Source: EURLEX
Language: en
Format: md

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**COMMISSION OF THE EUROPEAN COMMUNITIES**

**Brussels, 01.06.1995**
**COM(95)** **208 final**

**94/0192 (CNS)**

**Amended proposal for a**
**COUNCIL REGULATION (EC. ECSC. Euratom)**

**amending the Financial Regulation of 21 December 1977**
**applicable to the general budget of the European Communities**

**(presented by the Commission pursuant to Article** **189a(2)** **of the EC Treaty**
**and the second paragraph of Article** **119** **of the Euratom Treaty)**

**EXPLANATORY MEMORANDUM**

On 22 July 1994 the Commission presented a proposal for the amendment of the Financial
Regulation in the research field to cater for the new activities being conducted by the Joini
Research Centre under the fourth framework programme of European Community
activities in the field of research, technological development and demonstration (1994-98)
adopted by Parliament and Council Decision of 26 April 1994.

The specific purpose is to cater for the new competitive approach for the JRC, whicli
means that the Centre will have to start competing with other bodies to carry out certain
projects financed by the general budget and will therefore have to make competitive bids to
win funding for some of its activities.

Parliament gave its opinion on the proposal at its March 1995 part-session and passed a
number of amendments, most of which the Commission is able to accept.

The Commission is incorporating Parliament's amendments subject to various drafting
adjustments, but cannot endorse the refusal of the increase from the current 15% to 22%
for transfers on which decisions are to be taken by the Commission itself in the field of
direct action (excluding exploratory research).

This increase, together with the other amendments proposed by the Commission
concerning transfers, will give the Commission greater autonomy in managing JRC
appropriations by putting it on the same footing as its competitors, which are not subject to
the same constraints.

The Commission has accordingly drawn up this amended proposal under Article 189a(2) oi
the EC Treaty and the second paragraph of Article 119 of the Euratom Treaty.

AMENDED PROPOSAL FOR A COUNCIL REGULATION (EC, ECSC, Euratom)

amending the Financial Regulation of 21 December 1977 applicable

to the general budget of the European Communities

In the light of the opinions delivered by Parliament and the Court of Auditors, the
Commission is amending its proposal as follows:

INITIAL PROPOSAL

AMENDED PROPOSAL
(COM(94)338 final, 22.7.1994)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the
European Coal and Steel Community, and in
particular Article 78h thereof,

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

Having regard to the Treaty establishing the
European Atomic Energy Community, and in
particular Article 183 thereof,

Having regard to the proposal from the
Commission [1],

Having regard to the opinion of the European
Parliament [2],

Having regard to the opinion of the Court of
Auditors [3],

Whereas conciliation has taken place in a
conciliation committee as provided in the Joint
Declaration of the European Parliament, the
Council and the Commission of 4 March 1975, [4 ]

Whereas the fourth framework programme of
European Community activities in the field of
research and technological development and

1 OJL
2 OJL
3 OJL
4 OJC 89, 2.4.1975 p. 1

INITIAL PROPOSAL AMENDED PROPOSAL

demonstration (1994-1998) [5] adopted by decision
of the Council and Parliament of 26 April 1994
introduced a new competitive approach for the
Joint Research Centre, which implies, amongst
other things, that the JRC will gradually have to
enter into competition with other bodies for
certain projects financed by means of
appropriations in the general budget, whether
inside or outside the particular subsection referred
to in Article 92(1) of the Financial Regulation of
21 December 1977 applicable to the general
budget [6] ; whereas it is necessary to adapt the
Financial Regulation in order to take account of
this competitive approach;

The third recital is replaced by the following:

Whereas this new competitive approach implies
changes to certain terms of the Financial
Regulation so as to afford the JRC greater
flexibility in the management of its appropriations
and thus enable it to compete effectively with
other similar bodies;

Whereas, in this connection, the Commission
should be given greater autonomy in this area for
transferring appropriations, including
appropriations for staff;

Whereas appropriations obtained on a competitive
basis should be treated as revenue from services
for third parties so as to ensure total transparency
in the accounts pertaining to these operations,

HAS **ADOPTED THIS REGULATION:**

Whereas this new competitive approach implies
changes to certain terms of the Financial
Regulation so as to afford the JRC greater
effectiveness in the management of its
appropriations and thus enable it to compete with
other similar bodies;

The fourth recital is replaced by the following

Whereas, in this connection, the Commission
should be given greater autonomy in this area lor
transferring appropriations;

5 OJL 126, 19.5.1994, p. 1
6 OL L 356, 31.12.1977 - last amended by Council Regulation N° 610/90 of 13.3.1990 (JO L 70,
16.3.1990)

INITIAL PROPOSAL AMENDED PROPOSAL

Article 1

The Financial Regulation is amended as follows:

1. Article 92 is amended as follows:

(a) in the second subparagraph of paragraph
1, point (a) is replaced by the following:

"(a) direct action consisting of research
programmes and exploratory
research and scientific and technical

support activities of an institutional
nature carried out by the
establishments of the Joint Research
Centre (JRC) and in principle
entirely financed from the general
budget of the European
Communities;"

