Proposal for a COUNCIL REGULATION amending Regulation (EU, Euratom) No 1311/2013 laying down the multiannual financial framework for the years 2014-2020
Date: 2016-09-14
Institutions: European Commission, Secretariat-General
Subjects: budgetary procedure, commitment of expenditure, financial management, general budget (EU)

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   EUROPEAN COMMISSION  Brussels, 14.9.2016  COM(2016) 604 final 2016/0283 (APP)   Proposal for a COUNCIL REGULATION amending Regulation (EU, Euratom) No 1311/2013 laying down the multiannual financial framework for the years 2014-2020   
 
 
EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

In the first years of the multiannual financial framework (MFF) for the years 2014-2020, the 
Union  has  been  confronted  with  unforeseen  challenges  of  an  unprecedented  scale  resulting 
from  instability  in  its  neighbourhood  occasioning  security  threats  and  mass  migratory 
movements.  

In  its  Communication  on  the  "Mid-Term  Review/Revision  of  the  Multiannual  Financial 
Framework 2014-2020 – An EU Budget Focused on Results"1 the Commission has assessed 
the  functioning  and  use  made  of  special  instruments  in  the  first  two  to  three  years  of 
implementation of the MFF.  

In order to mobilise additional financial means for measures contributing to tackle the above 
mentioned  challenges,  wide  use  has  been  made  of  all  budgetary  availabilities,  including 
redeployments,  margins  and  special  instruments,  and  new  instruments  such  as  European 
Union  Trust  Funds  and  the  Facility  for  Refugees  in  Turkey  were  set  up  to  draw  additional 
funding whilst respecting the constraints set by the MFF. Compared with the previous period 
the  special  instruments  laid  down  in  Regulation  No  1311/20132  ("MFF  Regulation")  have 
considerably increased the flexibility of the MFF, allowing the Union to take decisive action. 
However,  as  these  challenges  persist,  the  Union's  continued  capacity  to  react  swiftly  in 
emergency situations is at stake. 

Against this background, the European Parliament called for bold steps to enhance the Union 
budget's flexibility3, whilst informal Council discussions also pointed at the need to enhance 
the ability of the current MFF to respond to unforeseen events4.  

2. 

LEGAL BASIS AND CONTENT OF THE PROPOSAL 

The  present  proposal  is  based  on  Article  2  of  the  MFF  Regulation  which  provides  that  the 
mid-term review of the MFF shall, as appropriate, be accompanied by a legislative proposal 
for the revision of this Regulation. Such a revision shall not reduce the pre-allocated national 
envelopes,  without  prejudice  to  the  adjustment  of  the  cohesion  policy  envelopes  made  in 
accordance with Article 7 of the MFF Regulation5. 

Taking  into  account  the  use  made  of  special  instruments  since  the  beginning  of  the  MFF 
period and the new challenges the Union has been and continues  to be confronted with, the 
Commission proposes to amend the MFF Regulation in order to increase the annual maximum 
amounts set for the Emergency Aid Reserve (Article 9) and the Flexibility Instrument (Article 

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COM(2016)603 of 14.09.2016. 
Council  Regulation  (EU,  Euratom)  No  1311/2013  of  2  December  2013  laying  down  the  multiannual 
financial framework for the years 2014-2020 (OJ L 347, 20.12.2013, p. 884). 
European Parliament resolution of 6 July 2016 on the preparation of the post-electoral revision of the 
MFF 2014-2020: Parliament’s input ahead of the Commission’s proposal (2015/2353(INI)), P8_TA-
PROV(2016)0309. 
Dutch  Presidency  report:  Towards  a  forward-looking  and  flexible  Multiannual  Financial  Framework, 
30.5.2016, 
https://www.rijksoverheid.nl/binaries/rijksoverheid/documenten/kamerstukken/2016/05/30/voorzittersc
hapsverslag-over-mfk/voorzitterschapsverslag-over-mfk.pdf. 
For  that  adjustment,  see:  Technical  Adjustment  of  the  financial  framework  for  2017  in  line  with 
movements in GNI and adjustment of cohesion policy envelopes, COM(2016) 311 final, 30.6.2016. 

