CELEX: 51984PC0123
Language: en
Date: 1984-03-09
Title: AMENDMENT OF THE PROPOSAL FOR A COUNCIL REGULATION ( ECSC, EEC, EURATOM ) AMENDING THE FINANCIAL REGULATION OF 21 DECEMBER 1977 APPLICABLE TO THE GENERAL BUDGET OF THE EUROPEAN COMMUNITIES

9.4.84                             Official Journal of the European Communities                          No C 97/1
                                                          II
                                                  (Preparatory Acts)
                                             COMMISSION
              Amendment of the proposal for a Council Regulation amending the Financial Regulation
               of 21 December 1977 applicable to the general budget of the European Communities (')
                                                   COM(84) 123 fin.
              (Submitted by the Commission to the Council in accordance with the second paragraph of
              Article 149 of the EEC Treaty and the second paragraph of Article 119 of the Euratom
                                               Treaty on 15 March 1984)
                                                    (84/C 97/01)
THE COUNCIL OF THE EUROPEAN                                   Whereas Article 107 of the Financial Regulation of
COMMUNITIES,                                                  21 December 1977 (5), as amended by Regulation
                                                              (ECSC, EEC, Euratom) No 1252/79 (6) and Finan-
Having regard to the Treaty establishing the Euro-            cial Regulation 80/1176/EEC, Euratom, ECSC (7)
pean Coal and Steel Community, and in particular              provides for the said Financial Regulation to be
Article 78 (h) thereof,                                       examined by the European Parliament and the
                                                              Council in the light of a proposal from the Commis-
                                                              sion;
Having regard to the Treaty establishing the Euro-
pean Economic Community, and in particular
                                                              Whereas, in view of the evolution of the general
Article 209 thereof,
                                                             budget of the European Communities and of the
                                                              application of the Financial Regulation of
Having regard to the Treaty establishing the Euro-            21 December 1977 since its entry into force, it is
pean Atomic Energy Community, and in particular               necessary to adjust many of the provisions of the
Article 183 thereof,                                          said Financial Regulation;
Having regard to the proposals from the Commis-               Whereas the general budget of the European Com-
sion,                                                         munities has increased in size over the years and
                                                              whereas it is now the centre of attention at Com-
Having regard to the opinion of the European                  munity level;
Parliament (2),
                                                              Whereas, as far as appropriations falling within the
                                                              present Section III of the budget are concerned, the
Having regard to the opinions of the Court of                 time has come to introduce a more uniform and
Auditors (3),                                                 rational presentation, to ensure political transpar-
                                                              ency of appropriations and to increase the number
Whereas the conciliation provided for in the Joint            of headings available; whereas, to this end, the pres-
Declaration of 4 March 1975 of the European Par-              ent Section III should be reserved for staff and
liament, the Council and the Commission (4) took              administrative appropriations and several sections
place in a Conciliation Committee:                            introduced, as required, for operating appropria-
                                                              tions, taking into account changes in the contents of
                                                              the budget and future prospects;
(•)  OJNoC 119,21.5. 1981, p. 1.
(2) OJ No C 277, 17. 10. 1983, p. 64.
(') OJ No C 232, 11.9. 1981, p. 1; OJ No C 122, 13.5.          (5) OJ No C 89, 22. 4. 1975, p. 1.
     1982, p. 7.                                               (*) OJ No L 160, 28. 6. 1979.
(4) OJNoL356, 31. 12. 1977, p. 1.                              0) OJ No L 345, 20. 12. 1980, p. 23.
 ---pagebreak--- No C 97/2                         Official Journal of the European Communities                               9. 4. 84
Whereas the budgetary presentation of the borrow-            Whereas, in connection with the repayment of Com-
ing and lending operations should be improved and            munity aids, the Financial Regulation should con-
greater transparency achieved by including esti-             tain provisions on the payment of interest and the
mates and authorizations for these operations in a           imposition of penalties when these funds have been
separate part of the budget; whereas the borrowing           misused;
and lending operations involve commitments which
the Communities must honour; whereas these oper-
ations have accordingly been entered in the general          Whereas, since the cost of living is rising constantly,
budget to give clear expression to the Communities'          it has become essential that, for the determination of
undertaking to use budget funds to meet the obliga-          certain amounts in connection with the awarding of
tions arising from the borrowing contracts if the            contracts, reference be made to the measures for the
recipients of the loans default or are late with their       implementation of this Regulation, so that these
repayments;                                                  amounts can be adjusted by what is, technically
                                                             speaking, a more appropriate legislative procedure,
Whereas, in order to cover all the appropriations
entered in the general budget of the European Com-
munities, the Financial Regulation should be                  HAS ADOPTED THIS FINANCIAL REGULATION:
extended to include the special provisions required
for the budgetary management of Community exter-
nal aid;                                                                              Article 1
                                                             The Financial Regulation of 21 December 1977
Whereas it is necessary to produce a more transpar-          applicable to the general budget of the European
ent presentation of the appropriations for research,         Communities, as amended by Council Regulation
development and technological innovation and to              (ECSC, EEC, Euratom) No 1252/79 of 25 June 1979
introduce appropriate rules for this presentation;           and Council Financial Regulation 80/1176/EEC,
                                                              Euratom, ECSC of 16 December 1980, is amended
                                                             as follows:
 Whereas, in the light of experience and in the inter-
ests of greater flexibility in the management of the
 Communities' own resources, any surplus or deficit              1. Article 1 (1). The second subparagraph is
 from one financial year should be entered, for the                 replaced by the following:
purposes of adjustment, in the budget of the next                   'For the purposes of this Financial Regulation,
but one financial year;                                             the revenue and expenditure of the Communi-
                                                                    ties shall comprise:
Whereas, in the light of the experience acquired                    — the administrative expenditure of the
since its entry into force, it is necessary to make                      European Coal and Steel Community and
more detailed or revise certain provisions of the                        the corresponding revenue,
Financial Regulation of 21 December 1977, notably                   — the revenue and expenditure of the Euro-
in respect of the presentation of appropriations in                      pean Economic Community, in particular
the general budget, the arrangements for provisional                     loans raised, loans granted and repay-
twelfths, transfers and carryovers, and the introduc-                    ments and related costs,
tion of formal deadlines for the clearance procedure
                                                                    — the revenue and expenditure of the Euro-
for the EAGGF, Guarantee Section, and for food                           pean Atomic Energy Community which
aid;                                                                     may be credited to or charged against the
                                                                         budget pursuant to the Euratom Treaty
                                                                         and to the measures taken in implementa-
Whereas, in order to improve interinstitutional rela-                    tion thereof, in particular loans granted
tions, the Financial Regulation should include pro-                      and related costs and repayments of loans
visions on the procedure for supplementary and                           raised and related costs.'
amending budgets, the establishment of the finan-
cial statement to accompany proposals, the indica-
tive nature of the estimates of the financial cost of           2. Article 1. Paragraphs 2, 3, 4 and 5 are replaced
operations provided for in legal acts, improvements                 by the following text:
to the organization of relations between the institu-               '(2) The appropriations entered in the budget
tions and the Court of Auditors and the information                 shall be authorized for the duration of one
to be given to the budgetary authority on the utiliza-              financial year. They shall constitute the upper
tion of advances from the EAGGF Guarantee Sec-                      limit of expenditure which may be paid or
tion;                                                               authorized during each financial year.
