Proposal for a DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on the mobilisation of the European Globalisation Adjustment Fund in accordance with point 28 of the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management (application EGF/2009/015 DK/Danfoss Group from Denmark)
Date: 2010-08-02
Institutions: European Commission
Subjects: Denmark, EU aid, budgetary discipline (EU), budgetary procedure, commitment of expenditure, dismissal, financial management, fund (EU), globalisation, interinstitutional agreement, reintegration into working life

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EUROPEAN COMMISSION 

Brussels, 2.8.2010 
COM(2010)416 final 

Proposal for a 

DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

on the mobilisation of the European Globalisation Adjustment Fund in accordance with 
point 28 of the Interinstitutional Agreement of 17 May 2006 between the European 
Parliament, the Council and the Commission on budgetary discipline and sound 
financial management (application EGF/2009/015 DK/Danfoss Group from Denmark) 

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EXPLANATORY MEMORANDUM 

The  Interinstitutional  Agreement  of  17 May  2006  between  the  European  Parliament,  the 
Council  and  the  Commission  on  budgetary  discipline  and  sound  financial  management1 
allows for the mobilisation of the European Globalisation Adjustment Fund (EGF) (point 28) 
within  the  annual  ceiling  of  EUR 500 million over  and  above  the  relevant  headings  of  the 
financial framework. 

The rules applicable to the contributions from the EGF are laid down in Regulation (EC) No 
1927/2006  of  the  European  Parliament  and  of  the  Council  of  20  December  2006  on 
establishing the European Globalisation Adjustment Fund 2. 

On 8 September 2009, Denmark submitted application EGF/2009/015 DK/Danfoss Group for 
a financial contribution from the EGF, following 1 443 redundancies in the Danfoss Group in 
Denmark. 

After  a  thorough  examination  of  this  application,  the  Commission  has  concluded  in 
accordance  with  Article  10  of  Regulation  (EC)  No  1927/2006  that  the  conditions  for  a 
financial contribution under this Regulation are met. 

SUMMARY OF THE APPLICATION AND ANALYSIS 

Key data: 

EGF Reference no. 
Member State 
Article 2 
Enterprises concerned 
NUTS II region 
NACE Revision 2 division 
Reference period 
Starting date for the personalised services 
Application date 
Redundancies during the reference period: 
Redundant workers targeted for support 
Personalised services: budget in EUR 
Expenditure for implementing EGF3: budget in EUR 
% expenditure for implementing EGF 
Total budget in EUR 
EGF contribution EUR (65 %) 

EGF/2009/015 
Denmark 
(a) 
Danfoss A/S, Sauer Danfoss ApS, Danfoss Drives A/S 
DK03 - Syddanmark 
n/a 
01/03/2009 – 30/06/2009 
01/10/2009 
08/09/2009 
588 
1,010 
12 986 846 
695 211 
5.1 % 
13 682 057 
8 893 336 

1. 

The  application  was  presented  to  the  Commission  on  8  September  2009  and 
supplemented by additional information up to 30 March 2010. 

1 
2 
3 

OJ C 139, 14.6.2006, p. 1. 
OJ L 406 of 30.12.2006, p. 1. 
In accordance with the third paragraph of Article 3 of Regulation (EC) No 1927/2006. 

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2. 

The application meets the conditions for deploying the EGF as set out in Article 2(a) 
of  Regulation  (EC)  No  1927/2006,  and  was  submitted  within  the  deadline  of  10 
weeks referred to in Article 5 of that Regulation.  

Link  between  the  redundancies  and  major  structural  changes  in  world  trade  patterns 
due to globalisation or the global financial and economic crisis 

3. 

In order to establish the link between the redundancies and the global financial and 
economic  crisis  Denmark  argues  that  the  redundancies  in  Danfoss  A/S,  Sauer 
Danfoss  ApS  and  Danfoss  Drives  A/S  are  a  direct  consequence  of  the  abrupt 
deterioration  of  demand  for  mechanical  and  electronic  machinery  as  a  result  of  the 
economic  crisis  and  associated  recession.  It  provides  statistical  evidence  from 
Eurostat  that  demonstrates  that  the  generally  favourable  evolution  in  production  in 
the  sector  'manufacture  of  machinery  and  equipment'  changed  dramatically  in  the 
fourth  quarter  of  2008  in  the  EU.  In  both  Denmark  and  Germany  (the  leading  EU 
producer) declines in production of 25 % and over were recorded between 2008 Q4 
and 2009 Q3. 

