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/2011/013 DK/Flextronics from Denmark)
Date: 2012-10-19
Institutions: European Commission
Subjects: Denmark, European Globalisation Adjustment Fund, collective dismissal, commitment of expenditure, economic recession, electronics industry, employment aid, general budget (EU), payment appropriation, reintegration into working life

EUROPEAN 
COMMISSION 

Brussels, 19.10.2012  
COM(2012) 623 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/2011/013 DK/Flextronics from Denmark) 

EN 

   EN 

 
 
 
 
  
 
EXPLANATORY MEMORANDUM 

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 
management1  allows  for  the  mobilisation  of  the  European  Globalisation  Adjustment  Fund 
(EGF)  through  a  flexibility  mechanism,  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 Fund2. 

On 21 December 2011, Denmark submitted application EGF/2011/013 DK/Flextronics for a 
financial  contribution  from  the  EGF,  following  redundancies  in  Flextronics  International 
Denmark A/S (hereinafter called 'Flextronics Denmark') 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 

Primary enterprise 

Suppliers and downstream producers 
Reference period 
Starting date for the personalised services 
Application date 
Redundancies during the reference period 
Redundancies before and after the reference period 
Total eligible redundancies 
Redundant workers expected to participate in the 
measures 
Expenditure for personalised services (EUR) 
Expenditure for implementing EGF3 (EUR) 
Expenditure for implementing EGF (%) 
Total budget (EUR) 
EGF contribution (65 %) (EUR) 

EGF/2011/013 
Denmark 
(c) 
Flextronics International 
Denmark A/S 
0 
1.7.2011 – 31.10.2011 
21.3.2012 
21.12.2011 
216 
87 
303 

153 

1 972 381 
136 712 
6,48 
2 109 093 
1 370 910 

1. 

The  application  was  presented  to  the  Commission  on  21  December  2011  and 
supplemented by additional information up to 23 August 2012. 

1 
2 
3 

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

EN 

2 

   EN 

 
 
                                                 
2. 

The application meets the conditions for deploying the EGF as set out in Article 2(c) 
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. 

4. 

5. 

6. 

7. 

8. 

9. 

4 
5 
6 

Denmark  submits  that  the  redundancies  at  Flextronics  Denmark  are  a  direct 
consequence  of  the  major  structural  changes  in  world  trade  patterns  in  the  area  of 
services provided by Flextronics Denmark, i.e. design and electronics manufacturing 
services to original electronic equipment manufacturers.  

Flextronics International Denmark A/S (the full name of the company) was created 
in 2004 as part of Flextronics International Ltd., which itself was registered in 1990 
in  Singapore,  having  grown  from  an  originally  US  American  company  founded  in 
Silicon  Valley 
to 
CircuitsAssembly.com4,  as  the  second  global  Electronics  Manufacturing  Services 
(EMS) company by revenue. 

in  1969.  Flextronics 

ranked,  according 

in  2011  was 

The recent trend in electronic equipment production of moving facilities to Asia was 
also  followed  by  Flextronics,  as  the  Singapore  headquarters  decided  to  close  the 
Danish  enterprise  while  at  the  same  time  expanding  outside  Europe.  On  the 
development agenda of Flextronics International Ltd. there is a focus on the creation 
of huge production parks in South America and South East Asia5.  

Flextronics  Denmark  was  an  important  producer  of  printed  circuit  boards  (PCBs) 
which are ubiquitous components of any electronic equipment such as smart cards, 
electronic  gaming,  digital  cameras,  mobile  phones,  personal  computer  electronics, 
etc.  With  the  company  outsourcing  this  production  to  a  daughter  company  Multek, 
one of the best-known PCB suppliers in the world, providing one-stop interconnect 
solutions  in  the  electronic  industry,  the  output  of  Flextronics  Denmark  and  the 
relevant  European  PCBs  market  was  no  longer  of  any  interest  to  Flextronics 
International Ltd. 