 ---pagebreak--- 9. 4. 84                            Official Journal of the European Communities                           No C 97/3
       Expenditure may not be authorized for a                      (2) Estimates relating to costs or staff
       period going beyond the financial year.                      requirements in legislative acts other than the
                                                                    general budget shall be merely indicative.'
       (3) Administrative expenditure arising from
       contracts which have been concluded in
                                                                 4. Article 3 becomes Article 4. This Article is
       accordance with local usage for periods going
                                                                    replaced by the following:
       beyond the financial year and expenditure for
       repayment of loans raised and related costs
       shall be charged to the budget for the financial             (1) Subject to Article 26, all revenue and
       year in which it is effected.                                expenditure shall be entered in full in the
                                                                    budget and in the accounts without any adjust-
                                                                    ment against each other.
       (4) The implementation of multiannual
       activities may give rise to commitment appro-
       priations and payment appropriations.                         (2) Total revenue shall cover total appropria-
                                                                     tions; revenue shall not be assigned to a
       Commitment appropriations shall cover, for                    specific purpose.
       the current financial year, the total cost of the             However, certain revenue shall not be used for
       legal obligations entered into for activities                 any other purpose, notably:
       whose implementation extends over more than                   — financial contributions from Member
       one financial year.                                                States to certain research programmes pur-
                                                                          suant to Article 4 (6) of the Decision of
       Payment appropriations shall cover expendi-                        21 April 1970 on own resources;
       ture arising from commitments entered into in
                                                                     — revenue earmarked for a specific purpose,
       the current financial year and/or preceding
                                                                          such as income from foundations, sub-
       financial years.
                                                                          sidies, gifts, bequests;
       (5) The entries intended for multiannual                      — contributions to Community activities
       activities and consisting of commitment and                        from non-Member States or various
       payment appropriations shall be shown in the                       bodies;
       budget as follows:                                            — revenue from third parties in respect of
                                                                          work carried out at their request;
       — the commitment appropriation authorized                     — the proceeds of loans raised, the repay-
             for the financial year concerned and the                     ment of loans granted from these proceeds
             payment appropriation considered neces-                      and related costs.
             sary for the same financial year shall be
             entered under the appropriate heading;                  (3) The total appropriations referred to in
                                                                     paragraph 2 shall be the total non-differen-
       — the estimated annual payment appropria-                     tiated appropriations and payment appropria-
             tions required for subsequent financial                 tions.
             years shall be set out against the commit-
             ment appropriations in an indicative                    (4) The Commission may accept any dona-
             schedule in the remarks column.                         tion made to the Communities, and in partic-
                                                                     ular foundations, subsidies, gifts and bequests.
        (6) The multinannual activities in respect of
        which a distinction is to be made between                    The Commission may accept donations which
        commitment appropriations and payment                        may involve some financial charge only sub-
        appropriations shall be determined during the                ject to prior authorization from Parliament and
        budgetary procedure.'                                        the Council, which shall act on the matter
                                                                     within two months of the date of receipt of the
                                                                     request from the Commission. If no objection
                                                                     has been made within this period, the Com-
    3. The following new Article 3 is added:                         mission shall take a final decision in respect of
         '(1) Where proposals submitted to the Coun-                  acceptance.'
         cil and Parliament may have budgetary conse-
         quences, including significant changes in the            5. Article 4 becomes Article 5. The present text
         number of posts, the Commission shall draw                   becomes paragraph 1 and the following para-
         up a financial statement.                                    graph 2 is added:
         In the case of multiannual operations, this
         financial statement shall contain the estimated              '(2) No expenditure may be committed or
         schedule of annual requirements of appropria-                authorized in excess of the authorized appro-
         tions and posts.                                             priations, without prejudice to Article 26 (2).'
 ---pagebreak--- No C 97/4                        Official Journal of the European Communities                               9. 4. 84
  6. Article 5 becomes Article 6. The last three para-               (c) appropriations in respect of payments
     graphs are replaced by the following:                                still outstanding by virtue of commit-
                                                                          ments duly entered into before the
     'The readjustment of entries in respect of value                     close of the financial year shall be car-
     added tax own resources or, if appropriate, of                       ried over automatically to the next
     financial contributions, which under the third                       financial year only.
     subparagraph of Article 10 (3) of the Regula-
     tion is carried out following the final adoption
                                                                 2.  In the case of budget headings where a
     of a supplementary or amending budget, shall
                                                                    distinction is made between commitment
     be entered in the accounts for the financial                    appropriations and payment appropria-
     year of the supplementary or amending budget                   tions:
     in question.
     The allotted appropriations shall be used                      (a) commitment appropriations not com-
     solely to cover expenditure properly entered                        mitted at the end of the financial year
     into and paid in the financial year for which                       for which they were entered in the
     they were granted, save as otherwise provided                       budget shall remain in existence for
     in Articles 7, 93 and 101, and to cover the                         the following financial year without
     debts relating to preceding financial years for                     prejudice to the provisions of Article
     which no appropriation was carried forward.                         92(4);
     The commitments shall be entered in the
     accounts on the basis of the commitments con-                  (b) payment appropriations which have
     tracted up to 31 December.                                          not been used at the end of the finan-
                                                                         cial year for which they were entered
     The expenditure of a financial year shall be                        shall be carried over automatically to
      entered in the accounts for that year on the                       the next financial year only.
      basis of the expenditure for which authoriza-
      tion reached the financial controller not later            3. In the case of appropriations which were
      than 31 December and the accounting officer                   entered in the budget chapter containing
      not later than the following 10 January, and                  "provisional appropriations" and which
      for which payment was effected by the                         remain available at the close of the finan-
      accounting officer not later than 15 January.                 cial year:
                                                                    (a) appropriations in respect of staff and
      By way of derogation from the two preceding                         administrative expenditure (Titles 1
      subparagraphs, the expenditure of the                               and 2) may not be carried over;
      EAGGF, Guarantee Section, and expenditure                     (b) appropriations in respect of other
      on food aid shall be taken into account for a                       expenditure may be carried over to the
      financial year in accordance with the rules laid                    next financial year only.
      down in Articles 100 and 118.'
                                                                 4.  In the case of appropriations on which a
  7. Article 6 becomes Article 7. This Article is                    decision to carry over may be taken, the
      replaced by the following:                                     Commission shall submit to the budgetary
                                                                     authority, not later than 31 March, the
      'The following rules shall govern the utiliza-                 duly substantiated requests to carry over
      tion of appropriations:                                        appropriations made by Parliament, the
                                                                     Council, the Court of Justice, the Court of
       1. In the case of budget headings where there                 Auditors and by the Commission itself.
           is no distinction between commitment                      The Council shall consult Parliament and,
           appropriations and payment appropria-                     acting by qualified majority, shall decide
           tions:                                                    on the requests to carry over appropria-
                                                                     tions in respect of expenditure necessarily
           (a) appropriations relating to remunera-                  resulting from the Treaties or acts adopted
               tions and allowances of members and                   in accordance therewith.
               staff of the institutions may not be
                                                                     Parliament shall consult the Council and
               carried over;
                                                                     act on the requests to carry over appropria-
                                                                     tions in respect of expenditure other than
           (b) a decision may be taken to carry over
                                                                     that necessarily resulting from the Treaties
               to the next financial year only the por-
                                                                     or acts adopted in accordance therewith.
               tion of the other appropriations still
               uncommitted at the close of the finan-                If no decision is taken by the budgetary
               cial year;                                            authority within six weeks, the requests to
 ---pagebreak--- 9. 4. 84                            Official Journal of the European Communities                           No C 97/5
           carry over appropriations shall be deemed                      article, in the accounts for the current
           to have been approved.                                         financial year.'
