Draft Interinstitutional Agreement  between the European Parliament, the Council and the Commission on cooperation in budgetary matters and on sound financial management
Date: 2011-06-29
Institutions: European Commission
Subjects: Council of the European Union, European Commission, European Parliament, budget, financial cooperation, financial management, interinstitutional agreement

EUROPEAN COMMISSION 

Brussels, 29.6.2011 
COM(2011) 403 final 

Draft Interinstitutional Agreement  

between the European Parliament, the Council and the Commission on cooperation in 
budgetary matters and on sound financial management 

 
 
 
 
  
 
TABLE OF CONTENTS: 

PART I – FINANCIAL FRAMEWORK AND SPECIAL INSTRUMENTS .................................................. 3 
A. PROVISIONS RELATED TO THE FINANCIAL FRAMEWORK ................................................................................. 3 
B. PROVISIONS RELATED TO THE SPECIAL INSTRUMENTS NOT INCLUDED IN THE FINANCIAL FRAMEWORK ......... 3 
B.1. Emergency Aid Reserve.......................................................................................................................... 3 
B.2. European Union Solidarity Fund........................................................................................................... 4 
B.3. Flexibility Instrument ............................................................................................................................. 4 
B.4. European Globalisation Adjustment Fund............................................................................................. 5 
B.5. Reserve for crises in the agriculture sector............................................................................................ 5 
B.6. Contingency Margin............................................................................................................................... 6 

PART II – IMPROVEMENT OF INTERINSTITUTIONAL COLLABORATION IN BUDGETARY 
MATTERS............................................................................................................................................................. 7 
A. THE INTERINSTITUTIONAL COLLABORATION PROCEDURE ............................................................................... 7 
B. INCORPORATION OF FINANCIAL PROVISIONS IN LEGISLATIVE ACTS................................................................. 7 
C. EXPENDITURE RELATING TO FISHERIES AGREEMENTS ..................................................................................... 8 
D. FINANCING OF THE COMMON FOREIGN AND SECURITY POLICY (CFSP)........................................................... 8 
E. INVOLVEMENT OF THE INSTITUTIONS AS REGARDS THE DEVELOPMENT POLICY ISSUES AND THE EUROPEAN 
DEVELOPMENT FUND......................................................................................................................................... 10 
F. COOPERATION OF THE INSTITUTIONS IN THE BUDGETARY PROCEDURE ON ADMINISTRATIVE EXPENDITURE.. 10 
PART III – SOUND FINANCIAL MANAGEMENT OF EU FUNDS .......................................................... 11 
A. FINANCIAL PROGRAMMING ........................................................................................................................... 11 
B. AGENCIES AND EUROPEAN SCHOOLS............................................................................................................. 12 
ANNEX - INTERINSTITUTIONAL COOPERATION DURING THE BUDGETARY PROCEDURE... 13 
Part A. Calendar of the budgetary procedure ............................................................................................. 13 
Part B. Priorities for the Budget Procedure................................................................................................ 13 
Part C. Establishment of the Draft Budget and Updating of Estimates....................................................... 13 
Part D. Budgetary procedure before the Conciliation ................................................................................ 14 
Part E. Conciliation process ....................................................................................................................... 14 
Part F. Amending Budgets........................................................................................................................... 17 

1

 
 
 
Draft 

Interinstitutional Agreement 

between the European Parliament, the Council and the Commission on cooperation in 
budgetary matters and on sound financial management 

THE  EUROPEAN  PARLIAMENT,  THE  COUNCIL  OF  THE  EUROPEAN  UNION  AND 
THE EUROPEAN COMMISSION, 

hereinafter referred to as the institutions, 

HAVE AGREED AS FOLLOWS 

1. 

2. 

3. 

4. 

5. 

6. 

The purpose of this Agreement adopted in accordance with Article 295 of the Treaty 
on  the  functioning  of  the  European  Union  (hereinafter  "TFEU")  is  to  improve  the 
functioning  of  the  annual  budgetary  procedure  and  cooperation  between  the 
institutions on budgetary matters. 

The Agreement is binding on all the institutions for as long as it is in force. 

This Agreement does not alter the respective budgetary powers of the institutions as 
laid down in the Treaties, in Council Regulation (EU) No …/201x laying down the 
Multiannual  Financial  Framework  for  the  years  2014-20xx1  (hereinafter  referred  to 
as  the  MFF  Regulation)  and  in  the  Regulation  (EU)  No  /201x  of  the  European 
Parliament and of the Council on the financial rules applicable to the annual budget 
of the Union (hereinafter referred to as the Financial Regulation)2. 

Any amendment of this Agreement requires the consent of all the institutions. 

This Agreement is in three parts: 

– 

– 

– 

Part  I  contains  complementary  provisions  related  to  the  multiannual  financial 
framework  and  provision  on  special  instruments  not  included  in  the  financial 
framework. 

Part  II  relates  to  the  interinstitutional  collaboration  during  the  budgetary 
procedure. 

Part  III  contains  provisions  related  to  sound  financial  management  of  EU 
funds. 

This  Agreement  enters  into  force  on  the  same  day  as  the  MFF  Regulation  and 
replaces  the  Interinstitutional  Agreement  of  17  May  2006  between  the  European 
Parliament,  the  Council  and  the  Commission  on  budgetary  discipline  and  sound 
financial management3. 

1 
2 
3 

OJ L , p. . 
OJ L, p. . 
OJ C 139, 14.6.2006, p. 1.  

