Source: EURLEX
Language: en
Format: md

**Council of the**
**European Union**

**Interinstitutional File:**

**2018/0232 (COD)**

**PROPOSAL**

**Brussels, 12 June 2018**
**(OR. en)**

**9929/18**

**UD 119**
**ENFOCUSTOM 122**
**MI 445**
**COMER 54**
**TRANS 253**
**ECOFIN 594**
**CODEC 1012**

From: Secretary-General of the European Commission,
signed by Mr Jordi AYET PUIGARNAU, Director

To: Mr Jeppe TRANHOLM-MIKKELSEN, Secretary-General of the Council of
the European Union

No. Cion doc.: COM(2018) 442 final

Subject: Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND
OF THE COUNCIL establishing the 'Customs' programme for cooperation
in the field of customs

Delegations will find attached document COM(2018) 442 final.

Encl.: COM(2018) 442 final

9929/18 PhL/at

## DG G 3 B EN

EUROPEAN

COMMISSION

Brussels, 8.6.2018
COM(2018) 442 final

2018/0232 (COD)

Proposal for a

**REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL**

**establishing the 'Customs' programme for cooperation in the field of customs**

{SEC(2018) 295 final} - {SWD(2018) 321 final} - {SWD(2018) 322 final}

# **EN EN**

**EXPLANATORY MEMORANDUM**

**1.** **CONTEXT** **OF** **THE** **PROPOSAL**

On 2 May 2018, the Commission adopted a package on the next Multi-Annual Financial
Framework for the period 2021-2027 [1] . The Commission proposed a new, modern long-term
budget, tightly geared to the political priorities of the Union at 27. The proposed budget
combines new instruments with modernised programmes to deliver efficiently on the Union’s
priorities. Building on those foundations the Commission is proposing a new Customs
programme under the “Single Market, Innovation and Digital” budget heading. This
programme will support the work of and cooperation between customs authorities as
described in the Communication accompanying the Multi-Annual Financial Framework
proposal [2] .

This proposal provides for a date of application as of 1 January 2021 and is presented for a
Union of 27 Member States, in line with the notification by the United Kingdom of its
intention to withdraw from the European Union and Euratom based on Article 50 of the
Treaty on European Union received by the European Council on 29 March 2017.

**•** **Reasons for and objectives of the proposal**

For 50 years, the customs union has been a significant example of successful integration in
the EU. It is one of the few areas of exclusive competence of the EU without which the
elimination of internal frontiers would not have been possible. The EU is the largest trading
block in the world and has a share of 15% of total world trade. The total number of customs
declarations has been constantly growing over the last five years reaching the level of 313
million in 2016 or 10 declarations per second, with 98% of customs declarations being made
electronically.

Customs help safeguarding the financial interests of the Union and of the Member States and,
in their role as guardians of the external EU border for goods, also protect the public against
terrorist, health, environmental and other threats. Customs apply a list of more than 60 noncustoms legislations relating to, inter alia, dual use goods, firearms, drug precursors,
movement of cash, intellectual property rights, public health, product safety and consumer
protection, the protection of wildlife and of the environment. Customs authorities play also a
critical role in securing the integrity of the supply chain and preventing terrorist organisations
from freely moving their funds. The future Import Control System 2 (ICS2) for customs risk
management will contribute decisively to the security of the Union, its citizens and its
businesses. In addition, new challenges arising through rapidly changing technologies
(digitalisation, connected-ness, Internet of things, blockchain) and business models (ecommerce, supply chain optimisation), reduced public financial means, increasing volumes of
world trade and a persistent transnational crime and security threat constantly increase the
pressure to improve the performance of the customs union and enlarge the scope of the tasks
to be performed by customs administrations.

Since 2016, the Union Customs Code is the new legal customs framework. The major goals of
the Union Customs Code are the end of paper-based procedures and the digitalisation of
interactions between trade and customs, as well as a reinforced risk management with a view
to advance cargo information. As such, the Union Customs Code has triggered a massive
digitalisation project with 17 different electronic systems to be mostly in place by 2020. Some

1 COM(2018) 322 final
2 COM(2018) 321 final

# EN 1 EN

systems will be deployed gradually up to 2025. These electronic systems touch upon all
customs procedures and will therefore be at the heart of the functioning of the customs union.
When fully implemented, the Union Customs Code will enhance the competitiveness of
European businesses and rebalance the important equilibrium between customs controls and
facilitation of the legitimate flow of goods transiting or moving in and out of the Union.

The upcoming withdrawal of the United Kingdom from the EU implies disentangling the
United Kingdom as a Member State from all existing customs electronic systems financed by
Customs 2020. These implications and costs however cannot be precisely estimated and are
therefore not covered in this paper as they are still largely unknown at this stage of the
ongoing negotiations between the EU and the United Kingdom.

The implementation of all these aspects can only be achieved through intense operational
cooperation between customs administrations of the Member States, between them and other
authorities, with trade and other third parties. The proposed programme, which is the
successor programme of Customs 2020, will support cooperation in the field of customs.

Customs cooperation and capacity building will be clustered around human networking and
competency building actions, on the one hand, and information technology (IT) capacity
building actions on the other hand. The first cluster will streamline the exchange of good
practices and operational knowledge amongst the Member States and other countries
participating in the programme, with a specific focus on project-based structured
collaboration allowing for deep and integrated forms of cooperation between participating
countries, thus paving the way for further evolution of the customs union. The second cluster
enables the programme to fund a complete set of IT infrastructure and systems, including the
digitalisation of interactions between trade and customs as well as a reinforced risk
management that will allow Union customs administrations becoming fully-fledged eadministrations.

**•** **Consistency with existing policy provisions**

The current proposal is consistent with the Union Customs Code [3] and other legislation that
the customs authorities have to apply.

The current proposal is also consistent with the existing Customs 2020 programme, which
objective is to support the functioning and modernisation of the customs union in order to
strengthen the internal market by means of cooperation between participating countries, their
customs authorities and their officials. Similarly, the current proposal will provide the
operational, organisational, methodological and budgetary framework to implement EU
customs policy objectives and activities.

As such, the proposal is a continuation of the current programme. But it will entail greater
intensity in the way cooperation will take place and as regards the number of electronic
systems, as well as the possibility to take on board a certain level of innovation.

**•** **Consistency with other Union policies**

The proposal is consistent with other Union policies and in particular with other proposed EU
actions programmes and funds that pursue similar objectives in related fields of competence.

The programme is closely linked with the new Customs Control Equipment Instrument (one
of the two components of the new Integrated Border Management Fund), which will support
the purchase, maintenance and upgrade of the eligible equipment. The customs programme

3 Regulation (EU) No 952/2013 of the European Parliament and of the Council of 9 October 2013 laying
down the Union Customs Code (OJ L 269, 10.10.2013, p. 1).

# EN 2 EN

will instead be used to support all relating actions, such as cooperation activities for the
assessments of equipment needs, training in relation to the equipment purchased, etc.

In addition, as the customs programme aims at supporting the customs authorities, _inter alia_,
in protecting the EU financial interests, it has connections with the activities carried out by the
European Anti-Fraud Office as regards combating fraud for the protection of Union financial
interests in accordance with Art. 325 TFEU and with the EU anti-fraud programme. There
will be synergies between the latter, which pursues specifically the objective of protecting the
financial interests of the Union, and the customs programme, which supports the proper
functioning of the customs union and, in so doing, contributes to the protection of those
financial interests. The focus of each programme will be therefore distinct, but with potential
for complementary action. Synergies will also be possible with the activities of the European
Public Prosecutor Office and with the Justice Programme of the Justice, Rights and Values
Fund in relation to training on the application of EU customs law.

The customs programme also intends to ensure product safety and the protection of European
consumers, as well as to ensure a level-playing field for EU industry. It therefore ties in with
the initiatives of the Single Market programme aiming to strengthen market surveillance and
to ensure that only compliant and safe products enter the EU market.

To address security challenges and counter criminal activities, synergies with the Internal
Security Fund could be explored. Economies of scale could especially relate to multi-agencies
cooperation, custom control equipment and other capacity building actions.

Moreover, significant synergies exist at operational level with the Fiscalis programme that
supports cooperation in the field of taxation. In the field of electronic systems, there is crossfertilisation and joint funding of shared components such as Data Centre infrastructure and the
Common Communication Network. Identical IT management approaches and common
horizontal support mechanisms are in place. The same type of joint actions is used and a
similar approach for human capacity building and training is followed. The programme
management in terms of proposal, management, action management, implementing acts,
performance monitoring is fully streamlined. In addition, there is an emerging and growing
need for joint activities between taxation and customs, in particular in the domain of e
commerce.

Decision 70/2008/EC of the European Parliament and of the Council of 15 January 2008 on a
paperless environment for customs and trade foresees a Multi-Annual Strategic Plan (MASP)
for customs to coordinate the development and operation of customs electronic systems,
which are mainly funded by the Programme. In order to ensure coherence and coordination
between the Programme and the MASP, the relevant provisions of the Decision will be
included in the Programme. The new proposal will accordingly repeal the current e-Customs
decision [4] and will therefore become the basis for the Multi-Annual Strategic Plan for Customs
electronic systems (MASP-C).

Finally, there are possibly further synergies to exploit in the IT area with various Union
initiatives such as the Digital Europe Programme [5], all programmes that run (significant)
electronic systems, the reuse of the building blocks [6] of the Connecting Europe Facility (CEF),
the European Interoperability Framework [7], the Rolling Plan for ICT standardisation [8], the

4 Decision No 70/2008/EC of the European Parliament and of the Council of 15 January 2008 on a
paperless environment for customs and trade (OJ L 23, 26.1.2008, p. 21) _._
5 COM(2018) 434
6 [https://ec.europa.eu/cefdigital/wiki/display/CEFDIGITAL/CEF+Digital+Home](https://ec.europa.eu/cefdigital/wiki/display/CEFDIGITAL/CEF+Digital+Home)
7 COM(2017)134

# EN 3 EN

action plan on FinTech [9], the Horizon Europe [10], the work of the EU Blockchain Observatory
and Forum [11] and other initiatives about fraud and cybersecurity risks.

