Source: EURLEX
Language: en
Format: md

C 151 E/202 EN Official Journal of the European Communities 25.6.2002

**Proposal for a Regulation of the European Parliament and of the Council on aid for poverty**
**diseases (HIV/AIDS, malaria and tuberculosis) in developing countries**

(2002/C 151 E/10)

_COM(2002) 109 final — 2002/0051(COD)_

_(Submitted by the Commission on 4 March 2002)_

THE EUROPEAN PARLIAMENT AND THE COUNCIL

OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community, and in particular Article 179 thereof,

Having regard to the proposal from the Commission,

Acting in accordance with the procedure laid down in Article
251 of the Treaty,

Whereas:

(1) The right to good health is a fundamental human right
recognised by Article 25 of the Universal Declaration of
Human Rights. This right is being denied to over a fifth of
the world's population.

(2) Article 35 of the Charter of Fundamental Rights of the
European Union calls for a high level of human health
protection in the definition and implementation of all
Union policies and activities.

(3) HIV/AIDS, malaria and tuberculosis cause the deaths of
more than five and a half million people each year, their
greatest impact being on morbidity and life expectancy in
developing countries.

(4) The failure to reduce the burden of these diseases and the
evidence of their increasing impact has brought them to
the centre of the development debate and has led to calls
for urgent action and a series of national, regional and
international initiatives, all meant to achieve the
Millennium Development Goals which include clear
targets to fight HIV/AIDS, malaria and tuberculosis, and
to which the European Community and its Member States
committed themselves.

(5) The international community, represented by United
Nations Secretary General Kofi Annan, calls for an
additional minimal investment of USD 7-10 billion per
year for HIV/AIDS, malaria and tuberculosis.

(6) HIV/AIDS, malaria and tuberculosis require an appropriate structural response, which is both comprehensive
and coherent and which is beyond the financial and
human resources of most developing countries.

(7) The effectiveness of programmes to support national
strategies to combat HIV/AIDS, malaria and tuberculosis
partly depends on the improved coordination of aid at
both the European and the international level, including
partnerships with the private sector, and on the use of
procedures tailored to the specific nature of the strategies
and partners concerned.

(8) For the partner countries and populations in question, the
type of assistance provided for by this Regulation is a
pre-requisite for development and thus contributes
significantly to the Community's development cooperation policy.

(9) In its Communications to the Council and the European
Parliament of 20 September 2000 and 21 February 2001
on Action related to Communicable Diseases in the
Context of Poverty Reduction, the Commission outlined
the policy principles and strategic priorities needed to
enhance the effectiveness of action by the Community
and the Member States in this field.

(10) In its Resolutions of 10 November 2000 and 14 May
2001, the Council emphasised the gravity of the
HIV/AIDS, malaria and tuberculosis epidemics and the
need to step up efforts to give more support at
national, regional and global levels.

(11) The European Parliament has adopted several Resolutions
and reports on this subject, including the Khanbhai report
adopted on 4 October 2001 on the Commission's
Communications on accelerated action targeted at major
communicable diseases within the context of poverty
reduction.

(12) In its Resolutions of September 1998 and October 2000,
the ACP-EU Joint Parliamentary Assembly underlined the
threat posed by HIV/AIDS to all development efforts and
the need for rapid action.

(13) The present Regulation renders obsolete Council Regulation (EC) No 550/97 of 24 March 1997 on HIV/AIDSrelated operations in developing countries, which should
therefore be repealed ( [1] ).

( [1] ) OJ L 85, 27.3.1997, p. 1.

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(14) The present Regulation lays down, for the entire duration
of the programme it establishes, a financial framework
constituting the prime reference, within the meaning of
point 33 of the Interinstitutional Agreement between the
European Parliament, the Council and the Commission of
6 May 1999 on budgetary discipline and improvement of
the budgetary procedure ( [1] ), for the budgetary authority
during the annual budgetary procedure.

(15) Since the measures necessary for the implementation of
this Regulation are management measures within the
meaning of Article 2 of Council Decision 1999/468/EC
of 28 June 1999 laying down the procedures for the
exercise of implementing powers conferred on the
Commission ( [2] ), they should be adopted by use of the
management procedure provided for in Article 4 of that
Decision.

(16) In accordance with the principles of subsidiarity and
proportionality set out in Article 5 of the Treaty, the
objective of the proposed action, namely to combat the
three major communicable diseases within the context of
poverty reduction, with particular reference to developing
countries, cannot be attained by the Member States acting
alone and, by reason of the scale and effects of the
proposed action, can therefore only be achieved by the
Community. This Regulation confines itself to the
minimum required to achieve that objective and does
not go beyond what is necessary for that purpose,

HAVE ADOPTED THIS REGULATION:

CHAPTER I

**PURPOSE AND SCOPE**

_Article 1_

1. The Community shall implement the European
Community Programme for Action targeting the three major
communicable diseases, namely HIV/AIDS, malaria and tuberculosis, in developing countries.