       5. Unused revenue and appropriations avail-
           able at 31 December arising from the spe-             8. Article 7 becomes Article 8. The first and
           cific revenue referred to in Article 4 (2)               second subparagraphs become paragraphs 1
           shall be carried over automatically.                     and 2. The third subparagraph is replaced by
                                                                    the following:
           Commitments entered in Part II of the
           budget shall be carried over to the next                 '(3) Expenditure relating to rents or certain
           financial year automatically where the                   associated expenditure which is payable in
           operations authorized have not been                      advance in accordance with provisions laid
           effected by the end of the financial year.               down by law or contract may give rise to pay-
                                                                    ments from 20 December onwards to be
                                                                    charged to the appropriations for the next
       6. The following appropriations shall lapse                  financial year.
           at the end of the year:
                                                                    (4) Advances, in respect of the following
           (a) appropriations from the previous                     financial year, within the meaning of Articles
                financial year:                                     98 and 118 to finance the expenditure of the
                — commitment appropriations re-                     Guarantee Section of the European Agricul-
                    maining in existence which have                 tural Guidance and Guarantee Fund and
                    not been committed, subject to the              expenditure on food aid may be paid from 10
                    provisions of Article 92 (4);                   December onwards if the budget for the fol-
                                                                    lowing financial year has been adopted at that
                — appropriations carried over auto-                 date. Otherwise advances may not be paid
                    matically which have not been                   until after final adoption of the budget, with-
                    paid;                                           out prejudice to the procedures laid down in
                — appropriations carried over by                    Article 9. The funds thus paid shall be used
                    decision of the budgetary auth-                 having regard to the rules laid down in Articles
                    ority which have been neither                   98 and 118.
                    committed nor paid;                             (5) The loans authorized in Part II of the
           (b) appropriations of the financial year                 budget may be granted only against the pro-
                which have not been carried over.                    ceeds of the borrowing operations.'
       7. The appropriations for the Guidance Sec-
           tion of the European Agricultural Guid-               9. Article 8 becomes Article 9. This Article is
           ance and Guarantee Fund and for the                      replaced by the following:
            European Regional Development Fund                       '(1) If the budget is not finally adopted at the
           may be used by way of exception to                        beginning of the financial year, Article 78b of
           finance projects for which they were not                  the ECSC Treaty, Article 204 of the EEC
           initially committed, under the conditions                 Treaty and Article 178 of the Euratom Treaty
           laid down in Regulations (EEC) No                         shall apply to commitment and payment of
           3171/75 0), (EEC) No 355/77 (2) and                       expenditure already approved in principle in
           (EEC) No 214/79( 3 ).                                     the last budget duly adopted.
        8.  Parliament and the Council shall be prov-                 An item of expenditure shall be considered as
            ided, for their information, before 31 May,               having been approved in principle in the last
            with a list of the commitment appropria-                  budget duly adopted if it could have been
            tions remaining in existence, the auto-                   charged to a specific budget heading under the
            matic carryovers and the appropriations                   financial year concerned.
            carried over by decision of the budgetary
            authority.                                                (2) (a) Commitments may be entered into in
                                                                               respect of any chapter:
        9.  For the purpose of implementing the                                — for up to one-quarter of the total
            budget, the utilization of appropriations                               appropriations entered in the rel-
            carried over shall be shown separately, by                              evant chapter for the preceding
                                                                                    financial year, account being
                                                                                    taken of all transfers, plus one-
                                                                                    twelfth for each completed month,
       (') OJNoL315,5. 12. 1975, p. t.                                         — without exceeding the appropria-
       O3 OJ No L 51, 23. 2. 1977, p. 1.
       ( ) OJ No L 35, 9. 2. 1979, p. 1.                                            tions provided for in the draft
 ---pagebreak--- No C 97/6                         Official Journal of the European Communities                              9. 4. 84
                   budget or, in the absence thereof,             (b) for non-compulsory expenditure, the
                   in the preliminary draft budget.                     second subparagraph of Article 78 (b) (2)
                                                                        of the ECSC Treaty, the third paragraph of
              The global provisional commitments                        Article 204 of the EEC Treaty and the
              of the EAGGF, Guarantee Section,                          third paragraph of Article 178 of the
              referred to in Article 98 shall be                        EAEC Treaty shall apply.
              treated as commitments for the pur-
              poses of these provisions.                          The additional twelfths shall be authorized in
                                                                  whole and may not be split.
          (b) Payments may be made monthly in
               respect of any chapter:                            Where this procedure is to be applied, the
                                                                  annual amount authorized for each chapter as
                                                                  twelfths may not exceed the amount in the
              — up to one-twelfth of the total                    chapter of the budget for the previous year,
                   appropriations entered in the                  account being taken of transfers, or the
                   chapter concerned for the preced-              amount in the chapter of the draft budget or,
                   ing financial year, account being              in the absence thereof, the preliminary draft
                   taken of all transfers,                        budget.
               — as long as this measure does not                  (6) If, for a given chapter, the expenditure
                   have the effect of placing at the               required to prevent any interruption of Com-
                   disposal of the Commission, for                 munity action in the sector concerned cannot
                   any month, appropriations in                    be met by application of the procedures
                   excess of one-twelfth of those                  referred to in paragraphs 2 to 5, appropriations
                   provided for in the draft budget                available under the twelfths arrangements
                   or, in the absence thereof, in the              may, on a proposal from the Commission, be
                   preliminary draft budget.                       transferred between chapters.
                                                                   Decisions on the proposal for transfer shall be
     (3) The draft budget referred to in paragraphs
                                                                   taken in accordance with the procedure laid
      2 (a) and 2 (b) above shall be the draft in the
                                                                   down in Article 78b (2) of the ECSC Treaty,
      form in which it stands at the start of the
                                                                    Article 204 of the EEC Treaty and the third
      financial year when the provisional twelfth
                                                                    paragraph of Article 178 of the Euratom
      arrangements began to be applied.
                                                                    Treaty.
                                                                    If, however, in the case of transfers involving
      (4) Where the absence of a budget is due to                   both expenditure necessarily resulting from the
      the rejection of the draft budget, by Parliament              Treaties or from acts adopted in accordance
      as provided for by Article 78 (8) of the ECSC                 therewith and other expenditure, the Council
      Treaty, Article 203 (8) of the EEC Treaty and                 and Parliament disagree on the amount to be
      Article 117 (8) of the Euratom Treaty, the                    transferred, the smaller of the amounts
      appropriations referred to in the second indent               accepted by one of the two institutions shall be
      of paragraph 2 (a) and in the second indent of                deemed to have been approved. Where one of
      paragraph 2 (b) shall be those entered in the                 the institutions rejects the principle of the
      rejected draft budget or, where appropriate, in               transfer, such transfer shall not be made.
      the new draft budget drawn up, following the
      rejection decision, before the start of the finan-
      cial year.                                                    (7) The decisions referred to in the preceding
                                                                    paragraphs shall specify the requisite measures
                                                                    in respect of resources for the purposes of this
       (5) If the continuity of Community activities                Article.
       and administrative needs so require:                         (8) The budgetary authority shall seek to
                                                                    limit the period for which the system of provi-
       (a) for compulsory expenditure, the Council,                 sional twelfths is applied.'
           acting by a qualified majority, may, at the
           request of the Commission and after con-            10. Article 9 becomes Article 10. The following
           sulting Parliament, authorize simulta-                    second subparagraph is added:
           neously two or more provisional twelfths
           for both commitments and payments in                      'Publication shall, under normal circum-
           addition to those automatically made                      stances, take place within one month of the
           available under paragraph 2 (a) and 2 (b);                final adoption of the budget.'