2

 
 
                                                 
PART I – FINANCIAL FRAMEWORK and SPECIAL 
INSTRUMENTS 

A. PROVISIONS RELATED TO THE FINANCIAL FRAMEWORK 

7. 

8. 

Information relating to operations not included in the general budget of the European 
Union  and  the  foreseeable  development  of  the  various  categories  of  Union's  own 
resources is set out, by way of indication, in separate tables. This information shall 
be updated annually together with the documents accompanying the draft budget. 

Except  in  sub-ceiling  Economic,  social  and  territorial  cohesion  of  the  financial 
framework,  for  the  purposes  of  sound  financial  management,  the  institutions  shall 
ensure  as  far  as  possible  during  the  budgetary  procedure  and  at  the  time  of  the 
budget's  adoption  that  sufficient  margins  are  left  available  beneath  the  ceilings  for 
the various headings. 

Updating of forecasts for payment appropriations after 2020 

9. 

In 2017, the Commission shall update the forecasts for payment appropriations after 
2020.  That  update  shall  take  into  account  the  real  implementation  of  budget 
appropriations for commitments and budget appropriations for payments, as well as 
the  implementation  forecasts.  It  shall  also  consider  the  rules  defined  to  ensure  that 
payment  appropriations  develop  in  an  orderly  manner  compared  to  commitment 
appropriations  and  the  growth  forecasts  of  the  European  Union  Gross  National 
Income. 

B. PROVISIONS RELATED TO THE SPECIAL INSTRUMENTS NOT INCLUDED IN THE 
FINANCIAL FRAMEWORK 

B.1. Emergency Aid Reserve 

10. 

The Emergency Aid Reserve is intended to allow for a rapid response to specific aid 
requirements of third countries following events which could not be foreseen when 
the budget was established, first and foremost for humanitarian operations, but also 
for  civil  crisis  management  and  protection,  and  situations  of  particular  pressure 
resulting from migratory flows at the Union's external borders where circumstances 
so require.  

The annual amount of the Reserve is fixed at EUR 350 million (2011 prices) and can 
be used up to year n+1 in accordance with the Financial Regulation. The Reserve is 
entered in the general budget of the European Union as a provision. The portion of 
the annual amount stemming from previous years shall be drawn on first, in order of 
age.  The  portion  of  the  annual  amount  from  year  n  which  is  not  used  in  year  n+1 
shall lapse. 

When  the  Commission  considers  that  the  Reserve  needs  to  be  called  on,  it  shall 
present to the two arms of the budgetary authority a proposal for a transfer from the 
Reserve to the corresponding budgetary lines. 

3

 
 
Any Commission proposal for a transfer to draw on the Reserve, however, must be 
preceded by an examination of the scope for reallocating appropriations. 

In the case of disagreement a trilogue procedure shall be initiated. 

The transfers shall be made in accordance with the Financial Regulation. 

B.2. European Union Solidarity Fund 

11. 

The European Union Solidarity Fund is intended to allow financial assistance in the 
event  of  major  disasters  occurring  on  the  territory  of  a  Member  State  or  of  a 
candidate country, as defined in the relevant basic act. There shall be a ceiling on the 
annual amount available for the Fund of EUR 1 billion (2011 prices). On 1 October 
each year, at least one quarter of the annual amount shall remain available in order to 
cover needs arising until the end of the year. The portion of the annual amount not 
entered in the budget may not be rolled over in the following years. 

In exceptional cases and if the remaining financial resources available in the Fund in 
the  year  of  occurrence  of  the  disaster,  as  defined  in  the  relevant  basic  act,  are  not 
sufficient  to  cover  the  amount  of  assistance  considered  necessary  by  the  budgetary 
authority, the Commission may propose that the difference be financed through the 
annual amounts available for the following year. The annual amount of the Fund to 
be budgeted in each year may not, under any circumstances, exceed EUR 1 billion. 

When the conditions for mobilising the Fund as set out in the relevant basic act are 
met,  the  Commission  shall  make  a  proposal  to  deploy  it.  Where  there  is  scope  for 
reallocating  appropriations  under  the  heading  requiring  additional  expenditure,  the 
Commission  shall  take  this  into  account  when  making  the  necessary  proposal,  in 
accordance  with  the  Financial  Regulation,  by  means  of  the  appropriate  budgetary 
instrument. The decision to deploy the Fund shall be taken jointly by the two arms of 
the  budgetary  authority.  The  Council  shall  act  by  a  qualified  majority  and  the 
European  Parliament  shall  act  by  a  majority  of  its  component  members  and  three 
fifths of the votes cast. 

In the case of disagreement a trilogue procedure shall be initiated. 

B.3. Flexibility Instrument 

12. 

The Flexibility Instrument with an annual ceiling of EUR 500 million (2011 prices) 
is  intended  to  allow  the  financing,  for  a  given  financial  year  and  up  to  the  amount 
indicated,  of  clearly  identified  expenditure  which  could  not  be  financed  within  the 
limits of the ceilings available for one or more other headings. 

The annual  amount  of  the  Flexibility  Instrument  may  be  used  up  to  year  n+3.  The 
portion  of  the  annual  amount  stemming  from  previous  years  shall  be  used  first,  in 
order of age. The portion of the annual amount from year n which is not used in year 
n+3 shall lapse. 

