CELEX: 51987PC0284R(01)
Language: en
Date: 1987-06-25
Title: Proposal for a COUNCIL REGULATION (EURATOM, ECSC, EEC) amending the Financial Regulation of 21 December 1977 applicable to the general budget of the European Communities (presented by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (87) 284
Vol. 1987/0169
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In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983 concerning
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1983 über die Freigabe der historischen Archive der Europäischen Wirtschaftsgemeinschaft und
der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983, S. 1), zuletzt geändert durch die
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                              COM(87 ) 284 final
                                              Brussels , 25 June 1987
                                 Proposai for a
                    COUNCIL REGULATION ( EURATOM, ECSC , EEC )
       amending the Financial Regulation of 21 December 1977
        applicable to the general budget of the European Communities
                         ( presented by the .Commission )
 C0MC87 ) 284 final
 ---pagebreak---                                                                           ùm zii
                                        Λ
                              EXPLANATORY MEMORANDUM
Proposal for amendment of the Financial Regulation of 21 December 1977,
presented with the preliminary draft budget for 1988
In its preliminary draft budget for 1988 the Commission considers it necessary
to propose to the budgetary authority two innovations affecting presentation
mainly on the grounds of greater transparency and budgetary objectivity .
I. CREATION OF A NEW SECTION VI ( Appropriations for a number of institutions )
Some administrative expenditure concerns all ©f the institutions , either by
virtue of its destination ( e.g. the Joint Interpreting Service , the Official
Publications Office , the European Schools ) or because of the way it is managed
( e.g. pensions ).
                                            \
In the Commission 's view the existing budget presentation , whereby this
expenditure is included in Section III ( Commission ), is unsuitable since it
provides neither transparency nor a fair picture of the true volume of the
appropriations for each institution .
It should also be noted that the last paragraph of Article 202 of the EEC
Treaty states :
       " The expenditure of the , Assembly , the Council , the Commission
       and the Court of Justice shall be set out in separate parts of
       the budget , without prejudice to special arrangements for cer¬
       tain common items of expenditure ."
The Treaty , then, makes explicit provision for " common items of expenditure"
of an interinstitutional nature . The Commission believes that the time has now
come to apply this provision to the formal structure of the budget .
 ---pagebreak---                                          - 2 -
The new Section VI will therefore now cover the following expenditure :
         -  pensions and allowances ;
         -  the Joint Interpreting Service ;
         -  publications , including the Offical Journal ;
         -  the Official Publications Office ;
         -  the European Schools .                                                    >
This represents a considerable volume of expenditure - more than 300 million
ECU in 1988 - and by its very nature that figure is bound to increase in the
coming years . The proposed change , then , is in line with the Commission 's call
for greater clarity in the budget .
The provisions of the Financial Regulation that will have to be amended are
Articles 15 , 16 , 18 and 21 . The relevant proposals are attached .
II . NEW BUDGET STRUCTURE FOR ALL STAFF SERVING OUTSIDE THE COMMUNITY
By virtue of its aims and the policies it pursues , the Community is coming to
play an increasingly important role . in the outside world , its main concerns
being :
        - relations with the       ACP countries    ( associated under  the European
           Development Fund );
        - relations   with    certain  countries      in  the  southern  and  eastern
           Mediterranean ( linked through Financial Protocols );
        - relations with non-associated developing countries in Latin America
           and Asia ;            *
        - relations with     numerous other non-member countries throughout       the
           world .
These external responsibilities of the Commission have led to the gradual
establishment of the appropriate administrative infrastructures locally , as
and when required .     In budgetary terms , , however , the situation has never been
consolidated or made transparent . Instead there are specific solutions for
each area ( the EAC for the ACP countries , local delegations for the other
areas according to circumstances and requirements ).
 ---pagebreak---                                         - 3 -
This situation is unsatisfactory from the point of view of :
- administration Clack of centralization );
- the budget ( lack of transparency );
- management , both of staff and of the appropriations in question ;           \
For these reasons the Commission - which has already submitted appropriate
proposals for changes to the Staff Regulations and is taking the necessary
steps as regards its own internal organization - is proposing the creation of
a new single structure in the preliminary draft budget for 1988 to accommodate
all staff and administrative expenditure relating to this specific area of
Community activity .
For obvious reasons of transparency and because of the special conditions
attaching to its execution , it is essential for this new structure to form a
separate and clearly identifiable whole . The Commission therefore proposes
that a new Annex II r be added to Part A of Section III .
The attached proposal includes the appropriate amendments to Artices 15 and 16
of the Financial Regulation and a number of additions ( Title IXa - Special
provisions ).     These will be supplemented in due course by appropriate
implementing rules to be adopted by the Commission in line with the specific
management requirements in this field .
