OPINION OF THE COMMISSION  pursuant to Article 294, paragraph 7, point (c) of the Treaty on the Functioning of the European Union, on the European Parliament's amendments  to the Council's position regarding the  proposal for a REGULATION OF THE EUROPEAN PARLIAMENT  AND OF THE COUNCIL  amending Regulation (EC) N°1934/2006 establishing a financing instrument for cooperation with industrialised and other high-income countries and territories (ICI Plus)
Date: 2011-04-01
Institutions: European Commission
Subjects: EU financing, action programme, cooperation policy, industrialised country

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EUROPEAN COMMISSION 

Brussels, 1.4.2011 
COM(2011) 167 final 

2009/0059 (COD) 

OPINION OF THE COMMISSION 

pursuant to Article 294, paragraph 7, point (c) of the Treaty on the Functioning of the 
European Union, 
on the European Parliament's amendments  
to the Council's position regarding the  
proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT  
AND OF THE COUNCIL 

amending Regulation (EC) N°1934/2006 establishing a financing instrument for 
cooperation with industrialised and other high-income countries and territories (ICI 
Plus) 

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2009/0059 (COD) 

OPINION OF THE COMMISSION 

pursuant to Article 294, paragraph 7, point (c) of the Treaty on the Functioning of the 
European Union, 
on the European Parliament's amendments 
to the Council's position regarding the  
proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT  
AND OF THE COUNCIL 

amending Regulation (EC) N°1934/2006 establishing a financing instrument for 
cooperation with industrialised and other high-income countries and territories (ICI 
Plus) 

1. 

INTRODUCTION 

Article 294 (7) (c) of the Treaty on the Functioning of the European Union provides 
that  the  Commission  is  to  deliver  an  opinion  on  the  amendments  proposed  by  the 
European Parliament at second reading. The Commission sets out its opinion below 
on the amendments proposed by the Parliament.  

2. 

BACKGROUND 

Date on which the proposal was sent to Parliament and Council: 21 April 2009 

Doc  COM  (2009)  197  final  2-2009/0059  (COD)  corrigendum  30  November  2009, 
amended 01 December 2009 (entry into force of the Lisbon Treaty) 

Date of Parliament's opinion at first reading: 21 October 2010 

Date on which the amended proposal was sent to Parliament and Council: none 

Date of political agreement on the Council position: none  

Date of formal adoption of the Council position: 10 December 2010 

Date of Parliament's opinion at second reading: 3 February 2011 

3. 

PURPOSE OF THE PROPOSAL 

In the framework of the mid-term review of the external action financial instruments, 
the Commission made this proposal in order to fill a legislative gap: namely the EU 
cannot  finance  activities  which  do  not  fall  clearly  into  the  category  of  Official 
Development Assistance (ODA) in forty-six of the EU’s partner countries around the 
world. 

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This  situation  derives  from  the  fact  that  the  DCI  regulation  (Article  2(4))  excludes 
most  measures  which  do  not  meet  the  ODA  criteria,  which  are  set  by  the 
Development Assistance Committee of the Organisation for Economic Cooperation 
and  Development  (OECD/DAC(hence  “DACable”)  with  only  limited  exceptions. 
There  are  no  other  legal  provisions  allowing  measures  ineligible  as  ODA  to  be 
financed in the countries falling under the DCI. 

In several areas, the Commission and Parliament had divergent views on the ODA-
eligibility (“DAC-ability”) of certain actions. EP identified a number of problematic 
examples  which  it  did  not  consider  to  be  ODA  during  the  “democratic  scrutiny” 
process  (when  the  Commission  consults  EP  on  strategy  papers  and  multi-annual 
programmes) and also during the Comitology procedure (when it scrutinised annual 
action programmes). Subsequently EP passed a series of resolutions condemning the 
Commission for exceeding its implementing powers in adopting such projects under 
the DCI Regulation and calling for their withdrawal. 