The Commission shall make a proposal for the Flexibility Instrument to be used after 
it  has  examined  all  possibilities  for  re-allocating  appropriations  under  the  heading 
requiring additional expenditure. 

The  proposal  shall  identify  the  needs  to  be  covered  and  the  amount.  It  may  be 
presented, for any given financial year, during the budgetary procedure. 

4

 
 
The  decision  to  deploy  the  Flexibility  Instrument  shall  be  taken  jointly  by  the  two 
arms of the budgetary authority. The Council shall act by a qualified majority and the 
European  Parliament  shall  act  by  a  majority  of  its  component  members  and  three 
fifths of the votes cast.  

Agreement shall be reached in the framework of the annual budgetary procedure. 

B.4. European Globalisation Adjustment Fund 

13. 

The  European  Globalisation  Adjustment  Fund  is  intended  to  provide  additional 
support for workers who suffer from the consequences of major structural changes in 
world  trade  patterns,  to  assist  them  with  their  reintegration  into  the  labour  market, 
and also to farmers suffering from effects of globalisation. 

The  Fund  may  not  exceed  a  maximum  annual  amount  of  EUR 429  million  (2011 
prices).  

The appropriations shall be entered in the general budget of the European Union as a 
provision.  

When the conditions for mobilising the Fund, as set out in the relevant basic act, are 
met, the Commission shall make a proposal to deploy it. The decision to deploy the 
Fund shall be taken jointly by the two arms of the budgetary authority. The Council 
shall act by a qualified majority and the European Parliament shall act by a majority 
of its component members and three fifths of the votes cast. 

At  the  same  time  as  it  presents  its  proposal  for  a  decision  to  deploy  the  Fund,  the 
Commission shall present to the two arms of the budgetary authority a proposal for a 
transfer  to  the  relevant  budgetary  lines.  In  the  case  of  disagreement  a  trilogue 
procedure shall be initiated. 

Transfers  related  to  the  Fund  shall  be  made  in  accordance  with  the  Financial 
Regulation. 

B.5. Reserve for crises in the agriculture sector 

14. 

The  Reserve  for  crises  in  the  agricultural  sector  is  intended  to  provide  additional 
support for the sector in case of major crises effecting the agricultural production or 
distribution in case it cannot be financed within the limits of the ceiling available for 
Heading 2. 

The Reserve may not exceed a maximum annual amount of EUR 500 million (2011 
prices). 

The appropriations shall be entered in the general budget of the European Union as a 
provision.  

When  the  Commission  considers  that  the  Reserve  needs  to  be  called  on,  in 
accordance  with  the  relevant  basic  act,  it  shall  present  to  the  two  arms  of  the 
budgetary authority a proposal for a transfer from the Reserve to the corresponding 
budgetary  lines.  Any  Commission  proposal  for  a  transfer  to  draw  on  the  Reserve, 
however,  must  be  preceded  by  an  examination  of  the  scope  for  reallocating 
appropriations. 

5

 
 
In the case of disagreement a trilogue procedure shall be initiated. 

Transfers  related  to  the  Reserve  shall  be  made  in  accordance  with  the  Financial 
Regulation. 

B.6. Contingency Margin 

15. 

A  contingency  margin  of  up  to  0.03%  of  the  Gross  National  Income  of  the  Union 
shall  be  constituted  outside  the  ceilings  of  the  financial  framework  as  a  last  resort 
instrument to react to unforeseen circumstances. 

Recourse  to  the  Contingency  Margin  shall  not  exceed,  at  any  given  year,  the 
maximum amount foreseen in  paragraph  (1)(c) of Article 4 of the MFF Regulation 
and shall be consistent with the own resources ceiling. 

The mobilisation of the contingency margin, or part thereof, shall be proposed by the 
Commission  after  a  thorough  analysis  of  all  other  financial  possibilities.  The 
Commission  shall  accompany  the  proposal  for  the  mobilisation  of  the  Contingency 
Margin by a proposal for reallocation, by a significant amount as far as supported by 
the analysis, within the existing budget. 

The  decision  to mobilise the Contingency Margin shall be taken jointly by the two 
arms of the budgetary authority. The Council shall act by a qualified majority and the 
European  Parliament  shall  act  by  a  majority  of  its  component  members  and  three 
fifths of the votes cast. 

6

 
 
PART II – IMPROVEMENT OF 
INTERINSTITUTIONAL COLLABORATION IN 
BUDGETARY MATTERS 

A. THE INTERINSTITUTIONAL COLLABORATION PROCEDURE 

16. 

The details of interinstitutional collaboration during the budgetary procedure are set 
out in the Annex. 

B. INCORPORATION OF FINANCIAL PROVISIONS IN LEGISLATIVE ACTS 

17. 

Each legislative act concerning a multiannual programme adopted under the ordinary 
legislative procedure shall contain a provision in which the legislative authority lays 
down the financial envelope for the programme. 

That amount shall constitute the prime reference for the budgetary authority during 
the annual budgetary procedure. 

The  budgetary  authority  and  the  Commission,  when  it  draws  up  the  draft  budget, 
undertake not to depart by more than 10 % from that amount for the entire duration 
of  the  programme  concerned,  unless  new,  objective,  long-term  circumstances  arise 
for  which  explicit  and  precise  reasons  are  given,  with  account  being  taken  of  the 
results  obtained  from  implementing  the  programme,  in  particular  on  the  basis  of 
assessments.  Any  increase  resulting  from  such  variation  must  remain  within  the 
existing  ceiling  for  the  heading  concerned,  without  prejudice  to  the  use  of 
instruments mentioned in the MFF regulation and in this Agreement. 