2. Under that Programme the Community shall provide
financial assistance and appropriate expertise with a view to
promoting investments in health, poverty reduction and
equitable economic growth in developing countries.

3. In the allocation of such funding and expertise, priority
shall be given to:

(a) the poorest and least developed countries and the most
disadvantaged sections of the population within developing
countries;

( [1] ) OJ C 172, 18.6.1999, p. 1.
( [2] ) OJ L 184, 17.7.1999, p. 23.

(b) action that complements and reinforces both the policies
and capacities of developing countries and the assistance
provided through other instruments of development cooperation.

_Article 2_

The purpose of activities carried out under this Regulation shall
be to:

(a) optimise the impact of existing interventions, services and
commodities targeted at the major communicable diseases
affecting the poorest populations;

(b) increase the affordability of key pharmaceuticals;

(c) increase research and development, including vaccines,
microbicides and innovative treatments.

_Article 3_

Community financial support shall be given to specific projects
designed to further the objectives described in Article 2(1) and,
in particular, to those which aim to:

(a) provide the necessary technical, scientific and normative
input in order to prioritise health interventions within
the total development cooperation budget and improve
health outcomes related to the three major communicable
diseases, keeping a balanced approach between prevention,
treatment and care, with a primary focus on prevention;

(b) improve the performance of health interventions targeted
at the three major communicable diseases within the
context of a comprehensive health system;

(c) improve pharmaceutical policies and practice, and help
developing countries, at regional or national level, to
develop high-quality local production of off-patent and/or
licensed key pharmaceuticals;

(d) promote global tiered pricing for key pharmaceuticals for
developing countries;

(e) analyse the effects of factors, such as the level of net import
price, tariffs, taxes, and importation, distribution and local
registration fees, on consumer prices of medical goods in
developing countries;

C 151 E/204 EN Official Journal of the European Communities 25.6.2002

(f) provide, where appropriate, technical assistance to
developing countries to help them address public health
issues in accordance with the provisions of the
Agreement on Trade Related Aspects of Intellectual
Property Rights (TRIPs) as clarified in the Doha Declaration
on the TRIPs Agreement and Public Health;

(g) develop an incentive package to encourage more private
investment by the Research and Development based
industries in new products, particularly vaccines and
microbicides, designed to fight the major communicable
diseases in developing countries;

(h) support collaborative clinical, epidemiological, operational
and social studies, so as to enable health-related research to
be conducted on a sounder basis;

(i) encourage capacity building in developing countries, to
enable them to coordinate, host and conduct large-scale
population trials;

(j) support global initiatives targeting the major
communicable diseases in the context of poverty reduction,
including the Global Fund to fight HIV/AIDS, tuberculosis
and malaria which came into operation on 29 January
2002.

_Article 4_

1. In the context of the operations referred to in Article 3,
Community support may take the form of:

(a) financial assistance;

(b) technical assistance, training or other services;

(c) supplies, such as medical supplies and commodities, and
works;

(d) audits and evaluation and monitoring missions.

Priority shall be given to enhancing national capacity with a
view to long-term viability.

2. Community financing may cover both investment expenditure, excluding the purchase of real estate, and, in exceptional
and duly substantiated cases, taking into account the fact that
the operation must, as far as possible, aim at medium-term
viability, recurring expenditure as well (including administrative
expenditure, maintenance and running costs), the operation of
which temporarily represents a burden for the partner, so that
the maximum use is made of the support referred to in
paragraph 1.

CHAPTER II

**PROCEDURES FOR THE IMPLEMENTATION OF AID**

_Article 5_

1. Community financing under this Regulation shall take the
form of grants.

2. A financial contribution from the partners defined in
Article 6 shall be sought for each cooperation operation. In
specifying the amount of the contribution requested, regard
shall be had to the capacity of the partners concerned and
the nature of the operation in question. In certain circumstances, the contribution may be made in kind if the partner
is either a non-governmental organisation (NGO) or a
community-based organisation.

3. The provision of financial assistance under this Regulation may entail co-financing with other donors, in particular
with Member States, the United Nations, and international or
regional development banks or financial institutions.

4. In the context of the operations referred to in Article
3(1)(g)-(i), financial assistance shall be granted in coordination
with the new instruments for product research and development on poverty-related communicable diseases implemented under the Community Framework Programme of
Research and Development 2002-2006.

_Article 6_

1. The partners eligible for financial assistance under this
Regulation include:

(a) administrative authorities and agencies at national, regional
and local government level;

(b) local authorities and other decentralised bodies;

(c) local communities, NGOs, community-based organisations
and other not-for-profit natural and legal persons from the
private sector;

(d) regional organisations;

(e) international organisations, such as the United Nations and
its agencies, as well as development banks, financial
institutions, global initiatives, international public/private
partnerships;

(f) research institutes and universities.