Founded in 1978, currently Multek has more than 12 000 workers across the globe 
working at ten facilities on four different continents. There are only 420 employees 
left in Europe (Rigid PCB Manufacturing-Germany) and 370 in the USA, while the 
venues  in  China  are  expanding  rapidly  (with  10  900  employees),  supplying  the 
booming electronic industry in South Asia. 

Japan  and  the  Asia-Pacific  region  collectively  account  for  a  major  share  of  the 
worldwide  PCBs  market  as  do  India  and  China.  A  key  reason  for  the  growing 
significance  of  these  countries  is  the  rapid  expansion  of  electronic  manufacturing 
there, not least due to the cost of labour and manufacturing cost benefits6. 

Under these circumstances, and with shrinking markets in Europe for the production 
of  electronics  in  general  and  PCBs  in  particular,  the  decision  to  close  Flextronics 
Denmark was taken by the headquarters of the company in August 2011. 

http://www.circuitsassembly.com/cms/component/content/article/159/10901-ems-top-50 
http://investors.flextronics.com/phoenix.zhtml?c=98555&p=irol-irhome 
http://www.electronics.ca 

EN 

3 

   EN 

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

10. 

11. 

12. 

13. 

14. 

15. 

Denmark submitted this application under the intervention criteria of Article 2(c) of 
Regulation  (EC)  No  1927/2006,  which  permits  Member  States,  in  exceptional 
circumstances,  duly  substantiated  by  the  Member  State  concerned,  to  submit  an 
application  for  a  contribution  from  the  EGF  even  if  the  intervention  criteria  laid 
down  by  point  (a)  or  (b)  are  not  entirely  met,  when  redundancies  have  a  serious 
impact on employment and the local economy. 

The  application  cites  216  redundancies  in  Flextronics  International  Denmark  A/S 
during the four-month reference period from 1 July 2011 to 31 October 2011 and a 
further  87  outside  the  reference  period  but  related  to  the  same  collective 
redundancies  procedure.  All  303  redundancies  were  calculated  in  accordance  with 
the  first  indent  of  the  second  paragraph  of  Article  2  of  Regulation  (EC)  No 
1927/2006. 

Denmark  argues  that  the  application  is  made  in  exceptional  circumstances  and 
justifies the request for EGF support by the importance of the employer in the local 
labour  market,  the  overall  labour  market  situation  in  the  municipality  of  Skive  as 
well  as  demographic  trends.  The  closure  of  Flextronics  Denmark  followed  several 
other closures or delocalisations of important employers in the area such as Metallic, 
Nørhaven,  Jamo,  Royal  Greenland,  Bodisen  and  Danish  Crown.  Danish  authorities 
confirm that at the time of its closure, Flextronics Denmark was the most important 
industrial employer in the municipality. 

Danish authorities also argue the exceptional circumstances for this case in view of 
the fact that the municipality of Skive is part of the region of Midtjylland which was 
affected  negatively  by  globalisation  in  the  last  couple  of  years  and  for  which  EGF 
support  was  sought  both  in  2010  and  2012  (EGF/2010/017  and  EGF/2012/003).  In 
both  cases  redundancies  occurred  at  the  Vestas  group,  i.e.  813  workers  were 
dismissed  between  June  2009  and  March  2010  and  additional  569  in  2012.  Apart 
from the workers from the municipality of Varde (region of South Denmark) all the 
rest  of  the  dismissed  workers  were  from  the  region  of  Midtjylland  where  the 
municipality  of  Skive  is  situated.  This  makes  the  labour  market  opportunities  even 
more limited for the redundant workers from Flextronics. 

Apart  from  the  limited  labour  market  opportunities  in  the  municipality  of  Skive, 
there  has  been  a  more  clearly  expressed  negative  trend  on  unemployment  rates  in 
comparison  to  the  region  of  Midtjylland  and  the  Vestjylland  area  as  a  whole.  Full 
time unemployed comprised 5,6 % in Skive in November 2011 and grew to 7 % in 
March 2012, while respective figures for Midtjylland were 5,2 % in November 2011 
and  6 %  in  March  2012  (  5 %  and  6 %  for  the  area  of  Vestjylland  for  the  same 
reference period). 