**2.** **LEGAL** **BASIS,** **SUBSIDIARITY** **AND** **PROPORTIONALITY**

**•** **Legal basis**

This proposal requires combining several legal bases as it may have several distinct but
correlated purposes:

–
Article 33 of the Treaty on the Functioning of the European Union (TFEU), which
calls for Union action with regard to customs cooperation and the EU customs union;

–
Article 114 TFEU, which calls for Union action with regard to the internal market;
and

–
Article 207 TFEU, which calls for Union action with regard to common commercial
policy.

Article 33 TFUE is foreseen as a continuation of the customs cooperation under the current
programme. In addition and in order to contemplate and cover the wide variety of tasks that
customs authorities need to perform at borders in a multitude of domains other than mere
customs cooperation, the proposal is also based on Article 114 TFUE and on Article 207
TFUE.

EU action is also required because of obligations stemming from international agreements, in
particular under the remit of the World Trade Organisation.

**•** **Subsidiarity (for non-exclusive competence)**

Action at Union level rather than at national level is necessary for the following reasons:

–
The customs union is an exclusive competence of the Union. By transferring their
powers to the Union, Member States agreed that actions in the customs area will be
better taken at Union level. However, the Union legal framework in itself does not
ensure sufficiently the proper functioning of the Customs Union. It should be
complemented by supporting measures as provided by the Customs programme in
order to ensure that Union customs legislation is applied in a convergent and
harmonised way.

–
Many of the activities in the customs area are of a cross-border nature, involving and
affecting all Member States, and therefore they cannot be effectively and efficiently
delivered by individual Member States. Union action is needed to underpin the
European dimension of customs work, to avoid internal market distortions and to
support the effective protection of the Union external borders.

–
In this regard, Union action is justified to ensure the proper functioning and further
development of the customs union and its common regulatory framework, as it has
been shown to be the most efficient and effective response to shortcomings and
challenges in implementing the customs union and customs cooperation.

8       [https://ec.europa.eu/growth/industry/policy/ict](https://ec.europa.eu/growth/industry/policy/ict-standardisation_en) standardisation_en
9 [https://ec.europa.eu/info/business-economy-euro/banking-and-finance/fintech_en#action-plan](https://ec.europa.eu/info/business-economy-euro/banking-and-finance/fintech_en#action-plan)
10 [https://ec.europa.eu/info/designing-next-research-and-innovation-framework-programme/what-shapes-](https://ec.europa.eu/info/designing-next-research-and-innovation-framework-programme/what-shapes-next-framework-programme_en)
[next-framework-programme_en](https://ec.europa.eu/info/designing-next-research-and-innovation-framework-programme/what-shapes-next-framework-programme_en)
11 [https://ec.europa.eu/digital-single-market/en/news/european-commission-launches-eu-blockchain-](https://ec.europa.eu/digital-single-market/en/news/european-commission-launches-eu-blockchain-observatory-and-forum)
[observatory-and-forum](https://ec.europa.eu/digital-single-market/en/news/european-commission-launches-eu-blockchain-observatory-and-forum)

# EN 4 EN

**•** **Proportionality**

Action at EU level is much more efficient than if it was to be left to Member States.

The vast majority of the proposed budget will be spent on IT capacity building activities. The
backbone of the customs cooperation is a highly secured dedicated communication network.
This common network ensures that every national administration only needs to connect once
to this common infrastructure to be able to exchange any kind of information. If such an
infrastructure were not available Member States would have to link 26 times to the national
systems of each of the other Member States. The chosen approach is based on an IT
architecture model where European electronic systems are made up of a combination of
common and national components. This model has been favoured above a fully centralised IT
architecture model as the former leaves part of the budgetary responsibility with Member
States which will develop the national electronic components at national level taking into
account also national preferences, requirements and constraints. Enhancing the
interoperability and interconnectivity for the sake of the internal market is therefore achieved
in a proportionate manner.

The Commission shall exercise coordinating, executive and management functions, as laid
down in the Treaties. Coordination by the Commission needs to be undertaken with national
customs authorities, with specialised representatives, at operational level and on a long term
basis in view of existing and future challenges for the Union identified in the customs field.
The various fora and tools of the programme provide an appropriate framework for the
Commission to take on its coordinating role in the customs area.

**•** **Choice of the instrument**

In line with the conclusion of the Impact Assessment, EU intervention by means of a funding
programme is appropriate. A successor to the Customs 2020 programme is being proposed by
the Commission.

**3.** **RESULTS** **OF** **EX-POST** **EVALUATIONS,** **STAKEHOLDER**
**CONSULTATIONS** **AND** **IMPACT** **ASSESSMENTS**

**•** **Retrospective evaluations/fitness checks of existing legislation**

The proposal takes into account the recommendations of the final evaluation of the Customs
2013 as well as the preliminary results of the ongoing mid-term evaluation of Customs 2020
programmes. The findings of the Customs 2013 final evaluation [12] were broadly positive with
regard to the Customs 2013 programme’s contribution to policy-level objectives and in terms
of helping customs authorities to work as one. The biggest gains can be summarised as
follows:

–
Enhancing safety and security, including the full implementation of the Import
Control System and the Customs Risk Management System as well as the
mainstreaming of the Authorised Economic Operator and Economic Operator
Systems.

–
Facilitation of trade, allowing the Customs Union to expedite the movement, release
and clearance of goods, including goods in transit, while guaranteeing the safety of
the goods.

12 https://ec.europa.eu/taxation_customs/sites/taxation/files/resources/documents/common/
publications/studies/customs_2013_final_evaluation_report.pdf

# EN 5 EN

–
Protection of the EU’s financial interests, due to the use of centralised databases and
the enhanced effectiveness of risk management systems.

The achievements made during the period under review were not assessed as a simple
evolution of already on-going trends. Rather, they were significant and path breaking
(especially regarding the introduction of electronic systems related to security and safety) and
indicative of major developments towards the realisation of the key programme objectives.

The evaluation identified a strong case for the EU added value of the programme, particularly
regarding its role in supporting the implementation of EU legislation at national level. The
electronic systems funded through the programme are highly complementary to national
initiatives and mostly relate to implementing such legislation. This led to reductions in
administrative costs that would result from each Member State needing to develop similar
electronic systems on its own. The networking fostered through the joint actions of the
programme was also considered crucial for several reasons, including ensuring the consistent
application of common legislation, spreading best practices and building the trust needed for
administrations to act as if they were one administration.

The preliminary findings of the ongoing mid-term evaluation of Customs 2020 can be
summarised as follows [13] :

–
Relevance: the level of interest shown by national administrations in actively
engaging in the programme suggests there is alignment between the programme
activities and actual need. Working visits were considered by national authorities as
the most useful type of joint actions, followed closely by seminar, workshops, project
groups and the newly introduced Expert Teams.

–
Effectiveness: customs authorities agree that the programme's joint actions
contributed to improving the exchange of information between administrations. The
training modules developed under the programme had led to a more uniform
approach to the application of EU customs law among participating countries.

–
Efficiency: procedures for preparing the programme cycle and the Annual Work
Programmes were in general positive. In relation to the Performance Monitoring
Framework (PMF), its implementation was mostly considered successful. Though
the data generated is mainly self-reported, it appears to be collected systematically
and generate useful information. However, it is not clear to what extent the PMF data
is used to take management decisions or is used as an early warning system to steer
programme interventions. There is a need to simplify the current monitoring system,
especially regarding the number of impact indicators and the length of action followup forms.

–
Coherence: broad levels of agreement exist on joint actions' contribution to national
initiatives by supporting the consistent application of EU law and by managing the
European electronic systems. It has also been reported that supported initiatives
under the programme are complementary to initiatives at national level.

–
EU added value: national customs administrations were generally positive about the
extent to which the programme is achieving results that would not have been possible
by national administrations acting alone. A high proportion of respondent to
evaluation questionnaires also found that the programme is instrumental for building

13 Limited coverage of IT domain, as replies to IT questionnaire and case studies were still not finalised at
the time of drafting this IA

# EN 6 EN

trust and leading to convergence with the customs administration of EU Member
States and other participating countries (candidate countries and potential
candidates). Initial interviews also point to efficiency gains through pooling of
resources, especially in the area of IT (economies of scale ad reduced development
costs). Initial findings also suggest challenges for national authorities to align
national considerations with EU customs requirements: diverging interests may in
some cases act as a barrier to realise EU added value and few national authorities
also expressed frustration when having to adjust their ambition to that of less
advanced national customs administrations.

**•** **Stakeholder consultations**

The Commission contracted an external study to support the Impact Assessment which
included dedicated consultation to gather more broadly the view from stakeholders.
Considering the particular scope of the programme (customs administrations are the only
direct beneficiaries), these consultations concentrated on the customs administrations by
means of discussions in a project group, country visits/case studies and dedicated surveys.
Interviews with business associations and economic operators, academics as well as Customs
2020 programme participants and international organisations (e.g. World Customs
Organisation) complemented these activities.

An open public consultation on "EU funds in the area of investment, research & innovation,
SMEs and single market" was carried out. It gathered the views of citizens on, among others,
policy challenges and needs for EU intervention as regards the customs union.

**•** **External expertise**

The Commission contracted an external study to support this impact assessment by providing
quantitative and qualitative information. The objective of this assignment was to: (1) identify
the key drivers setting the customs scene in a post 2020 context, the problems to be faced by
the customs union and the Member States' customs administrations and the objectives for an
EU-level intervention based on the identified drivers and problems; (2) identify the possible
EU policy options to achieve the objectives and deploy a future EU financing intervention and
assess the identified options' expected economic, social and environmental impacts; and (3)
compare the options according to the set criteria (such as efficiency, effectiveness, relevance,
coherence) and rank them with reasoned arguments.

The external study and the related consultation activities confirmed the challenging times
ahead of customs administrations and the need for an ambitious programme around two key
dimensions: on the one hand, continuity and reinforcement of (IT and human) capacity
building and cooperation actions for an equal interpretation and implementation of the
customs union and, on the other hand, more enhanced operational cooperation and better
addressing innovation.

**•** **Impact assessment**

On 27 April 2018, the Regulatory Scrutiny Board gave a positive opinion on the
accompanying impact assessment, with a recommendation to further improve the report with
respect to some key aspects such as providing further elements on electronic systems for
justifying the increase of budget and to elaborate on the simplification of monitoring
arrangements and indicators beyond the legal base indicators.

Those two aspects were considered in the final version of the impact assessment.
Clarifications were provided on the legal context (obligations stemming from the Union
Customs Code in particular) and the complexity of European electronic systems for
explaining the significant increase in budget. Performance information indicators will be

# EN 7 EN

simplified as this part of the monitoring system placed substantial burdens on administrations
and DG TAXUD, without leading to big improvements in the programme’s design and
management.