 ---pagebreak--- 9.4.84                            Official Journal of the European Communities                            No C 97/7
  11. Article 10 becomes Article 11. The second sub-               (b) as regards the Commission sections:
      paragraph of paragraph 1 becomes paragraph                        — a definition of the policies justifying
      2, paragraph 2 becomes paragraph 3, para-                              the requests for appropriations,
      graph 3 becomes paragraph 4 and is replaced
      by the following:                                                 — an explanation of the changes in
                                                                             appropriations from one financial year
      '(4) Any conversion between the ECU and a                              to the next,
      national currency shall be effected in accord-
      ance with the special provisions referred to in                   — a detailed statement on borrowing and
      Article 123.'                                                          lending policy.
                                                                  (3) Each of the sections of the preliminary
                                                                  draft budget shall be preceded by an introduc-
  12. Title II. The heading is replaced by the follow-            tion prepared by the institution concerned.
      ing:                                                        The Commission shall prepare a single intro-
                                                                   duction to its sections.
                          TITLE II                                (4) The preliminary draft budget shall be
                                                                  accompanied by working documents contain-
         ESTABLISHMENT AND STRUCTURE                              ing the following information:
                    OF THE BUDGET'
                                                                   (a) in respect of staff:
  13. Section 1. The heading is replaced by the fol-                    — for each category of staff, a detailed
      lowing:                                                                list of budgetary posts and numbers of
                                                                             persons in post on the date of the sub-
                                                                             mission of the preliminary draft
                                                                             budget, indicating their distribution by
                                                                             grade and administrative unit (or prin-
                         'SECTION 1                                          cipal operational unit for the esta-
           ESTABLISHMENT OF THE BUDGET                                       blishments of the Joint Research
                                                                             Centre),
                                                                        — where a change in the number of per-
  14. Article 11 becomes Article 12. The second para-                        sons in post is proposed and in partic-
      graph is replaced by the following:                                    ular the creation of new posts, a state-
                                                                             ment justifying such changes;
      'The Economic and Social Committee shall,
      for 1 June, forward to the Council an estimate               (b) in respect of subsidies to the bodies set up
      of its revenue and expenditure for the follow-                    pursuant to the Treaties or acts adopted in
      ing year.'                                                        accordance therewith, and having legal
                                                                        personality, an estimate of revenue and
                                                                        expenditure prefaced by an explanatory
                                                                        statement drawn up by the bodies con-
  15. Article 12 becomes Article 13. This Article is                    cerned.
      replaced by the following:                                   5. The Commission shall also attach to the
      '(1) The Commission shall, in the prelimi-                   preliminary draft budget:
      nary draft budget which it shall place before
                                                                   — an analysis of the financial management
      the Council not later than 1 September of each                    for the preceding financial year, as pro-
      year:                                                             vided for in Article 80, and a balance sheet
      — draw up a general statement of revenue of                       of assets and liabilities of the Communi-
           the Communities, and consolidate the esti-                   ties as at 31 December of the preceding
           mates referred to in Article 12;                             financial year, as provided for in
      — draw up the second part of the budget                           Article 81, and
           containing the borrowing and lending                    — an opinion on the estimates of the other
           operations.                                                  institutions; this opinion may contain dif-
      It shall at the same time forward the prelimi-                    ferent estimates, accompanied by the
      nary draft budget to Parliament.                                  reasons therefor.'
      (2) The Commission shall prepare a general
      introduction to the preliminary draft budget.
      This introduction shall contain in particular:           16. The following new Article 14 is added:
      (a) financial tables covering the entire budget;              '1. The Commission may, on its own initia-
           and                                                      tive or if requested by Parliament, the Council,
 ---pagebreak--- No C 97/8                       Official Journal of the European Communities                              9. 4. 84
     the Court of Justice or the Court of Auditors,              (3) All preliminary draft supplementary
     present to the Council a letter of amendment                and/or amending budgets must, as a general
     to the preliminary draft budget necessitated by             rule, be forwarded to the Council by the date
     the receipt of new information which was not                laid down for the submission of the prelimi-
     available at the time the preliminary draft was             nary draft budget for the following financial
     established.                                                year.
     However, save in very exceptional circum-                  The competent authorities shall discuss them
     stances, the Commission must send such letter              in the light of their urgency.
     of amendment to the Council at least 30 days
     before the first reading of the draft budget by            (4) Requests for supplementary and/or
     Parliament, and the Council must send a letter             amending budgets from Parliament, the Coun-
     of amendment to the draft budget to Parlia-                cil, the Court of Justice or the Court of Audi-
     ment at least 15 days before the said first read-          tors shall be forwarded by the Commission to
     ing.                                                       the budgetary authority. The Commission may
                                                                 attach a dissenting opinion.
     2. If circumstances arise which it could not
     have taken into account when establishing the               (5) Where the Commission proposes a preli-
     draft budget, the Council may, if necessary,                minary draft supplementary and/or amending
     send to Parliament a letter of amendment to                 budget, the Council must present a draft sup-
     the said draft under the conditions laid down               plementary and/or amending budget.
      in the second subparagraph of paragraph 1.'                (6) Preliminary draft and draft supplemen-
                                                                 tary and/or amending budgets shall be accom-
                                                                 panied by justifications and information avail-
                                                                 able on the implementation of the current
 17. The following new Article 15 is added:
                                                                 budget at the time of their establishment.
      '(I) In the event of unavoidable, exceptional              (7) Preliminary draft supplementary and/or
      or unforeseen circumstances, the Commission                amending budgets shall take into account the
      may submit preliminary draft supplementary                 transfers approved up to the time of their
      and/or amending budgets. Also, particularly                 establishment.'
      to enable policies to be adapted, the Commis-
      sion may submit preliminary draft amending
      budgets which do not alter the total amount of         18. A rticle 13 becom es A rticle 16.
      the annual budget and to which the corre-
      sponding necessary draft Regulations would
      be attached.
                                                             19. Article 14 becomes Article 17. This Article is
       Preliminary draft supplementary budget means               replaced by the following:
       any proposal which would alter the total
       amount of appropriations and hence of                      '(1) The budget shall be adopted in accord-
       revenue or which would give rise to one or                 ance with Article 78 of the ECSC Treaty,
       more new operations without, however,                      Article 203 of the EEC Treaty and Article 177
       increasing the total amount of appropriations.             of the Euratom Treaty.
                                                                  This decision shall have the effect of determin-
       Preliminary draft amending budget means any                ing the rate of VAT allocated to the Com-
       proposal which would not change or would                   munity budget, calculated from an estimate of
       reduce total appropriations or revenue and                 the base.
       which involves internal financial or technical
                                                                   (2) The final adoption of the budget shall,
       changes to the budget.
                                                                   from 1 January of the following financial year
       (2) Preliminary draft supplementary and/or                  or from the date of the adoption if it is later
       amending budgets shall be subject to the pro-               than 1 January, bind immediately each Mem-
       visions of Article 78 of the ECSC Treaty,                   ber State to make over to the Commission the
        Article 203 of the EEC Treaty and Article 177              payments due as specified in the texts in
        of the Euratom Treaty.                                     force.'
        They shall be submitted, examined, estab-
        lished and finally adopted in the same form
        and according to the same procedure as the           20. The following new Article 18 is inserted:
        budget whose estimates they are amending.