Industrial  jobs  declined  by  35 %  in  the  municipality  of  Skive  in  the  period  2006  – 
2011. For the period 2008 – 2010, job losses there were considerably larger (7,5 %) 
than in the rest of Denmark in general (4 %) or the region of Midtjylland in particular 
(4,5 %).  

EN 

4 

   EN 

 
16. 

17. 

18. 

The  Skive  municipality  is  characterised  by  a  higher  presence  of  unskilled  workers 
(20,1 %) in comparison to the whole of Denmark (18,1 %). It is also characterised by 
a  higher  level  (35,5 %)  of  workers  who  have  achieved  primary  education  only;  the 
relevant value for Denmark as a whole is 29,3 %.  

Labour  market  indicators  for  2010  show  that  2,2 %  of  the  population  of  the 
municipality  were  unemployed,  3 %  were  temporarily  out  of  the  workforce  while 
20 % were employed as low-skilled and only 4,6 % as high-skilled workers. The lay-
offs  from  Flextronics  Denmark  are  considered  as  further  deteriorating  the  labour 
market in Skive especially with regard to low-skilled workers.  

The Danish authorities also refer to the considerable deterioration in the demographic 
structure observed since 2006, when the decline in jobs in manufacturing started, as 
both younger and better educated workers were leaving the municipality, opting for 
new  employment  elsewhere.  Given  the  circumstances  described,  the  Danish 
authorities  assess  the  future  development  of  the  labour  market  as  exceptionally 
threatened  and  therefore  want  to  upskill  the  redundant  workers  from  Flextronics  to 
provide relevant job opportunities for them within the Skive municipality. 

19. 

In such circumstances the redundancies can be seen to have a serious negative effect 
on the regional and local economy described. 

Explanation of the unforeseen nature of those redundancies 

20. 

21. 

The  Danish  authorities  argue  that  the  redundancies  were  unforeseen  as  Flextronics 
Denmark A/S was developing extremely well between 2004 and 2011. In 2010, the 
company  employed  420  workers  and  was  the  biggest  industrial  employer  in  the 
municipality of Skive. In its annual accounts for 2010, Flextronics Denmark reported 
a surplus of DKK 11,2 million DKK (approximately. EUR 1,5 million). 

Given  the  excellent  economic  results,  it  was  completely  unforeseen  when  the 
headquarters started laying off workers in Skive at the beginning of 2011 when it lost 
interest in the Danish market. Even though the CEO tried to rescue the company with 
a new strategy and diversification of production, in August 2011, Flextronics Int. Ltd 
decided to close down the plant in Skive. 

Identification of the dismissing enterprises and workers targeted for assistance 

22. 

The  application  relates  to  303  redundancies  in  the  enterprise  Flextronics  Denmark, 
153 of whom are expected to participate in the measures.  

23. 

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

Category 
Men 
Women 
EU citizens 
Non EU citizens 
15-24 years old 
25-54 years old 
55-64 years old 
> 64 years old 

Number
72
81
150
3
5
118
30
0

Percent 
47,06 
52,94 
98,04 
1,96 
3,27 
77,12 
19,61 
0,00 

EN 

5 

   EN 

 
24. 

25. 

Among the targeted workers, seven have a longstanding health problem or disability. 

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

Category 
Managers 
Professionals 
Technicians and associate professionals 
Clerks 
Craft and related trade workers 
Plant and machine operators 
Elementary occupations 

Number
3
3
20
6
10
110
1

Percent 
1,96 
1,96 
13,07 
3,92 
6,54 
71,89 
0,65 

26. 

In  accordance  with  Article  7  of  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 

27. 

28. 

