Council Regulation (EC) No 219/2007 of 27 February 2007 on the establishment of a Joint Undertaking to develop the new generation European air traffic management system (SESAR)
Date: 2007-02-27
Institutions: Council of the European Union
Subjects: air safety, air space, air traffic, air traffic control, joint venture, new technology, operation of the Institutions, research and development

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(Acts adopted under the EC Treaty/Euratom Treaty whose publication is obligatory)

I

REGULATIONS

COUNCIL REGULATION (EC) No 219/2007

of 27 February 2007

on the establishment of a Joint Undertaking to develop the new generation European air traffic
management system (SESAR)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty
Community, and in particular Article 171 thereof,

establishing the European

infrastructure which will enable the safe and
control
environmentally friendly development of air transport,
benefiting fully from the technological advances of
programmes such as Galileo.

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Parliament,

(3)

Following the Community's accession to Eurocontrol, the
Commission and Eurocontrol have signed a cooperation
the
framework agreement
single European sky and for research and development
activities in the field of air traffic control.

for the implementation of

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

(4)

Whereas:

(1)

(2)

In order to create the single European sky, on 10 March
2004 the European Parliament and the Council adopted
Regulation (EC) No 549/2004 laying
down the
framework for the creation of the single European sky
framework Regulation) (1), Regulation (EC) No
(the
550/2004 on the provision of air navigation services in
the single European sky (the service provision Regu-
lation) (2), Regulation (EC) No 551/2004 on the organ-
isation and use of the airspace in the single European sky
(the airspace Regulation) (3), and Regulation (EC) No
552/2004 on the interoperability of the European Air
Traffic Management network (the interoperability Regu-
lation) (4).

to modernise air
(the SESAR project),

in
The project
Europe,
technological
element of the single European sky. It aims by 2020
to give the Community a high-performance air traffic

traffic management

the

is

(1) OJ L 96, 31.3.2004, p. 1.
(2) OJ L 96, 31.3.2004, p. 10.
(3) OJ L 96, 31.3.2004, p. 20.
(4) OJ L 96, 31.3.2004, p. 26.

of

the

future

European

preparation

In accordance with the guidelines adopted by the
Competitiveness Council of 7 June 2005 concerning
the
space
the European Union will be responsible
programme,
for ensuring the availability and continuity of operational
services supporting its policies, and it will contribute to
the development, deployment
a
infrastructure by concentrating on
European space
the
applications
space-based
achievement of its policies.

and operation of

contribute

to

to

(5)

(6)

(7)

and

development

The SESAR project aims to integrate and coordinate
research
activities which were
previously undertaken in a dispersed and uncoordinated
manner in the Community,
including the most remote
and outlying regions thereof, referred to in Article 299(2)
of the Treaty.

By avoiding the duplication of research and development
activities, the SESAR project will not lead to an increase
in the overall volume of air users' contributions to
research and development efforts.

The SESAR project is composed of three phases: a defi-
nition phase, a development phase and a deployment
phase.

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(8)

(9)

(10)

(11)

(12)

(13)

(14)

The definition phase of the SESAR project aims to define
the different technological steps to be taken, the priorities
in the modernisation programmes and the operational
implementation
the
It
Community and by the European Organisation for the
Safety of Air Navigation (Eurocontrol).

co-financed

plans.

by

is

The definition phase started in October 2005 and is
carried out under the responsibility of Eurocontrol by a
consortium of undertakings chosen after a public invi-
tation to tender. It will finish in 2008 and will result in
the European Air Traffic Management Master Plan. This
plan will define the work programme for the implemen-
tation of
including the different
deployment strategies.

the target concepts,

The definition phase will be followed by the development
phase (2008-2013) which will develop new equipments,
systems or standards, which will ensure a convergence
towards a fully interoperable Air Traffic Management
system in Europe.

(2014-2020), which will be

The development phase will change into the deployment
phase
scale
production and implementation of the new air traffic
management infrastructure. The infrastructure should be
composed of
interoperable
components which guarantee high performance air
transport activities in Europe.

fully harmonised

large

and

a

(15)

activities.

Therefore, Community

The activities undertaken by the Joint Undertaking under
the SESAR programme are mainly research and devel-
opment
funding
should be paid in particular from its research and devel-
opment framework programmes. Additional funding can
be paid from the Trans-European Network programme in
accordance to Article 4(g) of Decision 1692/96/EC of the
European Parliament and the Council of 23 July 1996 on
Community guidelines for the development of the Trans-
European transport network (1), which envisages
the
possibility of
research and development
activities.

financing

(16)

The Community funding for
the Joint Undertaking
should, at this stage of the project, be limited to the
development phase within the period covered by the
current financial framework 2007-2013. However, this
does not prejudge the possibility for the Council
to
review the scope, governance, funding and duration of
the Joint Undertaking on the basis of the progress made
in the development phase.