        They must be substantiated by reference to the              'The Commission and the budgetary authority
        latter.                                                     may agree to bring forward certain dates for
 ---pagebreak--- 9. 4. 84                            Official Journal of the European Communities                            No C 97/9
       the adoption and forwarding of the prelimi-                  1. In the general statement of revenue:
        nary draft and draft budgets. This agreement
        may not, however, have the effect of reducing                  — the rate of value added tax (VAT) and
        or delaying the periods allowed for considera-                      the estimated base from which it is
       tion of these texts under Article 78 of the                          derived, and the estimated revenue of
        ECSC Treaty, Article 203 of the EEC Treaty                          the Communities for the financial year
       and Article 177 of the Euratom Treaty.'                              in question, divided into titles, chap-
                                                                            ters, articles and items.
  21. Section II. The heading is replaced by the                       — the revenue for the preceding financial
       following:                                                           year, divided into titles, chapters,
                                                                            articles and items,
                                                                       — appropriate remarks on each subdivi-
                                                                            sion.
                           'SECTION II
        STRUCTURE AND PRESENTATION OF THE                           2. In the Commission sections and the sec-
                             BUDGET'                                   tion for each of the other institutions :
 22. Article 15 becomes Article 19:
                                                                       (a) as regards the statement of revenue:
       (a) Paragraph 1 is replaced by the following:
                                                                           — the estimated revenue for each
            '(1) The budget shall consist of two                                 institution for the financial year in
            parts:                                                               question, divided into titles, chap-
            Part One shall contain:                                              ters, articles and items, following
            — a general statement of the revenue of                              a decimal classification system,
                 the Communities,                                          — the revenue entered in the budget
            — separate sections subdivided into                                  for the preceding financial year
                 statements of revenue and expenditure                           and the revenue established for
                 of Parliament, the Council, the Com-                            the last financial year for which
                 mission, the Court of Justice and the                           accounts have been closed, using
                 Court of Auditors. The Commission                               the same decimal classification,
                 shall have one section for staff and                      — appropriate remarks on each
                 administrative appropriations, and                              revenue heading;
                 several sections, as required, for oper-
                 ating appropriations. The revenue and
                 expenditure of the Economic and                       (b) as regards the statement of expendi-
                 Social Committee shall be entered in                      ture:
                 the section dealing with the Council                      (ba) in the case of the various items,
                 and presented in the form of a state-                            articles, chapters and titles:
                 ment of revenue and expenditure, sub-
                                                                                  — the appropriations made
                 divided in the same way as the sec-
                                                                                       available for the financial
                 tions of the budget and subject to the
                                                                                       year in question, these appro-
                 same rules.
                                                                                       priations being the commit-
            Part Two shall contain:                                                    ment appropriations and the
            — borrowing and lending operations.'                                       payment appropriations for
                                                                                       the budget headings for
       (b) In the final line of paragraph 4 'Article 21'                               which this distinction has
            is replaced by 'Article 25'.                                               been agreed,
       (c) Paragraph 5 is replaced by the following:                              — the appropriations made
            '(5) A statement of revenue and expendi-                                   available for the preceding
            ture in respect of the Office for Official                                 financial year,
            Publications of the European Communi-                                 — the actual expenditure in the
            ties, established in accordance with                                       last financial year for which
            Article 120 (2) shall be attached to the                                   the accounts have been
            Commission section relating to staff and                                   closed, determined as fol-
            administrative appropriations.'                                            lows:
                                                                                       — for the budget headings
 23. Article 16 becomes Article 20. This Article is                                         where the distinction
       replaced by the following:                                                           between      commitment
       'The budget shall show:                                                              appropriations and pay-
 ---pagebreak--- No C 97/10                       Official Journal of the European Communities                            9. 4. 84
                          ment appropriations has                        and temporary posts for each grade in
                           not been made:                                each category and in each service
                          — actual payments in                           authorized within the limits of the
                              the last financial year                    budget appropriations.
                              for       which      the                   The staff of the Supply Agency and
                              accounts have been                         the European Agency for Cooperation
                               closed plus the carry-                    shall be shown separately in the Com-
                               overs to the next                         mission's list of posts;
                               financial year;
                      — for the headings where                      — a list of posts paid from the research
                          the distinction between                        and development and technological
                           commitment appropria-                         innovation appropriations, classified
                          tions      and      payment                    by category and grade and distinguish-
                           appropriations has been                       ing between permanent and non-
                           made:                                         permanent staff, authorized within the
                                                                         limits of the budget appropriations.
                          — in          commitments:
                               commitments entered                       As regards scientific and technical
                               into during the finan-                    staff, the classification may be based
                               cial    year    against                   on groups of grades, in accordance
                               appropriations       for                  with the conditions laid down in each
                              that financial year                        budget. The list of posts must specify
                               and against appro-                        the number of highly qualified tech-
                               priations remaining                       nical or scientific personnel who are
                               from the preceding                        accorded special advantages under the
                               financial year;                           Staff Regulations applicable to these
                                                                         officials,
                           — in payments: pay-
                               ments effected during                — a list of posts fixing the number of
                               the financial year                        posts for each grade in each category
                               against      appropria-                   in:
                               tions for the financial
                               year and        against                   — the Office for Official Publica-
                               appropriations carried                          tions,
                               over from the preced-
                               ing financial year;                       — the European Centre for the
                                                                               Development        of  Vocational
             (bb) in the case of the appropriations                            Training,
                  intended for the implementation
                  of multiannual activities and                          —     the European Foundation for the
                  consisting of commitment appro-                              Improvement of Living and
                  priations and payment appropria-                             Working Conditions.
                  tions: in the remarks column, an
                  indicative schedule of the pay-                   The list of posts shall show next to the
                  ments relating to the financial                   number of posts authorized for the finan-
                  year concerned and subsequent                     cial year the number authorized for the
                  financial years;                                  preceding year.
             (be) appropriate remarks on each sub-
                  division. These remarks shall                     The list of posts shall constitute an abso-
                  include:                                          lute limit for each institution; no appoint-
                                                                    ment may be made in excess of the limit
                  — basic legal instrument, where
                                                                    set.
                       one exists,
                  — all such explanations as may                    In cases of half-time work authorized by
                       be necessary concerning the                  the appointing authority in accordance
                       nature and purpose of the                    with Article 55a of the Staff Regulations of
                       appropriations.                              officials of the European Communities, a
                                                                    post in a given grade may serve for the
     3.  As regards total staff:                                    assignment of two officials of the same
                                                                    grade or of a lower grade. Such assignment
         — for each section of the budget, a list of                shall automatically terminate when the
             posts fixing the number of permanent                   authorization expires.
 ---pagebreak--- 9. 4. 84                           Official Journal of the European Communities                         No C 97/11
       5. As regards borrowing and lending opera-                  The acts of delegation shall be communicated
           tions:                                                  to all the parties concerned in accordance with
           in Part Two, two titles divided into chap-              the implementing measures provided for in
           ters, articles and items, accompanied by                Article 123.'
           appropriate remarks.
           These remarks shall, in particular, contain         26. Article 19 becomes Article 23. This Article is
           an undertaking that the Communities will                replaced by the following:
           use their funds to meet the obligations                 Each institution shall appoint a financial con-
           arising from borrowing contracts if the                 troller.
           recipients of loans default or are late with
           their repayments.                                       He shall be responsible for monitoring:
           Title One shall contain:                                — the commitment and authorization of all
                                                                        expenditure,
           — authorizations for loans to be raised in
                the financial year concerned;                      — the establishment and collection of all
                                                                        revenue.