The municipality of Skive is located in a rural area in the north-west of the region of 
Midtjylland.  The  population  has  been  gradually  declining  in  recent  years  and 
numbered  47 928  in  2011.  The  municipality  covers  an  area  of  690,7 km2  with  a 
population density of 69,5 inhabitants per km2. Although Skive is located in ''outer'' 
Denmark  in  a  rural  region,  industry  has  played  a  major  role,  with  three  out  of  ten 
employees in the private sector working in industry. But since 2006, major industries 
have  left  the  municipality  and  Skive  has  lost  approximately  2 000  industrial  jobs 
between 2008 and 2010, some of them due to globalisation. In June 2011, 12 % of 
the  members  of  3F  (the  trade  union  representing  low-skilled  workers)  were 
unemployed.  In  an  analysis  of  the  future  competence  needs  in  the  region  of 
Midtjylland with a 2020 perspective, new growth areas have been identified: energy 
and environment, medical / health ICT, tourism, and food production7. 

Denmark  implemented  a  comprehensive  local  and  regional  government  reform  in 
2007, leading to further empowerment of the municipal authorities. These have new 
specific responsibilities regarding employment. Job centres have been established at 
municipal  level  to  ensure  a  common  access  point  for  citizens  and  business 
enterprises  to  the  public  employment  effort.  In  addition,  at  local,  regional  and 
national  levels  Employment  Councils  have  been  established,  representing  the 
stakeholders in the labour market. 

29. 

For the purposes of this application, the principal stakeholder is the municipality of 
Skive. Other stakeholders are mentioned in more detail in point 37 below. 

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

30. 

7 

Flextronics  Denmark  was  the  major  provider  of  both  high-skilled  and  low-skilled 
jobs  in  the  municipality.  The  closure  of  Flextronics  followed  a  number  of  other 
closures of manufacturing enterprises in recent years, i.e. Metallic, Nørhaven, Jamo, 

http://www.newinsight.dk/en/projekter/vis/projectName/analyse-af-virksomhedernes-
kompetencebehov-i-holstebro-skive-struer-og-lemvig 

EN 

6 

   EN 

 
                                                 
31. 

32. 

33. 

Royal  Greenland,  Bodisen  and  Danish  Crown which  either  closed  or  moved  out  of 
the region. 

Following such closures, higher-educated workers moved to other industrial regions 
while the lower-educated and lower-skilled people tended to stay and remain jobless. 
As approximately 190 of the redundant workers from Flextronics Denmark are low- 
skilled, the percentage of the low-skilled unemployed in the municipality is likely to 
rise by about two percentage points.  

Relevant  authorities  in  the  Employment  Region  Midjutland  have  published  in  May 
2012  a  survey  of  the  labour  market  situation  where  they  clearly  identify  that 
unskilled  workers  –  both  men  and  women  –  are  at  a  higher  risk  of  long-term 
unemployment  as  compared  to  other  groups.  Given  the  high  percentage  of  low-
skilled workers from Flextronics, there is a  higher risk for these  workers to remain 
unemployed for a longer period. 

As local authorities have identified a direct link between the educational level of the 
redundant  workers  and  the  demographic  situation  in  the  municipality,  they 
anticipated the creation of a vicious circle of low education level → unemployment 
→  deteriorating  demographic  situation  and  are  trying  to  avert  it  by  mobilising 
resources from the EGF in addition to their own efforts. 

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 

34. 

All the following measures proposed by the Danish authorities combine to form a co-
ordinated  package  of  personalised  services  which  aims  at  re-integrating  the 
redundant workers into employment: 

–  Assessment  of  already  acquired  qualifications  and  competences  as  a  means  of 
shortening the pathway to obtaining a (new) formal qualification - individually or 
in groups. This assessment is expected to be especially relevant for the unskilled 
workers. 

–  Training and education activities: 

– 

– 

For  the  unskilled  workers  a  combination  of  general  education  as  a 
means  of  obtaining  access  to  or  the  accomplishment  of  vocational 
education; training in reading/writing skills and arithmetics; vocational 
training  within  sectors  with  good  job  opportunities  and  further 
education 
i.e.  obtaining  basic 
qualifications within new sectors and relevant certificates. 

training  courses, 

/  vocational 

For  the  skilled  workers  (including  office  personnel)  various  types  of 
education  /  adult  education  to  raise  the  workers'  qualifications  to  a 
higher level within the same occupational field, e.g skilled craftsperson 
to  become  a  technician;  specialised  courses  to  obtain  supplementary 
skills  or  certificates  and  new  general  or  vocational  education  with  a 
view to changing occupation or sector. 