This Point does not apply to appropriations for cohesion adopted under the ordinary 
legislative procedure and pre-allocated by Member States which contain a financial 
envelope  for  the  entire  duration  of  the  programme  and  to  the  large  scale  projects 
referred to in Article 14 of the MFF Regulation. 

18. 

Legislative  acts  concerning  multiannual  programmes  not  subject  to  the  ordinary 
legislative procedure shall not contain an 'amount deemed necessary'. 

Should  the  Council  wish  to  include  a  financial  reference,  this  shall  be  taken  as 
illustrating the will of the legislative authority and shall not affect the powers of the 
budgetary authority as defined by the TFEU. This provision shall be mentioned in all 
legislative acts which include such a financial reference. 

If  the  amount  concerned  has  been  the  subject  of  an  agreement  pursuant  to  the 
conciliation  procedure  provided  for  in  the  Joint  Declaration  of  the  European 
Parliament, the Council and the Commission of 4 March 19754, it shall be considered 
a reference amount within the meaning of Point 17 of this Agreement. 

4 

OJ C 89, 22.4.1975, p. 1. 

7

 
 
                                                 
C. EXPENDITURE RELATING TO FISHERIES AGREEMENTS 

19. 

The  expenditure  on  fisheries  agreements  shall  be  subject  to  the  following  specific 
rules: 

The  Commission  undertakes  to  keep  the  European  Parliament  regularly  informed 
about  the  preparation  and  conduct  of  the  negotiations,  including  the  budgetary 
implications. 

In  the  course  of  the  legislative  process  relating  to  fisheries  agreements,  the 
institutions undertake to make every  effort to ensure that all procedures are carried 
out as quickly as possible. 

Amounts foreseen in the budget for new agreements or renewal of agreements which 
come into force after January 1 of the related budget year shall be put in reserve.  

If  appropriations  relating  to  fisheries  agreements  (including  the  reserve)  prove 
insufficient, the Commission shall provide the budgetary authority with the necessary 
information for an exchange of views in the form of a trilogue, possibly simplified, 
on  the  causes  of  the  situation,  and  on  the  measures  which  might  be  adopted  under 
established procedures. Where necessary, the Commission shall propose appropriate 
measures. 

Each  quarter,  the  Commission  shall  present  to  the  budgetary  authority  detailed 
information about implementation of agreements in force and a financial forecast for 
the remainder of the year. 

D. FINANCING OF THE COMMON FOREIGN AND SECURITY POLICY (CFSP) 

20. 

As regards CFSP expenditure which is charged to the general budget of the European 
Union  in  accordance  with  Article  41  of  the  Treaty  on  European  Union,  the 
institutions  shall  endeavour,  in  the  conciliation  committee,  and  on  the  basis  of  the 
draft  budget  established  by  the  Commission,  to  secure  agreement  each  year  on  the 
amount  of  the  operating  expenditure  to  be  charged  to  the  budget  of  the  European 
Union and on the distribution of this amount between the articles of the CFSP budget 
chapter suggested in the fourth paragraph of this Point. In the absence of agreement, 
it  is  understood  that  the  European  Parliament  and  the  Council  shall  enter  in  the 
budget the amount contained in the previous budget or the amount proposed in the 
draft budget, whichever is the lower. 

The  total  amount  of  operating  CFSP  expenditure  shall  be  distributed  between  the 
articles  of  the  CFSP  budget  chapter  as  suggested  in  the  fourth  paragraph  of  this 
Point.  Each  article  shall  cover  instruments  already  adopted,  instruments  which  are 
foreseen  but  not  yet  adopted  and  all  future  -  that  is  unforeseen  -  instruments  to  be 
adopted by the Council during the financial year concerned. 

Since, under the Financial Regulation, the Commission has the authority to transfer 
appropriations  autonomously  between  articles  within  the  CFSP  budget  chapter,  the 
flexibility  deemed  necessary  for  speedy  implementation  of  CFSP  actions  shall 
accordingly  be  assured.  In  the  event  of  the  amount  of  the  CFSP  budget  chapter 
during  the  financial  year  being  insufficient  to  cover  the  necessary  expenses,  the 
European Parliament and the Council shall seek a solution as a matter of urgency, on 

8

 
 
a proposal from the Commission, taking into account Article 2 of the MFF regulation 
and Point 10 of this Agreement. 

Within the CFSP budget chapter, the articles into which the CFSP actions are to be 
entered could read along the following lines: 

– 

– 

– 

– 

– 

crisis  management  operations,  conflict  prevention,  resolution  and 
stabilisation,  monitoring  and  implementation  of  peace  and  security 
processes, 

non-proliferation and disarmament, 

emergency measures, 

preparatory and follow-up measures, 

European Union Special Representatives. 

The amount for measures entered under the article mentioned in the third indent may 
not exceed 20 % of the overall amount of the CFSP budget chapter. 

21. 