As  result,  some  types  of  actions  were  financed  outside  DCI  under  the  Preparatory 
Actions created by EP for this purpose (i.e. business and scientific exchanges with 
India and China, cooperation with middle-income-group countries in Asia and in 
Latin America). The Preparatory Actions ended in 2009. An agreement was reached 
by  Commissioner  Ferrero-Waldner  and  the  EP  committee  chairs  concerned  those 
European  students  and  teachers  participating  in  the  external  part  of  Erasmus 
Mundus  would  only  be  financed  from  DCI  until  the  end  of  2009.  Filling  the  gap 
should  also  ensure  that  some  energy  projects  and  public  diplomacy  activities  that 
will  not  be  ODA-eligible  (e.g.  in  Asia,  Central  Asia  and  in  Iraq/Iran)  can  be 
financed. 

The Commission proposal is a pragmatic, ad hoc solution to this problem: it simply 
adds  the  DCI  countries  to  the  existing  Industrialised  Countries  Instrument.  This 
instrument  was  considered  the  most  appropriate  because  the  EU  uses  it  to  finance 
cooperation  in  pursuit  of  non  development-related  interests.  Its  general  policy 
objective will apply also to DCI countries: ‘to provide a specific response to the need 
to  strengthen  links  and  to  engage  further  with  them  on  a  bilateral,  regional  or 
multilateral  basis  in  order  to  create  a  more  favourable  environment  for  the 
development  of  the  relations  of  the  Community  with  these  countries  and  territories 
and to promote dialogue while fostering Unions interests.’ 

The proposal is limited in time to the period 2010-2013 and has a limited scope in 
terms  of  its  policy  content  and  budgetary  implications.  It  does  not  prejudge  any 
future  proposals  for  the  future  generation  of  external  action  financial  instruments 
under the next financial framework. 

The  Commission  proposal  was  accepted  already  by  EP  in  budgetary  terms:  to 
replace  the  Preparatory  Actions  and  provide  for  the  non-ODA  actions,  new  budget 
lines  were  created  in  the  2010  budget  with  the  necessary  appropriations,  pending 
formal  adoption  of  the  proposal.  If  the  proposal  is  not  adopted,  then  the 
appropriations in the budget cannot be implemented in the absence of a legal basis.  

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4. 

OPINION  OF  THE  COMMISSION  ON  THE  AMENDMENTS  BY  THE  EUROPEAN 
PARLIAMENT 

4.1 

Amendments accepted by the Commission 

The Commission can accept the text as it was agreed between the three institutions 
during the trilogues which took place in October and November 2010 (Recital 1 ;2; 
3;  4;  5;  6;  7;  8;  9;  and  Articles  1;  2;  3;  4;  5.2;  7;  8;  9.1;  12;  13  and  14).  For 
information these Recitals and Articles have already been approved by the Council in 
first reading. 

4.2 

Amendments rejected by the Commission 

The  Commission  cannot  accept  the  Articles  relating  to  delegated  acts  and 
Comitology  issues  (Recital  8a,  Article  6.1;  14a;  14b;  14c  (delegated  acts),  Article 
6.3; deleting Article 15 (Comitology)) 

Commission  cannot  accept  the  Article  16  on  the  financial  provisions  which  states 
that  DCI  money  cannot  be  used  to  fund  the  ICI  Plus.  This  amendment  is  not 
acceptable.  The  decision  on  the  source  of  funding  is  the  prerogative  of  the  budget 
authorities when they adopts each year the budget. It cannot be part of a legislative 
act.  The  Article  has  to  stick  to  standard  provisions  as  set  out  in  every  financial 
instrument.  However, in order to facilitate agreement  and re-assure the  institutions, 
the Commission is ready to make a statement, recalling that the financial reference 
amount fixed in Article 16 for countries listed in Annex II will be implemented using 
dedicated  budget  lines  which  are  intended  for  activities  other  than  Official 
Development Assistance.  

5. 

CONCLUSION 

The  discussions  with  the  co-legislators  shall  continue  after  the  second  reading,  in 
order  to  work  on  a  consensual  solution  preferably  giving  EP  substantive  scrutiny 
rights for the remainder of the current Multiannual Programming Period and leaving 
options  open  for  the  next  one,  including  the  possibility  of  having  recourse  to 
delegated acts while fully respecting the criteria established in Article 290 TFEU. 

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