DRAFT AMENDING BUDGET No 1 TO THE GENERAL BUDGET 2021 Brexit Adjustment Reserve
Date: 2021-01-22
Institutions: Directorate-General for Budget, European Commission
Subjects: United Kingdom, amending budget, budgetary reserve (EU), draft budget (EU), financial year, general budget (EU), withdrawal from the EU

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 22.1.2021  COM(2021) 30 final 2020/371 (BUD)  DRAFT AMENDING BUDGET No 1 TO THE GENERAL BUDGET 2021 Brexit Adjustment Reserve  
 
 
Having regard to: 

– 

– 

– 

the Treaty on the Functioning of the European Union, and in  particular Article 314 
thereof,  in  conjunction  with  the  Treaty  establishing  the  European  Atomic  Energy 
Community, and in particular Article 106a thereof, 

Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council 
of 18 July 2018 on the financial rules applicable to the general budget of the Union 
(…)1, and in particular Article 44 thereof, 

the general budget of the European Union for the financial year 2021, as adopted on 
18 December 20202, 

The  European  Commission  hereby  presents  to  the  European  Parliament  and  to  the  Council 
Draft Amending Budget No 1 to the 2021 budget. 

CHANGES  TO  THE  STATEMENT  OF  REVENUE  AND  EXPENDITURE  BY 
SECTION 

The changes to the general statement of revenue and to the individual section III are available 
on EUR-Lex (https://eur-lex.europa.eu/budget/www/index-en.htm). 

1  
2  

OJ L 193, 30.7.2018. 
OJ L XX, xx.3.2021. 

1 

 
 
 
 
 
                                                           
Table of Contents 

1. 

2. 

3. 

4. 

INTRODUCTION ....................................................................................................................................................... 4 

ESTABLISHMENT OF THE BREXIT ADJUSTMENT RESERVE .................................................................... 4 

FINANCING ................................................................................................................................................................ 5 

SUMMARY TABLE BY MFF HEADING ............................................................................................................... 6 

2 

 
 
 
 
EXPLANATORY MEMORANDUM 

1. 

INTRODUCTION 

The  adoption  of  the  proposal  for  a  Regulation  of  the  European  Parliament  and  of  the  Council 
establishing  the  Brexit  Adjustment  Reserve  (the  Reserve)  on  25  December  20203  provides  for  the 
establishment of a Reserve within the thematic special instruments outside of the EU budget ceilings 
of the multiannual financial framework ‘to counter unforeseen and adverse consequences in Member 
States  and  sectors  that  are  worst  affected’  by  the  adverse  consequences  of  the  withdrawal  of  the 
United  Kingdom  (UK)  from  the  Union,  mitigating  thus  its  impact  on  the  economic,  social  and 
territorial cohesion.  

The purpose of Draft Amending Budget (DAB) No 1 for the year 2021 is to enter in the Union annual 
budget  2021  EUR 4 244 832 000  in  current  prices  (EUR 4 000 000 000  in  2018  prices),  both  in 
commitment  and  in  payment  appropriations,  to  meet  the  pre-financing  needs  resulting  from  the 
implementation  of  the  Brexit  Adjustment  Reserve  in  2021.  The  maximum  resources  for  the 
implementation of the Reserve amount to EUR 5 000 000 000 in 2018 prices (EUR 5 370 994 000 in 
current prices) 

ESTABLISHMENT OF THE BREXIT ADJUSTMENT RESERVE  

2. 
Following the conclusions of the European Council of 21 July 20204, the adoption of the Multiannual 
Financial  Framework  on  17  December  20205  and  the  adoption  of  the  EU  2021  budget  on  18 
December  2020,  the  European  Parliament  and  the  Council  invited  the  Commission  to  submit  a 
proposal  for  the  relevant  instrument  necessary  to  operationalise  the  Brexit  Adjustment  Reserve6,  in 
view of ensuring that a sufficient amount of appropriations can be made available for mobilisation in 
the financial year 2021 without delay. Following the adoption of the proposal for a Regulation of the 
European Parliament and of the Council establishing the Brexit Adjustment Reserve on 25 December 
2020, this DAB proposes to enter in the EU 2021 budget the budgetary impact of the Reserve for the 
year 2021. 

Upon  adoption  of  the  Regulation,  the  support  will  be  disbursed  in  two  allocation  rounds.  The  first 
round – covered by this DAB – will be paid in 2021 in the form of pre-financing within the meaning 
of Article 115(2), point (b)(i), of the Financial Regulation, whereby an amount per Member State has 
been  set  based  on  an  allocation  key  taking  into  account  the  relative  degree  of  economic  integration 
with the UK, including trade in goods and services, and the negative implications on the EU fisheries 
sector.The allocation criteria for pre-financing to be paid by the Commission to Member States are set 
out in Annex I of the proposal for the Reserve. The second round will be activated in 2024 following 
the  clearance  of  the  pre-financing  and  calculation  of  the  additional  amounts  due  to  Member  States 
from the Reserve, where eligible. The corresponding appropriations will be thus added to the Reserve 
in the context of the 2024 draft budget.   

The proposal for a Regulation foresees that it is necessary to  grant Member States flexibility and in 
particular  to  allow  the  Commission  to  adopt  the  financing  decision  providing  the  pre-financing 
without the obligation pursuant to Article 110(2) of the Financial Regulation to provide a description 
of the concrete actions to be financed.  

In line with recital 11 and Article 4(3) of the proposal for a Regulation, the Commission requests to 
make  available  EUR  4 244 832 000  in  both  commitment  and  payment  appropriations  to  cover  the 

3  
4  
5  

6  

COM(2020) 854 final. 
EUCO 10/20 
Council  Regulation  (EU,  Euratom)  2020/2093  of  17  December  2020  laying  down  the  multiannual  financial 
framework for the years 2021 to 2027, OJ L 433I , 22.12.2020 
Common understanding on the content of the budget for 2021, based on the Draft Elements of Joint Conclusions 
no.  4  as  presented  by  the  Commission  on  4  December  2020,  reached  by  the  Conciliation  Committee  on  4 
December 2020. 