Four main scenarii were analysed:

–
The EU 27 baseline scenario: the Union would have to review its customs legislation
and repeal a significant part of the enhancements brought to customs operations by
the adoption of the new UCC in 2016. As a result, this could impact the EU's
international commitments and would also compromise other EU policy objectives,
in particular the security agenda.

–
The critical mass scenario: no other development would be possible after their
implementation and cooperation would be limited to supporting the implementation
of the UCC. This would be in essence a regression in terms of IT and overall customs
operations.

–
The continuity plus scenario: both the necessary minimum for the customs union – to
continue to function and deliver – and the next logical step – after the adoption of the
UCC.

–
The structural centralisation scenario: centralisation – whether transitional or directly
fully structural – could strengthen the performance of customs administrations in the
EU and deliver on the programme’s objectives. It would however represent a change
of operating model, which requires preparation and is therefore largely unrealistic for
the next MFF.

The chosen scenario after analysis at political level is the continuity plus scenario. Current
cooperation mechanisms and tools must be further optimised if the maximum benefits of the
customs union and the internal market are to be obtained: in line with EU international
commitments at the World Trade Organisation, the customs administrations of Member States
should work and operate as if they were one single entity. This would be aligned with the
political messages in the recent Commission Communication on developing the EU customs
union and its governance. Achieving all this in times of increased expectations towards the
Union delivering on its fundamentals – of which the customs union is a part – is therefore
politically and economically vital. This decision is also reflected in the post-2020 MFF
proposal package that the Commission presented on 2 May 2018 [14] .

Further to a technical comment transmitted by the Regulatory Scrutiny Board, an additional
indicator has been included as regards the UCC completion rate, allowing providing also an
insight in the development of the UCC electronic systems that is supported by the Programme
and consumes a substantial part of its budget.

**•** **Simplification**

The on-going programme is already streamlined with a strong focus on outputs and results. It
implements all simplifications identified in past evaluations. The main additional
simplification identified would consist in an extended use of lump sums / unit costs and the
possibility to adopt multi-annual work programmes to avoid the annual administrative burden
of comitology.

**•** **Fundamental rights**

The proposal has no particular bearing on fundamental rights.

14 COM(2018) 321 final

# EN 8 EN

**4.** **BUDGETARY** **IMPLICATIONS**

The timing of the review of EU funding programmes is linked to the proposal for a new
Multiannual Financial Framework, as proposed on 2 May 2018 [15] . In accordance with this
proposal, this Regulation on the Customs programme contains a budgetary framework of
EUR 950 million (in current prices) for the period 2021-2027.

The Customs programme will be implemented in direct management mode and in a prioritybased manner. Work programmes are established – together with the stakeholders –
stipulating the priorities for a specific period.

The Customs programme will have an impact on the Union and Member States revenue.
Although not quantifiable, it will facilitate and streamline the work done by Customs
authorities for the collection of customs duties, as well as of VAT and excise duties at import.
By increasing the quality of work through cooperation and IT and human capacity building,
customs administrations will be more efficient for protecting the financial interests of the
Union and of Member States.

**5.** **OTHER** **ELEMENTS**

**•** **Implementation plans and monitoring, evaluation and reporting arrangements**

The impact of the proposed Customs programme will be assessed through interim and final
evaluations, as well as by monitoring on an ongoing basis a set of high-level key performance
indicators. These evaluations will be carried out in line with paragraphs 22 and 23 of the
Interinstitutional Agreement of 13 April 2016 [16], where the three institutions confirmed that
evaluations of existing legislation and policy should provide the basis for impact assessments
of options for further action. The evaluations will assess the Instrument's effects on the
ground, based on indicators and targets and on a detailed analysis of the degree to which the
instrument can be deemed relevant, effective, and efficient, provides enough EU added value
and is coherent with other EU policies. They will include lessons learnt to identify any
lacks/problems or any potential to further improve the actions or their results and to help
maximise their impact. They will also include identification and quantification of regulatory
costs, benefits and savings.

The evaluation reporting system shall ensure that data for programme evaluation are collected
efficiently, effectively, in a timely manner and at the appropriate level of granularity; such
data and information shall be communicated to the Commission, in a way that complies with
other legal provisions; for instance, when necessary, personal data shall be made anonymous.
To that end, proportionate reporting requirements shall be imposed on recipients of Union
funds.

The results and outputs of the programme will be regularly subject to assessment through a
comprehensive monitoring system, based on defined indicators, in view of setting
accountability for the delivery of value for money.

Data for measuring performance will be drawn from various electronics systems and data
collection tools. The main tools envisaged at present are action follow-up forms, event
assessment forms and regular polls of customs officials.

15 COM(2018) 322 final
16 Interinstitutional Agreement between the European Parliament, the Council of the European Union and
the European Commission on Better Law-Making of 13 April 2016; OJ L 123, 12.5.2016, p. 1–14

# EN 9 EN

Since the programme plays a supporting role, helping participating country administrations to
share information and boost their capacity, the monitoring system focuses on following the
progress of the programme’ activities in terms of indicators at outputs levels. Whenever
possible, it also follows indicators in areas related to the programme’s high-level objectives.

The Commission will, on a yearly basis, issue a programme progress report containing a
summary of performance towards the programme objectives and the related output and result
indicators.

**•** **Detailed explanation of the specific provisions of the proposal**

**Chapter I - General Provisions**

The proposed programme will provide support to customs union and customs authorities to
protect the financial and economic interests of the Union and its Member States, to protect the
Union from unfair and illegal trade while supporting legitimate business activity, to ensure the
security and safety of the Union and its residents and to maintain a proper balance between
customs controls and facilitation of legitimate trade. This objective has been adjusted to allow
providing support in a more comprehensive manner to the customs union and customs
authorities as regards the whole range of their mission, as defined in the Union Customs
Code, and in view of emerging needs, as further detailed in the impact assessment.

Like the ongoing Customs 2020 programme, the new programme will be open for
participation to Member States, acceding countries, candidate countries and potential
candidates. In line with overall Union policy, countries of the European Neighbourhood
Policy and third countries in accordance with the conditions laid down in specific agreements
between the Union and those countries will also have the possibility to take part in the
programme under certain conditions.

As in the past, the Programme will provide funding in any of the forms laid down in the
Financial Regulation, in particular grants, procurement and reimbursement of costs. If deemed
appropriate, prizes may also be considered for specific actions, in which case the
implementation criteria and modalities would be detailed in the work programmes.

**Chapter II - Eligibility**

The types of actions considered eligible for programme funding are in essence similar to the
ones under the current programme. Their typology has however been simplified and reduced
in order to provide for more flexibility. The indicative list in Annex 1 provides an overview of
concrete actions that could be funded under the programme.

Based on the lessons learnt with the current Expert Teams tool under the current Customs
2020 programme, the proposal provides specific focus on project-based structure cooperation
aimed at boosting enhanced operational cooperation allowing for deep and integrated forms of
cooperation between participating countries, thus paving the way for the further evolution of
the customs union.

A novelty compared to the current Customs 2020 programme is represented by the inclusion
of actions complementing or supporting the actions implementing the objectives of the newly
established Customs Control Equipment Instrument, which is part of the Integrated Border
Management Fund. In particular, the Customs Control Equipment Instrument will only
support the purchase, maintenance and upgrade of the eligible equipment while the Customs
programme will support all relating actions, such as cooperation actions for the assessment of
equipment needs or, where appropriate, training in relation to the equipment purchased.

Considering the importance of globalisation, the Programme will continue to provide the
possibility of involving representatives of governmental authorities, including from third

# EN 10 EN

countries, as well as representatives of international organisations, economic operators or civil
society as external experts, where beneficial for the actions implementing the objective of the
Programme.

**Chapter III - Grants**

The implementation of the programme will occur through the most commonly used spending
mechanisms of Union budget, namely public procurement and grants. As regards grants, the
proposal stipulates that no call for proposal will apply where the eligible entities are customs
authorities.

As in the past, the Programme should fund actions up to 100% given their strong EU added
value. Where actions require the awarding of grants, the applicable co-financing rate will be
set out in the work programmes.

**Chapter IV - Specific provisions for IT capacity building actions**

The provisions under this chapter aim at providing an improved framework and governance
for the IT capacity building actions carried out under the programme. Building on the
experience of previous Customs programmes and in view of the increasing number of
European electronic systems, some novelties are proposed. An improved definition of the
European electronic systems ‘common components’ and ‘national components’ reflecting
better the reality of electronic systems and their features has been integrated. The tasks
incumbent on the Commission on the one hand and the Member States on the other hand have
been listed. Finally, a Multi-Annual Strategic Plan for Customs (MASP-C), to be drawn up by
the Commission, in partnership with the Member States, will allow for a better planning of
budgetary and human resources both at national and EU level. Accompanying reporting duties
have been introduced to allow for a better monitoring of IT capacity building actions.

**Chapter V - Programming, monitoring, evaluation and control**

In view of the mid- to long-term nature of the objectives pursued and building on experience
gained over time, work programmes should cover several years. This is a novelty compared to
the current Customs 2020 programme which foresees annual work programmes. The shift
from annual to multiannual work programmes will reduce the administrative burden for both
the Commission and Member States.

A list of core indicators has been added in Annex 2 to improve the monitoring of the
programme and its performance from the outset. The Commission will be empowered to
adopt delegated acts in order to develop the provisions for a monitoring and evaluation
framework, including through amendments to Annex 2 to review and/or complement the list
of indicators where necessary.

Interim and final evaluations will be carried out in a timely manner to feed into the decisionmaking process.

**Chapter VI - Exercise of the delegation and committee procedure**

The Commission is empowered to adopt delegated powers as regards the review of the
performance monitoring framework and related indicators.

A Customs Programme committee (examination procedure) will assist the Commission.

**Chapter VII - Transitional and final provisions**

Coherent, effective and proportionate targeted information to multiple audiences will be
ensured, including the media and public.