Denmark provided information that demonstrated that Danfoss adjusted net sales of 
the  first  nine  months  were  17 %  lower  than  the  year  before,  and  the  firm  made  a 
significant loss. Likewise, Sauer Danfoss had suffered a drop in sales during the third 
quarter  of  2008  of  52 %  in  Europe,  48 %  in  the  Americas  and  23 %  in  the  Asia-
Pacific region. 

The  downturn  in  production  caused  by  the  crisis  exacerbated  an  already  difficult 
situation for companies in the sector. As a result of cost pressures from Asia, where 
labour  costs  are  considerably  lower  than  those  in  the  EU,  production  had  been 
progressively migrating out of the EU, including Denmark. 

Companies in the Danfoss Group were not unaffected by the cost pressures, and had 
already started to move some production out of the EU, including to Mexico where 
Danfoss  had  already  established  a  production  facility.  Denmark  acknowledges  that 
the redundancies in Danfoss and other companies in the sector would have occurred 
in any event, but would have taken place over a longer period, and could thus have 
been planned for and dealt with more easily. 

The economic crisis placed unexpected pressures on the Danfoss Group, which saw 
its  pre-tax  profit  drop  from  DKK 164 million  in  2008  Q1  to  a  pre-tax  loss  of 
DKK 562 million in 2009 Q1. In such circumstances the company had no alternative 
but to close certain production facilities, with the redundancies as a consequence. 

Denmark does not expect that any of the jobs lost in the three enterprises will return 
to  Denmark  even  after  the  crisis.  The  cost  pressures  in  the  sector,  along  with  the 
growing  importance  of  markets  in  Asia  and  other  non-EU  regions,  will  ensure  that 
any new production capacity is likely to be established outside the EU. 

Demonstration  of  the  number  of  redundancies  and  compliance  with  the  criteria  of 
Article 2(a) 

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4. 

5. 

Denmark submitted this application under the intervention criteria of Article 2(a) of 
Regulation  (EC)  No  1927/2006,  which  requires  at  least  500  redundancies  over  a 
four-month period in an enterprise and in its suppliers and downstream producers. 

The application cites 588 redundancies in 3 enterprises of the Danfoss Group during 
the  four-month  reference  period  from  1  March  2009  to  30  June  2009.  All  of  the 
redundancies were calculated in accordance with the 2nd indent of the 2nd paragraph 
of Article 2 of Regulation (EC) No 1927/2006. 

Explanation of the unforeseen nature of those redundancies 

6. 

The  Danish  authorities  argue  that  the  global  economic  and  financial  crisis 
exacerbated  an  already  difficult  situation  for  enterprises  in  the  engineering  sector. 
Cost pressures had been exerting pressure on enterprises in high-cost countries, and 
the reduction in demand and thus production that the crisis brought left the Danfoss 
Group  with  no  alternative  but  to  close  loss-making  production  facilities.  The 
suddenness of the crisis meant that alternatives could not be found quickly, and the 
depth of the recession meant that losses incurred by the Group were unsustainable. 

Identification of the dismissing enterprises and workers targeted for assistance 

7. 

The  application  cites  a  total  of  1 443  redundancies  in  the  following  enterprises,  of 
which 588 occurred during the reference period, and 855 which occurred before the 
reference period, but which  are eligible for inclusion according to Article 3a (b) of 
Regulation (EC) No 1927/2006: 

Enterprises and number of dismissals 

Danfoss A/S 

Sauer Danfoss ApS 

Danfoss Drives 

345 

909 

189 

Total Enterprises: 3 

Total of Dismissals: 1 443 

Denmark  estimates  that  70%  of  the  redundant  workers  (1 010),  will  receive 
assistance  from  the  EGF.  The  remaining  30%  are  expected  to  find  employment 
through their own initiative without requiring assistance from the EGF. 

