services are deliv-
ered and that the expenditure declared by the beneficiaries
has actually been incurred and complies with Community
and national rules; verifications on-the-spot of individual
operations may be carried out on a sample basis in accor-
dance with the detailed rules to be adopted by the Commis-
sion in accordance with the procedure referred to in
Article 101(3);

For the operational programme the Member State shall des-

1.
ignate the following:

(a) a managing

authority

to manage

the operational

programme;

(c)

ensuring that there is a system for recording and storing in
computerised form accounting records of each operation
under the operational programme and that the data on
implementation necessary for financial management, moni-
toring, verifications, audits and evaluation is collected;

(b) a certifying authority to certify statements of expenditure
and applications for payment before they are sent to the
Commission;

(d) ensuring that beneficiaries and other bodies involved in the
implementation of operations maintain either a separate
accounting system or an adequate accounting code for all
transactions relating to the operation without prejudice to
national accounting rules;

(c) an audit authority, functionally independent of the manag-
ing authority and the certifying authority, responsible for
verifying the effective functioning of
the management
and control system.

2.
The Member State may designate one or more intermedi-
ate bodies to carry out some or all of the tasks of the managing
or certifying authority under the responsibility of that authority.

3.
The Member State shall lay down rules governing its rela-
tions with the authorities referred to in paragraph 1 and their
relations with the Commission.

(e)

ensuring that the evaluations of operational programmes
referred to in Articles 48 and 49 are carried out in accor-
dance with Article 47;

(f)

setting up procedures to ensure that all documents regard-
ing expenditure and audits required to ensure an adequate
audit trail are held in accordance with the requirements of
Article 87;

Subject to Article 57(1)(b), some or all of the authorities

4.
referred to in paragraph 1 may be part of the same body.

(g) ensuring that the certifying authority and the audit author-
ity receive all necessary information on the procedures
and verifications carried out in relation to expenditure for
the purpose of certification and audit respectively;

Article 59

Functions of the managing authority

(h) guiding the work of the monitoring committee and provid-
ing it with the documents required to permit the quality of
the implementation of the operational programme to be
monitored in the light of its specific goals;

The managing authority of an operational programme shall be
responsible for managing and implementing the operational pro-
gramme in accordance with the principle of sound financial man-
agement and, in particular, for:

(a)

ensuring that operations are selected for funding in accor-
dance with the criteria applicable to the operational pro-
gramme and that they comply with applicable Community
and national rules, for the whole of their implementation
period;

(i)

drawing up and, after approval by the monitoring commit-
tee, submitting to the Commission the annual and final
reports on implementation;

(j)

ensuring compliance with the information and publicity
requirements laid down in Article 51.

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Article 60

Functions of the certifying authority

The certifying authority of an operational programme shall be
responsible in particular for:

(a) drawing up and submitting to the Commission certified
statements of expenditure and applications for payment;

(b) certifying that:

(i)

(ii)

the statement of expenditure is accurate, results from
reliable accounting systems and is based on verifiable
supporting documents,

the expenditure declared complies with applicable Com-
munity and national rules and has been incurred in
respect of operations selected for funding in accordance
with the criteria applicable to the programme and com-
plying with the applicable Community and national
rules;

(c)

satisfying itself that the information received on the proce-
dures and verifications carried out in relation to expendi-
ture included in statements of expenditure provide an
adequate basis for certification;

(d)

taking account for the certification purposes of the results
of all audits carried out by or under the responsibility of the
audit authority;

(c) presenting the Commission, within nine months of the
approval of the operational programme, an audit strategy
covering the bodies which will perform the audits pursuant
to points (a) and (b), the method to be used, the sampling
method for audits on operations, and the indicative plan-
ning of audits to ensure that the main bodies are audited and
that audits are spread evenly throughout the programming
period;

(d) ensuring that the managing authority and the certifying
authority receive all necessary information on the audits
and controls carried out;

(e) by 31 December each year from 2008 up to 2015:

(i)

submitting to the Commission an annual control report
setting out the findings of the audits carried out during
the previous 12 month period ending on 30 June of the
year concerned in accordance with the audit strategy of
the operational programme and reporting any short-
comings found in the systems for the management
and control of the programme. The first report to be
submitted by 31 December 2008 shall cover the period
from 1 January 2007 to 30 June 2008. The informa-
tion concerning the audits carried out in the period after
1 July 2015 shall be included in the final control report
supporting the closure declaration referred to in
point (f);

(e) maintaining accounting records in computerised form of

expenditure declared to the Commission;

(ii)

(f)

keeping an account of amounts recoverable and of amounts
withdrawn following cancellation of all or part of the con-
tribution for an operation. Amounts recovered prior to the
closure of the operational programme that are due to be
repaid to the general budget of the European Union follow-
ing financial corrections made in accordance with Article 97
shall be deducted from the next statement of expenditure.

Article 61

Functions of the audit authority

issuing an opinion based on the controls and audits that
have been carried out under its responsibility as to
whether the management and control system functions
effectively, so as to provide reasonable assurance that
statements of expenditure presented to the Commission
are correct and, as a consequence, reasonable assurance
that the underlying transactions are legal and regular;

(iii) submitting, where applicable under Article 85, a decla-
ration for partial closure assessing the legality and the
regularity of the expenditure concerned;

The audit authority of an operational programme shall be

1.
responsible in particular for:

(f)

(a)

ensuring that audits are carried out to verify the effective
functioning of the management and control system of the
operational programme;

submitting to the Commission at the latest by 31 March
2017, a closure declaration assessing the validity of the
application for payment of the balance and the legality and
regularity of the underlying transactions covered by the final
statement of expenditure, which shall be supported by a final
control report.

(b) ensuring that audits are carried out on operations on the
basis of an appropriate sample to verify expenditure
declared;

The audit authority shall ensure that the audit work takes

2.
account of internationally accepted audit standards.

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3. Where the audits and controls referred to in paragraph 1
(a) and (b) are carried out by a body other than the audit author-
ity, the audit authority shall ensure that such body has the nec-
essary functional independence.

Its composition shall be decided by the Member State in confor-
mity with Article 8(1) and in agreement with the managing
authority.

4.
The Commission shall provide its comments on the audit
strategy presented under paragraph 1(c) no later than three
months following its receipt. In the absence of comments within
this period it shall be considered to be accepted.

At its own initiative, a representative of the Commission
2.
shall participate in the work of the monitoring committee in an
advisory capacity.

CHAPTER II

Monitoring

Article 62

Principles of monitoring

1. Monitoring shall consist of the examination of the correct
implementation of the operational programme.

2. Monitoring shall be carried out in the first instance by the
monitoring committee and the managing authority.

3.
The Commission shall participate in the monitoring
through its participation in the monitoring committee and the
annual review of the operational programme which shall include,
in particular, the analysis of the annual implementation and con-
trol reports.