# EN 11 EN

2018/0232 (COD)

Proposal for a

**REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL**

**establishing the 'Customs' programme for cooperation in the field of customs**

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular
Articles 33, 114 and 207 thereof,

Having regard to the proposal from the European Commission,

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

Having regard to the opinion of the European Economic and Social Committee [1],

Acting in accordance with the ordinary legislative procedure,

Whereas:

(1) The Customs 2020 programme set up under Regulation (EU) No 1294/2013 [2] and its
predecessors have significantly contributed to facilitating and enhancing customs
cooperation. Many of the activities in the customs area are of a cross-border nature,
involving and affecting all Member States, and therefore they cannot be effectively
and efficiently delivered by individual Member States. A customs programme at
Union level, implemented by the Commission, offers Member States a Union
framework to develop those cooperation activities, which is more cost-efficient than if
each Member State were to set up individual cooperation frameworks on a bilateral or
multilateral basis. It is therefore appropriate to ensure the continuity of Union
financing of activities in the field of customs cooperation by establishing a new
programme in the same area, the Customs programme.

(2) The customs union has evolved considerably over the last fifty years and customs
administrations now successfully perform a wide variety of tasks at borders. Acting
together, they work to facilitate trade and reduce red tape, collect revenues for national
and Union budgets and protect the public against terrorist, health, environmental and
other threats. In particular, with the introduction of an EU-wide Common Risk
Management Framework [3] and customs control of movements of large amounts of cash
to combat money laundering and terrorist financing, customs assume a front line
position in the fight against terrorism and organised crime,. Given that broad mandate,
customs is now effectively the lead authority for the control of goods at the Union’s
external borders. Against that backdrop, the Customs programme should not only
cover customs cooperation but extend its support to the mission of customs authorities

1 OJ C,, p. .
2 Regulation (EU) No 1294/2013 of the European Parliament and of the Council of 11 December 2013
establishing an action programme for customs in the European Union for the period 2014-2020
(Customs 2020) and repealing Decision No 624/2007/EC, OJ L 347, 20.12.2013, p. 209.
3 [https://ec.europa.eu/taxation_customs/general-information-customs/customs-risk-](https://ec.europa.eu/taxation_customs/general-information-customs/customs-risk-management/measures-customs-risk-management-framework-crmf_en)
[management/measures-customs-risk-management-framework-crmf_en](https://ec.europa.eu/taxation_customs/general-information-customs/customs-risk-management/measures-customs-risk-management-framework-crmf_en)

# EN 12 EN

at large, as set out in Article 3 of Regulation (EU) No 952/2013, i.e. the supervision of
the Union's international trade, the implementation of the external aspects of the
internal market, of the common trade policy and of the other common Union policies
having a bearing on trade, as well as the security of the supply chain. The legal basis
will therefore cover customs cooperation (Article 33 TFEU), internal market (Article
114 TFEU) and commercial policy (Article 207 TFEU).

(3) In providing a framework for actions that has as objective to support the customs
union and customs authorities, the Programme should contribute to protecting the
financial and economic interests of the Union and its Member States; protecting the
Union from unfair and illegal trade while supporting legitimate business activity;
ensuring the security and safety of the Union and its residents; and facilitating
legitimate trade, so that businesses and citizens can benefit from the full potential of
the internal market and of global trade.

(4) This Regulation lays down a financial envelope for the Programme, which is to
constitute the prime reference amount, within the meaning of point 17 of the
Interinstitutional Agreement of 2 December 2013 between the European Parliament,
the Council and the Commission on budgetary discipline, on cooperation in budgetary
matters and on sound financial management [4], for the European Parliament and the
Council during the annual budgetary procedure.

(5) In order to support the process of accession and association by third countries, the
Programme should be open to the participation of acceding and candidate countries as
well as potential candidates and partner countries of the European Neighbourhood
Policy if certain conditions are fulfilled. It may also be open to other third countries, in
accordance with the conditions laid down in specific agreements between the Union
and those countries covering their participation to any Union programme.

(6) Regulation (EU, Euratom) [2018/XXX] of the European Parliament and of the
Council [5] (the ‘Financial Regulation’) applies to this Programme. It lays down rules on
the implementation of the Union budget, including the rules on grants, prizes,
procurement and reimbursement of external experts.

(7) The actions which applied under the Customs 2020 programme have proven to be
adequate and should therefore be maintained. In order to provide more simplicity and
flexibility in the execution of the Programme and thereby better deliver on its
objectives, the actions should be defined only in terms of overall categories with a list
of illustrative examples of concrete activities. Through cooperation and capacity
building, the Customs programme should also promote and support the uptake and
leverage of innovation to further improve the capabilities to deliver on the core
priorities of customs.

(8) Regulation [2018/XXX] establishes, as part of the Integrated Border Management
Fund, a Customs Control Equipment Instrument [6] (‘CCE Instrument’). In order to
preserve the coherence and horizontal coordination of all cooperation actions relating
to customs and customs control equipment, it is appropriate to implement all of them
under one single legal act and set of rules, being this Regulation. Therefore, the CCE

4 OJ C 373, 20.12.2013, p. 1
5 COM(2016) 605 final
6 Proposal for a Regulation of the European Parliament and of the Council establishing, as part of the
Integrated Border Management Fund, the instrument for financial support for customs control
equipment

# EN 13 EN

Instrument should only support the purchase, maintenance and upgrade of the eligible
equipment while this Programme should support all other related actions, such as
cooperation actions for the assessment of equipment needs or, where appropriate,
training in relation to the equipment purchased.

(9) Exchanges of customs and related information are key for a proper functioning of
customs and they extend well beyond the exchanges within the customs union.
Adaptations or extensions of European electronic systems to third countries not
associated to the Programme and international organisations could indeed have an
interest for the Union or the Member States. Therefore, when duly justified by such an
interest, adaptations of or extensions to European electronic systems for cooperation
with third countries and international organisations should be eligible costs under the
Programme.

(10) Considering the importance of globalisation, the Programme should continue to
provide the possibility of involving external experts within the meaning of Article 238
of the Financial Regulation. Those external experts should mainly be representatives
of governmental authorities, including from non-associated third countries, as well as
representatives of international organisations, economic operators or civil society.

(11) In line with the Commission's commitment to ensure the coherence and simplification
of funding programmes, set out in its Communication of 19 October 2010 entitled 'The
EU Budget Review [7] ', resources should be shared with other Union funding
instruments if the envisaged actions under the Programme pursue objectives that are
common to various funding instruments, excluding however double financing. Actions
under the Programme should ensure coherence in the use of the Union's resources
supporting the customs union and customs authorities.

(12) Information Technology (IT) capacity building actions are set to attract the greatest
part of the budget under the Programme. Specific provisions should describe,
respectively, the common and national components of the European electronic
systems. Moreover, the scope of actions and the responsibilities of the Commission
and the Member States should be clearly defined.

(13) Decision No 70/2008/EC of the European Parliament and of the Council [8] requests the
Commission to draw up a Multi-Annual Strategic Plan for Customs for creating a
coherent and interoperable electronic customs environment for the Union. The
development and operation of the electronic systems included in the Multi-Annual
Strategic Plan are mainly funded by the Programme. In order to ensure coherence and
coordination between the Programme and the Multi-Annual Strategic Plan, the
relevant provisions of the Decision should be included in this Regulation. As all
relevant provisions of Decision No 70/2008/EC are now taken over either by
Regulation (EU) No 952/2013 or by this Regulation, Decision No 70/2008/EC should
be repealed.

(14) This Regulation should be implemented by means of work programmes. In view of the
mid- to long-term nature of the objectives pursued and building on experience gained
over time, work programmes should be able to cover several years. The shift from

7 COM (2010)700 final
8 Decision No 70/2008/EC of the European Parliament and of the Council of 15 January 2008 on a
paperless environment for customs and trade (OJ L 23, 26.1.2008, p. 21).

# EN 14 EN

annual to multiannual work programmes will reduce the administrative burden for
both the Commission and Member States.

(15) In order to ensure uniform conditions for the implementation of this Regulation,
implementing powers should be conferred to the Commission. Those powers should
be exercised in accordance with Regulation (EU) No 182/2011 of the European
Parliament and of the Council [9] .

(16) Pursuant to paragraph 22 and 23 of the Inter-institutional agreement for Better LawMaking of 13 April 2016 [10], there is a need to evaluate this programme on the basis of
information collected through specific monitoring requirements, while avoiding
overregulation and administrative burdens, in particular on Member States. These
requirements, where appropriate, can include measurable indicators, as a basis for
evaluating the effects of the Instrument on the ground.

(17) In order to respond appropriately to changes in policy priorities, the power to adopt
acts in accordance with Article 290 of the Treaty on the Functioning of the European
Union should be delegated to the Commission in respect of amending the list of
indicators to measure the achievement of the specific objectives of the Programme. It
is of particular importance that the Commission carries out appropriate consultations
during its preparatory work, including at expert level, and that those consultations be
conducted in accordance with the principles laid down in the Interinstitutional
Agreement on Better Law-Making of 13 April 2016. In particular, to ensure equal
participation in the preparation of delegated acts, the European Parliament and the
Council receive all documents at the same time as Member States' experts, and their
experts systematically have access to meetings of Commission expert groups dealing
with the preparation of delegated acts.

(18) In accordance with the Financial Regulation, Regulation (EU, Euratom) No 883/2013
of the European Parliament and of the Council [11], Council Regulation (Euratom, EC)
No 2988/95 [12], Council Regulation (Euratom, EC) No 2185/96 [13] and Council
Regulation (EU) 2017/1939 [14], the financial interests of the Union are to be protected
through proportionate measures, including the prevention, detection, correction and
investigation of irregularities and fraud, the recovery of funds lost, wrongly paid or
incorrectly used and, where appropriate, the imposition of administrative sanctions. In
particular, in accordance with Regulation (EU, Euratom) No 883/2013 and Regulation
(Euratom, EC) No 2185/96, the European Anti-Fraud Office (OLAF) may carry out

9 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011
laying down the rules and general principles concerning mechanisms for control by the Member States
of the Commission's exercise of implementing powers (OJ L 55, 28.2.2011, p. 13)
10 Interinstitutional Agreement between the European Parliament, the Council of the European Union and
the European Commission on Better Law-Making of 13 April 2016; OJ L 123, 12.5.2016, p. 1–14.
11 Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11
September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and
repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council
Regulation (Euratom) No 1074/1999,(OJ L 248, 18.9.2013, p. 1).
12 Council Regulation (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European
Communities financial interests (OJ L 312, 23.12.1995, p. 1).
13 Council Regulation (Euratom, EC) No 2185/96 of 11 November 1996 concerning on-the-spot checks
and inspections carried out by the Commission in order to protect the European Communities' financial
interests against fraud and other irregularities (OJ L292,15.11.1996, p. 2).
14 Council Regulation (EU) 2017/1939 of 12 October 2017 implementing enhanced cooperation on the
establishment of the European Public Prosecutor’s Office (‘the EPPO’) (OJ L 283, 31.10.2017, p. 1).