(17)

Substantial participation from industry is an essential
It is therefore funda-
element for the SESAR project.
mental
the development
for
the public budget
phase of the SESAR project be supplemented by contri-
butions from industry.

that

Taking into account the number of actors who will need
to be involved in this process and the financial resources
and technical expertise needed, it is vital for the ration-
alisation of activities to set up a legal entity capable of
ensuring the management of the funds assigned to the
SESAR project during its development phase.

(18)

(19)

It is therefore necessary to set up a Joint Undertaking
the Treaty in order to enable
under Article 171 of
considerable progress to be made in the development
technologies relating to air traffic control systems
of
during
the
the
deployment phase.

development

prepare

phase

and

The Joint Undertaking should be set up before the end of
the definition phase so that it can follow the work of the
definition phase and prepare the development phase in
the
order
European Air Traffic Management Master Plan.

rapid implementation of

to ensure

the

The Council should decide on the endorsement of the
European Air Traffic Management Master Plan, including
its transfer to the Joint Undertaking, to modernise air
in Europe, and should in this
traffic management
context also review the financing of the SESAR project
and in particular
the pledges of contributions from
industry to the Joint Undertaking.

The main task of the Joint Undertaking is to manage the
research, development and validation activities of
the
Sesar project by combining public and private sector
funding provided by its members and using external
technical resources and in particular by using Euro-
control's experience and expertise.

(20)

In order to facilitate communication with the founding
members, the seat of the Joint Undertaking should be
located in Brussels.

(1) OJ L 228, 9.9.1996, p. 1. Decision as last amended by Council
Regulation (EC) No 1791/2006 (OJ L 363, 20.12.2006, p. 1).

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(21)

(22)

(23)

The Joint Undertaking is a non-profit entity which shall
devote all its resources to the management of a public
research programme of European interest.
two
Its
founding members
organisations
acting on behalf of their respective Member States. This
entity should therefore be granted, as far as possible, the
most
exemption from taxation from the
hosting State.

international

extensive

are

The Commission should be assisted by the Single Sky
Committee established by Article 5 of Regulation (EC)
No 549/2004. The measures necessary for
the im-
plementation 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
the
Commission (1).

implementing

conferred

powers

on

The Commission should inform the European Parliament
and the Council on a regular basis of the progress of the
Joint Undertaking. This information should be done
the
through
Commission and on the basis of
the annual activity
reports of the Joint Undertaking.

evaluations

performed

periodic

by

(24)

The rules for the organisation and operation of the Joint
Undertaking should be laid down by drawing up the
statutes of the Joint Undertaking as set out in the Annex.

(25) As route charges are entirely borne by airspace users, the
latter contribute financially to the research and devel-
opment efforts in the air traffic management sector.
They should therefore be given appropriate represen-
tation within the Joint Undertaking.

(26)

is

air

substantial

SESAR project

the
in a new generation of

Public financing for
the definition and development
phases of
and
investments
traffic
to a large extent, be made by
management should,
Member States, including bodies designated by Member
States. Member States (of the European Union and/or of
Eurocontrol) should therefore be granted access free of
charge, for non-commercial purposes, to the knowledge
resulting from the project and be allowed to use this
knowledge for their own purposes,
including for calls
for public tender,

The Joint Undertaking shall cease to exist eight years after
2.
an endorsement by the Council of the European Air Traffic
Management Master Plan (the ATM Master Plan)
resulting
from the definition phase of the SESAR project. The Council
shall decide on such endorsement acting on a proposal from the
Commission.

The ATM Master Plan shall be communicated to the

3.
European Parliament.

4.
The scope, governance, funding and duration of the Joint
Undertaking shall, where appropriate, be reviewed by the
Council on the basis of a proposal
from the Commission
according to the development of the project and of the ATM
Master Plan, taking into account the evaluation referred to in
Article 7.