4.
Data exchange between the Commission and the Member
States for this purpose shall be carried out electronically in accor-
dance with the implementing rules referred to in Article 102.

Article 63

Monitoring committee

The Member State shall set up a monitoring committee for the
operational programme, in agreement with the managing author-
ity after consultation with the partners pursuant to Article 8. The
monitoring committee shall be set up within three months from
the date of the notification to the Member State of the decision
approving the operational programme.

The monitoring committee shall draw up its rules of procedure
within the institutional, legal and financial framework of the
Member State concerned and adopt them in agreement with the
managing authority in order to exercise its missions in accor-
dance with this Regulation.

Article 65

Tasks

The monitoring committee shall satisfy itself as to the effective-
ness and quality of the implementation of the operational pro-
gramme, in accordance with the following provisions:

(a)

(b)

(c)

(d)

(e)

(f)

(g)

it shall consider and approve the criteria for selecting the
operations financed within six months of the approval of
the operational programme and approve any revision of
those criteria in accordance with programming needs;

it shall periodically review progress made towards achieving
the specific targets of the operational programme on the
basis of documents submitted by the managing authority;

it shall examine the results of implementation, particularly
achievement of the targets set for each priority axis and the
interim evaluations referred to in Article 49;

it shall examine and approve the annual and final reports
on implementation referred to in Article 67 before they are
sent to the Commission;

it shall be informed of the annual control report and of any
relevant comments the Commission may make after exam-
ining that report;

at the initiative of the Member State, it may be informed of
the written information submitted to the Commission
referred to in Article 16(1);

it may propose to the managing authority any revision or
examination of the operational programme likely to make
possible the attainment of the EFF’s objectives set out in
Article 4 or to improve its management, including its finan-
cial management;

(h)

it shall consider and approve any proposal to amend the
content of the Commission decision on the contribution
from the EFF.

Article 64

Composition

Article 66

Arrangements for monitoring

The monitoring committee shall be chaired by a represen-

1.
tative of the Member State or the managing authority.

1.
The managing authority and the monitoring committee
shall ensure the quality of implementation of the operational
programme.

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The managing authority and the monitoring committee
2.
shall carry out monitoring by reference to financial indicators
and the indicators referred to in Article 20(1)(c) specified in the
operational programme.

(ii)

the total payments received from the Commission and
quantification of the financial indicators referred to in
Article 66(2),

3. Where the nature of the assistance permits, the statistics
shall be broken down by gender and by the size of the beneficia-
ry’s undertakings.

and

(iii) the expenditure paid out by the body responsible for

making payments to the beneficiaries;

Data exchange between the Commission and the Member
4.
States for this purpose shall be carried out electronically, in accor-
dance with the implementing rules referred to in Article 102.

(d)

the steps taken by the managing authority and the monitor-
ing committee to ensure the quality and effectiveness of
implementation, in particular:

Article 67

Annual reports and final reports on implementation

1.
By 30 June each year, and for the first time in 2008, the
managing authority shall send the Commission an annual report,
and by 31 March 2017 a final report, on the implementation of
the operational programme.

(i) monitoring and evaluation measures, including data col-

lection arrangements;

(ii) a summary of any significant problems encountered in
implementing the operational programme and any mea-
sures taken, including the response to comments made
under Article 69(2);

(iii) the use made of technical assistance;

2.
In order to obtain a clear view of the implementation of
the operational programme, the reports referred to in para-
graph 1 shall include the following information:

(e)

the measures taken to ensure information and publicity for
the operational programme;

(a)

the progress made in implementing the operational pro-
gramme and priority axes in relation to their specific, verifi-
able targets, with a quantification, wherever and whenever
they lend themselves to quantification, using the indicators
referred to in Article 20(1)(c) at the level of the priority axis;

(b) a change in the general situation having a direct impact on
the implementation of the assistance, in particular signifi-
cant socio-economic developments, changes in national,
regional or sectoral policies, and, where necessary, their con-
sequences for consistency between assistance from the EFF
and from other financial instruments;

(f)

the use made of assistance released following cancellation as
referred to in Article 96(2) to the managing authority or to
another public authority during the period of implementa-
tion of the operational programme.

(g) cases where a substantial modification has been detected

under Article 56.

(h)

significant problems relating to compliance with Commu-
nity law which have been encountered in the implementa-
tion of the operational programme and the measures taken
to deal with them.

(c)

the financial implementation of the operational programme,
detailing separately for the Convergence objective and the
Non-Convergence objective for each priority axis:

The breadth of information transmitted to the Commission shall
be proportional to the total amount of public expenditure of the
operational programme concerned. Where appropriate, such
information may be provided in summary form.

(i)

the expenditure paid out by the beneficiaries included
in the applications for payment sent to the managing
authority and the corresponding public contribution;

Information referred to in points (b), (d), (e), (f) and (g) shall not
be included if there has been no significant modification since
the previous report.

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The reports referred to in paragraph 1 shall be judged
3.
acceptable if they contain all the information listed in para-
graph 2. The Commission shall inform the Member State on the
acceptability of those reports within 15 working days.

Article 69

Annual examination of the operational programmes

4.
The Commission shall reach a decision on the content of
the annual report on implementation submitted by the manag-
ing authority within two months. For the final report on imple-
mentation, the time limit shall be five months. If the Commission
does not respond within the time limit laid down, the report
shall be deemed to be accepted.

Every year when the annual report on implementation
1.
referred to in Article 67 is submitted and taking account of the
opinion of the Commission, the Commission and the managing
authority shall examine the progress made in implementing the
operational programme, the principal results achieved over the
previous year, the financial implementation and other factors
with a view to improving implementation.

Article 68

Annual report by the Commission

1.
By 31 December each year, and for the first time in 2008,
the Commission shall forward to the European Parliament, to the
Council, to the European Economic and Social Committee and
to the Committee of the Regions a report on the actual imple-
mentation of this Regulation during the preceding year.

2.
This report shall summarise the main developments, trends
and challenges relating to the implementation of the operational
programmes.

3.

The annual report by the Commission shall also include:

Any aspects of the operation of the management and control
system raised in the annual control report, referred to in
Article 61(1)(e)(i), may also be examined and, where appropri-
ate, this examination shall be carried out with the participation
of the audit authority.

2.
After the examination referred to in paragraph 1 and, where
appropriate, with the participation of the audit authority, the
Commission may make comments to the Member State and the
managing authority, which shall inform the monitoring commit-
tee thereof. The Member State shall inform the Commission of
the action taken in response to those comments.