8. 

The break-down of the targeted workers is as follows : 

Category 
Men 
Women 
EU citizens 
Non EU citizens 
15 to 24 years old 
25 to 54 years old 
Over 54 years old 

Number 
624 
386 
n/a 
n/a 
96 
762 
152 

Percent 
61.8 % 
38.2 % 
n/a 
n/a 
9.5 % 
75.4 % 
15.0 % 

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9. 

In terms of professional categories, the break-down is as follows : 

and 

Category 
Professionals 
Technicians 
associate 
professionals 
Plant  and  machine 
and 
operators 
assemblers 

Number 
182 
107 

Percent 
18.0 % 
10.6 % 

721 

71.4 % 

10. 

In  accordance  with  Article  7  of  the  Regulation  (EC)  No  1927/2006,  Denmark  has 
confirmed  that  a  policy  of  equality  between  women  and  men  as  well  as  non-
discrimination has been applied, and will continue to apply, during the various stages 
of the implementation of and, in particular, in access to the EGF. 

Description of the territory concerned and its authorities and stakeholders 

11. 

The territory concerned is the municipality of Sønderborg, which was established on 
1  January  2007  as  an  amalgamation  of  seven  previous  municipalities.  It  has  a 
population of 76 647. Geographically, it consists of two different parts: the island of 
Als  and  the  Sundeved  peninsula,  connected  by  two  bridges  in  the  main  town  of 
Sønderborg.  Als  has  a  ferry  connection  over  the  Little  Belt  to  Fyn,  but  the  main 
transport  artery  in  southern  Jutland  is  to  the  west  of  the  municipality.  Especially 
northern Als, where Danfoss has its headquarters, is relatively remote. From the town 
of  Sønderborg  it  is  only  30 km  by  road  to  the  German  border,  and  part  of  the 
municipality is on the northern side of Flensburg Fjord, with a short journey across 
the  water  to  the  southern  shore  in  Germany.  The  municipality  is  thus  part  of  the 
border  region.  However,  northern  Schleswig-Holstein,  the  adjacent  area,  is  not  a 
German  ‘growth  region’.  In  fact,  over  the  last  decade,  there  has  been  a  significant 
Jutland. 
migration 
If  there  had  not  been  a  cluster  of  mechatronics  firms  around  Danfoss,  Als  in 
particular would certainly have become a peripheral area, as is the case for example 
with  the  neighbouring  areas  of  southern  Fyn  and  the  South  Fyn  archipelago. 
The  area  is  especially  characterised  by  a  relatively  high  average  age,  and 
demographic  forecasts  suggest  a  decline  in  population  over  the  next  ten  years  — 
without 
economic  downturn.  
Even  if  the  average  level  of  education  and  training  is  reasonably  high,  it  is  still  a 
feature of the area that a significant proportion of the population has been employed 
in unskilled industrial jobs. To a large extent it is this section of the population which 
is now affected by globalisation. 

effects  of 

considering 

Germany 

southern 

sudden 

labour 

from 

the 

the 

of 

to 

12. 

The principal stakeholders include Sønderborg municipality and the region of South 
Denmark. 

Expected impact of the redundancies as regards local, regional or national employment 

13. 

The  iron  and  metal  industry  in  Sønderborg  municipality  represents  around  25 %  of 
all  employment  in  the  municipality.  In  the  first  nine  months  of  2009  registered 
unemployment  climbed  by  more  than  300 %,  and  the  iron  and  metal  industry  has 
over the same time laid off more than 1 600 employees. 

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14. 

15. 

Denmark  has  provided  evidence  that  the  increase  in  unemployment  in  Sønderborg 
has been greater that the Danish average over the period from mid-2008 to mid-2009. 
During this period the numbers of unemployed workers in Sønderborg increased by 
around 250 %. 

With  around  15 %  of  the  workforce,  the  engineering  sector  was  the  largest  single 
sector  in  the  area,  and  the  job  loses  in  the  Danfoss  Group  will  not  be  absorbed  by 
other  enterprises.  Without  retraining,  the  redundant  workers  are  likely  to  find  it 
difficult to be re-employed. 