5.
The aim of the Joint Undertaking shall be to ensure the
modernisation of the European air traffic management system
by coordinating and concentrating all relevant research and
development efforts in the Community. It shall be responsible
for the execution of the ATM Master Plan and in particular for
carrying out the following tasks:

— organising and coordinating the activities of

the devel-
opment phase of the SESAR project,
in accordance with
the ATM Master Plan, resulting from the definition phase
of the project managed by Eurocontrol, by combining and
managing under a single structure public and private sector
funding,

— ensuring the necessary funding for the activities of the devel-
opment phase of the SESAR project in accordance with the
ATM Master Plan,

— ensuring the involvement of

the stakeholders of

the air
traffic management sector in Europe, in particular: air navi-
gation service providers, airspace users, professional staff
associations, airports, and manufacturing industry; as well
as the relevant scientific institutions or the relevant scientific
community,

HAS ADOPTED THIS REGULATION:

Article 1

Establishment of a Joint Undertaking

In order to manage the activities of

1.
the development
phase of the project to modernise air traffic management in
(the SESAR project), a Joint
Europe and to enhance safety,
Undertaking is hereby established, known as ‘SESAR Joint
Undertaking’ (the Joint Undertaking).

(1) OJ L 184, 17.7.1999, p. 23. Decision as last amended by Decision

2006/512/EC (OJ L 200, 22.7.2006, p. 11).

— organising the technical work of research and development,
validation and study, to be carried out under its authority
while avoiding fragmentation of such activities,

— ensuring the supervision of activities related to the devel-
opment of common products duly identified in the ATM
Master Plan and if necessary, to organise specific invitations
to tender.

6.
The Joint Undertaking shall be operational at the latest
when the ATM Master Plan has been transferred to the Joint
Undertaking.

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The seat of

7.
Brussels.

the Joint Undertaking shall be located in

Article 2

Legal status

The Joint Undertaking shall have legal personality.

In
1.
it shall enjoy the most extensive legal
every Member State,
It
capacity accorded to legal persons under that State's law.
may,
and
immovable property and may be a party to legal proceedings.

acquire or dispose of movable

in particular,

However, the position of the Community in the Admin-
3.
istrative Board as regards decisions concerning the appointment
of the Executive Director, strategic financial issues or decisions
taken under Article 23 of the Statutes shall be adopted in
accordance with the procedure referred to in Article 6(2) of
this Regulation.

The position of

4.
the Community in the Administrative
Board as regards decisions concerning the accession of new
members, the modification of the Statutes and significant modi-
fications of the ATM Master Plan shall be adopted in accordance
with the procedure referred to in Article 6(3).

2. Member States shall take all possible measures to afford
the Joint Undertaking the most extensive exemption from
taxation as possible as regards to VAT and other taxes and
excise duties.

Article 6

Committee procedure

The Commission shall be assisted by the Committee

1.
referred to in Article 5.

Article 3

Statutes of the Joint Undertaking

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

The Statutes of the Joint Undertaking, as set out in the Annex
hereto constitute an integral part of this Regulation and are
hereby adopted.

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

Article 4

Sources of financing

3. Where reference is made to this paragraph, Articles 5 and
7 of Decision 1999/468/EC shall apply.

1.
The financing of the Joint Undertaking shall come from
contributions from its members, including private undertakings,
in accordance with Articles 1 and 12 of the Statutes.

The period laid down in Article 5(6) of Decision 1999/468/EC
shall be set at one month.

The Community's contribution shall be paid from the
2.
budget of
development
framework programme. It may in addition be paid from the
budget of the Trans-European Networks framework programme.

research and

technological

the

All Community financial contributions to the Joint Under-
3.
taking shall cease upon expiry of
the 2007-2013 financial
perspectives unless otherwise decided by the Council on the
basis of a Commission proposal.

Article 5

Committee

The Single Sky Committee, established by Article 5 of
1.
Regulation (EC) No 549/2004,
shall be
informed on a regular basis about the work of the Joint Under-
taking. To this end, the Commission shall put the Sesar project
as an item on the agenda of the Committee's meetings.

(the Committee),

The Commission may consult

4.
other matter concerning the application of this Regulation.

the Committee on any

5.

The Committee shall adopt its Rules of Procedure.

Article 7

Evaluation

Joint Undertaking,

the Commission shall

Every three years from the start of the activities of the Joint
Undertaking and at least one year before expiry of the term of
carry out
the
evaluations on the implementation of
the
results obtained by the Joint Undertaking and its working
methods, as well as on the general financial situation of the
Joint Undertaking. The Commission shall present the results of
these evaluations
to the European Parliament and to the
Council.

this Regulation,

Article 8

Entry into force

The Commission shall adopt the Community position in

2.
the Administrative Board.