3. When the ex post evaluations of assistance granted over the
2000-2006 programming period are available, the overall results
shall be examined in the next annual examination.

(a) a summary of the activities of the EFF by Member State,
including a breakdown by Member Sate of the appropria-
tions committed and paid, as well as the use of technical
assistance by the Commission and the Member States;

CHAPTER III

Responsibilities of Member States and of the Commission

(b) an assessment of the coordination of the EFF with the Struc-

tural Funds and the EAFRD;

S e c t i o n 1

R e s p o n s i b i l i t i e s o f M e m b e r S t a t e s

(c) as soon as they become available, the findings of the evalu-

ations provided for in Article 49;

(d) when the fourth annual report is submitted and, again, when
the report covering the final year of programming is submit-
ted, a summary of the audits on management and control
systems set up by Member States carried out on behalf of
the Commission and of the outcome of audits on EFF assis-
tance carried out by the Member State and, where appropri-
ate, the financial corrections made.

4.
The report shall be based on an examination and assess-
ment by the Commission of the Member States’ annual report
and of any other available information. In particular in 2012,
this report shall in addition be based on the outcome of the stra-
tegic debate referred to in Article 16(1) and of any other avail-
able information. The report shall state the follow-up measures
taken or to be taken by the Member States and the Commission
which will enable adequate follow-up to be made of the findings
in the report.

Article 70

Management and control

1. Member States shall be responsible for ensuring the man-
agement and control of operational programmes, in particular
through the following measures:

(a)

ensuring that the management and control systems for the
operational programme are set up in accordance with
Articles 57 to 61 and function effectively;

(b) preventing, detecting and correcting irregularities and recov-
ering amounts unduly paid together with interest on late
payments where appropriate. They shall notify these to the
Commission and keep the Commission informed of the
progress of administrative and legal proceedings.

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2. When amounts unduly paid to a beneficiary cannot be
recovered, the Member State shall be responsible for reimburs-
ing the amounts lost to the general budget of the European Union
when it is established that the loss has been incurred as a result
of fault or negligence on its part.

Where the reservations concern only a single priority axis, the
first interim payment shall be made as regards the other priority
axes of the operational programme for which there is no
reservation.

Article 71

Setting up of management and control systems

3.
The report and the opinion referred to in paragraph 2 shall
be drawn up by the audit authority or by a public or private
body functionally independent of the managing and certifying
authorities, which shall carry out its work taking account of inter-
nationally accepted audit standards.

1.
Before the submission of the first application for interim
payment or at the latest within 12 months after the approval of
the operational programme, the Member States shall submit to
the Commission a description of the systems, covering in par-
ticular the organisation and procedures of:

S e c t i o n 2

R e s p o n s i b i l i t i e s o f t h e C o m m i s s i o n

(a)

the managing and certifying authorities and intermediate
bodies;

Article 72

Responsibilities of the Commission

(b)

the audit authority and any other bodies carrying out audits
under its responsibility.

2.
The description referred to in paragraph 1 shall be accom-
panied by a report setting out the results of an assessment of the
setting up of the systems and giving an opinion on their compli-
ance with Articles 57 to 61. If the opinion contains reservations,
the report shall indicate the seriousness of the shortcomings. The
Member State shall inform the Commission of the corrective
measures to be taken and the timetable for their implementation
and subsequently provide confirmation of the implementation of
the corresponding
the measures and the withdrawal of
reservations.

The report referred to in the first subparagraph shall be deemed
to be accepted, and the first interim payment shall be made, in
the following circumstances:

(a) within three months of the date of receipt of the report when
the opinion referred to in the first subparagraph is without
reservations and in the absence of observations by the
Commission;

1.
The Commission shall satisfy itself in accordance with the
procedure laid down in Article 71 that the Member States have
set up management and control systems that comply with
Articles 57 to 61 and on the basis of the annual control reports
and the annual opinion of the audit authority and its own audits,
that the systems function effectively during the period of imple-
mentation of the operational programmes.

2. Without prejudice to audits carried out by Member States,
Commission officials or authorised Commission representatives
may carry out on-the-spot audits to verify the effective function-
ing of the management and control systems, which may include
audits on operations included in the operational programme,
with a minimum of 10 working days’ notice, except in urgent
cases. Officials or authorised representatives of the Member State
may take part in such audits.

Commission officials or authorised Commission representatives,
duly empowered to carry out on-the-spot audits, shall have access
to the books and all other documents, including documents and
metadata drawn up or received and recorded on an electronic
medium, relating to expenditure financed by the EFF.

(b)

if the opinion contains reservations, upon confirmation to
the Commission that corrective measures concerning key
elements of the systems have been implemented, and the
corresponding reservations withdrawn, and in the absence
of observations by the Commission within three months of
the date of confirmation.

The aforementioned powers of audit shall not affect the applica-
tion of national provisions which reserve certain acts for agents
specifically designated by national legislation. Authorised Com-
mission representatives shall not take part, inter alia, in home vis-
its or the formal questioning of persons within the framework
of the national legislation of the Member State concerned. How-
ever, they shall have access to information thus obtained.

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The Commission may require a Member State to carry out
3.
an on-the-spot audit to verify the effective functioning of the sys-
tems or the correctness of one or more transactions. Commis-
sion officials or authorised Commission representatives may take
part in such audits.

Article 73

Cooperation with the audit authorities
of the Member States

1.
The Commission shall cooperate with the audit authority
of the operational programme to coordinate their respective audit
plans and audit methods and shall immediately exchange the
results of audits carried out on management and control sys-
tems in order to make the best possible use of resources and to
avoid unjustified duplication of work.

The Commission and the audit authority shall meet on a regular
basis and at least once a year, unless otherwise agreed between
them, in order to examine together the annual control report and
opinion presented under Article 61 and to exchange views on
other issues relating to the improvement of the management
and control of the operational programme.

In determining its own audit strategy, the Commission shall
2.
identify those operational programmes for which the opinion on
the compliance of the system under Article 71(2) is without res-
ervations, or where reservations have been withdrawn following
corrective measures, where the audit strategy of the audit author-
ity is satisfactory and where reasonable assurance has been
obtained that the management and control systems function
effectively on the basis of the results of audits carried out by the
Commission and the Member State.

3.
For those operational programmes, the Commission may
conclude that it can rely principally on the opinion referred to in
Article 61(1)(e)(ii) with regard to the effective functioning of the
systems and that it will carry out on-the-spot audits only if there
is evidence to suggest shortcomings in the system affecting
expenditure certified to the Commission in a year for which the
opinion under Article 61(1)(e)(ii), which contain no reservations
in respect of such shortcomings, has been provided.