           — estimates of capital repayments and
                interest payments to be made to the                The financial controller shall be consulted on
                Community by recipients of loans                   all accounting systems applied by the institu-
                granted;                                           tion to which he is attached. He shall have
                                                                   access to the information contained in these
           — estimates of the contributions by reci-               accounts.
                pients towards the costs of borrowing
                and lending operations;                            Monitoring shall be carried out by that official
                                                                   by means of inspection of the files relating to
           — the revenue entered in the budget for                 expenditure and revenue and, if necessary, on
                the preceding financial year and the               the spot.
                revenue established for the last finan-
                cial year for which the accounts have              The financial controller may be assisted in his
                been closed, broken down in the same               duties by one or more assistant financial con-
                way.                                               trollers.
           Title Two shall contain:                                The special rules applicable to such officials,
                                                                   which shall be laid down in the implementing
           — authorizations for loans to be granted                measures provided for in Article 123, shall be
                in the financial year concerned;                   such as to guarantee that they are independent
           — appropriations for capital repayments                 in the performance of their duties. Their
                and interest payments on loans raised;             appointment, their promotion, and discipli-
                                                                   nary measures or transfer, and any interruption
           — appropriations to cover the costs of                  or termination of appointment by whatever
                borrowing and lending operations;                  procedure shall be the subject of reasoned
           — appropriations entered in the budget                  decisions to be forwarded, for information, to
                for the preceding financial year and               Parliament, the Council and the Court of
                the actual expenditure in the last                 Auditors,
                financial year for which the accounts              The persons concerned and the institutions to
                have been closed, broken down in the               which they belong may institute proceedings
                same way.'                                         before the Court of Justice.
  24. Article 17 becomes Article 21.                           27. Article 20 becomes Article 24. This Article is
                                                                    replaced by the following:
  25. Article 18 becomes Article 22. Paragraph 3 is                 'In each institution, the collection of revenue
       replaced by the following:                                   and the payment of expenditure shall be car-
       '(3) With the exception of decisions overrul-               ried out by an accounting officer.
       ing the Financial Controller provided for in                 This accounting officer shall be appointed by
       Articles 26, 28, 39, 49 and 52, the Commission               the institution.
       and each of the other institutions may delegate              Without prejudice to the system provided for
       their powers in accordance with the conditions               in Articles 4 and 5 of Regulation (EEC)
       laid down by their internal rules of procedure               No 729/70 on the financing of the common
       and within the limits which they themselves                  agricultural policy, and subject to the second
       lay down in the act of delegation.                           paragraph of Article 53 on payments proce-
       Those so empowered may act only within the                   dures, to Article 54 on imprests and to
       limits of the powers expressly conferred upon                Article 110 on the financing of external aid of
       them.                                                        the Financial Regulation, the accounting offi-
 ---pagebreak--- No C 97/12                        Official Journal of the European Communities                                9. 4. 84
     cer alone is empowered to manage monies and                  from one chapter to another during the year
     other assets. He shall be responsible for their              after informing the budgetary authority three
     safekeeping.                                                 weeks in advance.
     The accounting officer shall be responsible for
     preparing the financial statements provided                  (5) Without prejudice to the transfers which
     for in Articles 78, 79, 80 and 81 of this Regula-            it may make on its own authority in accord-
     tion.                                                        ance with paragraph 3 above, the Commission
                                                                  may make proposals to the budgetary auth-
     He may be assisted in his duties by one or                   ority for transfers from one chapter to another.
     more assistant accounting officers, appointed
     under the same conditions as the accounting                   (6) The budgetary authority shall take deci-
     officer.                                                      sions on transfers of appropriations as follows:
     The special rules applicable to the accounting                (a) in the case of proposals for transfers relat-
     officer and to assistant accounting officers                       ing to expenditure necessarily resulting
     shall be laid down in the implementing                             from the Treaties or from acts adopted in
     measures provided for in Article 123.'                             accordance therewith, the Council shall,
                                                                        after consulting Parliament, act by a quali-
                                                                        fied majority within six weeks, except in
                                                                        urgent cases. Parliament shall deliver its
 28. Article 21 becomes Article 25. This Article is                     opinion within such time as will permit the
     replaced by the following:                                         Council to be apprised of it and to act
     '(1) Appropriations shall be earmarked for                         within the time limit indicated. Where the
     specific purposes by chapter, article and item.                    Council does not act within this time limit,
                                                                        the proposals for transfers shall be deemed
     (2) Parliament, the Council, the Court of Jus-                     to be approved;
     tice and the Court of Auditors may transfer
     appropriations from one chapter to another,                   (b) in the case of proposals for transfers relat-
     from one article to another and from one item                       ing to expenditure other than that neces-
     to another within their own sections of the                         sarily resulting from the Treaties or from
     budget.                                                             acts adopted in accordance therewith, Par-
                                                                         liament shall, after consulting the Council,
     The Court of Justice and the Court of Auditors                      act within six weeks, except in urgent
      shall inform the budgetary authority and the                       cases. The Council shall deliver its opin-
      Commission three weeks before making such                          ion within such a time as will permit Par-
      transfers.                                                         liament to be apprised of it and to act
      (3) The Commission may, within its own sec-                        within the time limit indicated. Where Par-
      tions of the budget:                                               liament does not act within this time limit,
                                                                         the proposals for transfers shall be deemed
      (a) transfer appropriations from one item to                       to be approved;
           another and from one article to another
           within each chapter;                                     (c) proposals for transfers relating both to
                                                                         expenditure necessarily resulting from the
      (b) transfer appropriations from one chapter
                                                                         Treaties or from acts adopted in accord-
           to another within each of the titles relating
                                                                         ance therewith, and to other expenditure
           to staff expenditure and administrative
                                                                         shall be deemed to be approved if neither
           expenditure. It shall inform the budgetary
                                                                         the Council nor Parliament has decided
           authority three weeks before making such
                                                                          otherwise within six weeks of the date on
           transfers;
                                                                          which the two institutions received the
      (c) transfer payments appropriations from one                       proposals;
           chapter to another;                                      (d) if, in the case of the proposals for transfers
      (d) transfer appropriations entered in the                          referred to in the preceding subparagraph,
           chapter of the budget containing the provi-                    Parliament and the Council reduce the
           sional appropriations to the budget head-                      proposal for a transfer by different
           ing for which they were initially earmarked                    amounts, whichever is the smaller of the
           provided that the suspensive condition                         amounts accepted by one of the two insti-
           that originally gave rise to entry of the                      tutions shall be deemed to be approved.
           appropriations in this special chapter has                     Where only one of the institutions rejects
           been satisfied. It shall inform the budget-                    the principle of the transfer, such transfer
            ary authority three weeks before making                       shall not be made.
            such transfers.
       (4) The budgetary authority may enter in the                 (7) For the purposes of this Article the Com-
       budget one or more lists of chapters between                 mission sections shall be treated as a single
       which the Commission may make transfers                       section.