Each  year,  the  High  Representative  of  the  Union  for  Foreign  Affairs  and  Security 
Policy (hereinafter "the High Representative") shall consult the European Parliament 
on a forward-looking document, which shall be transmitted by June 15 for the year in 
question, setting out the main aspects and basic choices of the CFSP, including the 
financial  implications  for  the  general  budget  of  the  European  Union  and  an 
evaluation  of  the  measures  launched  in  the  year  n-1.  Furthermore,  the  High 
Representative  shall  keep  the  European  Parliament  informed  by  holding  joint 
consultation  meetings  at  least  five  times  a  year,  in  the  framework  of  the  regular 
political  dialogue  on  the  CFSP,  to  be  agreed  at  the  latest  in  the  Conciliation 
committee. Participation in these meetings shall be as follows: 

– 

– 

for  the  European  Parliament,  the  bureaux  of  the  two  Committees 
concerned, 

for the Council, the Chairman of the Political and Security Committee. 

The Commission shall be invited to participate at these meetings. 

Whenever  the  Council  adopts  a  decision  in  the  field  of  the  CFSP  entailing 
expenditure,  the  High  Representative  shall  immediately,  and  in  any  event  no  later 
than five working days following the final decision, send the European Parliament an 
estimate  of  the  costs  envisaged  ('financial  statement'),  in  particular  those  regarding 
time-frame,  staff  employed,  use  of  premises  and  other  infrastructure,  transport 
facilities, training requirements and security arrangements. 

Once  a  quarter,  the  Commission  shall  inform  the  budgetary  authority  about  the 
implementation of CFSP actions and the financial forecasts for the remaining period 
of the year. 

9

 
 
E. INVOLVEMENT OF THE INSTITUTIONS AS REGARDS THE DEVELOPMENT 
POLICY ISSUES AND THE EUROPEAN DEVELOPMENT FUND 

22. 

The Commission will establish a common dialogue with the European Parliament on 
development policy issues regardless of their source of financing. The scrutiny of the 
European  Parliament  on  the  European  Development  Fund  will  be  aligned  on  a 
voluntary  basis  to  the  scrutiny  rights  that  exist  under  the  EU  general  budget, 
specifically  the  Development  Cooperation  Instrument,  pursuant  to  modalities  to  be 
fixed in the informal dialogue. 

F. COOPERATION OF THE INSTITUTIONS IN THE BUDGETARY PROCEDURE ON 
ADMINISTRATIVE EXPENDITURE 

23. 

The European Parliament, the Council and the Commission shall seek an agreement 
on the sharing of the Administrative expenditure every year at an early stage of the 
annual budgetary procedure. Estimates of expenditure of each institution will contain 
estimates  of  the  possible  budgetary  impact  from  changes  to  provisions  in  the  staff 
regulations.  The  European  Parliament  and  the  Council  agree  to  ensure  that  this 
impact will be reflected in the level of authorised appropriation for all institutions. 

The  European  Parliament,  the  Council  and  the  Commission  agree  to  a  progressive 
reduction of staff by 5% between 2013 and 2018. This reduction should apply to all 
institutions, bodies and agencies. 

10

 
 
 
PART III – SOUND FINANCIAL MANAGEMENT OF 
EU FUNDS 

A. FINANCIAL PROGRAMMING 

24. 

The Commission shall submit twice a year, the first time in April/May (together with 
the  documents  accompanying 
in 
December/January  (after  the  adoption  of  the  budget),  a  complete  financial 
programming  for  headings 1  (except  subceiling  for  Economic,  social  and  territorial 
cohesion),  2  (for  environment  and  fisheries),  3  and  4  of  the  financial  framework. 
This document, structured by heading, policy area and budget line, should identify:  

the  draft  budget)  and 

the  second 

time 

(a) 

the  legislation  in  force,  with  a  distinction  being  drawn  between  multiannual 
programmes and annual actions: 

– 

– 

for  multiannual  programmes  the  Commission  should  indicate  the 
procedure  under  which  they  were  adopted  (ordinary  and  special 
legislative procedure), their duration, the total financial envelope and the 
share allocated to administrative expenditure; 

for  annual  actions  (pilot  projects,  preparatory  actions,  Agencies)  and 
actions  financed  under  the  prerogatives  of  the  Commission,  the 
Commission  should  provide  multiannual  estimates  and  the  margins  left 
under  the  authorised  ceilings  fixed  in  [the  delegated  Regulation  on  the 
execution modalities of the Financial Regulation]; 

(b)  pending  legislative  proposals:  ongoing  Commission  proposals,  with  the  latest 

update. 

The  Commission  should  consider  ways  of  cross-referencing 
the  financial 
programming with its legislative programming to provide more precise and reliable 
forecasts. For each legislative proposal, the Commission should indicate whether or 
not it is included in the April-December programme. The budgetary authority should 
in particular be informed of: 

(a) 

(b) 

all  new  legislative  acts  adopted  and  all  pending  proposals  presented  but  not 
included in the April-December document (with the corresponding amounts); 

legislation  foreseen  in  the  Commission's  annual  legislative  work  programme 
with an indication of actions likely to have a financial impact (yes/no). 

Whenever necessary, the Commission should indicate the reprogramming entailed by 
new legislative proposals. 

11

 
 
B. AGENCIES AND EUROPEAN SCHOOLS 

25. 

Before  presenting  its  proposal  for  the  creation  of  a  new  agency,  the  Commission 
should produce a sound, complete and objective impact assessment, taking inter-alia 
into account the critical mass of staff and competencies, cost-benefits aspects, impact 
on  national  and  EU  activities  and  the  budgetary  implications  for  the  expenditure 
heading  concerned.  On  the  basis  of  that  information  and  without  prejudice  to  the 
legislative  procedures  governing  the  setting  up  of  the  agency,  the  two  arms  of  the 
budgetary authority commit themselves, in the framework of budgetary cooperation, 
to arrive at a timely agreement on the financing of the agency. 