(b) in the second subparagraph of paragraph
1, point (b) is replaced by the following:

"(b) indirect action consisting of
programmes carried out under
contracts to be concluded with third

parties. The JRC may participate in
these activities on the same basis as

third parties. These activities shall in
principle be partially financed from
the general budget of the European
Communities (shared-cost action
projects);

(c) in the second subparagraph of paragraph
1, point (e) is replaced by the following:

"(e) other activities of a competitive
nature carried out by the JRC:

      - scientific and technical support
activities under the R&TD

framework programmes in
principle entirely financed from the
general budget;

      - services for third parties.";

Article

Article 92 is amended as follows:

```
(a) unchanged

(b) unchanged

(c) unchanged

```

INITIAL PROPOSAL AMENDED PROPOSAL

(d) the following paragraph is inserted after
paragraph 2:

"3. Notwithstanding paragraph 1, the JRC
may receive appropriations entered
elsewhere than in the subsection
referred to in that paragraph in respect
of its participation on a competitive
basis in activities implemented under
Community policies financed, in
principle, entirely from the general
budget."

(d) the following paragraphs are inserted
after paragraph 2:

"3. Notwithstanding paragraph 1, the JRC
may receive funding covered by
appropriations entered elsewhere than
in the subsection referred to in that

paragraph in respect of its
participation on a competitive basis in
activities implemented under
Community policies financed, in
principle, entirely from the geneml
budget.

4. The provisions of Title IV on the
conclusion of contracts shall app I y Jo
the cases referred to in the first indent

of paragraph 1(e) and in paragraph 3."

Paragraph 2 of Article 93 is replaced by the
following:

" However, for the Joint Research Centre.
appropriations for staff and appropriations for
resources shall be entered in two separate
chapters."

The following indents are inserted in Article [ (] )4:

"- in order to permit full comparison between
forecasts and outturn, the table of equivalence
of commitments and payments shal I be
presented with the same subdivisions and
headings in the budget and in the revenue and
expenditure account;

- In the working document accompanying the
preliminary draft budget the Commission shall
provide the necessary information concerning
the foreseeable distribution and utilization of

the commitment appropriations for the various
budget headings for the duration of the action
and also concerning the revenue originating
from financing by third parties (public or
private) as part of JRC participation in sharedcost action."

INITIAL PROPOSAL AMENDED PROPOSAL

2. Article 95 is amended as follows:

(a) the first paragraph is replaced by the
following:

"Notwithstanding Article 26 and without
prejudice to paragraph 7 thereof, the
Commission may, within the subsection
referred to in Article 92, transfer
appropriations from one title to another
and from one chapter to another in respect
of the activities referred to in

Article 92(lXa).";

(b) the second paragraph is replaced by the

following:

"These transfers may not have the effect of
increasing or decreasing by more than
22% in commitment appropriations the
initial allocation entered in the budget for
each of the programmes referred to in
Article 92(1 )(a) excluding exploratory
research. They may not have the effect of
increasing the appropriations earmarked
for exploratory research by more than 6%
in commitment appropriations of the initial
allocation for the total of the programmes
referred to above";

(c) the third paragraph is deleted;

(d) the fourdi subparagraph is replaced by the
following:

"For the purposes of the application of
Article 26, the budget headings relating to
the activities referred to in Article 92 (I)
(b) (excluding JRC participation), (c) and
(d) shall be regarded as chapters."

Article 95 is amended as follows.

(a)unchanged

(b)unchanged

(c) deleted

(d)unchanged

INITIAL PROPOSAL AMENDED PROPOSAL

3. The following paragraph is added after Article
96(3):

"4. The appropriations relating to the activities
referred to in Article 92 (I) (b), as regards the
participation of the JRC on a competitive
basis, and (e) and (3) shall be treated as
revenue from services to third parties provided
for in paragraphs 1 and 2."

Article 2

This regulation shall enter into force on the third
day following that of its publication in the
Official Journal of the European Communities.

It shall apply from

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

Done at Brussels,

For the Council

The President

3. The following paragraph is added after Article
96(3):

"4. The appropriations relating to the activities
referred to in Article 92 (1) (b), as regards the
participation of the JRC on a competitive
basis, and (e) and (3) shall be treated as
revenue from services to third parties provided
for in paragraphs 1 and 2."

The utilization of these appropriations shall be
shown in a set of analytical accounts in the
revenue and expenditure accounts for each
category of action to which it relates; it shall
be separate from revenue originating from
financing bv third parties (public or private)
and from revenue from services provided for
third parties in connection with the activities
referred to in paragraphs 1 and 2 or activities
of a different nature."

Article 2

Article 95 may be revised, if necessary, on expiry
of the 1995-98 framework programme < >n the
basis of a reasoned report.

This regulation shall enter into force on the third
day following that of its publication m the
Official Journal of the European Communities.

It shall apply from

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

Done at Brussels,

For the Council

The President

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#### **BSN 0254-1475**

## **COM(95) 208 final**

# **DOCUMENTS**

### **EN 01 15** **Catalogue number : CB-CO-95-233-EN-C** **ISBN 92-77-89187-4**

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