 ---pagebreak--- 9.4.84                            Official Journal of the European Communities                           No C 97/13
     (8) The appropriations which may be trans-                   (c) Subparagraph (g) of paragraph             2 is
      ferred shall be as follows:                                     replaced by the following;
     — non-differentiated appropriations for the                      '(g) proceeds from the sale of vehicles,
           current financial year and non-differen-                   equipment and installations and scientific
           tiated appropriations carried over,                        and technical apparatus, equipment and
     — commitment appropriations for the current                      materials which are being replaced or
           financial year and commitment appropria-                   scrapped.'
           tions remaining from the preceding finan-
           cial year,                                             (d) Paragraphs 3 and 4 are replaced by the
     — payment appropriations for the current                         following:
           financial year and payment appropriations                  '(3) By way of derogation from Article 4,
           carried over.                                              repayments made by third parties may be
     (9) Appropriations may also be transferred,                      deducted from expenditure in cases where
     by decision of the budgetary authority,                          the institution has effected a payment for
                                                                      which it is legally liable to the creditors
     between headings where a distinction is made
                                                                      but where all or part thereof has been paid
     between commitment appropriations and pay-
                                                                      on behalf of those third parties.
     ment appropriations and headings where no
     such distinction is made.                                        (4) By way of derogation from Article 4,
                                                                      adjustments may be made in respect of
     (10) Every proposal for a transfer within a                      exchange differences occurring in budget
     chapter or from one chapter to another shall be                  operations. The final gain or loss shall be
     subject to the approval of the financial con-                    entered in the balance for the year.'
     troller, who shall certify that the appropria-
     tions are available.
                                                                  (e) The following new paragraph 6 is added:
     (11) Appropriations may be transferred only
                                                                      '(6) Where recipients of Community aid
     to budget headings for which the budget has
                                                                      repay advances to the general budget, such
     authorized appropriations or carried a token
                                                                      amounts shall be re-entered under the
     entry.
                                                                      budget heading to which the original
     (12) This Article shall apply to the appropria-                  expenditure was charged.'
     tions corresponding to revenue earmarked for
     a specific purpose under Article 4 (2) only as
     long as the revenue is not used for any other
     purpose.                                                 30. Article 23 becomes Article 27:
     (13) Transfers within the titles of the budget
     devoted to the EAGGF, Guarantee Section,                     (a) Paragraph 1 is replaced by the following:
     appropriations shall be the subject of special
     provisions under Article 103 of this Regula-                      '(1) All measures which may give rise to
     tion.                                                             or modify a debt due to the Communities
     (14) No transfer shall be made between                            must be preceded by a proposal from the
     Parts I and II of the budget.'                                    competent authorizing officer. Such pro-
                                                                       posals shall be forwarded to the financial
                                                                       controller of the institution for his
                                                                       approval and to the accounting officer for
 29. Article 22 becomes Article 26:                                    provisional registration. They shall men-
                                                                       tion, in particular, the type of revenue, the
     (a) The words introducing the items in para-                      estimated amount thereof, the budget
           graph 1 are replaced by the following:                      heading to which it is to be booked and
                                                                       the name and description of the debtor.
           ' 1. By way of derogation from Article 4,                   The purpose of the approval of the finan-
           the following deductions may be made                        cial controller shall be to establish that:
           from all bills, invoices or statements,
           which shall then be passed for payment of
                                                                      (a) the revenue is booked to the correct
           the net amount:'                                                 budget item;
     (b) The words introducing the items in para-
           graph 2 are replaced by the following:                     (b) the proposal is in order and conforms
           '2. By way of derogation from Articles 4                        to the relevant provisions, in particular
           and 5, the following sums may be re-used                         of the budget and of the regulations
           under the heading to which the initial                           and also of all acts made in imple-
           expenditure was charged:'                                        mentation of the Treaties and of the
 ---pagebreak--- No C 97/14                          Official Journal of the European Communities                                9. 4. 84
                 regulations, and to the principles of              shall be entered in the budget, expressed in
                 sound financial management.                        ECU. They shall be made available in accord-
                 Forward proposals may be made in                   ance with Council Regulation (EEC, Euratom,
                 respect of certain items of current                ECSC) No 2891/77, and with Article 32 of this
                 revenue in accordance with the imple-              Financial Regulation.
                 menting measures provided for in                   (2) The Commission shall inform the budget-
                 Article 123.                                       ary authority of any material delay or any
                 The financial controller may withhold              other difficulty in making revenue available.'
                 his approval if he considers that the
                 conditions laid down in para-
                 graph 1 (a) and (b) above are not met.         34. Article 27 becomes Article 31. This Article is
                 The superior authority of the institu-              replaced by the following:
                 tion may, by a decision stating the full            'The balance from each financial year, calcu-
                 reasons therefor and on its sole re-                lated in accordance with Article 15 of Council
                 sponsibility, overrule this refusal. This           Regulation (EEC, Euratom, ECSC) No 2891/
                 decision shall be enforceable; it shall             77, shall be entered as revenue in the case of a
                 be communicated for information to                  surplus or expenditure in the case of a deficit
                 the financial controller. The superior              in a supplementary or amending budget in the
                 authority of each institution shall                 second financial year following the financial
                 inform the Court of Auditors of all                 year in question.
                 such decisions within one month.'
                                                                     However, if the situation requires, a decision
     (b) In the last line of the first subparagraph of               may be taken to enter all or part of this bal-
           paragraph 2 'Article 106' is replaced by                  ance in advance in a supplementary or amend-
           'Article 123'.                                            ing budget in the financial year immediately
                                                                     following the financial year in question.'
 31. A rticle 24 becomes A rticle 28 :
      (a) The third subparagraph of paragraph 1 is              35. A rticle 28 becomes A rticle 32 :
           replaced by the following:                                (a) Paragraph 1 is replaced by the following:
            'The accounting officer shall inform the                      '(1) The contributions provided for in
            authorizing officer and the financial con-                    Article 4 (6) of the Decision of 21 April
            troller of any revenue not recovered within                    1970 for the financing of certain supple-
            the time limits laid down. If necessary, he                   mentary research programmes shall be
            shall initiate the recovery procedure.'                       paid over as follows:
      (b) The third subparagraph of paragraph 2 is                        — seven-twelfths of the amount shown in
            replaced by the following:                                         the budget not later than 31 January,
            'If approval is withheld, the superior auth-                  — the remaining five-twelfths not later
            ority of the institution may, by a decision                        than 15 July.
            stating the full reasons therefor, and on its
            sole responsibility, overrule this refusal.                   (2) If the budget is not finally adopted
            This decision shall be final and binding; it                  before the start of the financial year, the
            shall be communicated for information to                       contributions provided for in paragraph 1
            the financial controller. The superior auth-                   shall be based on the amount shown in the
             ority of each institution shall inform the                    draft budget, as referred to in Article 9 (3)
             Court of Auditors of all such decisions                       and (4) of this Regulation or, if this does
             within on month.'                                             not exist, in the preliminary draft budget.'
       (c) In paragraph 4 'Article 106' is replaced by                (b) Paragraphs 2 and 3 become paragraphs 3
             'Article 123'.                                                and 4.
  32. Article 25 becomes Article 29.                             36. Article 29 becomes Article 33. This Article is
                                                                      replaced by the following:
                                                                      'The Commission shall, four times a year, pres-
  33. Article 26 becomes Article 30. This Article is                  ent to Parliament and the Council a report on
       replaced by the following:                                     the implementation of the budget and of any
       '(1) Estimates of the own resources and, if                    supplementary or amending budgets and on
       appropriate, of the contributions referred to in               the Communities' financial situation, covering
       Article 4 (2), (3) and (6) of the Decision of                  both revenue and expenditure. This report
       21 April 1970 to be paid by the Member States                  shall also give details of the utilization of
 ---pagebreak--- 9.4.84                             Official Journal of the European Communities                          No C 97/15
     appropriations carried forward from previous                  (2) The Commission shall enter the amounts
      financial years.                                             credited to the account referred to in para-
     This report shall at the same time be sent to                 graph 1 in its accounts kept in implementation
     the Court of Auditors.'                                       of the statement of revenue for the general
                                                                   budget of the European Communities on the
                                                                   basis of the rate for the ECU applying for the
                                                                   month in respect of which the entry is made.'