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

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

Done at Brussels, 27 February 2007.

For the Council
The President

P. STEINBRÜCK

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ANNEX

STATUTES OF THE JOINT UNDERTAKING

Article 1

Members

Article 2

Organs of the Joint Undertaking

The following shall be founding members of the Joint Under-

1.
taking:

The organs of the Joint Undertaking shall be the Administrative Board
and the Executive Director.

— the European Community, represented by the European Commission

(the Commission),

Article 3

Composition and chairmanship of the Administrative Board

1.

The Administrative Board shall be composed of:

— the European Organisation for the Safety of Air Navigation (Euro-

control), represented by its Agency.

(a) a representative from each of the members of the Joint Undertaking;

2.

The following may become members of the Joint Undertaking:

(b) a representative of the military;

— the European Investment Bank,

— any other public or private undertaking or body including those
from third countries that have concluded at least one agreement
with the European Community in the field of air transport.

Any request for accession shall be addressed to the Executive
3.
Director, who shall transmit it to the Administrative Board. The Admin-
istrative Board shall decide whether to authorise negotiations. If author-
isation is given, the Executive Director shall negotiate the conditions of
them to the Administrative Board. These
accession and submit
conditions
relating to the
financial contributions and representation within the Administrative
Board. The draft agreement shall be presented to the Administrative
Board for approval under Article 5(1)(d).

in particular, provisions

include,

shall

4.
In deciding whether to authorise negotiations on accession with a
public or private undertaking or body the Administrative Board shall, in
particular, take account of the following criteria:

— documented knowledge and experience with air traffic management
and/or with the manufacture of equipment and/or services for use in
air traffic management,

(c) a representative of civil users of airspace, designated by their repre-

sentative organisation at European level;

(d) an air navigation service providers’ representative, designated by

their representative organisation at European level;

(e) an equipment manufacturers’ representative, designated by their

representative organisation at European level;

(f) an airports’ representative, designated by their representative orga-

nisation at European level;

(g) a representative from the bodies representing staff in the air traffic
management sector, designated by their representative organisation
at European level;

(h) a representative of the relevant scientific institutions or the relevant
scientific community, designated by their representative organisation
at European level.

The Administrative Board shall be chaired by the representative of

2.
the Community.

Article 4

Voting in the Administrative Board

— the contribution that the undertaking or body can be expected to

make to the execution of the ATM Master Plan,

The representatives referred to in points (a) and (c) of Article 3(1)

1.
shall have the right to vote.

— the financial soundness of the undertaking or body,

— potential conflicts of interest.

The members of the Joint Undertaking shall have a number of
2.
votes in proportion to their contribution to the funds of the Joint
Undertaking. However, notwithstanding the first
this
paragraph, the Community and Eurocontrol shall each have not less
than 25 % of the total number of votes and the airspace users’ repre-
sentative referred to in point (c) of Article 3(1) shall have at least 10 %
of the total number of votes.

sentence of

5. Membership of the Joint Undertaking may not be transferred to a
third party without the prior and unanimous agreement of the Admin-
istrative Board.

3.
Decisions of
simple majority of
these Statutes.

the Administrative Board shall be adopted by a
the votes cast unless otherwise provided for in

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If the votes are evenly divided, the Community shall have the

4.
casting vote.

(k) deciding on proposals to the Commission on the extension and the

dissolution of the Joint Undertaking;

5.
Any decision relating to the accession of new members (within the
meaning of Article 1(2)), the appointment of the Executive Director,
proposed amendments to these Statutes, proposals to the Commission
on the duration of the Joint Undertaking, the dissolution of the Joint
Undertaking or decisions taken under Article 23 shall require the
positive vote of the Community’s representative on the Administrative
Board.

6.
Decisions relating to the adoption of the ATM Master Plan and its
modifications shall require the positive votes of the founding members.
Notwithstanding paragraph 1, such decisions shall not be taken where
the representatives referred to in points (c), (d), (f), and (g) of Article
3(1) are unanimously opposed.

(l)

establishing procedures for granting rights of access to tangible and
intangible assets which are the property of the Joint Undertaking
and the transfer of such assets;

(m) laying down the rules and procedures for awarding the contracts
including specific

necessary to implement the ATM Master Plan,
procedures for conflicts of interest;

(n) deciding on proposals to the Commission to amend the Statutes in

accordance with Article 24;

Article 5

Responsibilities of the Administrative Board

(o) exercising such other powers and performing such other functions,
including the establishment of
subsidiary bodies, as may be
necessary for the purposes of the development phase of the Sesar
project;

1.