# EN 15 EN

administrative investigations, including on-the-spot checks and inspections, with a
view to establishing whether there has been fraud, corruption or any other illegal
activity affecting the financial interests of the Union. In accordance with Regulation
(EU) 2017/1939, the European Public Prosecutor's Office (EPPO) may investigate and
prosecute fraud and other criminal offences affecting the financial interests of the
Union, as provided for in Directive (EU) 2017/1371 of the European Parliament and of
the Council [15] . In accordance with the Financial Regulation, any person or entity
receiving Union funds is to fully cooperate in the protection of the Union’s financial
interests, to grant the necessary rights and access to the Commission, OLAF, the
EPPO and the European Court of Auditors and to ensure that any third parties
involved in the implementation of Union funds grant equivalent rights.

(19) Horizontal financial rules adopted by the European Parliament and the Council on the
basis of Article 322 of the Treaty on the Functioning of the European Union apply to
this Regulation. These rules are laid down in the Financial Regulation and determine
in particular the procedure for establishing and implementing the budget through
grants, procurement, prizes, indirect implementation, and provide for checks on the
responsibility of financial actors. Rules adopted on the basis of Article 322 TFEU also
concern the protection of the Union's budget in case of generalised deficiencies as
regards the rule of law in the Member States, as the respect for the rule of law is an
essential precondition for sound financial management and effective EU funding.

(20) The types of financing and the methods of implementation under this Regulation
should be chosen on the basis of their ability to achieve the specific objectives of the
actions and to deliver results, taking into account, in particular, the costs of controls,
the administrative burden, and the expected risk of non-compliance. This should
include consideration of the use of lump sums, flat rates and unit costs, as well as
financing not linked to costs as referred to in Article 125(1) of the Financial
Regulation.

(21) Since the objective of this Regulation cannot be sufficiently achieved by the individual
Member States but can rather, by reason of its scale and effects, be better achieved at
Union level, the Union may adopt measures, in accordance with the principle of
subsidiarity, as set out in Article 5 of the Treaty on European Union. In accordance
with the principle of proportionality as set out in that Article, this Regulation does not
go beyond what is necessary in order to achieve that objective.

(22) This Regulation replaces Regulation (EU) No 1294/2013 of the European Parliament
and of the Council, which should therefore be repealed,

15 Directive (EU) 2017/1371 of the European Parliament and of the Council of 5 July 2017 on the fight
against fraud to the Union's financial interests by means of criminal law (OJ L 198, 28.7.2017, p. 29).

# EN 16 EN

HAVE ADOPTED THIS REGULATION:

_CHAPTER I_

_GENERAL PROVISIONS_

_Article 1_

_Subject matter_

1. This Regulation establishes the 'Customs' programme for cooperation in the field of
customs ('Programme').

2. It lays down the objectives of the Programme, the budget for the period 2021 – 2027,
the forms of Union funding and the rules for providing such funding.

_Article 2_

_Definitions_

For the purposes of this Regulation, the following definitions shall apply:

(1) 'customs authorities' means the authorities defined in point (1) of Article 5 of
Regulation (EU) No 952/2013;

(2) 'European electronic systems' means electronic systems necessary for the customs
union and for the execution of the mission of customs authorities

(3) 'third country' means a country that is not member of the Union.

_Article 3_

_Programme objectives_

1. The Programme has the general objective to support the customs union and customs
authorities to protect the financial and economic interests of the Union and its
Member States, to ensure security and safety within the Union and to protect the
Union from unfair and illegal trade, while facilitating legitimate business activity.

2. The Programme has the specific objective to support the preparation and uniform
implementation of customs legislation and policy as well as customs cooperation and
administrative capacity building, including human competency and the development
and operation of European electronic systems.

_Article 4_

_Budget_

1. The financial envelope for the implementation of the Programme for the period 2021
– 2027 shall be EUR 950 000 000 in current prices.

2. The amount referred to in paragraph 1 may also cover expenses for preparation,
monitoring, control, audit, evaluation and other activities for managing the

# EN 17 EN

Programme and evaluating the achievement of its objectives. It may moreover cover
expenses relating to studies, meetings of experts, information and communication
actions, in so far as they are related to the objectives of the Programme, as well as
expenses linked to information technology networks focusing on information
processing and exchange, including corporate information technology tools and other
technical and administrative assistance needed in connection with the management of
the Programme.

_Article 5_

_Third countries associated to the Programme_

The Programme shall be open to the following third countries:

(a) acceding countries, candidate countries and potential candidates, in accordance with
the general principles and general terms and conditions for the participation of those
countries in Union programmes established in the respective framework agreements
and Association Council decisions, or similar agreements, and in accordance with the
specific conditions laid down in agreements between the Union and those countries;

(b) countries covered by the European Neighbourhood Policy, in accordance with the
general principles and general terms and conditions for the participation of those
countries in Union programmes established in the respective framework agreements
and association Council decisions, or similar agreements, and in accordance with the
specific conditions laid down in agreements between the Union and those countries,
provided that those countries have reached a sufficient level of approximation of the
relevant legislation and administrative methods to those of the Union;

(c) other third countries, in accordance with the conditions laid down in a specific
agreement covering the participation of the third country to any Union programme,
provided that the agreement:

–
ensures a fair balance as regards the contributions and benefits of the third
country participating in the Union programmes;

–
lays down the conditions of participation in the programmes, including the
calculation of financial contributions to individual programmes and their
administrative costs. These contributions shall constitute assigned revenues in
accordance with Article [21(5)] of Regulation [2018/XXX] [the new Financial
Regulation];

–
does not confer to the third country a decisional power on the Programme;

–
guarantees the rights of the Union to ensure sound financial management and
to protect its financial interests.

_Article 6_

_Implementation and forms of EU funding_

1. The Programme shall be implemented in direct management in accordance with the
Financial Regulation.

# EN 18 EN

2. The Programme may provide funding in any of the forms laid down in the Financial
Regulation, in particular grants, prizes, procurement and reimbursement of travel and
subsistence expenses incurred by external experts.

_CHAPTER II_

_ELIGIBILITY_

_Article 7_

_Eligible actions_

1. Only actions implementing the objectives referred to in Article 3 shall be eligible for
funding.

2. Actions complementing or supporting the actions implementing the objectives
referred to in Article 3 of Regulation (EU) [2018/XXX] [CCE instrument] shall also
be eligible for funding under this Programme.

3. Actions referred to in paragraphs 1 and 2 shall include the following:

(a) meetings and similar ad-hoc events;

(b) project-based structured collaboration;

(c) IT capacity building actions, in particular the development and operation of
European electronic systems;

(d) human competency and capacity building actions;

(e) support and other actions, including:

(1) studies;

(2) innovation activities, in particular proof-of-concepts, pilots and
prototyping initiatives;

(3) jointly developed communication actions;

(4) any other action provided for in the work programmes referred to in
Article 13, which is necessary for attaining or in support of the objectives
set out in Article 3.

Possible forms of actions referred to in points (a), (b) and (d) are presented in a nonexhaustive list in Annex 1.

4. Actions consisting in the development and operation of adaptations or extensions to
the common components of the European electronic systems for cooperation with
third countries not associated to the Programme or international organisations shall
be eligible for funding when they are of interest to the Union. The Commission shall
put in place the necessary administrative arrangements, which may provide for a
financial contribution from the third parties concerned to these actions.

5. Where an IT capacity building action referred to in point (c) of paragraph 3 concerns
the development and operation of a European electronic system, only the costs
related to the responsibilities entrusted to the Commission pursuant to Article 11(2)
shall be eligible for funding under the Programme. Member States shall bear the
costs related to the responsibilities entrusted to them pursuant to Article 11(3).

# EN 19 EN

_Article 8_

_External experts_

1. Wherever beneficial for the achievement of the actions implementing the objectives
referred to in Article 3, representatives of governmental authorities, including those
from third countries not associated to the programme pursuant to Article 5,
representatives of international and other relevant organisations, of economic
operators and organisations representing economic operators and of civil society may
take part as external experts to actions organised under the Programme.

2. Costs incurred by the external experts referred to in paragraph 1 shall be eligible for
reimbursement under the Programme in accordance with the provisions of Article
238 of the Financial Regulation.

3. The external experts shall be selected by the Commission based on their skills,
experience and knowledge relevant to the specific action, avoiding any potential
conflict of interest.

_CHAPTER III_

_GRANTS_

_Article 9_

_Award, complementarity and combined funding_

1. Grants under the Programme shall be awarded and managed in accordance with Title
VIII of the Financial Regulation.

2. An action that has received a contribution from another Union programme may also
receive a contribution under the Programme, provided that the contribution do not
cover the same costs. The rules of each contributing Union programme shall apply to
its respective contribution to the action. The cumulative funding shall not exceed the
total eligible costs of the action and the support from the different Union
programmes may be calculated on a pro-rata basis in accordance with the documents
setting out the conditions for support.

3. In accordance with Article 198(f) of the Financial Regulation, the grants shall be
awarded without a call for proposals where the eligible entities are customs
authorities of the Member States and of the third countries associated to the
Programme as referred to in Article 5 of this Regulation, provided that the conditions
set out in that Article are met.

_Article 10_

_Co-financing rate_

1. By derogation to Article 190 of the Financial Regulation, the Programme may
finance up to 100 % of eligible costs of an action.

2. The applicable co-financing rate where actions require the awarding of grants shall
be set out in the multiannual work programmes referred to in Article 13.

# EN 20 EN

_CHAPTER IV_

_SPECIFIC PROVISIONS FOR IT CAPACITY BUILDING ACTIONS_

_Article 11_

_Responsibilities_

1. The Commission and the Member States shall ensure jointly the development and
operation, including the design, specification, conformance testing, deployment,
maintenance, evolution, security, quality assurance and quality control, of the
European electronic systems listed in the Multi-Annual Strategic Plan for Customs
referred to in Article 12.