Co-ordinated  package  of  personalised  services  to  be  funded  and  a  breakdown  of  its 
estimated  costs,  including  its  complementarity  with  actions  funded  by  the  Structural 
Funds 

16. 

17. 

Denmark proposes a package of measures in favour of the redundant workers that is 
built around three pillars, following an initial vocational counselling and placement: 
education and training, employment incentives and incentives for business start-ups. 
The package is designed to take into account the educational levels of the workers, 
their  ability  to  be  mobile,  and  current  or  expected  job  opportunities  in  the  region. 
Although  all  of  the  targeted  workers  will  participate  in  the  initial  counselling  and 
placement, other actions may target smaller numbers of workers, some of whom will 
benefit from more than one action where appropriate. 

An initial vocational counselling and placement is carried out in order to identify the 
best  options  for  each  worker  individually.  Each  targeted  worker  is  offered  a  basic 
training to identify their skills and to find the best fit with the available active labour 
market measures. It is estimated that 70 % of the redundant workers will avail of this 
action, at an estimated cost of € 3 356 per worker. 

18. 

The  pillar 

'education 

and 

training' 

comprises 

five 

separate 

actions: 

in 

training 

(1)  Supplementary 
tourism.  It 
that  132  workers, 
predominantly those with low levels of educational attainment will benefit from the 
action, at an estimated cost of € 6 644 pe r worker. The  action  aims 
the 
workers  skills  relevant  to  the  growing  tourism  sector  in  the  region,  including 
advertising,  marketing,  branding,  the  service  concept  and  business  administration. 

is  estimated 

to  give 

(2) Supplementary training in energy technology. Due to the focus on sustainability, 
demand for skilled workers from small, medium and large enterprises in the region is 
expected. It is proposed to train approximately 88 workers, predominantly those with 
low  levels  of  educational  attainment,  to  enter  this  industry,  in  close  collaboration 
with  existing  employers  in  the  region.  The  estimated  cost  per  worker  is  € 6 644. 

(3)  Attracting  and  retaining  young  people  in  education.  The  Sønderborg  area  is 
characterized by having a group of young people without training. There have been 
many initiatives to tackle this, but they have not had the desired effect. This action is 
aimed  at  attracting  younger  redundant  workers  back  into  education,  for  which 
additional support is needed, including guidance and material and financial support 
to facilitate the transition from work to study. It is estimated that 132 workers with 
low  levels  of  educational  attainment  will  benefit  from  this  action,  at  an  estimated 
cost of € 6 711 per worker.   

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(4)  Education  and  training  in  business  management.  An  estimated  66  workers, 
predominantly  those  with  low  levels  of  educational  attainment,  will  be  offered 
training  in  aspects  of  business  administration,  such  as  accounting,  planning, 
communication, and strategic management. The training will include both classroom 
and  practical  (on-the-job)  training.  The  estimated  cost  per  worker  is  € 7 114. 

(5)  Remedial  education.  An  estimated  352  of  the  older  workers  (aged  40-60)  with 
very low levels of educational attainment will be offered remedial education in areas 
such as reading, spelling and mathematics in order to allow them to take advantage 
of  other  educational  and  employment  opportunities.  The  cost  per  workers  is 
estimated at € 5 302. 

19. 

The 

pillar 

'employment 

incentives' 

comprises 

three 

separate 

actions: 

(1)  Incentives  for  older  persons  who  wish  to  change  career.  This  action  aims  to 
provide  incentives  to  older  workers  (aged  40-60)  who  have  worked  in  the  metal 
sector to take up opportunities in other sectors. In recognition of the likelihood that 
the  metal  sector  will  not  recover  in  the  near  future  in  the  region,  it  is  necessary  to 
help  these  workers  move  to  other  sectors.  This  action  will  include  guidance  and 
mobility  support,  and  it  is  estimated  that  around  88  workers  will  benefit,  at  an 
estimated cost of € 4 952 per worker. 