In particular, the Administrative Board shall be responsible for:

(a)

adopting the ATM Master Plan endorsed by the Council as referred
to in Article 1(2) of this Regulation and approving any proposal to
modify it;

(b) giving guidelines and taking the decisions necessary for the imple-
mentation of the development phase of the Sesar project and exer-
cising overall control over its implementation;

(c)

approving the Joint Undertaking’s work programme and annual
work programmes referred to in Article 16(1) as well as the
annual budget, including the staff establishment plan;

(p) adopting the arrangements for implementing Article 8.

2.
The Administrative Board shall adopt its rules of procedure which
shall ensure that its proceedings run in a smooth and efficient manner,
particularly in the event of a significant expansion in membership.
These rules shall also include the following provisions:

(a)

the Administrative Board shall meet at
least four times a year.
Extraordinary meetings shall be convened either at the request of
one-third of the members of the Administrative Board representing
at least 30 % of the voting rights, at the request of the Community
or of the Executive Director;

(d) authorising negotiations and deciding on the accession of new
referred to in

members and on the relating agreements as
Article 1(3);

(b) the meetings shall normally take place at the seat of the Joint

Undertaking;

(e)

supervising the execution of the agreements between members and
the Joint Undertaking;

(c) unless otherwise decided in particular cases, the Executive Director

shall participate in the meetings;

(f)

appointing and dismissing the Executive Director and approving
the organisation chart;

(d) specific procedures for identifying and avoiding conflicts of interest.

(g) deciding on the amounts and procedures for the payment of
financial contributions and the assessment of contri-

members’
butions in kind;

(h) adopting the financial regulations of the Joint Undertaking;

(i)

approving the annual accounts and balance-sheet;

Article 6

Avoidance of conflicts of interest

1. Members of the Joint Undertaking or of the Administrative Board
and Joint Undertaking staff are not allowed to participate in the
preparation, evaluation or the awarding procedures of calls for public
tender, if they own or have partnership agreements with bodies who are
potential candidates for calls for public tender or represent such bodies.

(j)

adopting the annual report on the progress of the development
phase of the Sesar project and its financial situation referred to
in Article 16(2);

2. Members of the Joint Undertaking and participants in the Admin-
istrative Board must disclose any direct or indirect personal or corporate
interest in the outcome of the deliberations of the Administrative Board
in relation to any matter on the agenda. This requirement also applies
to the staff in relation to the tasks which are assigned to them.

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Based on the disclosure mentioned in paragraph 2 the Adminis-
3.
trative Board may decide to exclude members, participants or staff from
decisions or tasks where a conflict of interest is likely to occur. They
will not have access to information relating to the fields deemed subject
to potential conflicts of interest.

(i)

submit the annual accounts and balance-sheet to the Administrative
Board;

(j)

submit to the Administrative Board any proposal involving changes
in the design of the Sesar project.

Article 7

Executive Director

Article 8

Staff of the Joint Undertaking

1.
The Executive Director shall be responsible for the day-to-day
management of the Joint Undertaking and is its legal representative.

The staff complement shall be determined in the establishment

1.
plan that will be set out in the annual budget.

The Executive Director shall be appointed by the Administrative
from the European Commission which shall

2.
Board on a proposal
include at least three candidates.

The members of the staff of the Joint Undertaking shall have a
2.
fixed-term contract based on the conditions of employment of servants
of the European Communities.

The Executive Director shall perform his duties with complete

3.
independence within the powers assigned to him.

The Executive Director shall direct the execution of the Sesar
4.
project within the guidelines established by the Administrative Board
to which he shall be responsible. He shall provide the Administrative
Board with all
its
functions.

information necessary for

the performance of

5.

The Executive Director shall in particular:

(a) employ, manage and supervise the staff of the Joint Undertaking,

including the staff referred to in Article 8(4);

(b) organise, manage and supervise the activities of the Joint Under-

taking;

3.

All staff expenditure shall be borne by the Joint Undertaking.

Any member of

4.
the Joint Undertaking may propose to the
Executive Director to second members of its staff to the Joint Under-
taking in accordance with the conditions provided for in the relevant
agreement.

Staff seconded to the Joint Undertaking shall be included in the staff
establishment plan and must act with complete independence under the
supervision of the Executive Director.

Article 9

Agreements

1.
In order to carry out the tasks defined in Article 1(5) of this
Regulation, the Joint Undertaking may conclude specific agreements
with its members.