Where the Commission reaches such a conclusion, it shall inform
the Member State concerned accordingly. Where there is evi-
dence to suggest shortcomings, it may require the Member State
to carry out audits in accordance with Article 72(3) or it may
carry out its own audits under Article 72(2).

TITLE VIII

FINANCIAL MANAGEMENT

CHAPTER I

Financial management

S e c t i o n 1

B u d g e t c o m m i t m e n t s

Article 74

Budget commitments

The Community budget commitments in respect of the opera-
tional programmes (hereinafter referred to as budget commit-
ments) shall be effected annually and separately for
the
Convergence and Non-Convergence objectives during the period
between 1 January 2007 and 31 December 2013. The first bud-
get commitment shall be made before the adoption by the Com-
mission of the decision approving the operational programme.
Each subsequent commitment shall be made by the Commis-
sion, as a general rule by 30 April each year, on the basis of the
decision to grant a contribution from the EFF referred to in
Article 17.

S e c t i o n 2

P a y m e n t s

Article 75

Common rules for payments

1.
Payments by the Commission of the contribution from the
EFF shall be made in accordance with the budget appropriations.
Each payment shall be posted to the earliest open budget
commitment.

2.
Payments shall take the form of pre-financing, interim pay-
ments and payment of the balance. They shall be made to the
body designated by the Member State.

3.
At the latest by 30 April each year, Member States shall
send the Commission a provisional forecast of their likely appli-
cations for payment for the current financial year and the subse-
quent financial year.

4.
All exchanges concerning financial transactions between
the Commission and the authorities and bodies designated by the
Member States shall be made by electronic means, in accordance
with the implementing rules referred to in Article 102. In cases
of force majeure, and in particular of malfunction of the common
computerised system or a lack of a lasting connection, the Mem-
ber State may forward the statement of expenditure and the
application for payment in hard copy.

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Article 76

Rules for calculating interim payments

2. With regard to Articles 76(2) and 77(b), the statements of
expenditure shall also highlight the total amount of Community
assistance paid or due to be paid to the beneficiaries.

1.
Interim payments shall be calculated by applying to the
public contribution declared in the statement of expenditure cer-
tified by the certifying authority under each priority axis and
under each Convergence/Non-Convergence objective, the rate of
Community co-financing established under the current financ-
ing plan for that priority axis and that objective.

Article 79

Accumulation of pre-financing and interim payments

The cumulative total of pre-financing and interim pay-
1.
ments made shall not exceed 95 % of the contribution from the
EFF to the operational programme.

By way of derogation from paragraph 1, in response to a
2.
specific and properly grounded request by the Member State, an
interim payment shall be the amount of Community assistance
paid or due to be paid to the beneficiaries in respect of the pri-
ority axis and of the objective. This amount must be specified by
the Member State in the statement of expenditure.

2. When this ceiling is reached, the certifying authority shall
continue transmitting to the Commission any certified statement
of expenditure on the 31 December of year n, as well as the
amounts recovered during the year for the EFF, at the latest by
the end of February of year n+1.

Article 77

Rules for calculating payments of the balance

Payment of the balance shall be limited to whichever of the fol-
lowing two amounts is smaller:

(a)

(b)

the amount calculated by applying to the public contribu-
tion declared in the final statement of expenditure certified
by the certifying authority under each priority axis and under
each Convergence/Non-Convergence objective, the rate of
Community co-financing established under the current
financing plan for that priority axis and that objective;

the amount of Community assistance paid or due to be paid
to the beneficiaries in respect of each priority axis and for
each objective. The latter amount must be specified by the
Member State in the last statement of expenditure certified
by the certifying authority in respect of each priority axis
and for each objective.

Article 78

Statement of expenditure

All statements of expenditure shall include, for each prior-
1.
ity axis and for each objective, the total amount of eligible expen-
diture paid by beneficiaries in implementing the operations and
the corresponding public contribution paid or due to be paid to
the beneficiaries, according to the conditions governing the pub-
lic contribution. Expenditure paid by beneficiaries shall be sup-
ported by receipted invoices or accounting documents of
equivalent probative value. As regards operations not involving
expenditure by the beneficiary, the expenditure certified by the
certifying authority and submitted to the Commission shall be
the public aid paid to the beneficiary.

Article 80

Wholeness of payment to beneficiaries

Member States shall satisfy themselves that the bodies respon-
sible for making the payments ensure that the beneficiaries
receive the total amount of the public contribution as quickly as
possible and in full. No amounts shall be deducted or withheld,
nor shall any further specific charge or other charge with equiva-
lent effect be levied that would reduce these amounts for the
beneficiaries.

S e c t i o n 3

P r e - f i n a n c i n g

Article 81

Payment

1.
Following the Commission decision approving a contribu-
tion from the EFF to an operational programme, a single pre-
financing amount for the period 2007 to 2013 shall be paid by
the Commission to the body designated by the Member State.
This pre-financing amount shall represent 7 % of the contribu-
tion from the EFF to that operational programme. It may be
spread to two financial years in accordance with the available
budget of the EFF.

2.
The total amount paid as pre-financing shall be reimbursed
to the Commission by the body designated by the Member State
if no application for payment under the operational programme
is sent within 24 months from the date on which the Commis-
sion paid the first instalment of the pre-financing amount.

3.
Any interest generated by the pre-financing shall be posted
to the operational programme, being regarded as a resource for
the Member State in the form of national public contribution
and shall be declared to the Commission at the time of the final
closure of the operational programme.

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The amount paid as pre-financing shall be totally cleared
4.
from the Commission accounts when the operational pro-
gramme is closed in accordance with Article 86.

S e c t i o n 4

I n t e r i m p a y m e n t s

Article 82

Interim payments

Subject to available funding and the absence of the inter-
2.
ruption of the payment deadline or suspension of payments in
accordance with Articles 88 and 89 respectively, the Commis-
sion shall make the interim payment no later than two months
after the date on which an application for payment meeting the
conditions referred to in Article 83 is registered with the
Commission.

S e c t i o n 5

P a y m e n t o f t h e b a l a n c e a n d p r o g r a m m e
c l o s u r e

Interim payments shall be made for the operational programme.
The first interim payment shall be made in accordance with the
provisions of Article 71(2).

Article 85

Partial closure

Article 83

Acceptability of applications for payment

Partial closure of the operational programme may be made

1.
at periods to be determined by the Member State.

Each interim payment made by the Commission shall be

1.
subject to the following conditions being met:

(a)

the Commission must have been sent an application for pay-
ment and a statement of expenditure, in accordance with
Article 78;

Partial closure shall relate to operations completed during the
period up to 31 December of the previous year. For the purpose
of this Regulation, an operation shall be deemed completed
where the activities under it have been actually carried out and
for which all expenditure by the beneficiaries and the correspond-
ing public contribution have been paid.