(2) Internships and mentoring. It is expected that around 264 of the younger workers 
with  a low level  of  education will  benefit from internships and  mentoring,  in  close 
cooperation  with  businesses  in  the  region  which  have  a  track  record  of  recruiting 
staff  from  other  sectors.  The  estimated  cost  per  worker  is  € 5 161.  The  aim  is  to 
ensure  that  these  workers  remain  in  close  contact  with  the  job  market,  to  facilitate 
their reintegration as quickly as possible. 

(3)  Company-based  training.  In  order  to  facilitate  the  reintegration  of  the 
unemployed into the labour market, this action offers on-the-job training, especially 
in  SMEs,  with  a  specific  focus  on  the  skills  that  such  firms  require.  It  is  estimated 
that around 264 redundant workers will benefit from this action, at an estimated cost 
of € 5 772 per worker. 

20. 

The  pillar  'incentives  for  business  start-ups'  contains  three  separate  actions,  all  of 
which are aimed primarily at the older workers with low levels of education amongst 
the redundancies: 

(1) Financial support to persons starting up businesses in growth industries. Financial 
assistance in the form of interest-only loans would be offered to redundant workers 
who start new companies in growth business such as the leisure or welfare sectors. It 
is expected that 44 people will benefit from it. The financial support may be awarded 
if  the  redundant  worker  recruits  employees  in  the  company  he  or  she  starts.  It  is 
€ 26 846. 
estimated 

loan  per  entrepreneur  will  be  about 

the  average 

that 

(2) On-going advice and mentoring for entrepreneurs. To help new entrepreneurs to 
succeed, this action proposes to offer entrepreneurs ongoing advice and mentoring. It 
is expected that 66 will benefit, at an estimated cost of around € 4 027 per worker. 

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Each  entrepreneur  will  be  assigned  a  mentor  with  knowledge  of  the  sector  who 
regularly  consults  and  advises  the  entrepreneur.  It  is  planned  that  the  mentoring 
scheme  will  run  for  one  year,  and  simultaneously  it  is  planned  to  set  up  network 
groups  within  current  and  potential  growth  sectors,  where  new  entrepreneurs  can 
meet, discuss and cooperate. 

(3)  Support  for  advertising  and  branding  of  growth  entrepreneurs.  This  action  is 
designed to provide professional advice from an advertising agency on branding and 
advertising the start-up companies. It is expected that 18 workers will benefit from 
this action, which will run for six months, at an estimated cost of around € 8 054 per 
worker. 

The  expenditure  for  implementing  EGF,  which  is  included  in  the  application  in 
accordance  with  Article  3  of  Regulation  (EC)  No  1927/2006,  covers  preparatory, 
management and control activities as well as information and publicity. 

The  personalised  services  presented  by  the  Danish  authorities  are  active  labour 
market measures within the eligible actions defined by Article 3 of Regulation (EC) 
No  1927/2006.  The  Danish  authorities  estimate  the  total  costs  of  these  services  at 
€ 12 986 846 and the expenditure for implementing EGF at € 695 211 (5.1 % of the 
total amount). The total contribution requested from the EGF is € 8 893 336 (65 % of 
the total costs). 

Estimated 
number of 
workers 
targeted 

Estimated cost 
per worker 
targeted 
(in EUR) 

Total costs 
(EGF and 
national co-
financing) (in 
EUR) 

21. 

22. 

Actions 

Personalised services (first paragraph of Article 3 of Regulation (EC) No 1927/2006) 

Vocational counselling and placement 

1 010

3 356 

3 389 262

Education and Training 

Supplementary training in tourism 

Supplementary training in energy 
technology 

Attracting and retaining young people in 
youth or continuing training 

Education and training in business 
management 

Remedial education 

Employment incentives 

132

88

132

66

352

6 644 

6 644 

877 047

584 698

6 711 

885 906

7 114 

469 530

5 302 

1 866 309

Incentives for older persons who wish to 
change career 

88

4 953 

435 866

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Internships and mentoring 

Company-based training 

Incentives for business start-ups 

Financial support to persons starting up 
businesses in growth industries 

On-going advice and mentoring for 
entrepreneurs 

Support for advertising and branding of 
growth entrepreneurs 

Sub total personalised services 

264

264

44

66

18

5 161 

1 362 523

5 772 

1 523 758

26 846 

1 181 208

4 027 

265 772

8 054 

144 966

12 986 846

Expenditure  for  implementing  EGF  (third  paragraph  of  Article  3  of  Regulation  (EC)  No 
1927/2006) 