Eurocontrol’s

2.
agreement with the Joint Undertaking. This agreement shall:

role and contribution shall be defined in an

(c) submit to the Administrative Board his proposals concerning the

organisation chart;

(a) establish the detailed arrangements for the transfer and the use of

the results of the definition phase to the Joint Undertaking;

(d) draw up and regularly update the global and the annual work
including an estimate on
programme of
programme costs, and submit them to the Administrative Board;

the Joint Undertaking,

(b) describe Eurocontrol’s tasks and responsibilities in the implemen-
tation of the ATM Master Plan under the authority of the Joint
Undertaking, such as:

(e) draw up,

in accordance with the Financial Regulations, the draft
annual budget, including the staff establishment plan, and submit
them to the Administrative Board;

(f) ensure that the obligations of the Joint Undertaking, with regard to

the contracts and agreements it concludes are met;

(g) ensure that the activities of the Joint Undertaking are carried out
with complete independence and without any conflicts of interest;

(h) draw up the annual report on the progress of the Sesar project and
its financial situation, and such other reports as may be requested by
the Administrative Board, and submit them to the latter;

(i) organising research, development and validation activities in
accordance with the work programme of the Joint Undertaking;

(ii) coordinating the common developments for the future system

under the responsibility of Eurocontrol;

(iii) proposing, after consultation with the stakeholders referred to
in Article 1(5) of this Regulation, possible amendments to the
ATM Master Plan;

(iv) updating convergence indicators (European convergence and
local convergence and implementation

implementation plan,
plan);

(v) liaising with the International Civil Aviation Organisation.

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All agreements with members shall include appropriate provisions
3.
which shall prevent any possible conflict of interest for members in
performing the tasks under the said agreements.

4.
Representatives of members of the Joint Undertaking shall not
participate in deliberations of the Joint Undertaking pertaining to nego-
tiations on the conclusion of
their own agreements referred to in
paragraph 1 and shall be denied access to the documentation on
these deliberations.

Article 10

External contracts

1.
Notwithstanding the provisions of Article 9, the Joint Undertaking
may conclude service and supply contracts with undertakings or a
consortium of undertakings,
the tasks
provided for in Article 1(5) of this Regulation.

to carry out

in particular

2.
The Joint Undertaking shall ensure that the contracts referred to in
paragraph 1 provide for the right of the Commission to carry out, on
behalf of the Joint Undertaking, controls in order to ensure that the
financial interests of the Community are protected.

The contracts referred to in paragraph 1 shall include all appro-
3.
priate provisions relating to the intellectual property rights referred to in
In order to avoid any
Article 18 and appropriate penalty clauses.
conflict of
is
interests, members
subject to an invitation to tender, including their staff seconded under
Article 8(4), cannot take part in carrying out this work.

involved in defining work that

Article 11

Working groups

In order to carry out the tasks provided for in Article 1(5) of this
1.
Regulation,
the Joint Undertaking can set up a limited number of
working groups to carry out activities which are not already being
carried out elsewhere. These groups shall rely on the expertise of profes-
sionals and shall work in a transparent manner.

The experts who take part in the working groups shall not belong

2.
to the staff of the Joint Undertaking.

The members referred to in the second indent of Article 1(2) shall
3.
undertake to pay a minimum initial contribution of EUR 10 million
within a period of one year from when their accession to the Joint
Undertaking is accepted. This amount shall be reduced to EUR five
million for members that subscribe to the Joint Undertaking within
12 months of its constitution.

In the case of undertakings, subscribing individually or collectively,
which may be regarded as small or medium-sized enterprises within
the Commission recommendation of 6 May 2003
the meaning of
concerning the definition of small and medium-sized enterprises (1),
this amount shall be reduced to EUR 250 000 regardless of when
they become members. New members may be offered the option of
paying the initial contribution in several instalments, over a period to be
agreed and established in their agreements as referred to in Article 1(3).

4.
The Administrative Board shall decide on the amounts which must
be released by each member in proportion to the contributions which it
has agreed to pay and shall establish the deadline by which the
members must pay their contributions.

Contributions in kind are possible except as regards the contri-
5.
butions referred to in paragraph 2. They shall be subject
to an
evaluation of their value and their utility for carrying out the tasks of
the Joint Undertaking and shall be specified in the agreement referred to
in Article 1(3).