                                          *
                                      *       *
As regards the procedural aspect , the Commission would point out that , for
purely practical reasons ,      the accompanying proposed amendments to the
Financial Regulation have simply been grafted on to the existing text of the
Financial Regulation adopted on 21 December 1977 .
1 The new Annex II takes the place of the Annex hitherto used for the Official
   Publications Office , which is transferred to Section VI .
 ---pagebreak---                                         - 4 -
As the institutions concerned are aware /     the Commission presented a proposal
for a complete overhaul^ of the Financial Regulation in 1980/ updated in 1984
by a modified proposal ^ broadly reflecting the deliberations and opinions of
the Court of Auditors and Parliament .
The Commission is therefore maintaining its 1984 proposal and may well make       >
some additions to it in the near future in the light of the objectives set out
in C0M(87 ) 100 and 101 . For the moment / however / it is proposing that the
amendments to the Financial Regulation should be limited to the essential
minimum for the purposes of the structural changes contained in the
preliminary draft budget for 1988 .
   C0M(80 ) 760 final / 12.12.1980; 0J C 119/ 21.5.1981 .
  C0MÍ84 ) 123 final / 9.3.1984 ; 0J C 97/ 9.4.1984 .
 ---pagebreak---                                          •5
                                Proposai for a
                   COUNCIL REGULATION ( EURATOM, ECSC , EEC )
       amending the Financial Regulation of 21 December 1977 No ....
        applicable to the general budget of the European Communities
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the            European Coal and  Steel
Community , and in particular Article 78f thereof ,
Having regard to the Treaty establishing the European Economic Community ,    and
in particular Article 209 thereof ,
Having regard to the Treaty establishing the European Atomic Energy Community ,
and in particular Article 183 thereof ,
                                                      1
Having regard to the proposal from the Commission ,
                                                              2
Having regard to the opinion of the European Parliament ,
Having regard to the opinions of the . Court of Auditors,^
                                                                            1
Whereas   Article 107 of the Financial Regulation of 21 December 1977 as
amended by Regulations Nos 1252 /79^ and 1176/80° provides that the European
Parliament and the Council shall examine the Financial Regulation in the light
of a proposal from the Commission ;
Whereas a meeting of the Conciliation Committee provided for in the Joint
Declaratiog   of 4 June 1975 1>y the European Parliament , the Council and the
Commission0 has taken place;
Whereas provision should be made for an appropriate structure to accommodate
all staff and administrative expenditure relating to the Commission 's tasks
outside the Community in order to enhance budget transparency and create the
conditions     essential for management procedures to satisfy the       specific
requirements in this field ;
Whereas experience has shown the need for a single separate section in the
budget for expenditure of an interinstitutional nature in order to ensure
clarity and objectivity in the presentation of the appropriations for each
institution ; whereas this is provided for in the last paragraph of Article 202
of the EEC Treaty ,
HAS ADOPTED THIS REGULATION :
 ' 0J No C
5 0J No C
5 0J No C
4 0J No L 356, 31.12.1977, p. 1 .
5 0J L 160, 28.6.1979:
6 0J L 345, 20.12.1980, p. 23.
7
   0J C 89 , 22.4.1975 , p. 1 .
 ---pagebreak---  The Financial Regulation of 21 December 1977 is hereby amended as follows :
1 . The second indent of Article 15(1 ) is replaced by the following :
       "- separate sections subdivided into statements of revenue of the
            European Parliament , the Council , the Commission , the Court of
            Justice and the Court of Auditors , and an interinstitutional section .
            The revenue and expenditure of the Economic and Social Committee
            shall be entered in the section dealing with the Council and
            presented in the form of a statement of revenue and expenditure,
            subdivided in the same way as the sections of the budget and subject
            to the same rules ."
2 . The following new paragraph 5 is inserted in Article 15 :
       "5.     The Commission section shall include an Annex containing the
       statement of revenue and expenditure relating to staff serving outside
       the Community ,     implemented in accordance with Article 102a . The
       statement of expenditure in this Annex shall comprise a Title 1 ( Staff
       expenditure ) and a       Title  2 ( Administrative expenditure ), with a
       nomenclature reflecting the'specific requirements in this field . The
       total appropriations in each of these Titles shall be entered under a
       separate heading in Titles 1 and 2 respectively of the Commission
       section ."
3 . The first subparagraph of the existing paragraph 5 of Article 15 is
    renumbered paragraph 6 and replaced by the following :
       " 6 . The statement of revenue and expenditure of the Office for Official
       Publications of the European Communities , drawn up in accordance with
       Article 103(2 ), shall be attached to the interinstitutional section ."
4 . The second subparagraph of the existing paragraph 5 of Article 15 becomes
    paragraph 7 .