The following procedural steps shall be applied: 

–  Firstly, the Commission shall systematically present any proposal for setting up 
a  new  agency  to  the  first  trilogue  following  the  adoption  of  its  proposal,  and 
shall present the financial statement accompanying the legal act proposing the 
creation of the agency and illustrate its consequences for the remaining period 
of the financial programming; 

–  Secondly,  taking  into  consideration  the  progress  made  in  the  legislative 
process, and provided that each arm of the budgetary authority is in a position 
to take a stance on the financial consequences of the proposal in advance of the 
adoption of the legal act, the creation of the new agency shall be placed on the 
agenda of a subsequent trilogue (in urgent cases, in simplified form), in view of 
reaching an agreement on the financing; 

–  Thirdly, the agreement reached during a trilogue shall be confirmed in a joint 
declaration, subject to the approval by each arm of the budgetary authority in 
accordance with its own rules of procedure.  

The same procedure would be applied to any modification of the legal act setting up 
an agency which impacts on the resources of the agency in question.  

Should the tasks of an agency be modified substantially without a modification of the 
legal  act  setting  up  the  agency  in  question,  the  Commission  shall  inform  the 
budgetary authority by means of a revised financial statement, so as to allow the two 
arms of the budgetary authority to arrive at a timely agreement on the financing of 
the agency.  

When  the  creation  of  a  new  European  school  is  envisaged  by  the  Board  of 
Governors, a similar procedure is to be applied for its budgetary implications on the 
EU budget. 

Done at Brussels,  

For the European Parliament  
The President 

For the Council 

For the Commission 

The President 

Member of the Commission 

12

 
 
 
ANNEX - INTERINSTITUTIONAL COOPERATION 
DURING THE BUDGETARY PROCEDURE 

Part A. Calendar of the budgetary procedure 

1. 

The institutions shall follow the calendar defined in the points 2, 3, 5, 11, 12, 13, 14 
and 15 below for the various steps of the budgetary procedure. In due time before the 
start  of  the  budgetary  procedure,  they  can  agree  jointly,  if  needed,  on  any 
adjustments deemed appropriate to this calendar.  

Part B. Priorities for the Budget Procedure 

2. 

In  due  time  before  the  adoption  of  the  draft  budget  by  the  Commission  and  at  the 
latest  in  April,  a  meeting  of  the  trilogue  shall  be  convened  to  discuss  the  possible 
priorities for the budget of the forthcoming financial year. 

Part C. Establishment of the Draft Budget and Updating of Estimates 

3. 

4. 

5. 

6. 

The institutions, other than the Commission, are invited to adopt their statement of 
estimates before the end of March at the latest.  

Before  the  adoption  of  their  statements  of  estimates,  the  European  Parliament,  the 
Council  and  the  Commission  will  agree  on  orientations  regarding  the  desirable 
annual variation in the level of administrative expenditure for all institutions. 

The Commission shall adopt the draft budget in the last week of April or at the latest 
during the first week of May. It shall finalise the draft budget, including the general 
statement of revenues, and shall make it available officially before the end of May. 

The  Commission  shall  present  each  year  a  draft  budget  showing  the  European 
Union's actual financing requirements. 

It shall take into account: 

a) 

b) 

c) 

forecasts in relation to the Structural Funds provided by the Member States, 

the  capacity  for  utilising  appropriations,  endeavouring  to  maintain  a  strict 
relationship  between  appropriations  for  commitments  and  appropriations  for 
payments, 

the possibilities for starting up new policies through pilot projects and/or new 
preparatory actions or continuing multiannual actions which are coming to an 
end, after assessing whether it shall be possible to secure a basic act, within the 
meaning  of  the  Financial  Regulation  (definition  of  a  basic  act,  necessity  of  a 
basic act for implementation and exceptions), 

d) 

the  need  to  ensure  that  any  change  in  expenditure  in  relation  to  the  previous 
year is in accordance with the constraints of budgetary discipline. 

13

 
 
7. 

8. 

9. 

10. 

The institutions shall, as far as possible, avoid entering items in the budget involving 
insignificant amounts of expenditure on operations.  

The  two  arms  of  the  budgetary  authority  also  undertake  to  bear  in  mind  the 
assessment of the possibilities for implementing the budget made by the Commission 
in its drafts and in connection with implementation of the current budget. 

In the interest of sound financial management and owing to the effect of the major 
changes  in  the  budget  nomenclature  in  the  titles  and  chapters  on  the  management 
reporting  responsibilities  of  Commission  departments,  the  two  arms  of  the  budget 
authority  undertake  to  discuss  any  major  changes  with  the  Commission  during  the 
conciliation. 

Until such time as the Conciliation Committee is convened, the Commission may, if 
necessary, amend the draft budget in accordance with Article 314(2) TFEU including 
by  an  amending  letter  updating  expenditure  estimates  for  agriculture.  The 
Commission  shall  submit  information  on  updates  to  the  two  arms  of  the  budget 
authority  for  their  consideration  as  soon  as  they  are  available.  It  shall  supply  the 
budgetary authority with all the duly justified reasons it may require. 

Part D. Budgetary procedure before the Conciliation 

11. 

12. 

13. 

14. 

15. 

A trilogue meeting shall be convened in good  time before  the Council’s reading to 
allow the institutions to have an exchange of views on the draft budget. 