EN 

7 

   EN 

 
– 

For  managers,  engineers  and  technicians,  the  personalised  package 
formal 
envisages  special  courses 
qualifications,  for  example  certificates  for  project  management  and 
similar fields. 

to  obtain  supplementary  or 

The  long-term  employment  perspectives  of  the  individual  workers  are  taken  into 
consideration, so that training and educational activities are designed to concentrate – 
but not be limited to – sectors with a development potential as identified by the latest 
analyses. 

–  Entrepreneurship 

is  particularly  supported  by  a 

to  be 
implemented in cooperation with the local Business and Tourist Centre. The first 
step of this process is an initial course which will assess the potential of the future 
entrepreneur. Only after a positive outcome will the second step be implemented; 
this  will  comprise  a  process  of  development  of  a  business  plan  in  combination 
with  individual  counselling,  information  sessions,  and  meetings  with  relevant 
network groups. 

two-step  process 

–  Individual  outplacement:  This  will  be  targeted  at  workers  with  professional  or 
managerial  skills  who  have  not  succeeded  in  finding  a  new  job  within  a 
reasonable  time  after  leaving  Flextronics.  The  basic  idea  is  to  help  people  who 
already  have  the  necessary  skills  but  who  have  not  been  successful  in  finding  a 
new job. Each worker will be assisted by a professional outplacement consultant 
who will act as advisor and sparring partner for the worker in his or her job search 
efforts  for  a  period  of  time.  The  purpose  is  to  help  these  workers  get  maximum 
effect from their job search efforts as quickly as possible. 

–  Subsistence  allowance:  This  will  be  paid  daily  to  all  targeted  workers  who 
actively participate in the EGF measures. The allowances will be granted for the 
duration  of  the  specific  activity  and  will  be  an  integral  part  of  the  active  labour 
market  measures  which  target  the  employability  of  the  redundant  workers  in  a 
longer-term perspective and seek for increase of skills and competences. 

The expenditure for implementing the EGF, which is included in the application in 
accordance with Article 3 of Regulation (EC) No 1927/2006, covers preparatory and 
administrative measures, management, information and publicity activities as well as 
evaluation  and  control  activities.  Apart  from  leaflets,  a  web  site  and  general 
information activities,  successful case stories will be collected and presented to  the 
press  and  the  public  from  time  to  time.  A  final  seminar  will  be  organised  on  the 
impact of the EGF support in this case. The proportion of implementing expenditure, 
at  6,48 %  of  total  expenditure,  is  higher  than  usual  since  this  is  a  relatively  small 
case,  yet  some  of  the  costs  in  absolute  terms  are  close  to  those  needed  for  the 
management of a larger one. The evaluation expenditure includes the services of an 
external consultant. 

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 at EUR 2 109 093, of 
which  the  expenditure  for  personalised  services  at  EUR 1 972 381  and  the 
expenditure for implementing the EGF at EUR 136 712 (6,48 % of the total amount). 
The total contribution requested from the EGF is EUR 1 370 910 (65 % of the total 
costs). 

35. 

36. 