 ---pagebreak--- 5 . The first Line of Article 16(2 ) is replaced by the following :
       "2 .       in   the   section for    each institution   and   in   the   inter-
       institutional section :"
6 . Article 18(2 ) is replaced by the following :
       "2.       The requisite powers for the implementation of the sections of the
       budget relating to the European Parliament , the Council , the Court of
       Justice and the Court of Auditors , and, as appropriate , of the inter-
       institutional section , shall be conferred upon the other institutions by
       the Commission ."
7 . The following paragraph 9 is added to Article 21 :
       "9 .     The following provisions shall apply to the interinstitutional
       section :
       -     The European Parliament and the Council may transfer appropriations
             from one chapter to anotheh and from one article to another where
             these appropriations relate solely to them . The Commission shall be
             informed of such transfers.'
       -     The     Commission may transfer appropriations from one chapter to
             another and from one article to another where these appropriations
             relate solely to itself or      where   it has sole responsibility for
             managing them on behalf of all the institutions .        It shall inform
             the budgetary authority two weeks before making such transfers .
                                   *
       -     The     Court of Justice and the Court of Auditors may transfer
             appropriations from one chapter to another and from one article
           • to another where these appropriations relate solely to them .
             They shall inform the budgetary authority and the Commission two
             weeks before making such transfers .
       - Any transfers between appropriations relating solely to one
             institution      and appropriations relating solely to the other
             institutions shall ,     on a proposal from the       Commission ,     be
             submitted to the budgetary authority ,        which    shall decide in
             accordance with paragraph 2 ."
 ---pagebreak--- 8 . The following new Title IXa is inserted :
                                     " TITLE IXa
                                SPECIAL PROVISIONS
             APPLICABLE TO THE STATEMENT OF REVENUE AND EXPENDITURE
                RELATING TO STAFF SERVING OUTSIDE THE COMMUNITY
                           AND TO THEIR ADMINISTRATION
                                  Article 102a
The provisions of Titles I to VI and XI shall apply to the statement of
revenue and expenditure relating to staff serving outside the Community
insofar as they do not conflict with the specific provisions of this Title .
                                  Article 102b
The expenditure of a financial year shall be entered , in the accounts for that
year on the basis of the expenditure for which authorization reaches the
Financial Controller not later than . 31 December and in respect of which
payment is made before 15 January . However , expenditure involving payments
made not later than 31 December under the imprest accounts may still be
entered in the accounts for that year up to 1 March of the following year .
                                    Article 102c
Within the Annex containing the statement of revenue and the statement of
expenditure relating to staffs serving outside the Community ,   the Commission
may transfer appropriations :
- between • the titles relating to staff expenditure and administrative
   expenditure respectively , in which case it shall inform the budgetary
   authority two weeks before doing so ;
- from one chapter to another within the titles relating to staff expenditure
   and administrative expenditure .
                                    Article 102d
In accordance with Article 106 the Commission shall adopt implementing rules
relating , in particular , to :
- the award of contracts ;
- the keeping of inventories ;
- the system of accounts ;
- imprest accounts ."                         1
 ---pagebreak--- 9 . The first subparagraph of Article 103(2 ) is replaced by the following :
            " The appropriations for the Office /   the total amount of which shall
       be entered under a special budget heading within the interinstitutional
       section , shall be set out in detail in an Annex to that section . The
       appropriations shown under this specific budget heading may be
       transferred in accordance with the conditions set out in Article 21 ."
10 . Article 103(4 ) is deleted .
11 . Paragraphs 5 ,   6, 7 , 8, 9 and 10 of Article 103 are renumbered 4 , 5 , 6, 7,
     8 and 9 .
12 . The second subparagraph of the existing paragraph 8 ( renumbered 7 ) of
     Article 103 is replaced by the following :
       " The accounts shall be financed regularly by payments effected by the
       Commission upon receipt of calls for funds from the Office .             Such
       payments may not exceed the tota'l amount of the appropriations entered
       for this purpose in the specific heading in the interinstitutional
       section setting out the total appropriations for the Office ."
13 . The following Article 108a is added :
                                   " Article 108a
         During the transitional period when some of the appropriations relating
       to staff serving outside the Community are still entered in Chapter 98
       of Title 9 of the budget pending fulfilment of the conditions necessary
       for them to be entered in the new statement of revenue and expenditure
       provided for in Article 15(5 ), the Commission is authorized ,
        notwithstanding     Article 21(2 ),    to make any transfers that may be
       required in the course of the financial year between Chapter 98 and that
       new statement ."
                                     Article 2
  This Regulation shall enter into force on the day of its publication in the
  Official Journal of the European Communities .
  It shall apply for the first time to the drawing up of the 1988 budget .
  This Regulation shall be binding in. its entirety and directly applicable in
  all Member States .
  Done at                                                 For the Counci l