2. The Commission shall, in particular, ensure the following:

(a) the development and operation of common components as established under
the Multi-Annual Strategic Plan for Customs provided for in Article 12;

(b) the overall coordination of the development and operation of European
electronic systems with a view to their operability, interconnectivity and
continuous improvement and their synchronised implementation;

(c) the coordination at Union level of European electronic systems with a view to
their promotion and implementation at national level;

(d) the coordination of the development and operation of European electronic
systems as regards their interactions with third parties, excluding actions
designed to meet national requirements;

(e) the coordination of European electronic systems with other relevant actions
relating to e-Government at Union level.

3. The Member States shall, in particular, ensure the following:

(a) the development and operation of national components as established under the
Multi-annual Strategic Plan for Customs provided for in Article 12;

(b) the coordination of the development and operation of the national components
of European electronic systems at national level;

(c) the coordination of European electronic systems with other relevant actions
relating to e-Government at national level;

(d) the regular provision to the Commission of information regarding the measures
taken to enable their respective authorities or economic operators to make full
use of European electronic systems;

(e) the implementation at national level of European electronic systems.

_Article 12_

_Multi-Annual Strategic Plan for Customs (MASP-C)_

1. The Commission shall draw up and keep updated a Multi-Annual Strategic Plan for
Customs listing all tasks relevant for the development and operation of European
electronic systems and classifying each system, or part thereof, as:

# EN 21 EN

(a) a common component: a component of the European electronic systems
developed at Union level, which is available for all Member States or identified
as common by the Commission for reasons of efficiency, security and
rationalisation;

(b) a national component: a component of the European electronic systems
developed at national level, which is available in the Member State that created
such a component or contributed to its joint creation;

(c) or a combination of both.

2. The Multi-Annual Strategic Plan for Customs shall also include innovation and pilot
actions as well as the supporting methodologies and tools related to the European
electronic systems.

3. Member States shall notify the Commission of the completion of each task allocated
to them under the Multi-Annual Strategic Plan for Customs referred to in paragraph
1. They shall also regularly report to the Commission on progress with their tasks.

4. No later than 31 March of each year, the Member States shall submit to the
Commission annual progress reports on the implementation of the Multi-Annual
Strategic Plan for Customs referred to in paragraph 1 covering the period 1 January
to 31 December of the preceding year. Those annual reports shall be based on a preestablished format.

5. No later than 31 October of each year, the Commission shall, on the basis of the
annual reports referred to in paragraph 4, establish a consolidated report assessing the
progress made by Member States and the Commission in the implementation of the
plan referred to in paragraph 1 and make that report public.

_CHAPTER V_

_PROGRAMMING, MONITORING, EVALUATION AND CONTROL_

_Article 13_

_Work programme_

1. The Programme shall be implemented by multiannual work programmes referred to
in Article 108 of the Financial Regulation.

2. The multiannual work programmes shall be adopted by the Commission by means of
implementing acts. Those implementing acts shall be adopted in accordance with the
procedure referred to in Article 18(2).

_Article 14_

_Monitoring and reporting_

1. Indicators to report on progress of the Programme towards the achievement of the
specific objectives set out in Article 3 are set in Annex 2.

2. To ensure effective assessment of progress of the Programme towards the
achievement of its objectives, the Commission is empowered to adopt delegated acts

# EN 22 EN

in accordance with Article 17 to amend Annex 2 to review or complement the
indicators where considered necessary and to supplement this Regulation with
provisions on the establishment of a monitoring and evaluation framework.

3. The performance reporting system shall ensure that data for monitoring programme
implementation and results are collected efficiently, effectively, and in a timely
manner. To that end, proportionate reporting requirements shall be imposed on
recipients of Union funds.

_Article 15_

_Evaluation_

1. Evaluations shall be carried out in a timely manner to feed into the decision-making

process.

2. The interim evaluation of the Programme shall be performed once there is sufficient
information available about the implementation of the Programme, but no later than
four years after the start of the programme implementation.

3. At the end of the implementation of the Programme, but no later than four years after
the end of the period specified in Article 1, a final evaluation of the Programme shall
be carried out by the Commission.

4. The Commission shall communicate the conclusions of the evaluations, accompanied
by its observations, to the European Parliament, the Council, the European Economic
and Social Committee and the Committee of the Regions.

_Article 16_

_Audits and investigations_

Where a third country participates in the programme by a decision under an international
agreement or by virtue of any other legal instrument, the third country shall grant the
necessary rights and access required for the authorizing officer responsible, the European
Anti-Fraud Office (OLAF), the European Court of Auditors to comprehensively exert their
respective competences. In the case of OLAF, such rights shall include the right to carry out
investigations, including on-the-spot checks and inspections, provided for in Regulation (EU,
Euratom) No 883/2013 of the European Parliament and of the Council concerning
investigations conducted by the European Anti-Fraud Office (OLAF).

_CHAPTER VI_

_EXERCISE OF THE DELEGATION AND COMMITTEE PROCEDURE_

_Article 17_

_Exercise of the delegation_

1. The power to adopt delegated acts is conferred on the Commission subject to the
conditions laid down in this Article.

# EN 23 EN

2. The power to adopt delegated acts referred to in Article 14(2) shall be conferred on
the Commission until 31 December 2028.

3. The delegation of power referred to in Article 14(2) may be revoked at any time by
the European Parliament or by the Council. A decision to revoke shall put an end to
the delegation of power specified in that decision. It shall take effect the day
following the publication of the decision in the _Official Journal_ of the European
Union or at a later date specified therein. It shall not affect the validity of any
delegated acts already in force.

4. Before adopting a delegated act, the Commission shall consult experts designated by
each Member State in accordance with the principles laid down in the
Interinstitutional Agreement on Better Law-Making of 13 April 2016.

5. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to
the European Parliament and to the Council.

6. A delegated act adopted pursuant to Article 14(2) shall enter into force if no
objection has been expressed either by the European Parliament or by the Council
within a period of two months of notification of that act to the European Parliament
and the Council or if, before the expiry of that period, the European Parliament and
the Council have both informed the Commission that they will not object. That
period shall be extended by two months at the initiative of the European Parliament
or of the Council.

_Article 18_

_Committee procedure_

1. The Commission shall be assisted by a committee referred to as the "Customs
Programme Committee". That committee shall be a committee within the meaning of
Regulation (EU) No 182/2011.

2. Where reference is made to this paragraph, Article 5 of Regulation (EU) No
182/2011 shall apply.

_CHAPTER VII_

_TRANSITIONAL AND FINAL PROVISIONSArticle 19_

_Information, communication and publicity_

1. The recipients of Union funding shall acknowledge the origin and ensure the
visibility of the Union funding (in particular when promoting the actions and their
results) by providing coherent, effective and proportionate targeted information to
multiple audiences, including the media and the public.

2. The Commission shall implement information and communication actions relating to
the Programme, and its actions and results. Financial resources allocated to the
Programme shall also contribute to the corporate communication of the political
priorities of the Union, as far as they are related to the objectives referred to in
Article 3.

# EN 24 EN

_Article 20_

_Repeal_

1. Regulation (EU) No 1294/2013 is repealed with effect from 1 January 2021.

2. Decision No 70/2008/EC is repealed with effect from 1 January 2021.

_Article 21_

_Transitional provisions_

1. This Regulation shall not affect the continuation or modification of the actions
concerned, until their closure, under Regulation (EU) No 1294/2013, which shall
continue to apply to the actions concerned until their closure.

2. The financial envelope for the Programme may also cover technical and
administrative assistance expenses necessary to ensure the transition between the
Programme and the measures adopted under its predecessor, the Regulation (EU) No
1294/2013.

3. If necessary, appropriations may be entered in the budget beyond 2027 to cover the
expenses provided for in Article 4(2), to enable the management of actions not
completed by 31 December 2027.

_Article 22_

_Entry into force_

This Regulation shall enter into force on the twentieth day following that of its publication in
the _Official Journal of the European Union_ .This Regulation shall be binding in its entirety
and directly applicable in all Member States.

Done at Brussels,

_For the European Parliament_ _For the Council_
_The President_ _The President_

# EN 25 EN

**LEGISLATIVE FINANCIAL STATEMENT**

**1.** **FRAMEWORK** **OF** **THE** **PROPOSAL/INITIATIVE**

1.1. Title of the proposal/initiative

1.2. Policy area(s) concerned _(programme cluster)_

1.3. Nature of the proposal/initiative

1.4. Grounds for the proposal/initiative

1.5. Duration and financial impact

1.6. Management mode(s) planned

**2.** **MANAGEMENT** **MEASURES**

2.1. Monitoring and reporting rules

2.2. Management and control system

2.3. Measures to prevent fraud and irregularities

**3.** **ESTIMATED** **FINANCIAL** **IMPACT** **OF** **THE** **PROPOSAL/INITIATIVE**

3.1. Heading(s) of the multiannual financial framework and expenditure budget line(s)
affected

3.2. Estimated impact on expenditure

_3.2.1. Summary of estimated impact on expenditure_

_3.2.2. Estimated impact on appropriations of an administrative nature_

_3.2.3. Third-party contributions_

3.3. Estimated impact on revenue

# EN 1 EN

**1.** **FRAMEWORK** **OF** **THE** **PROPOSAL/INITIATIVE**

**1.1.** **Title of the proposal/initiative**

Proposal for a Regulation of the European Parliament and of the Council
establishing the Customs programme for cooperation in the field of customs

**1.2.** **Policy area(s) concerned** _**(Programme cluster)**_

Single market, Innovation and Digital

**1.3.** **The proposal/initiative relates to:**

 **a new action**

 **a new action following a pilot project/preparatory action** [1]

X **the extension of an existing action**

 **a merger or redirection of one or more actions towards another/a new action**

**1.4.** **Grounds for the proposal/initiative**

_1.4.1._ _Requirement(s) to be met in the short or long term including a detailed timeline for_
_roll-out of the implementation of the initiative_

The programme will be implemented through an implmenting act adopting a
multiannual work programme. The adoption is planned for Q1 2021 after the
consultation of the Customs programme Committee. The execution of the
multiannual work programme will be carried out through the conclusion of grant
agreements with the beneficiaries and the conclusion of public procurements
contracts with the service providers starting in Q2 2018 at the latest.