(b) no more than the maximum amount of assistance from the
EFF, as laid down in the current financing plan, has been
paid by the Commission during the whole period for each
priority axis and for each objective;

2.
Partial closure shall be made on condition that the Mem-
ber State sends the following to the Commission by 31 Decem-
ber of a given year:

(c)

(d)

the managing authority must have sent the Commission the
most recent annual report on implementation, in accor-
dance with Article 67(1) and (3);

(a) a statement of expenditure relating to operations referred

to in paragraph 1;

there is no reasoned opinion by the Commission in respect
of an infringement under Article 226 of the Treaty, as
regards the operation(s) for which the expenditure is declared
in the application for payment in question.

2.
If one or more of the conditions referred to in para-
graph 1 are not met, the Member State and the certifying author-
ity shall be informed by the Commission within a deadline of
one month, so that the necessary steps can be taken to remedy
the situation.

Article 84

Procedure for payment

The certifying authority shall ensure that requests for
1.
interim payments for the operational programme are grouped
together and sent to the Commission, as far as possible, on three
separate occasions a year. For a payment to be made by the Com-
mission in the current year, the latest date on which an applica-
tion for payment shall be submitted is 31 October.

(b) a declaration for partial closure in accordance with

Article 61(1)(e)(iii).

3.
Any financial corrections made in accordance with
Articles 96 and 97 concerning operations subject to a partial clo-
sure shall be net financial corrections.

Article 86

Conditions for the payment of the balance

1.

The Commission shall pay the balance, provided that:

(a)

the Member State has sent an application for payment com-
prising the following documents by 31 March 2017:

(i)

an application for payment of the balance and a state-
ment of expenditure in accordance with Article 78;

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(ii)

the final report on implementation for the operational
programme,
in
Article 67;

including the information set out

Article 87

Availability of documents

(iii) a closure declaration in accordance with Article 61(1)(f);

and

(b)

there is no reasoned opinion by the Commission in respect
of an infringement under Article 226 of the Treaty, as
regards the operation(s) for which the expenditure is declared
in the application for payment in question.

2.
Failure to send any of the documents referred to in para-
graph 1 to the Commission shall automatically result in the
decommitment of the balance, in accordance with Article 90.

The Commission shall inform the Member State of its opin-
3.
ion on the content of the closure declaration referred to in para-
graph 1(a)(iii) within five months of the date of its receipt. The
closure declaration shall be deemed to be accepted in the absence
of observations by the Commission within that five-month
period.

The managing authority shall ensure that all the support-
1.
ing documents regarding expenditure and audits on the opera-
tional programme concerned are kept available for
the
Commission and the European Court of Auditors for:

(a) a period of three years following the closure of an opera-

tional programme;

(b) a period of three years following the year in which partial
closure took place,
in the case of documents regarding
expenditure and audits on the operations referred to in
paragraph 2.

These periods shall be interrupted either in the case of legal pro-
ceedings or at the request duly motivated of the Commission.

2.
The managing authority shall make available to the Com-
mission, on request, a list of completed operations which have
been subject to partial closure under Article 85.

4.
Subject to available funding, the Commission shall pay the
balance within no more than 45 days from the later of the fol-
lowing dates:

3.
The documents shall be kept either in the form of the origi-
nals or in versions certified to be in conformity with the origi-
nals on commonly accepted data carriers.

(a)

the date on which it accepts the final report in accordance
with Article 67(4);

S e c t i o n 6

I n t e r r u p t i o n o f t h e p a y m e n t d e a d l i n e a n d
s u s p e n s i o n o f p a y m e n t s

or

(b)

the date on which it accepts the closure declaration referred
to in paragraph 1(a)(iii).

Article 88

Interruption of the payment deadline

5. Without prejudice to paragraph 6, the balance of the bud-
getary commitment shall be decommitted 12 months after the
payment has been made.

1.
The payment deadline may be interrupted by the authoris-
ing officer by delegation within the meaning of Regulation (EC,
Euratom) No 1605/2002 for a maximum period of six months
if:

The Commission shall inform the Member States about the date
of the closure of the operational programme within a deadline
of two months.

(a)

in a report of a national or Community audit body there is
evidence to suggest significant deficiency in the functioning
of the management and control systems;

6.
Notwithstanding the results of any audits performed by the
Commission or the European Court of Auditors, the balance paid
by the Commission for the operational programme may be
amended within nine months of the date on which it is paid or,
where there is a negative balance to be reimbursed by the Mem-
ber State, within nine months of the date on which the debit
note is issued. Such amendment of the balance shall not change
the date of the closure of the operational programme communi-
cated in accordance with paragraph 5.

or

(b)

the authorising officer by delegation has to carry out addi-
tional verifications following information coming to his
attention which alerted him that expenditure in a certified
statement of expenditure is linked to a serious irregularity
which has not been corrected.

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The Member State and the certifying authority shall be
2.
informed immediately of the reasons for the interruption. The
interruption shall be ended as soon as the necessary measures
have been taken by the Member State.

The part of budget commitment still open on 31 Decem-
2.
ber 2015 shall be automatically decommited if the Commission
has not received an acceptable application for payment for it by
31 March 2017.

Article 89

Suspension of payments

1.
All or part of the interim payments at the level of priority
axes or the operational programme may be suspended by the
Commission where:

(a)

there is a serious deficiency in the management and control
system of the operational programme which affects the reli-
ability of the procedure for certification of payments and for
which corrective measures have not been taken;

or

(b) expenditure in a certified statement of expenditure is linked
to a serious irregularity which has not been corrected;

or

(c)

there is a serious breach by a Member State of its obliga-
tions under Article 70.

2.
The Commission may decide to suspend all or part of
interim payments after having given the Member State the oppor-
tunity to present its observations within a period of two months.

3.
The Commission shall end suspension of all or part of
interim payments where the Member State has taken the neces-
sary measures to enable the suspension to be lifted. Where the
required measures are not taken by the Member State, the Com-
mission may adopt a decision to cancel all or part of the Com-
munity contribution to the operational programme in accordance
with Article 97.

S e c t i o n 7

A u t o m a t i c d e c o m m i t m e n t

3.
If this Regulation enters into force after 1 January 2007,
the period after which the first automatic decommitment as
referred to in paragraph 1 may be made shall be extended, for
the first commitment, by the number of months between 1 Janu-
ary 2007 and the date of the first budget commitment.