In order for the Commission to be able to assess in due time the implementability of 
amendments  envisaged  by  the  budgetary  authority  which  create  new  preparatory 
actions/pilot projects or prolong existing ones, both arms of the budgetary authority 
shall inform the Commission by mid-June of their intentions in this regard, so that a 
first discussion may already take place at this trilogue. 

The Council completes its reading by the end of July at the latest. 

The European Parliament's Committee on Budgets votes on its reading by the end of 
September or early October at the latest and the European Parliament's Plenary votes 
on its reading by the end of October at the latest. 

A  trilogue  meeting  could  be  convened  before  the  European  Parliament's  Plenary 
votes.  

Part E. Conciliation process 

16. 

If the European Parliament votes amendments to the Council's position, the President 
of the Council will, during the same plenary meeting, take note of the differences in 
the position of the two institutions and give his/her agreement for the President of the 
EP  to  convene  the  Conciliation  Committee  immediately. The  letter  convening  the 
Conciliation Committee will be sent at the latest on the first working day of the week 
following  the  end  of  the  parliamentary  session  during  which  the  plenary  vote was 
delivered and the conciliation period will start on the following day. The 21-day time 
period is calculated pursuant to Regulation (EEC Euratom) No 1182/71 determining 
the rules applicable to periods, dates and time limits. 

14

 
 
17. 

18. 

19. 

20. 

21. 

22. 

23. 

If  the  Council  cannot  agree  on  all  the  amendments  voted  by  the  European 
Parliament,  it  would  confirm  its  position  by  letter  sent  before  the  first  trilogue 
foreseen  during  the  conciliation  period.  In  such  case,  the  Conciliation  Committee 
will proceed in accordance with the conditions laid down in the following points. 

The  Conciliation  Committee  shall  be  chaired  jointly  by  representatives  of  the 
European Parliament and of the Council. Committee meetings shall be chaired by the 
co-chair  of  the  institution  hosting  the  meeting.  Each  institution,  in  accordance  with 
its  own  rules  of  procedure,  shall  designate  its  participants  for  each  meeting  and 
define its mandate for the negotiations. 

In  accordance  with  Article  314(5)  TFEU,  second  subparagraph,  the  Commission 
shall  take  part  in  the  conciliation  proceedings  and  shall  take  all  the  necessary 
initiatives  with  a  view  to  reconciling  the  positions  of  the  European  Parliament  and 
the Council.  

Trilogues shall take place throughout the conciliation procedure, at different levels of 
representation, with the aim of resolving outstanding issues and preparing the ground 
for an agreement to be reached in the Conciliation Committee. 

The  meeting  of  the  Conciliation  Committee  and  of  the  trilogues  shall  be  held 
alternately at the premises of the European Parliament and the Council, with a view 
to an equal sharing of facilities, including interpretation facilities. 

The dates of the meetings of the Conciliation Committee and the trilogues will be set 
in  advance  before  the  beginning  of  the  budgetary  procedure  by  agreement  of  the 
three institutions. 

A  common  set  of  documents  (input  documents)  comparing the various  steps of  the 
budgetary procedure will be made available for the Conciliation Committee5. It will 
include  "line  by  line"  figures,  totals  by  financial  framework  headings  and  a 
consolidated  document  with  figures  and  remarks  for  all  budget  lines  deemed 
technically  "open".  Without  prejudice  to  the  final  decision  of  the  Conciliation 
Committee, a specific document will list all budget lines deemed technically closed6. 
These documents will be classified by budgetary nomenclature. 

Other  documents  will  also  be  attached  to  the  input  documents  for  the  Conciliation 
Committee,  including  a  letter  of  executability  of  the  Commission  on  the  Council's 
position and the European Parliament's amendments; and possible letter(s) from other 
Institutions on the Council's position and the European Parliament's amendments. 

24. 

With  a  view  to  reaching  agreement  by  the  end  of  the  conciliation  period,  trilogues 
will:  

−  define the scope of the negotiations of the budgetary issues to be addressed; 

5 

6 

The  various  steps  will  include:  the  budget  of  the  current  financial  year  (including  adopted  amending 
budgets);  the  initial  draft  budget;  the  Council's  position  on  the  draft  budget;  the  European  Parliament's 
amendments on the Council's position and the letters of amendment presented by the Commission (if not 
yet fully approved by all institutions). 

A  budget  line  deemed  technically  closed  is  a  line  for  which  there  is  no  disagreement  between  the 
European Parliament and the Council, and for which no letter of amendment has been presented. 

15

 
 
                                                 
25. 

26. 

−  endorse the list of the budget lines deemed technically closed, subject to the final 

agreement on the entire budget of the financial year; 

−  discuss  issues  identified  under  the  first  indent  in  view  of  reaching  possible 

agreements to be endorsed by the Conciliation Committee; 

−  address  thematic  issues,  including  by  headings  of  the  multi-annual  financial 

framework.  

Tentative  conclusions  will  be  drawn  jointly  during  or  immediately  after  each 
trilogue, simultaneously with the agenda of the following meeting. Such conclusions 
will  be  registered  by  the  institution  hosting  the  trilogue  and  will  be  deemed 
provisionally approved after 24 hours without prejudice of the  final decision of the 
Conciliation Committee. 

The meetings of the Conciliation Committee will have available the conclusions of 
trilogues  and  a  document  with  the  budget  lines  for  which  an  agreement  has  been 
tentatively reached during the trilogues for possible endorsement. 