3 

 
 
 
 
                                                           
Reserve’s pre-financing needs. This amount will be entered as a provision pending the final adoption 
of the Regulation. 

Budget line 

Name 

Section III – Commission 
30 04 03 
Total 

Brexit Adjustment Reserve (BAR) 

Commitment 
appropriations 

Payment 
appropriations 

EUR 

4 244 832 000 
4 244 832 000 

4 244 832 000 
4 244 832 000 

Once the BAR Regulation is definitively adopted, the appropriations will be transferred without delay 
from the reserve article ’30 04 03’ to the budget article ‘16 02 03’. The financial contribution from the 
Reserve to a Member State will then be implemented within the framework of shared management in 
accordance with Article 63 of the Financial Regulation. 

3. 

FINANCING 

The Brexit Adjustment Reserve is one of the thematic special instrument within the MFF Regulation 
2021-20277.  The  related  appropriations  are  therefore  entered  into  the  budget  over  and  above  the 
expenditure ceilings of the MFF 2021-2027.  

7  

Council  Regulation  (EU,  Euratom)  2020/2093  of  17  December  2020  laying  down  the  multiannual  financial 
framework for the years 2021 to 2027, OJ L 433I, 22.12.2020 

4 

 
 
 
 
 
                                                           
4. 

SUMMARY TABLE BY MFF HEADING 

1. 

Single  Market,  Innovation  and 
Digital 

Ceiling 
Margin 

2. 

Cohesion and Values 

Of which under Flexibility 
Instrument 
Ceiling 
Margin 
territorial 

Economic,  social  and 
cohesion 

2a. 

Ceiling 
Margin 

2b.  Resilience and values 

Of which under Flexibility 
Instrument 
Ceiling 
Margin 
and 

Resources 

Natural 
Environment 

Ceiling 
Margin 
Of  which:  Market 
related 
expenditure and direct payments 

EAGF sub-ceiling 
 Rounding difference excluded for 
calculating the sub-margin 
 Net transfers between EAGF and 
EAFRD 
 Net balance available for EAGF 
expenditure (sub-ceiling corrected 
by transfers between EAGF and 
EAFRD) 
EAGF sub-margin 
Border 
and 

Migration 
Management 

3. 

4. 

5. 

Security and Defence 

Ceiling 
Margin 

Ceiling 
Margin 

6. 

Neighbourhood and the World 

Ceiling 
Margin 

7. 

European Public Administration 

Ceiling 
Margin 
Administrative 

which: 

of 
expenditure of the institutions 

Budget 2021 

Draft Amending Budget 1/2021 

Budget 2021 (incl. DAB 1/2021) 

CA 

PA 

CA 

PA 

CA 

PA 

20 816 559 767 

17 191 587 232 

20 816 559 767 

17 191 587 232 

In EUR 

20 919 000 000 
102 440 233 
52 861 898 534 

76 382 534 

52 786 000 000 
484 000 

66 153 765 904 

20 919 000 000 
102 440 233 
52 861 898 534 

76 382 534 

52 786 000 000 
484 000 

66 153 765 904 

48 190 516 000 

61 867 897 545 

48 190 516 000 

61 867 897 545 

48 191 000 000 
484 000 
4 671 382 534 

76 382 534 

4 595 000 000 

4 285 868 359 

48 191 000 000 
484 000 
4 671 382 534 

76 382 534 

4 595 000 000 

4 285 868 359 

58 568 566 908 

56 804 203 452 

58 568 566 908 

56 804 203 452 

58 624 000 000 
55 433 092 

58 624 000 000 
55 433 092 

40 367 954 000 

40 353 742 883 

40 367 954 000 

40 353 742 883 

40 925 000 000 

557 046 000 

40 367 954 000 

40 925 000 000 

557 046 000 

40 367 954 000 

2 278 829 759 

2 686 245 978 

2 278 829 759 

2 686 245 978 

2 467 000 000 
188 170 241 
1 709 261 441 
1 805 000 000 
95 738 559 
16 097 196 204 
16 247 000 000 
149 803 796 
10 448 313 002 
10 635 000 000 
186 686 998 

670 628 243 

10 810 999 356 

10 449 588 091 

2 467 000 000 
188 170 241 
1 709 261 441 
1 805 000 000 
95 738 559 
16 097 196 204 
16 247 000 000 
149 803 796 
10 448 313 002 
10 635 000 000 
186 686 998 

670 628 243 

10 810 999 356 

10 449 588 091 

8 035 824 720 

8 037 099 809 

8 035 824 720 

8 037 099 809 

Sub-ceiling 
Sub-margin 

Appropriations for headings 

Ceiling  

Of which under Flexibility 
Instrument 
Margin 
Thematic special instruments 

Total appropriations  

8 216 000 000 
180 175 280 
162 780 625 
615 
163 483 000 
000 

164 767 018 
256 
166 140 000 
000 

76 382 534 

628 462 086 

778 756 919 
1 470 835 000 
164 251 460 
615 

2 001 443 830 
1 293 450 000 
166 060 468 
256 

8 216 000 000 
180 175 280 
162 780 625 
615 
163 483 000 
000 

164 767 018 
256 
166 140 000 
000 

76 382 534 

628 462 086 

778 756 919 
5 715 667 000 
168 496 292 
615 

2 001 443 830 
5 538 282 000 
170 305 300 
256 

4 244 832 000 

4 244 832 000 

4 244 832 000 

4 244 832 000 

5