Article 91

Exceptions for time limits on decommitment

If a Commission decision subsequent to the decision approving
the operational programme is needed for authorisation of assis-
tance or of an aid scheme, the period leading to automatic
decommitment shall run from the date of that subsequent deci-
sion. The amounts in question shall be established on the basis
of a schedule provided by the Member State.

Article 92

Period of interruption for legal proceedings and
administrative appeals

The amount potentially concerned by automatic decommitment
shall be reduced by the amounts that the certifying authority has
not been able to declare to the Commission because of opera-
tions suspended by legal proceedings or an administrative appeal
having suspensory effect, on condition that the Member State
sends the Commission information stating the reasons by
31 December of the second year following the year of the bud-
get commitment as laid down in Article 90.

Article 90

Principles

For that part of commitments still open on 31 December 2015,
the time limit referred to in Article 90(2) shall be interrupted
under these same conditions in respect of the amount relating
to the operations concerned.

1.
The Commission shall automatically decommit any part of
a budget commitment in an operational programme that has not
been used for payment of the pre-financing or interim payments,
or for which an application for payment has not been sent in
conformity with Article 83, by 31 December of the second year
following the year of the budget commitment under the opera-
tional programme.

The abovementioned reduction may be requested once if the sus-
pension has lasted up to one year or several times for the num-
ber of years between the legal or administrative decision
suspending the implementation of the operation and the date of
the final legal or administrative decision.

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Article 93

Exceptions to the automatic decommitment

The following shall be disregarded in calculating the automatic
decommitment:

(a)

(b)

(c)

that part of the budget commitment for which an applica-
tion for payment has been made but whose reimbursement
has been interrupted or suspended by the Commission on
31 December of the second year following the year of the
budget commitment pursuant to Article 90 and in accor-
dance with Articles 88 and 89. When the problem resulting
in the interruption or suspension has been resolved, the
automatic decommitment rule shall be applied to that part
of the budget commitment which is concerned;

that part of the budget commitment for which an applica-
tion for payment has been made but whose reimbursement
has been capped in particular due to a lack of budget
resources;

that part of the budget commitment for which it has not
been possible to make an acceptable application for pay-
ment for reasons of force majeure seriously affecting imple-
mentation of the operational programme. The national
authorities claiming force majeure must demonstrate its direct
consequences on the implementation of all or part of the
operational programme.

Article 94

Procedure

1.
The Commission shall inform the Member State and the
authorities concerned in good time whenever there is a risk of
application of automatic decommitment under Article 90.

The Commission shall inform the Member State and the
2.
authorities concerned of the amount of the automatic decommit-
ment resulting from the information in its possession.

3.
The Member State shall have two months from the date of
receipt of that information to agree to the amount or submit its
observations. The Commission shall carry out the automatic
decommitment not later than nine months after the time limit
referred to in Article 90.

4.
The contribution from the EFF to the operational pro-
gramme shall be reduced, for the year concerned, by the amount
automatically decommitted. The Member State shall produce
within two months of the date of decommitment a revised
financing plan reflecting the reduced amount of assistance over
one or several of the priority axes of the operational programme.
Failing this, the Commission shall reduce the amounts allocated
to each priority axis proportionately.

S e c t i o n 8

U s e o f t h e e u r o

Article 95

Use of the euro

1.
Amounts set out in the operational programme submitted
by the Member State, certified statements of expenditure, appli-
cations for payment and expenditure mentioned in the annual
and final reports of implementation shall be denominated in
euro.

Commission decisions on operational programmes
2.
and Commission commitments and payments, shall be denomi-
nated and carried out in euro.

3. Member States which have not adopted the euro as their
currency on the date of an application for payment shall convert
into euro the amounts of expenditure incurred in national
currency.

These amounts shall be converted in euro using the monthly
accounting rate of the Commission in the month during which
the expenditure was registered in the accounts of the certifying
authority of the operational programme concerned. This rate
shall be published electronically by the Commission each month.

4. When the euro becomes the currency of a Member State,
the conversion procedure set out in the preceding paragraph shall
continue to apply to all expenditure recorded in the accounts by
the certifying authority before the date of entry into force of the
fixed conversion rate between the national currency and the euro.

CHAPTER II

Financial corrections

S e c t i o n 1

F i n a n c i a l c o r r e c t i o n s b y M e m b e r S t a t e s

Article 96

Financial corrections by Member States

1.
The Member State shall in the first instance bear the respon-
sibility for investigating irregularities, acting upon evidence of
any major change affecting the nature of the conditions for the
implementation or control of operations or the operational pro-
gramme and making the financial corrections required.

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The Member State shall make the financial corrections
2.
required in connection with individual or systemic irregularities
detected in operations or the operational programme. The cor-
rections made by the Member State shall consist of cancelling all
or part of the public contribution to the operational programme.
The Member State shall take into account the nature and gravity
of the irregularities and the financial loss to the EFF.

Without prejudice to paragraph 3, the resources of the EFF
released in this way may be re-used by the Member State until
31 December 2015 for the operational programme.

3.
The contribution cancelled in accordance with para-
graph 2 may not be re-used for the operation or operations that
were the subject of the correction, nor, where a financial correc-
tion is made for a systemic irregularity, for existing operations
within whole or part of the priority axis where the systemic
irregularity occurred.

4.
In the case of systemic irregularity, the Member State shall
extend its enquiries to cover all operations liable to be affected.

S e c t i o n 2

F i n a n c i a l c o r r e c t i o n s b y t h e C o m m i s s i o n

Article 97

Criteria for the corrections

1.
The Commission may make financial corrections by can-
celling all or part of the Community contribution to an opera-
tional programme where, after carrying out
the necessary
examination, it concludes that:

(a)

there is a serious deficiency in the management and control
system of the programme which has put at risk the Commu-
nity contribution already paid to the programme;

The Commission shall base its financial corrections on indi-
2.
vidual cases of irregularity identified, taking account of the sys-
temic nature of the irregularity to determine whether a flat rate
or extrapolated correction should be applied.

3.
The Commission shall, when deciding the amount of a cor-
rection, take account of the nature and gravity of the irregularity
and the extent and financial implications of the deficiencies found
in the operational programme.

4. Where the Commission bases its position on the facts
established by auditors other than those of its own services, it
shall draw its own conclusions regarding their financial conse-
quences, after examining the measures taken by the Member State
concerned under Article 96(2), the information supplied under
Article 70(1)(b) and any replies from the Member State.

Article 98

Procedure

1.
Before taking a decision on a financial correction, the Com-
mission shall open the procedure by informing the Member State
of its provisional conclusions and requesting the Member State
to submit its comments within two months.