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11) and to introduce a new special instrument for setting up a European Union Crisis Reserve 
financed from de-committed appropriations to allow the Union to react rapidly to crises, such 
as  the  current  migration  crisis,  as  well  as  to  events  with  serious  humanitarian  or  security 
implications.  In  parallel  with  the  present  proposal,  the  Commission  proposes  to  amend  the 
Interinstitutional  Agreement  on  cooperation  in  budgetary  matters  and  on  sound  financial 
management6 in order to provide for the mobilisation procedure of the new Crisis Reserve. 

Furthermore, it is proposed to remove the limitations in time and scope of the Global margin 
for commitments (Article 14).  

Concerning the Global margin for payments, it is proposed to remove the annual caps set for 
2018-2020 (Article 5.2) to allow for the full mobilisation, in the later years of the MFF, of the 
large  margins  in  payments  left  unused  in  2016  and  2017  should  it  prove  necessary,  and 
therefore ensure specific and maximum flexibility.  

3. 

BUDGETARY IMPLICATIONS 

The  present  proposal  has  no  immediate  budgetary  implications.  Special  instruments  are 
mobilised and appropriations entered in the annual budget subject to the procedures laid down 
in the MFF Regulation, the relevant basic acts (see Article 3, paragraph 2 of that Regulation) 
and  the  Interinstitutional  Agreement  on  budgetary  discipline,  on  cooperation  in  budgetary 
matters and on sound financial management. 

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Interinstitutional  Agreement  between  the  European Parliament,  the  Council and  the  Commission  of 2 
December  2013  on  budgetary  discipline,  cooperation  in  budgetary  matters  and  on  sound  financial 
management (OJ C 373, 20.12.2013, p. 1). 

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2016/0283 (APP) 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EU, Euratom) No 1311/2013 laying down the multiannual 
financial framework for the years 2014-2020  

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 312 thereof, 

Having  regard  to  the  Treaty  establishing  the  European  Atomic  Energy  Community,  and  in 
particular Article 106a thereof, 

Having regard to the proposal from the European Commission, 

Having regard to the consent of the European Parliament,  

After transmission of the draft legislative act to the national parliaments, 

Acting in accordance with a special legislative procedure, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

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Special instruments have been extensively used in the first years of implementation of 
the 2014-2020 multiannual financial framework (MFF) set out in Council Regulation 
(EU, Euratom) No 1311/20131 to address new challenges which arose in the European 
neighbourhood and called for swift and comprehensive Union action to deal with their 
far-reaching humanitarian and security implications. 

The  circumstances  which  occasioned  those  extraordinary  measures  and  the  need  to 
take  further  action  persist,  as  shown  by  the  recourse  made,  again,  under  the  draft 
budget  for  the  year  2017  to  margins  and  special  instruments,  which  reduces  the 
budgetary  availabilities  to  confront  such  situations  in  the  remaining  period  of  the 
MFF. 

In  order  to  implement  specific  and  maximum  possible  flexibility  and  to  ensure  the 
sufficiency  of  payment  ceilings  to  allow  the  Union  to  fulfil  its  obligations  in 
compliance  with  Article  323  of  the  Treaty,  the  limitations  set  for  the  adjustment  of 
payment ceilings for the years 2018-2020 need to be removed. 

The Emergency Aid Reserve and the Flexibility Instrument need to be reinforced and 
the restrictions regarding the Global margins for commitments and payments removed 
in  order  to  maintain  a  sufficient  capacity  for  the  Union  to  react  to  unforeseen 
circumstances. 

A new special instrument establishing a European Union Crisis Reserve financed from 
de-committed appropriations needs to be  provided for in order to allow the Union to 
react  rapidly  to  crises, such  as  the current  migration  crisis,  as  well  as  to  events  with 
serious humanitarian or security implications.  

Council  Regulation  (EU,  Euratom)  No  1311/2013  of  2  December  2013  laying  down  the  multiannual 
financial framework for the years 2014-2020 (OJ L 347, 20.12.2013, p. 884). 