EN 

8 

   EN 

 
Actions 

Estimated 
number of 
workers 
targeted 

Estimated 
cost per 
worker 
targeted 
(EUR) 

Total costs 
(EGF and 
national 
cofinancing) 
(EUR) 

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

Assessment of qualifications and competences 

110

General education for unskilled labour 

Vocational training for unskilled labour 

Vocational training for skilled labour 

Technical courses for technicians 

Specialised courses for managers and 
engineers 

Preparation courses for future entrepreneurs 

Business planning and counselling 

Individual outplacement 

Subsistance allowances 

Sub total personalised services 

50

60

11

20

6

20

10

20

153

537 

6 040 

8 054 

59 070

302 000

483 240

12 904 

141 944

10 738 

214 760

4 295 

25 770

1 342 

1 275 

1 342 

4 439 

26 840

12 750

26 840

679 167

1 972 381

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

Preparatory activities and administration 

Management 

Information and publicity 

Evaluation 

Control activities 

Sub total expenditure for implementing EGF 

Total estimated costs 

EGF contribution (65 % of total costs) 

59 866

32 886

18 792

20 134

5 034

136 712

2 109 093

1 370 910

EN 

9 

   EN 

 
 
 
 
 
 
 
 
 
 
37. 

Denmark  confirms  that  the  measures  described  above  are  complementary  with 
actions  funded  by  the  Structural  Funds  and  that  the  necessary  mechanisms  are  in 
place to prevent double financing from EU funds. 

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

38. 

Denmark started the personalised services to the affected workers included in the co-
ordinated  package  proposed  for  co-financing  to  the  EGF  on  21  March  2012.  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 

39. 

Following the  announcement  of the future closure  of Flextronics Denmark,  the  Job 
Centre  initiated  the  establishment  of  a  task  force.  Representatives  of  the  company, 
the employees, the Job Centre and the Trade Union F3 met regularly and coordinated 
the  drafting  of  the  application  which  was  initiated  by  the  task  force  and  the  Job 
Centre. The Job centre also  had an ongoing dialogue with the social partners about 
the quality and relevance of the services offered. 

40. 

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

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

41. 

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  above  do  not  receive  assistance 

from other EU financial instruments. 

Management and control systems  

42. 

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

Financing 

43. 

On  the  basis  of  the  application  from  Denmark,  the  proposed  contribution  from  the 
EGF  to  the  coordinated  package  of  personalised  services  (including  expenditure  to 
implement  EGF)  is  EUR 1 370 910,  representing  65 %  of  the  total  cost.  The 

EN 

10 

   EN 

 
44. 

45. 

46. 

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  to  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  Interinstitutional 
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. 

47. 

The Commission presents separately a transfer request in order to enter in the 2012 
budget  specific  commitment  appropriations,  as  required  in  Point  28  of  the 
Interinstitutional Agreement of 17 May 2006. 

Source of payment appropriations  

48. 

The amount of payment appropriations initially entered on the budget line 04 05 01 
in 2012 will be fully consumed after the adoption by the two arms of the budgetary 
authority  of  the  proposals  submitted  to  date  for  mobilising  the  EGF  and  therefore 
insufficient to cover the amount needed for the present application. A reinforcement 
of  the  payment  appropriations  of  the  EGF  budget  line  will  be  requested  either 
through  a  transfer,  in  case  a  source  of  available  appropriations can  be  identified, or 
an Amending budget. Appropriations from this budget line will be used to cover the 
amount of EUR 1 370 910 needed for the present application. 

EN 

11 

   EN 

 
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/2011/013 DK/Flextronics 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 
management8, 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  Fund9, 
and in particular Article 12(3) thereof, 

Having regard to the proposal from the European Commission10, 

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 
30 December 2011 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  enterprise  Flextronics  International  Denmark  A/S,  on  21  December  2011  and 
supplemented  it  by  additional  information  up  to  23  August  2012.  This  application 
complies  with  the  requirements  for  determining  the  financial  contributions  as  laid 
down  in  Article  10  of  Regulation (EC) No 1927/2006.  The  Commission,  therefore, 
proposes to mobilise an amount of EUR 1 370 910. 

8 
9 
10 

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

EN 

12 

   EN 

 
                                                 
(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  2012,  the  European 
Globalisation  Adjustment  Fund  (EGF)  shall  be  mobilised  to  provide  the  sum  of 
EUR 1 370 910 in commitment and payment appropriations. 

Article 2 

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

Done at Brussels,  

For the European Parliament 
The President 

For the Council 
The President 

EN 

13 

   EN