Where the Commission proposes a financial correction on the
basis of extrapolation or at a flat rate, the Member State shall be
given the opportunity to demonstrate, through an examination
of the documentation concerned, that the actual extent of irregu-
larity was less than the Commission’s assessment. In agreement
with the Commission, the Member State may limit the scope of
this examination to an appropriate proportion or sample of the
documentation concerned. Except in duly justified cases, the time
allowed for this examination shall not exceed a further period of
two months after the two-month period referred to in the first
subparagraph.

2.
The Commission shall take account of any evidence sup-
plied by the Member State within the time limits referred to in
paragraph 1.

(b) expenditure contained in a certified statement of expendi-
ture is irregular and has not been corrected by the Member
State prior to the opening of the correction procedure under
this paragraph;

3. Where the Member State does not accept the provisional
conclusions of the Commission, the Member State shall be invited
to a hearing by the Commission, in which both sides in coopera-
tion based on the partnership shall make efforts to reach an
agreement concerning the observations and the conclusions to
be drawn from them.

(c) a Member State has not complied with its obligations under
Article 96 prior to the opening of the correction procedure
under this paragraph.

4.
In case of an agreement, the Member State may re-use the
EFF resources concerned in conformity with the second subpara-
graph of Article 96(2).

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In the absence of agreement, the Commission shall take a
5.
decision on the financial correction within six months of the date
of the hearing taking account of all information and observa-
tions submitted during the course of the procedure. If no hear-
ing takes place, the six-month period shall begin to run two
months after the date of the letter of invitation sent by the
Commission.

2. Where reference is made to this paragraph, Articles 3 and 7
of Decision 1999/468/EC shall apply.

3. Where reference is made to this paragraph, Articles 4 and 7
of Decision 1999/468/EC shall apply.

Article 99

Obligations of Member States

The period referred to in Article 4(3) of Decision 1999/468/EC
shall be set at three months.

State’s obligation to pursue

A financial correction by the Commission shall not prejudice the
Member
recoveries under
Article 96(2) and to recover State aid under Article 87 of the
Treaty and under Article 14 of Council Regulation (EC)
No 659/1999 of 22 March 1999 laying down detailed rules for
the application of Article 88 of the EC Treaty (1).

CHAPTER III

Repayment

Article 100

Repayment

Any repayment due to be made to the general budget of
1.
the European Union shall be effected before the due date indi-
cated in the order for recovery drawn up in accordance with
Article 72 of Regulation (EC, Euratom) No 1605/2002. This due
date shall be the last day of the second month following the issu-
ing of the recovery order.

2.
Any delay in effecting repayment shall give rise to interest
on account of late payment, starting on the due date and ending
on the date of actual payment. The rate of such interest shall be
one and a half percentage points above the rate applied by the
European Central Bank in its main refinancing operations on the
first working day of the month in which the due date falls.

4.

The Committee shall adopt its own Rules of Procedure.

Article 102

Implementing rules

The implementing rules for this Regulation shall be adopted in
accordance with the procedure referred to in Article 101(3).

TITLE X

FINAL PROVISIONS

Article 103

Transitional provisions

(EEC) No 4028/86 (2),

1.
This Regulation shall not affect the continuation or modi-
fication, including the total or partial cancellation, of assistance
approved by the Commission on the basis of Council Regula-
tions
(EC)
No 2468/98 (4) and (EC) No 2792/1999 (5) or of any other leg-
islation which applies to such assistance on 31 December 2006,
which shall consequently apply thereafter to that assistance until
its closure.

(EC) No 3699/93 (3),

TITLE IX

COMMITTEE

Article 101

Committee

1.
The Commission shall be assisted by the European Fisher-
ies Fund Committee (hereinafter referred to as the Committee).

(1) OJ L 83, 27.3.1999, p. 1. Regulation as last amended by the 2003
Act of Accession. (The title of Regulation (EC) No 659/1999 has been
adjusted to take account of the renumbering of the Articles of the
Treaty establishing the European Community, in accordance with
Article 12 of the Treaty of Amsterdam; the original reference was to
Article 93 of the Treaty).

(2) Council Regulation (EEC) No 4028/86 of 18 December 1986 on
Community measures to improve and adapt structures in the fisher-
ies and aquaculture sector (OJ L 376, 31.12.1986, p. 7). Regulation
as repealed by Regulation (EEC) No 2080/93 (OJ L 193, 31.7.1993,
p. 1).

(3) Council Regulation (EC) No 3699/93 of 21 December 1993 laying
down the criteria and arrangements regarding Community structural
assistance in the fisheries and aquaculture sector and the processing
and marketing of its products (OJ L 346, 31.12.1993, p. 1). Regula-
tion as repealed by Regulation (EC) No 2468/98 (OJ L 312,
20.11.1998, p. 19).

(4) Council Regulation (EC) No 2468/98 of 3 November 1998 laying
down the criteria and arrangements regarding Community structural
assistance in the fisheries and aquaculture sector and the processing
and marketing of its products. Regulation as repealed by Regulation
(EC) No 2792/1999 (OJ L 337, 30.12.1999, p. 10).

(5) Council Regulation (EC) No 2792/1999 of 17 December 1999 lay-
ing down the detailed rules and arrangements regarding Community
structural assistance in the fisheries sector. Regulation as last amended
by Regulation (EC) No 485/2005 (OJ L 81, 30.3.2005, p. 1).

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By way of derogation from Articles 31(2), 32(4) and 37(1)
2.
of Council Regulation (EC) No 1260/1999 of 21 June 1999 lay-
ing down general provisions on the Structural Funds (1), sums
committed for assistance co-financed by the Financial Instrument
for Fisheries Guidance (FIFG), established by Council Regulation
(EC) No 1263/1999 of 21 June 1999 on the Financial Instru-
ment for Fisheries Guidance (2), approved by the Commission
between 1 January 2000 and 31 December 2006 for which
the certified statement of expenditure actually paid, the final
report on implementation, comprising also the progress report
referred to in Article 1(1) of Commission Regulation
(EC) No 366/2001 (3), and the declaration referred to in
Article 38(1)(f) of Regulation (EC) 1260/1999 have not been sent
to the Commission within 15 months after the final date of eli-
gibility of expenditure laid down in the decision granting a con-
tribution from the FIFG, shall be automatically decommitted by
the Commission not later than six months after that deadline,
giving rise to the repayment of amounts unduly paid.

If specific measures are necessary in order to facilitate the
3.
transition from the system in force to that established by this
Regulation, such measures shall be adopted in accordance with
the procedure referred to in Article 101(3).

Such measures shall, in particular, be adopted in order to inte-
grate existing Community support approved by the Commission
for the period 2000 to 2006 into the EFF support provided for
by this Regulation.