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(6) 

Regulation (EU, Euratom) No 1311/2013 should therefore be amended accordingly, 

HAS ADOPTED THIS REGULATION: 

Regulation (EU, Euratom) No 1311/2013 is amended as follows: 

Article 1 

(1) 

(2) 

In Article 3, paragraph 2 is replaced by the following: 

"2.  The  special  instruments  provided  for  in  Articles 9  to 15  shall  ensure  the 
flexibility of the MFF and shall be laid down in order to allow the budget procedure 
to run smoothly. The commitment appropriations may be entered in the budget over 
and  above  the  ceilings  of  the  relevant  headings  laid  down  in  the  MFF  where  it  is 
necessary to use the resources from the Emergency Aid Reserve, the European Union 
Solidarity  Fund,  the  Flexibility  Instrument,  the  European  Globalisation  Adjustment 
Fund,  the  Contingency  Margin,  the  European  Union  Crisis  Reserve,  the  specific 
flexibility  to  tackle  youth  unemployment  and  strengthen  research  and  the  global 
margin  for  commitments,  in  accordance  with  Council  Regulation  (EC)  No 
2012/20022, Regulation (EC)  No 1309/2013 of the European Parliament and  of the 
Council3,  and  the  Interinstitutional  Agreement  on  budgetary  discipline,  cooperation 
in budgetary matters and on sound financial management4.". 

(3) 

(4) 

In Article 5, paragraph 2 is deleted. 

In Article 6(1), the following point (f) is added: 

"(f)  calculation  of  the  de-committed  appropriations  made  in  year  n-2  to  be  made 
available to the European Union Crisis Reserve provided for in Article 13a.". 

(5) 

In Article 9, paragraph 2 is replaced by the following: 

"2.  The annual amount  of the  Reserve is  fixed at EUR 500  million (2011 prices) 
and  may  be  used  up  to  year  n+1  in  accordance  with  the  Financial  Regulation.  The 
Reserve  shall  be  entered  in  the  general  budget  of  the  Union  as  a  provision.  The 
portion  of  the  annual  amount  stemming  from  the  previous  year  shall  be  drawn  on 
first. That portion of the annual amount from year n which is not used in year  n+1 
shall lapse.". 

(6) 

In Article 11, paragraph 1 is replaced by the following: 

"1.  The  Flexibility  Instrument  is  intended  to  allow  the  financing,  for  a  given 
financial year, of clearly identified expenditure which could not be  financed within 
the limits of the ceilings available for one or more other headings. There shall be a 
ceiling  on  the  annual  amount  available  for  the  Flexibility  Instrument  of  EUR 1000 
million (2011 prices).". 

(7) 

The following Article 13a is inserted: 

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Council  Regulation  (EC)  No  2012/2002  of  11  November  2002  establishing  the  European  Union 
Solidarity Fund (OJ L 311, 14.11.2002, p. 3). 
Regulation (EU) No 1309/2013 of the European Parliament and of the Council of 17 December 2013 on 
the  European  Globalisation  Adjustment  Fund  (2014-2020)  and  repealing  Regulation  (EC)  No 
1927/2006 (OJ L 347, 20.12.2013, p. 855). 
Interinstitutional  Agreement  between  the  European Parliament,  the  Council and  the  Commission  of  2 
December  2013  on  budgetary  discipline,  cooperation  in  budgetary  matters  and  on  sound  financial 
management (OJ C 373, 20.12.2013, p. 1). 

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"Article 13a  

European Union Crisis Reserve 

1. 
The  European  Union  Crisis  Reserve  is  intended  to  allow  the  Union  to  react 
rapidly  to  crises,  as  well  as  to  events  with  serious  humanitarian  or  security 
implications.  

2.  Without prejudice to Article  [178] of the Financial  Regulation, de-committed 
appropriations made during year n-2 will be made available to the European Union 
Crisis Reserve in the framework of the budgetary procedure for year n. The Reserve 
shall  be  entered  in  the  general  budget  of  the  Union  as  a  provision.  The  annual 
amount  available  shall  be  used  up  to  year  n+1  in  accordance  with  the  Financial 
Regulation. The portion of the annual amount stemming from year n shall be drawn 
up first. That portion from the annual amount from year n which is not used in year 
n+1 shall lapse.". 

(8) 

Article 14 is replaced by the following: 

"Article 14 

Global margin for commitments  

1.  Margins left available below the MFF ceilings for commitment appropriations 
shall  constitute  a  Global  MFF  Margin  for  commitments,  to  be  made  available  over 
and above the ceilings established in the MFF for the years 2016 to 2020. 

2. 
Each  year,  as  part  of  the  technical  adjustment  provided  for  in  Article  6,  the 
Commission  shall  calculate  the  amount  available.  The  Global  MFF  Margin  or  part 
thereof  may  be  mobilised  by  the  European  Parliament  and  the  Council  in  the 
framework of the budgetary procedure pursuant to Article 314 TFEU.". 

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

Article 2 

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

Done at Brussels, 

For the Council 
The President 

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