Preparatory activities 

Management 

Information and publicity 

Control activities 

Sub total expenditure for implementing 
EGF 

Total estimated costs 

EGF contribution (65 % of total costs) 

104 282

347 606

104 282

139 042

695 211

13 682 057

8 893 336

23. 

Denmark  confirms  that  the  measures  described  above  are  complementary  with 
actions funded by the Structural Funds. 

Date(s)  on  which  the  personalised  services  to  the  affected  workers  were  started  or  are 
planned to start 

24. 

Denmark started the personalised services to the affected workers included in the co-
ordinated  package  proposed  for  co-financing  to  the  EGF,  on  1  October  2009.  This 
date therefore represents the beginning of the period of eligibility for any assistance 
that might be awarded from the EGF. 

Procedures for consulting the social partners 

25. 

The  South  Denmark  region  and  Sønderborg  municipality  prepared  the  application 
jointly,  with  the  involvement  of  various  social  partners,  including  industrial 
associations,  trade  unions  and  education  and  training  institutions.  A  public  hearing 
on  the  matter  was  also  held,  which  was  announced  in  the  local  and  regional  press, 
and all interested parties were able to participate. 

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26. 

The  Danish  authorities  confirmed  that  the  requirements  laid  down  in  national  and 
Community legislation concerning collective redundancies have been complied with. 

Information  on  actions  that  are  mandatory  by  virtue  of  national  law  or  pursuant  to 
collective agreements 

27. 

As regards the criteria contained in Article 6 of Regulation (EC) No 1927/2006, the 
Danish authorities in their application:  

•  confirmed that the financial contribution from the EGF does not replace measures 
which are the responsibility of companies by virtue of national law or collective 
agreements, 

•  demonstrated that the actions provide support for individual workers and are not 

to be used for restructuring companies or sectors, 

•  confirmed that the eligible actions referred to under points 16 to 23 above do not 

receive assistance from other Community financial instruments. 

Management and control systems  

28. 

Denmark  has  notified  the  Commission  that  the  financial  contributions  will  be 
managed  and  controlled  by  the  same  bodies  that  manage  and  control  the  European 
Social Fund (ESF) funding in Denmark. 

Financing 

29. 

30. 

31. 

32. 

On  the  basis  of  the  application  from  Denmark,  the  proposed  contribution  from  the 
EGF to the coordinated package of personalised services is € 8 893 336, representing 
65 %  of  the  total  cost.  The  Commission's  proposed  allocation  under  the  Fund  is 
based on the information made available by Denmark. 

Considering the maximum possible amount of a financial contribution from the EGF 
under  Article  10(1)  of  Regulation  (EC)  No  1927/2006,  as  well  as  the  scope  for 
reallocating  appropriations,  the  Commission  proposes  to  mobilise  the  EGF  for  the 
total  amount  referred  above,  to  be  allocated  under  heading  1a  of  the  financial 
framework. 

The  proposed  amount  of  financial  contribution  will  leave  more  than  25 %  of  the 
maximum annual amount earmarked for the EGF available for allocations during the 
last  four  months  of  the  year,  as  required  by  Article  12(6)  of  Regulation  (EC)  No 
1927/2006. 

By  presenting  this  proposal  to  mobilise  the  EGF,  the  Commission  initiates  the 
simplified  trialogue  procedure,  as  required  by  Point  28  of  the  Inter-institutional 
Agreement of 17 May 2006, with a view to securing the agreement of the two arms 
of the budgetary authority on the need to use the EGF and the amount required. The 
Commission invites the first of the two arms of the budgetary authority that reaches 
agreement on the draft mobilisation proposal, at appropriate political level, to inform 
the other arm and the Commission of its intentions. In case of disagreement by either 
of  the  two  arms  of  the  budgetary  authority,  a  formal  trialogue  meeting  will  be 
convened.  