Any member of

the Joint Undertaking that

fails to meet
its
6.
commitments concerning the contributions
in kind or does not
release the amount due within the prescribed time-limit shall be, for
six months following the expiry of this time-limit, disqualified from
voting in the Administrative Board until such time as its obligations
have been met. Upon expiry of this period of six months, if the obli-
gations have still not been met, its membership shall be revoked.

Article 13

Revenue

All

the revenue of

the Joint Undertaking shall be applied to
1.
promoting the tasks defined in Article 1(5) of this Regulation. Subject
to Article 25, no payment by way of division of any excess revenue
over expenditure shall be made to the members of the Joint Under-
taking.

The working groups shall be chaired by a representative of the

3.
Joint Undertaking.

2.
Notwithstanding the regulatory provisions applicable to the
Community’s contribution, any interest yielded by the contributions
paid by its members shall be considered to be revenue of the Joint
Undertaking.

Article 12

Financial provisions

Article 14

Financial regulations

The revenue of the Joint Undertaking shall come from the sources

1.
identified in Article 4 of this Regulation.

The financial regulations of the Joint Undertaking shall be adopted

1.
by the Administrative Board.

In order to start up the work of

2.
the
founding members shall pay a minimum initial contribution of EUR
10 million within a period of one year from the establishment of the
Joint Undertaking.

the Joint Undertaking,

The purpose of the financial regulations is to ensure the economic

2.
and sound financial management of the Joint Undertaking.

(1) OJ L 124, 20.5.2003, p. 36.

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The financial regulations should respect the broad principles laid
3.
down in Commission Regulation (EC, Euratom) No 2343/2002 of 23
December 2002 on the framework Financial Regulation for the bodies
referred to in Article 185 of Council Regulation (EC, Euratom) No
1605/2002 on the Financial Regulation applicable to the general
the European Communities (1), and shall
budget of
in particular
include the main rules on:

(a)

the presentation and structure of the Sesar project cost estimates
and the annual budget;

(b) the implementation of

the annual budget and internal

financial

control;

(c)

the method of payment of contributions by the members of the
Joint Undertaking;

(d) the keeping and presentation of accounts and inventory records as
well as the drawing up and presentation of the annual balance-sheet;

(e)

the procedure regarding calls for tender, based on non-discrimi-
nation between the countries of the members of the Joint Under-
taking and the Community character of the project, the award and
the terms and conditions of contracts and orders on behalf of the
Joint Undertaking.

the end of each financial year,

the
5. Within two months of
the annual accounts and balance-
Executive Director shall submit
sheets
the
to the Court of Auditors of
the preceding year
European Communities. The audit executed by the Court of Auditors
shall be based on records and performed on the spot.

for

The Executive Director shall present

6.
the annual accounts and
balance-sheet, together with the report of the Court of Auditors, to
the Administrative Board for approval by a majority of 75 % of the
votes cast. The Executive Director is entitled and, if requested by the
Administrative Board, obliged to comment on the report.

The Court of Auditors shall send its report to the members of the

7.
Joint Undertaking.

Article 16

Work programme and reports

1.
The Joint Undertaking shall draw up its work programme on the
basis of sound management and accountability principles setting out
clear deliverables and milestones. It shall consist of:

(a) a global work programme, divided into periods of thirty-six months;

4.
The detailed implementing rules enabling the Commission to
ensure compliance with its obligations pursuant to Article 274 of the
Treaty establishing the European Community shall be set out in an
agreement between the Joint Undertaking and the Commission.

(b) annual work programmes established each year which describe the
activities, timetable and costs of the Joint Undertaking over this
period.

Article 15

Implementation and control of the budget

1.

The financial year shall correspond to the calendar year.

Before 31 March of each year,

the Executive Director shall
2.
transmit to the members the cost estimates of the Sesar project as
approved by the Administrative Board.

The project cost estimates shall include a forecast of annual expenditure
for the following two years. Within this forecast,
the estimates of
revenue and expenditure for the first of those two financial years (preli-
minary draft budget) shall be drawn up in such detail as is necessary for
the internal budgetary procedure of each member regarding its financial
contributions to the Joint Undertaking. The Executive Director shall
supply the members with all supplementary information needed for
this purpose.

2.
The annual report shall show the progress of the Sesar project, in
particular with regard to the timetable, costs and performance of this
project.

Article 17

Protection of the financial interests of the Community

The Commission shall have the right to ensure that the financial
1.
the Community are protected by carrying out effective
interests of
controls. Should the Commission discover any irregularities,
it shall
reserve the right to reduce or suspend any subsequent payment to
the Joint Undertaking.