_1.4.2._ _Added value of Union involvement (it may result from different factors, e.g._
_coordination gains, legal certainty, greater effectiveness or complementarities). For_
_the purposes of this point 'added value of Union involvement' is the value resulting_
_from Union intervention which is additional to the value that would have been_
_otherwise created by Member States alone._

Reasons for action at European level (ex-ante)

Customs help safeguarding the financial interests of the Union and of the Member
States and, in their role as guardians of the external EU border for goods, also protect
the public against terrorist, health, environmental and other threats. Customs apply a
list of more than 60 non-customs legislations relating to, inter alia, dual use goods,
firearms, drug precursors, movement of cash, intellectual property rights, public
health, product safety and consumer protection, the protection of wildlife and of the
environment. Customs authorities play also a critical role in securing the integrity of
the supply chain and preventing terrorist organisations from freely moving their
funds. New challenges arising through rapidly changing technologies (digitalisation,
connected-ness, Internet of things, blockchain) and business models (e-commerce,
supply chain optimisation), reduced public financial means, increasing volumes of
world trade and a persistent transnational crime and security threat constantly
increase the pressure to improve the performance of the customs union and enlarge
the scope of the tasks to be performed by customs administrations.

1 As referred to in Article 58(2)(a) or (b) of the Financial Regulation.

# EN 0 EN

Since 2016, the Union Customs Code (UCC) is the new legal customs framework.
The UCC has triggered a massive digitalisation project with 17 different electronic
systems to be fully in place by 2025.

The implementation of all this can only be achieved through intense operational
cooperation between customs administrations of the Member States, between them
and other authorities, with trade and other third parties. The proposed programme,
which is the successor programme of Customs 2020, will support the customs union
and customs authorities through administrative and IT capacity building activities
and operational cooperation.

Expected generated Union added value (ex-post)

The vast majority of the proposed budget will be spent on IT capacity building
activities. The backbone of the customs cooperation is a highly secured dedicated
communication network that ensures that every national administration only needs to
connect once to this common infrastructure to be able to exchange any kind of
information. If such an infrastructure were not available Member States would have
to link 27 times to the national systems of each of the other Member States.

_1.4.3._ _Lessons learned from similar experiences in the past_

# EN 1 EN

_1.4.4._ _Compatibility and possible synergy with other appropriate instruments_

The programme is closely linked with the new Customs Control Equipment
Instrument which will support the purchase, maintenance and upgrade of the eligible
equipment.

In addition, it has connections with the activities carried out by the European AntiFraud Office OLAF as regards combating fraud for the protection of Union financial
interests in accordance with Art. 325 TFEU.

Moreover, significant synergies exist with the Fiscalis programme that supports
cooperation in the field of taxation. In the field of IT, there is cross-fertilisation and
joint funding of common IT components such as the Common Communication
Network. Identical IT management approaches and common horizontal support
mechanisms are in place. The same type of joint actions is used and a similar
approach for human capacity building and training is followed. The programme
management in terms of proposal, management, action management, implementing
acts, performance monitoring is fully streamlined.

# EN 2 EN

**1.5.** **Duration and financial impact**

_**X**_ **limited duration**

– X in effect from 01/01/2021 to 31/12/2027

–
X Financial impact from 2021 to 2027 for commitment appropriations and from
2021 to 2030 for payment appropriations.

 **unlimited duration**

–
Implementation with a start-up period from YYYY to YYYY,

–
followed by full-scale operation.

**1.6.** **Management mode(s) planned** **[2]**

_X_ **Direct management** by the Commission

–
X by its departments, including by its staff in the Union delegations;

–  by the executive agencies

 **Shared management** with the Member States

 **Indirect management** by entrusting budget implementation tasks to:

–  third countries or the bodies they have designated;

–  international organisations and their agencies (to be specified);

–  the EIB and the European Investment Fund;

–  bodies referred to in Articles 70 and 71 of the Financial Regulation;

–  public law bodies;

–  bodies governed by private law with a public service mission to the extent that
they provide adequate financial guarantees;

–  bodies governed by the private law of a Member State that are entrusted with
the implementation of a public-private partnership and that provide adequate
financial guarantees;

–  persons entrusted with the implementation of specific actions in the CFSP
pursuant to Title V of the TEU, and identified in the relevant basic act.

–
_If more than one management mode is indicated, please provide details in the ‘Comments’ section._

Comments

2 Details of management modes and references to the Financial Regulation may be found on the
BudgWeb site:
[https://myintracomm.ec.europa.eu/budgweb/EN/man/budgmanag/Pages/budgmanag.aspx](https://myintracomm.ec.europa.eu/budgweb/EN/man/budgmanag/Pages/budgmanag.aspx)

# EN 3 EN

**2.** **MANAGEMENT** **MEASURES**

**2.1.** **Monitoring and reporting rules**

_Specify frequency and conditions._

The impact of the proposed Customs programme will be assessed through interim
and final evaluations as well as by monitoring on an ongoing basis a set of high-level
key performance indicators.

The results and outputs of the programme will be regularly subject to assessment
through a comprehensive monitoring system, based on defined indicators in view of
accountability for value for money. Data for measuring performance will be drawn
from various data collection tools including action follow-up forms, event
assessment forms and regular polls of customs officials.

Since the programme plays a supporting role, helping participating country
administrations to share information and boost their capacity, the monitoring system
focuses on following the progress of the programme’ activities in terms of indicators
at outputs levels. Whenever possible, it also follows indicators in areas related to the
programme’s high-level objectives.

The Commission will, on a yearly basis, issue a programme progress report
containing a summary of performance towards the programme objectives and the
related output and result indicators.

**2.2.** **Management and control system(s)**

_2.2.1._ _Justification of the management mode(s), the funding implementation mechanism(s),_
_the payment modalities and the control strategy proposed_

The programme will be implemented in direct management mode given the nature of
the programme’s activities, its focus on customs administrations as beneficiaries and
the EU's exclusive competence for the customs union, it provides for the most
efficient allocation of financial resources and greatest impact possible. Indeed, it
offers both flexibility and steering power to the Commission for allocating yearly
through its financing decision the appropriate funds according to priorities agreed
with Member States through comitology, including emerging needs.Concretely, the
Commission services have to review and accept every single action in view of: the
objectives and conditions embedded in the regulation; the adopted annual work
programme; and the eligibility criteria contained in the financing decision/grant
agreements.

Implementation will be achieved mostly via procurement and, to a lesser extent, via
grant agreements established with the National Administrations.

For procurement, the payment modalities are fully aligned with corporate standards
(no pre-financing; all payments are linked to the acceptance of pre-defined
deliverables).

For grants, pre-financing up to 90% is envisaged. Final payment/recoveries for grants
are done on the basis of financial reports combined with ex-post on-the-spot audits.

The control system for procurment is based on a thorough ex-ante verification of
100% of all transactions therefore excluding any error at payment time.

For grants, the control strategy has a dual approach :

# EN 4 EN

(1) the National Administrations's financial reports are closed after a quick desk
review followed by the final payment/recovery order (therefore reducing the
payment delays). These payment/recovery orders remain verified by the usual exante controls embedded in the financial circuits (ex-ante verification of 100% of the
transactions).

(2) the above controls are underpinned by ex-post on-the-spot audits in the Member
States. DG TAXUD targets on-the-spot audit missions in 3 to 5 Member States per
year with the intention to cover the majority of the participating countries before the
end of the programme period.

_2.2.2._ _Information concerning the risks identified and the internal control system(s) set up_
_to mitigate them_

The risks associated to the financial transactions implementing the programme are
limited.

(1) For procurement, the bulk of transactions (mostly linked to developing and
operating IT systems) are implemented using existing framework contracts and/or
via co-delegation to other Commission services.

The overall internal control system in place at DG TAXUD (based upon thorough
ex-ante verification of 100% of the related transactions), allowed keeping the error
rates in the previous programme well below the materiality threshold (i.e. at an
estimated level of 0,5%). This control system will continue to be used and applied
for all transactions under the new programme thus ensuring error rates well below
the materiality treshold.

(2) For grants, the transactions are equally of low risk level, in particular since :

            - the beneficiaries are the customs administrations of Member States,
candidate countries and potential candidates – in such case there are no calls
for proposals;

            - expenditure is mostly linked to numerous actions with relatively small
amounts involved for each action (mainly reimbursements of travel and
subsistence expenditure);

            - obligatory use of ART2 (the IT system for monitoring the expenditure) for
recording the actions and compiling financial reports - this system embeds
certain controls;

            - all projects and actions under the programme are ex-ante approved by DG
TAXUD, the controls related to the selection and contracting phases ensure
the legality and regularity of the grants commitments;

            - the analysis of the most common errors detected during past ex-post
verifications or ex-post on-the-spot audits confirm that the related financial
transactions are of low risk.

Under the former programme, the error rate for the part implemented via grants was
also consistently below the materiality threshold (i.e. around 1%). This control
system will continue to be applied thus ensuring error rates well below the
materiality threshold.

# EN 5 EN

_2.2.3._ _Estimation and justification of the cost-effectiveness of the controls (ratio of "control_
_costs ÷ value of the related funds managed"), and assessment of the expected levels_
_of risk of error (at payment & at closure)_

The total annual cost of controls under the former programme has been consistenly
around 1,5% (cost of all controls (procurement and grants) over payments made
throughout the year) and is considered cost-effective.

The risk of error, as indicated above, is limited considering the nature and
implementation method of the related financial transactions. Furthermore, the global
internal control system, based on thorough ex-ante verifications, aims to remove all
potential errors prior to the payment/closure.

The ex-post on-the-spot controls for grants further reduce the potential risk of error at
payment/closure due to their strong deterring effect.

The applied control strategy has proven to be effective and efficient under the former
programme and the cost of control has shown to be limited.

Considering that the same control systems will be used for the new programme, the
anticipated cost of controls and expected level of risk of error at payment/closure
under the new programme will be similar.

**2.3.** **Measures to prevent fraud and irregularities**

_Specify existing or envisaged prevention and protection measures, e.g. from the Anti-Fraud Strategy._

DG TAXUD's anti-fraud strategy (AFS) focusses on developing a strong anti-fraud
culture within the DG through awareness raising activities on potential fraud risks
and ethical behaviour among DG TAXUD staff. The strategy furthermore addresses
an active cooperation with OLAF and the integration of fraud aspects into the
Strategic Planning and Programming (SPP) cycle of the DG.