2. Without prejudice to paragraph 1(e), Community
financial assistance shall be available to partners whose head
office is located in a Member State or in a third country that is
a beneficiary or potential beneficiary of Community assistance
under this Regulation, provided that this office is the actual
centre directing business operations. In exceptional cases, this
office may be located in another third country.

25.6.2002 EN Official Journal of the European Communities C 151 E/205

_Article 7_

1. Where operations are the subject of financing agreements
between the Community and countries which benefit from
operations financed under this Regulation, the agreements
shall stipulate that the payment of taxes, duties and charges
shall not be financed by the Community.

2. Any financing agreement or contract concluded under
this Regulation shall stipulate that it is subject to the supervision and financial control of the Commission which may
carry out spot-checks and inspections, and to audits by the
Court of Auditors, in accordance with the usual arrangements
laid down by the Commission under the provisions in force,
particularly those in the Financial Regulation applicable to the
general budget of the European Communities.

3. The necessary measures shall be taken to emphasise the
Community character of aid provided under this Regulation.

_Article 8_

1. Participation in invitations to tender for the award of
contracts shall be open on equal terms to all natural and
legal persons in the Member States and in all developing
countries. It may be extended, in exceptional cases, to other
third countries.

2. Supplies shall originate in the beneficiary country, other
developing countries or the Member States. In exceptional
cases, supplies may originate from other third countries.

_Article 9_

1. In order to secure the objectives of consistency and
complementarity referred to in the Treaty and to ensure
maximum effectiveness of these operations as a whole, the
Commission may take all necessary coordination measures,
including:

(a) establishing a system for the systematic exchange and
analysis of information on the operations financed and
those which the Community and the Member States
propose to finance;

(b) on-the-spot coordination of the implementation of
operations through regular meetings and exchanges of
information between the representatives of the Commission
and the Member States in the recipient country.

2. The Commission, in liaison with the Member States, may
take any initiative necessary for ensuring proper coordination
with the other donors concerned, in particular those forming
part of the United Nations system.

CHAPTER III

**DECISION-MAKING PROCEDURES**

_Article 10_

1. The financial framework for the implementation of this
Regulation for the period from 2003 to 2006 is hereby set at
. . . million euro [to be decided APS 2003].

2. The annual appropriation shall be authorised by the
budgetary authority within the limits of the financial
perspective.

_Article 11_

1. The Commission shall be responsible for drafting
strategic programming guidelines, defining the Community's
co-operation in terms of measurable objectives, priorities,
deadlines for specific areas of action, assumptions and
expected outcomes. Programming is annual and indicative.

2. An exchange of views with the Member States shall take
place on the basis of a presentation by the representative of the
Commission of the strategic programming guidelines for the
operations to be carried out, within the Committee referred to
in Article 13 paragraph 1.

_Article 12_

1. The Commission shall be responsible for appraising,
deciding and administering the operations covered by this
Regulation in accordance with the budgetary and other
procedures in force, in particular those laid down in the
Financial Regulation applicable to the general budget of the
European Communities.

2. Decisions concerning operations for which financing
under this Regulation exceeds 5 million euro and any
changes to these operations that entail a cost overrun of
more than 20 % of the amount initially fixed for the
operation concerned, shall be adopted in accordance with the
procedure referred to in Article 13, paragraph 2.

3. For decisions and changes to these operations amounting
to 5 million euro or less, the Commission will inform the
Member States.

_Article 13_

1. The Commission shall be assisted by the geographically
determined committee competent for development.

2. Where reference is made to this paragraph, the
management procedure laid down in Article 4 of Decision
1999/468/EC shall apply, in compliance with Article 7 and
Article 8 thereof.

3. The period provided for in Article 4, paragraph 3, of
Decision 1999/468/EC shall be set at 45 days.

C 151 E/206 EN Official Journal of the European Communities 25.6.2002

CHAPTER IV

**REPORTING AND FINANCIAL PROVISIONS**

_Article 14_

1. After each budget year, the Commission shall submit in
its annual report on EC development policy to the European
Parliament and to the Council, information on the operations
financed in the course of that year and the Commission's
conclusions on the implementation of this Regulation over
the previous budget year. The summary shall in particular
provide information about the strengths and weaknesses of
operations, those with whom contracts have been concluded
as well as the results of any independent evaluations of specific
operations.

2. One year before the expiry of this Regulation, the
Commission shall submit an independent appraisal report on
the implementation of this Regulation to the European
Parliament and the Council with a view to establishing
whether its objectives have been achieved and providing
guidelines for improving the effectiveness of future operations.

On the basis of this appraisal report the Commission may
make proposals for the future of this Regulation and, if
necessary, proposals for its amendment.

_Article 15_

Council Regulation (EC) No 550/97 is hereby repealed.
Operations that have been decided under Regulation (EC) No
550/97 shall continue to be implemented under that Regulation.

_Article 16_

1. This Regulation shall enter into force on the third day
following that of its publication in the _Official Journal of the_
_European Communities_ .

2. It shall apply until 31 December 2006.

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