2.
The reduced or suspended amount pursuant to paragraph 1 shall
be equivalent to the amount of the irregularities actually discovered by
the Commission.

The members shall

forthwith communicate to the Executive
3.
Director their comments on the project cost estimates, and in particular
on the estimates of revenue and expenditure for the following year.

Article 18

Property rights

Based on the approved project cost estimates, and taking into
4.
account the comments received from members, the Executive Director
shall prepare the draft budget for the following year and submit it to
the Administrative Board for adoption before 30 September.

(1) OJ L 357, 31.12.2002, p. 72.

the Sesar project

The Joint Undertaking shall own all the tangible and intangible assets
created by the Joint Undertaking or transferred to it for the devel-
in accordance with agreements
opment phase of
referred to in Articles 1(3) and 9, concluded by the Joint Undertaking.
The Joint Undertaking may grant access rights to the knowledge
resulting from the project,
in particular to its members as well as
Member States of the European Union and/or Eurocontrol for their
own and non commercial purposes.

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Article 19

Transparency and treatment of documents

Article 22

Confidentiality

in order

rules on the treatment of
The Administrative Board shall adopt
security,
requirements of
to reconcile
documents
take into
commercial secrecy, and public access. These rules shall
account, where appropriate,
the principles and limits laid down in
Regulation (EC) No 1049/2001 of the European Parliament and of
the Council (1).

the

Article 20

Anti-fraud measures

1.
For the purposes of combating fraud, corruption and other illegal
acts, Regulation (EC) No 1073/1999 of the European Parliament and of
the Council of 25 May 1999 concerning investigations conducted by
the European Anti-Fraud Office (OLAF) (2) shall apply.

The Joint Undertaking shall accede to the Interinstitutional
2.
Agreement of 25 May 1999 between the European Parliament, the
Council of the European Union and the Commission of the European
Communities concerning internal investigations by the European Anti
Fraud Office (OLAF) (3) and shall
forthwith issue the appropriate
provisions applicable to all employees of the Joint Undertaking.

3.
The Court of Auditors and OLAF may, if necessary, carry out on-
the-spot checks among the recipients of the Joint Undertaking’s funding
and the agents responsible for allocating it.

Article 21

Liability

The Joint Undertaking shall be solely responsible for meeting its

1.
obligations.

2.
The contractual liability of the Joint Undertaking shall be governed
by the relevant contractual provisions and the law applicable to the
contract in question.

3.
Any payment by the Joint Undertaking for covering the liability
referred to in paragraph 2 and the costs and expenses incurred in
connection therewith shall be considered expenditure of
the Joint
Undertaking.

4.
The Executive Director shall propose to the Administrative Board
to take out any necessary insurance, and the Joint Undertaking shall
take out such insurance as the Administrative Board may request.

The Joint Undertaking shall ensure the protection of sensitive infor-
the non-authorised disclosure of which could damage the
mation,
interests of the contracting parties. It shall apply the principles and
minimum standards of security defined and implemented by Council
Decision 2001/264/EC of 19 March 2001 adopting the Council’s
security regulations (4).

Article 23

Transfer of tangible and intangible assets by the Joint Undertaking

Upon expiry of the period referred to in Article 1 of this Regulation, the
transfer by the Joint Undertaking of all or part of the tangible and
intangible assets that it owns to another body shall be agreed by the
Administrative Board.

Article 24

Amending the Statutes

Any member of the Joint Undertaking may submit proposals for

1.
the amendment of these Statutes to the Administrative Board.

2.
If the Administrative Board agrees to such proposals by a majority
of 75 % of the votes and in accordance with Article 4(5) of these
Statutes, the Commission shall make a proposal
in accordance with
Article 5(4) of this Regulation.

Article 25

Dissolution of the Joint Undertaking

For the purpose of conducting the proceedings involved in winding up
the Joint Undertaking, the Administrative Board shall appoint one or
more liquidators, who shall comply with the decisions of the Adminis-
trative Board.

Article 26

Applicable law

The law of the State where the seat of the Joint Undertaking is located
shall apply in any matter not covered by these Statutes.

(1) OJ L 145, 31.5.2001, p. 43.
(2) OJ L 136, 31.5.1999, p. 1.
(3) OJ L 136, 31.5.1999, p. 15.

(4) OJ L 101, 11.4.2001, p. 1. Decision as
2005/952/EC (OJ L 346, 29.12.2005, p. 18).

last amended by Decision