Considering that the programme will be implemented (mostly) through procurement,
objective 3 of DG TAXUD's AFS (i.e. " Raising awareness on possible conflict of
interest in dealing with external stakeholders such as lobbyists, tenderers,
contractors") with focus on 1) maintaining records of contacts with lobbyists, 2)
centralised management of procurement procedures and contacts with tenderers, 3)
dedicated training on contacts with lobbyists, will be particularly applicable to the
implementation of the programme. The obligatory consultation of the Early
Detection and Exclusion System prior to awarding contracts (and any financial
transaction) will further contain any potential fraud and irregularity.

# EN 6 EN

**3.** **ESTIMATED** **FINANCIAL** **IMPACT** **OF** **THE** **PROPOSAL/INITIATIVE**

**3.1.** **Heading of the multiannual financial framework and new expenditure budget**

|3.1.|Heading of the multiannual financial line(s) proposed|l framewor|rk and new expenditure budget|Col5|Col6|Col7|
|---|---|---|---|---|---|---|
|Heading of<br>multiannual<br>financial<br>framework|Budget line|Type of <br>expenditure|Contribution|Contribution|Contribution|Contribution|
|Heading of<br>multiannual<br>financial<br>framework|Number|Diff./Non-<br>diff.1|from<br>EFTA<br>countries<br>2 <br>|from<br>candidate<br>countries3 <br>|from third<br>countries|within the<br>meaning of<br>Article [21(2)(b)]<br>of the Financial<br>Regulation|
|1|03.01 Single Market – Administrative line<br>03.05 Single Market – Cooperation in the field<br>of customs (CUSTOMS)|Diff.|NO|YES|YES|NO|

1 Diff. = Differentiated appropriations / Non-diff. = Non-differentiated appropriations.
2 EFTA: European Free Trade Association.
3 Candidate countries and, where applicable, potential candidates from the Western Balkans.

# EN 7 EN

**3.2.** **Estimated impact on expenditure**

_3.2.1._ _Summary of estimated impact on expenditure_

EUR million (to three decimal places)

**Heading of multiannual financial**

**1** Single Market, Innovation and Digital
**framework**

|Col1|Col2|Col3|2021|2022|2023|2024|2025|2026|2027|Post<br>2027|TOTAL|
|---|---|---|---|---|---|---|---|---|---|---|---|
|Operational appropriations (split according to<br>the budget lines listed under 3.1)|Commitments|(1)|126.587|130.144|132.753|135.414|138.129|140.897|143.976||**947.900**|
|Operational appropriations (split according to<br>the budget lines listed under 3.1)|Payments|(2)|30.975|94.322|117.123|122.203|124.928|127.061|129.462|201.826|**947.900**|
|Appropriations of an administrative nature<br>financed from the envelope of the programme1|Commitments =<br>Payments|(3)|0.300|0.300|0.300|0.300|0.300|0.300|0.300||**2.100**|
|**TOTAL appropriations for the envelope**<br>**of the programme **|Commitments|=1+3|126.887|130.444|133.053|135.714|138.429|141.197|144.276||**950.000**|
|**TOTAL appropriations for the envelope**<br>**of the programme **|Payments|=2+3|31.275|94.622|117.423|122.503|125.228|127.361|129.762|201.826|**950.000**|

1 Technical and/or administrative assistance and expenditure in support of the implementation of EU programmes and/or actions (former ‘BA’ lines), indirect research,
direct research.

# EN 8 EN

**Heading of multiannual financial**

7 ‘Administrative expenditure’
**framework**

EUR million (to three decimal places)

|Col1|Col2|2021|2022|2023|2024|2025|2026|2027|Post<br>2027|TOTAL|
|---|---|---|---|---|---|---|---|---|---|---|
|Human resources|Human resources|16.864|16.864|16.864|16.864|16.864|16.864|16.864||**118.048**|
|Other administrative expenditure|Other administrative expenditure|0.686|0.686|0.686|0.686|0.686|0.686|0.686||**4.802**|
|**TOTAL appropriations under HEADING**<br>**7 of the multiannual financial framework**|(Total commitments =<br>Total payments)|**17.550**|**17.550**|**17.550**|**17.550**|**17.550**|**17.550**|**17.550**||**122.850**|

EUR million (to three decimal places)

|Col1|Col2|2021|2022|2023|2024|2025|2026|2027|Post<br>2027|TOTAL|
|---|---|---|---|---|---|---|---|---|---|---|
|**TOTAL appropriations** <br>**across HEADINGS** <br>of the multiannual financial framework|Commitments|**144.437**|**147.994**|**150.603**|**153.264**|**155.979**|**158.747**|**161.826**||**1072.850**|
|**TOTAL appropriations** <br>**across HEADINGS** <br>of the multiannual financial framework|Payments|**48.825**|**112.172**|**134.973**|**140.053**|**142.778**|**144.911**|**147.312**|**201.826**|**1072.850**|

# EN 9 EN

_3.2.2._ _Summary of estimated impact on appropriations of an administrative nature_

–  The proposal/initiative does not require the use of appropriations of an
administrative nature

–
X The proposal/initiative requires the use of appropriations of an administrative
nature, as explained below:

EUR million (to three decimal places)

|HEADING 7<br>of the multiannual<br>financial framework|Col2|Col3|Col4|Col5|Col6|Col7|Col8|Col9|
|---|---|---|---|---|---|---|---|---|
|Human resources|16.864|16.864|16.864|16.864|16.864|16.864|16.864|**118.048**|
|Other administrative<br>expenditure|0.686|0.686|0.686|0.686|0.686|0.686|0.686|**4.802**|
|**Subtotal HEADING 7** <br>**of the multiannual**<br>**financial framework**|**17.550**|**17.550**|**17.550**|**17.550**|**17.550**|**17.550**|**17.550**|**122.850**|

|71<br>Outside HEADING<br>of the multiannual<br>financial framework|Col2|Col3|Col4|Col5|Col6|Col7|Col8|Col9|
|---|---|---|---|---|---|---|---|---|
|Human resources|||||||||
|Other expenditure <br>of an administrative<br>nature|0.300|0.300|0.300|0.300|0.300|0.300|0.300|**2.100**|
|**Subtotal** <br>**outside HEADING 7** <br>**of the multiannual**<br>**financial framework**|0.300|0.300|0.300|0.300|0.300|0.300|0.300|**2.100**|

The appropriations required for human resources and other expenditure of an administrative nature will be met by
appropriations from the DG that are already assigned to management of the action and/or have been redeployed within the
DG, together if necessary with any additional allocation which may be granted to the managing DG under the annual
allocation procedure and in the light of budgetary constraints.

1 Technical and/or administrative assistance and expenditure in support of the implementation of
EU programmes and/or actions (former ‘BA’ lines), indirect research, direct research.

# EN 10 EN

3.2.2.1. Estimated requirements of human resources

–  The proposal/initiative does not require the use of human resources.

–
X The proposal/initiative requires the use of human resources, as explained
below:

_Estimate to be expressed in full time equivalent units_

|Years|Col2|2021|2022|2023|2024|2025|2026|2027|
|---|---|---|---|---|---|---|---|---|
|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|** Establishment plan posts (officials and temporary staff)**|
|Headquarters and Commission’s<br>Representation Offices|Headquarters and Commission’s<br>Representation Offices|108|108|108|108|108|108|108|
|Delegations|Delegations||||||||
|Research|Research||||||||
|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 1 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 1 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 1 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 1 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 1 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 1 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 1 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 1 <br>Heading 7|** External staff (in Full Time Equivalent unit: FTE) - AC, AL, END, INT and JED** 1 <br>Heading 7|
|Financed<br>from<br>HEADING<br>7 of the<br>multiannual<br>financial<br>framework|- at<br>Headquarters|18|18|18|18|18|18|18|
|Financed<br>from<br>HEADING<br>7 of the<br>multiannual<br>financial<br>framework|- in<br>Delegations||||||||
|Financed<br>from the<br>envelope of<br>the<br>programme <br>2|- at<br>Headquarters||||||||
|Financed<br>from the<br>envelope of<br>the<br>programme <br>2|- in<br>Delegations||||||||
|Research|Research||||||||
|Other (specify)|Other (specify)||||||||
|**TOTAL**|**TOTAL**||||||||

The human resources required will be met by staff from the DG who are already assigned to management of the action and/or
have been redeployed within the DG, together if necessary with any additional allocation which may be granted to the
managing DG under the annual allocation procedure and in the light of budgetary constraints.

Description of tasks to be carried out:

|Officials and temporary staff|Figures include both staff working on the programme's direct management and<br>implementation and staff working on policy areas supported/funded by the programme.|
|---|---|
|External staff|Figures include both staff working on the programme's direct management and<br>implementation and staff working on policy areas supported/funded by the programme.|

1 AC= Contract Staff; AL = Local Staff; END = Seconded National Expert; INT = agency staff;
JPD= Junior Professionals in Delegations.
2 Sub-ceiling for external staff covered by operational appropriations (former ‘BA’ lines).

# EN 11 EN

_3.2.3._ _Third-party contributions_

The proposal/initiative:

–
X does not provide for co-financing by third parties

–  provides for the co-financing by third parties estimated below:

Appropriations in EUR million (to three decimal places)

|Years|2021|2022|2023|2024|2025|2026|2027|TOTAL|
|---|---|---|---|---|---|---|---|---|
|Specify the co-financing<br>body|||||||||
|TOTAL appropriations<br>co-financed|||||||||

**3.3.** **Estimated impact on revenue**

–  The proposal/initiative has no financial impact on revenue.

–
X The proposal/initiative has the following financial impact:

X on own resources

 on other revenue

please indicate, if the revenue is assigned to expenditure lines 

EUR million (to three decimal places)

|Budget revenue line:|1<br>Impact of the proposal/initiative|Col3|Col4|Col5|Col6|Col7|Col8|
|---|---|---|---|---|---|---|---|
|Budget revenue line:|**2021**|**2022**|**2023**|**2024**|**2025**|**2026**|**2027**|
|Article ………….||||||||

For assigned revenue, specify the budget expenditure line(s) affected.

Other remarks (e.g. method/formula used for calculating the impact on revenue or any other
information).

The impact of the programme may indirectly affect the revenue of the EU as
improved and more efficient customs are expected to lead, amongst others, to more
customs duties and VAT at importation being collected. Such effect is however not
quantifiable.

1 As regards traditional own resources (customs duties, sugar levies), the amounts indicated must be net
amounts, i.e. gross amounts after deduction of collection costs.

# EN 12 EN