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33. 

The Commission presents separately a transfer request in order to enter in the 2010 
budget specific commitment and payment appropriations, as required in Point 28 of 
the Interinstitutional Agreement of 17 May 2006. 

Source of payment appropriations  

34. 

In  the  current  state  of  implementation,  it  is  foreseeable  that  the  payment 
appropriations  available  under  the  budget  line  01.04  05  'Completion  of  programme 
for entreprises: improvement of the financial environment for small and middle-sized 
year.  
entreprises 

2010  will 

(SMEs)' 

fully 

used 

this 

not 

be 

in 

Payment appropriations are transferred to trust accounts as required to ensure that the 
European Investment Fund (EIF) is at all times in a position to make disbursements 
to the financial intermediaries. 

The  financial  crisis  had  a  major  effect  on  the  disbursement  profile  of  financial 
instruments,  particularly  those  in  the  area  of  venture  capital.  According  to  the 
European Venture Capital Association (EVCA), investments and divestments (exits) 
were more than halved between 2007 and 2009 compared to the pre-crisis situation. 
These  developments  had  also  a  substantial  impact  on  the  forecasts  in  terms  of 
disbursements for 2010. 

As  a  consequence  of  the  above  elements,  payment  appropriations  foreseen  in  the 
2010  budget  will  not  be  fully  needed  in  2010.  The  amount  of  EUR 8 893 336  can 
therefore be made available for transfer.  

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11 

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Proposal for a 

DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

on the mobilisation of the European Globalisation Adjustment Fund in accordance with 
point 28 of the Interinstitutional Agreement of 17 May 2006 between the European 
Parliament, the Council and the Commission on budgetary discipline and sound 
financial management (application EGF/2009/015 DK/Danfoss Group from Denmark) 

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on the Functioning of the European Union, 

Having  regard  to  the  Interinstitutional  Agreement  of  17 May  2006  between  the  European 
Parliament,  the  Council  and  the  Commission  on  budgetary  discipline  and  sound  financial 
management4, and in particular point 28 thereof, 

Having  regard  to  Regulation  (EC)  No  1927/2006  of  the  European  Parliament  and  of  the 
Council  of  20 December  2006  establishing  the  European  Globalisation  Adjustment  Fund5, 
and in particular Article 12(3) thereof, 

Having regard to the proposal from the European Commission6, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

The  European  Globalisation  Adjustment  Fund  (EGF)  was  established  to  provide 
additional support for workers made redundant as a result of major structural changes 
in world trade patterns due to globalisation and to assist them with their reintegration 
into the labour market. 

The scope of the EGF was broadened for applications submitted from 1 May 2009 to 
include support  for workers made  redundant  as a direct result of the global financial 
and economic crisis. 

The Interinstitutional Agreement of 17 May 2006 allows the mobilisation of the EGF 
within the annual ceiling of EUR 500 million. 

Denmark submitted an application to mobilise the EGF, in respect of redundancies in 
the Danfoss  Group. This application complies with the requirements for determining 
the 
of 
Regulation (EC) No 1927/2006.  The  Commission,  therefore,  proposes  to  mobilise  an 
amount of € 8 893 336. 

contributions 

in  Article 

financial 

down 

laid 

10 

as 

4 
5 
6 

OJ C 139, 14.6.2006, p. 1. 
OJ L 406, 30.12.2006, p. 1. 
OJ C […], […], p. […]. 

EN 

12 

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(5) 

The EGF should, therefore, be mobilised in order to provide a financial contribution 
for the application submitted by Denmark. 

HAVE ADOPTED THIS DECISION: 

Article 1 

For  the  general  budget  of  the  European  Union  for  the  financial  year  2010,  the  European 
Globalisation Adjustment Fund (EGF) shall be mobilised to provide the sum of € 8 893 336 in 
commitment and payment appropriations. 

This Decision shall be published in the Official Journal of the European Union. 

Article 2 

Done at, 

For the European Parliament 
The President 

For the Council 
The President 

EN 

13 

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