Article 104

Repeals

1. Without prejudice to the provisions of Article 103(1),
Regulations (EC) No 1263/1999 and (EC) No 2792/1999 are
hereby repealed with effect from 1 January 2007.

References to the repealed Regulations shall be construed

2.
as references to this Regulation.

Article 105

Review

The Council shall review this Regulation by 31 December 2013
at the latest in accordance with Article 37 of the Treaty.

Article 106

Entry into force

This Regulation shall enter into force on the 20th day following
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, 27 July 2006.

For the Council
The President
E. TUOMIOJA

(1) OJ L 161, 26.6.1999, p. 1. Regulation as last amended by Regulation

(EC) No 173/2005 (OJ L 29, 2.2.2005, p. 3).

(2) OJ L 161, 26.6.1999, p. 54.
(3) Commission Regulation (EC) No 366/2001 of 22 February 2001 lay-
ing down detailed rules for implementing the measures provided for
in Council Regulation (EC) No 2792/1999 (OJ L 55, 24.2.2001, p. 3).

L 223/42

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Official Journal of the European Union

15.8.2006

ANNEX I

The annual breakdown of commitment appropriations for the European Fisheries Fund, in 2004 prices, as referred to in
Article 12, shall be as follows:

2007

2008

2009

2010

2011

2012

2013

538 501 708

544 387 564

551 260 557

551 264 533

552 866 449

554 350 809

556 368 380

(in EUR)

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ANNEX II

Aid intensity

(a)

For all the measures referred to in Title IV, the limits of public contribution granted to an operation (A), and, where
appropriate, by the private beneficiaries (B), shall be as set out in the Table below, expressed as a percentage of total
eligible costs being the sum of (A) + (B).

For the Table below, the operations will fall within groups as follows:

Regions covered by
the Convergence
objective and outly-
ing Greek islands

Regions not covered
by the Convergence
objective

Outermost regions

Group 1

A ≤ 100 %
B ≥ 0 %

A ≤ 100 %
B ≥ 0 %

A ≤ 100 %
B ≥ 0 %

Group 2

A ≤ 40 %
B ≥ 60 % (*) (**)

A ≤ 40 %
B ≥ 60 % (*) (**)

A ≤ 50 %
B ≥ 50 % (*) (**)

Group 3

A ≤ 80 %
B ≥ 20 %

A ≤ 60 %
B ≥ 40 %

A ≤ 80 %
B ≥ 20 %

Group 4

A ≤ 60 %
B ≥ 40 % (***)

A ≤ 40 %
B ≥ 60 % (***)

A ≤ 75 %
B ≥ 25 %

(*)

(**)

In the case of operations referred to in Article 25(3) the (B) rates for Group 2 are increased by 20 percentage points. The (A) rates
are reduced accordingly.
In the case of operations referred to in Article 26(2) (investment on board within the meaning of Article 25 in small scale coastal
fishing vessels), the (B) rates for Group 2 may be reduced by 20 percentage points. The (A) rates are increased accordingly.
(***) In case of operations referred to in Articles 29 and 35 when undertaken by enterprises not covered by the definition in Article
3(f) with less than 750 employees or with a turnover of less than EUR 200 million, the (B) rates are increased in the regions
covered by the Convergence objective, with the exception of the outlying Greek islands, by 30 percentage points and in the
regions not covered by the Convergence objective by 20 percentage points. The (A) rates are reduced accordingly.

Group 1

Operations provided for in Article 23 (public aid for permanent cessation of fishing activities), Article 24 (public aid
for temporary cessation of fishing activities), Article 26(3) (socio-economic compensation for small-scale coastal fish-
ers), Article 26(4) (premiums for fishers and vessels owners involved in small-scale coastal fishing), Article 27 (socio-
economic compensation for the management of the Community fishing fleet), Article 30 (aqua-environmental
measures), Article 31 (public health measures), Article 32 (animal health measures), the first subparagraph of
Article 33(2) (investments on inland fishing facilities), Article 33(3) (reassignment of vessels operating in inland fish-
ing), Article 37 (collective actions), Article 38 (measures intended to protect and develop aquatic fauna and flora),
Article 39 (fishing ports, landing sites and shelters), Article 40 (development of new markets and promotional cam-
paigns), Article 41 (pilot projects), Article 42 (modification for reassignment of fishing vessels), Article 44 (eligible
measures for the sustainable development of fisheries areas) and Article 46 (technical assistance).

Group 2

Operations provided for under Article 25(1), (2), (6), (7) and (8) (investment on board fishing vessels), Article 26(2)
(investment on board within the meaning of Article 25 in small scale coastal fishing vessels), the second subpara-
graph of Article 33(2) (investments on board vessels operating in inland fishing) and Article 44 (eligible measures for
the sustainable development of fisheries areas).

Following the application of (*) and (**) where the EFF finances operations referred to in Article 25(3) in favour of
small scale coastal fishing vessels, the (B) rates for Group 2 will be:

— for the regions covered by the Convergence objective, the outlying Greek islands and the regions not covered by

the Convergence objective equal or more than 60 percentage points (B ≥ 60 %),

and

— for the outermost regions equal or more than 50 percentage points (B ≥ 50 %).

Group 3

Operations provided for in Article 37 (collective actions), Article 38 (measures intended to protect and develop aquatic
fauna and flora), Article 39 (fishing ports, landing sites and shelters), Article 41 (pilot projects) and Article 44 (eli-
gible measures for the sustainable development of fisheries areas).

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Group 4

Operations provided for in Article 29 (measures for productive investments in aquaculture), the first subparagraph of
Article 33(2) (investments on inland fishing facilities), Article 35 (eligible measures in processing and marketing),
Article 40 (development of new markets and promotional campaigns) and Article 44 (eligible measures for the sus-
tainable development of fisheries areas).

(b) The managing authority shall determine with respect to operations concerning:

(i) Article 37 (collective actions), Article 38 (measures intended to protect and develop aquatic fauna and flora),
Article 39 (fishing ports, landing sites and shelters) and Article 41 (pilot projects) whether they fall under group 1
or 3,

(ii) Article 40 (development of new markets and promotional campaigns) and the first subparagraph of Article 33(2)

(investments on inland fishing facilities) whether they fall under group 1 or 4,

(iii) and Article 44 (eligible measures for the sustainable development of fisheries areas) whether they fall under

groups 1, 2, 3 or 4.

The managing authority shall determine the above under (i), (ii) and (iii) on the basis of the following considerations:

— collective versus individual interest,

— collective versus individual beneficiary (producers’ organisations, organisations representing the trade),

— public access to the results of the operation versus private ownership and control,

— financial participation by collective bodies and research institutions.