The joint text provided for in Article 314(5) of the TFUE shall be established by the 
secretariats of the European Parliament and of the Council with the assistance of the 
Commission. It will consist of an introductory legal document, containing the date of 
the agreement at the Conciliation Committee, and annexes, which will include: 

− 

line  by  line  figures  for  all  budget  items  and  summary  figures  by  financial 
framework headings; 

−  a  consolidated  document,  indicating  figures  and  final  text  of  all  lines  that  have 

− 

been modified during the conciliation; 
the list of the lines not modified with regard to the draft budget or the Council's 
position on it. 

The  Conciliation  Committee  may  also  approve  conclusions  and  possible  joint 
statements in relation to the budget. 

27. 

The  joint  text  will  be  translated  in  all  languages  (by  the  services  of  the  European 
Parliament) and will be submitted to the approval of the two arms of the budgetary 
authority within 14 days from the date following the date of agreement on the joint 
text pursuant to Point 26. 

The  budget  will  be  subject  to  legal-linguistic  finalisation  after  the  adoption  of  the 
joint  text  by  integrating  the  annexes  of  the  joint  text  with  the  budget  lines  not 
modified during the conciliation process. 

28. 

institution  hosting 

The 
the  meeting  (trilogue  or  conciliation)  will  provide 
interpretation  facilities  with  a  full  linguistic  regime  applicable  to  the  Conciliation 
Committee meetings and an ad hoc linguistic regime for the trilogues. 

The institution hosting the meeting will ensure reproduction and distribution of room 
documents. 

The services of the three institutions will cooperate for the encoding of the results of 
the negotiations in order to finalise the joint text. 

16

 
 
Part F. Amending Budgets 

General principles 

29. 

Having  in  mind  that  amending  budgets  are  frequently  focused  on  specific  and 
sometimes  urgent  issues,  the  institutions  agree  on  the  principles  below  to  ensure 
appropriate  interinstitutional  cooperation  for  a  smooth  and  swift  adoption  of  the 
amending  budgets  while  avoiding,  as  far  as  possible,  to  have  to  convene  a 
conciliation meeting for amending budgets.  

30. 

As far as possible, the institutions shall endeavour to limit the number of amending 
budgets. 

Calendar 

31. 

32. 

33. 

The Commission shall inform in advance the two arms of the budgetary authority of 
the  possible  dates  of  adoption  of  draft  amending  budgets  without  prejudice  to  the 
final date of adoption. 

In  accordance  with  its  internal  rules  of  procedure,  each  arm  of  the  budgetary 
authority  shall  endeavour  to  examine  the  draft  amending  budget  proposed  by  the 
Commission at an early opportunity after adoption by the Commission. 

In  order  to  speed  up  the  procedure,  the  two  arms  of  the  budgetary  authority  shall 
ensure  that  their  respective  calendars  of  work  are  coordinated  as  far  as  possible  in 
order  to  enable  proceedings  to  be  conducted  in  a  coherent  and  convergent  fashion. 
They shall therefore seek as soon as possible to establish an indicative timetable for 
the various stages leading to the final adoption of the amending budget. 

The two arms of the budgetary authority shall take into account the relative urgency 
of the amending budget and the need to approve it in due time to be effective during 
the year concerned. 

Cooperation during the reading of each arm of the Budgetary Authority 

34. 

The institutions shall cooperate in good faith throughout the procedure clearing the 
way, as far as possible, for the adoption of amending budgets at an early stage of the 
procedure. 

When  appropriate  and  when  there  is  a  potential  divergence,  each  arm  of  the 
budgetary authority, before taking its final position on the amending budget, or the 
Commission, may propose to convene a specific trilogue, to discuss the divergences 
and to try to reach a compromise. 

35. 

All  draft  amending  budgets  proposed  by  the  Commission  and  not  yet  finally 
approved  shall  be  systematically  on  the  agenda  of  the  trilogues  planned  for  the 
annual  budgetary  procedure.  The  Commission  shall  present  the  draft  amending 
budgets and the two arms of the budgetary authority shall, as far as possible, notify 
their respective position ahead of the trilogue.  

17

 
 
36. 

If  a  compromise  is  reached  during  a  trilogue,  each  arm  of  the  budgetary  authority 
undertakes to consider the results of the trilogue when deliberating on the amending 
budget in accordance with the Treaty and its internal rules of procedure. 

Cooperation after the reading of each arm of the budgetary authority 

37. 

38. 

If  the  European  Parliament  approves  without  amendments  the  position  of  the 
Council, the amending budget shall be adopted. 

If  the  European  Parliament  adopts  amendments  by  a  majority  of  its  component 
members,  Article  314(4)(c)  TFEU  apply.  However,  before  the  Conciliation 
Committee meets a trilogue shall be called. 

– 

– 

If an agreement is reached during the trilogue and subject to the agreement of 
each  arm  of  the  budgetary  authority  on  the  results  of  the  trilogue,  the 
conciliation shall be closed by an exchange of letters without a meeting of the 
Conciliation Committee. 

If  no  agreement  is  reached  during  the  trilogue,  the  Conciliation  Committee 
shall meet and organise its work in accordance with the circumstances, with a 
view of completing as much as possible the decision-making process before the 
twenty-one-day deadline laid down in Article 314(6) TFEU. The Conciliation 
Committee may conclude by an exchange of letters. 

18