 37. Article 30 becomes Article 34. This Article is
     replaced by the following:                                38. Article 31 becomes Article 35.
     '(1) The Member States shall credit the
          amounts due to the account of the Com-               39. Article 32 becomes Article 36:
          mission with the financial organizations
          referred to in Article 9(1) of Council                   (a) In paragraph 2 'Article 96' is replaced by
          Regulation (EEC, Euratom, ECSC)                               'Article 98'.
          No 2891/77 in their national currency in                 (b) In paragraph 3 'Article 106' is replaced by
          accordance with the following provisions:                     'Article 123'.
          (a) the own resources referred to in
               Article 2 (a) and (b) of the Decision of        40. Article 33 becomes Article 37. In the final line
               21 April 1970 (agricultural levies and              'Article 106' is replaced by 'Article 123'.
               customs duties) and the balance of
               VAT resources referred to in                    41. Article 34 becomes Article 38:
               Article 10(4) of Council Regulation                 (a) The first paragraph becomes paragraph 1.
               (EEC, Euratom, ECSC) No 2891/77,
               both amounts expressed in national                  (b) The second paragraph is replaced by the
               currency, shall be credited to the                       following:
               abovementioned account as they                           '(2) Approval may not be conditional.
               stand;
                                                                        (3) The procedures for implementing this
          (b) the own resources accruing from VAT                       Article shall be determined by the imple-
               referred to in Article 4 (1) of the Coun-                menting measures provided for in
               cil Decision of 21 April 1970, the                       Article 123.'
               amounts of which are expressed in
               ECU in the general budget of the                42. Article 35 becomes Article 39:
               European Communities and, where
               appropriate, the financial contribu-                (a) In the first paragraph 'Article 34' is
               tions based on GNP and the adjust-                       replaced by 'Article 38'.
               ments to such contributions provided                (b) The second and third paragraphs are
               for in Article 10 (5) and (6) of Council                 replaced by the following:
               Regulation (EEC, Euratom, ECSC)
               No 2891/77 shall be converted at the                     'If approval is withheld and the authoriz-
               rate for the ECU applying on the first                   ing officer maintains his proposal, this
               working day following the fifteenth of                   refusal shall be referred for a decision to
               the month preceding the final date for                   the superior authority of the competent
               entry in the said account;                               institution among those listed in the first
                                                                        two paragraphs of Article 22.
          (c) the financial contributions referred to
               in Article 4 (6) of the Decision of                       Except where the availability of the appro-
               21 April 1970 (for the financing of                      priations is in doubt, the said superior
               supplementary research programmes)                        authority may, by a decision stating the
               shall be converted at the rate from the                  full reasons therefor and on its sole
               ECU applying on the last but one                         responsibility, overrule this refusal. This
               working day of the month preceding                        decision shall be enforceable; it shall be
               the final date for entry in the said                      communicated for information to the
               account;                                                  financial controller. The superior authority
                                                                         of each institution shall inform the Court
          (d) all other contributions or additional                      of Auditors of all such decisions within
               payments referred to in Article 32 (3)                    one month.'
               of this Financial Regulation shall be
                converted in accordance with which-            43. Article 36 becomes Article 40.
                ever of the methods laid down at (a)
               to (c) above applies to the case to
                which, depending on their nature,              44. Article 37 becomes Article 41:
                such contributions or additional pay-               (a) In paragraph 1 'Article 106' is replaced by
                ments correspond.                                        'Article 123'.
 ---pagebreak--- No C 97/16                        Official Journal of the European Communities                                 9. 4. 84
     (b) Paragraph 2 is deleted.                              55. Article 47 becomes Article 52.
     (c) Paragraph 3 becomes paragraph 2.                     56. Article 48 becomes Article 53. In the second
                                                                  paragraph 'Article 106' is replaced by
 45. Article 38 becomes Article 42.                               'Article 123'.
 46. Article 39 becomes Article 43.                           57. Article 49 becomes Article 54:
 47. Article 40 becomes Article 44. The third indent              (a) In the first paragraph 'Article 106' is
     is replaced by the following:                                      replaced by 'Article 123 .
     '— the amount to be paid (in figures and                     (b) The following new second paragraph is
           words), expressed in national currency or                    added:
           ECU.'                                                        'Only the accounting officer may replenish
                                                                        the imprest accounts, save in exceptional
 48. Article 41 becomes Article 45. In the first para-                  cases defined in the implementing
     graph 'Article 106' is replaced by 'Article 123'                   measures.'
     and 'Article 59' is replaced by 'Article 65'.                (c) The second paragraph becomes the third
                                                                        paragraph.
 49. Article 42 becomes Article 46:
      (a) The second paragraph is replaced by the             58. The following new title is added:
           following:
                                                                                       'SECTION IV
           'The authorizing officer may grant ad-
                                                                              MANAGEMENT OF POSTS'
           vances if a provision laid down by regula-
           tion specifically provides therefor.'              59. The following new Article 55 is added:
      (b) In the third paragraph 'Article 106' is                  ' 1. Within each institution the following shall
           replaced by 'Article 123'.                              be established:
      (c) In the fourth paragraph 'Article 49' is                  (a) a table of posts;
           replaced by 'Article 54'.
                                                                   (b) an organization chart with a diagram of
 50. The following new Article 4 7 is added:                             the organization of the departments.'
                                                              60. Title IV. The title of Section I is replaced by
       'Article 47                                                 the following:
                                                                                        'SECTION I
      (1) Interest shall be due on any amount paid                  CONTRACTS FOR THE SUPPLY OF GOODS
       to recipients of Community aid:                                    AND SERVICES; CONTRACTS FOR
       — either as an advance,                                              PURCHASE, LEASE AND HIRE'
       — or under the normal validation procedure,            61. Article 50 becomes Article 56. Paragraph 1 is
       which gives rise to repayment to the general                replaced by the following:
       budget.                                                     '1. Contracts for the purchase or hiring of
       Furthermore, where Community funds have                     buildings or goods, for the provision of ser-
       been wrongfully obtained, kept or used, the                 vices or for the performance of construction
       Commission may impose penalties.                            work shall be in writing. Apart from contracts
       (2) The procedure for implementing the                      relating to buildings, all such contracts shall be
       above measures shall be laid down in an                     concluded following an automatic public ten-
       implementing regulation adopted by the                       dering or discretionary tendering procedure.
       Council on the basis of Article 209 of the EEC               However, contracts may be made by private
       Treaty.'                                                     treaty in the circumstances referred to in
                                                                    Article 58.
  51. Article 43 becomes Article 48.                                Contracts may be made against invoice or bill
                                                                    of costs in the cases provided for in Article 63.'
  52. Article 44 becomes Article 49. 'Article 35' is
       replaced by 'Article 39'.                               62. Article 51 becomes Article 57. In paragraph 3
                                                                    'Article 106' is replaced by 'Article 123'.
  53. Article 45 becomes Article 50.
                                                               63. Article 52 becomes Article 58:
  54. Article 46 becomes Article 51.                                 (a) Item (a) is replaced by the following:
 ---pagebreak--- 9. 4. 84                            Official Journal of the European Communities                           No C 97/17
             'where the contract for the purchase or hir-           institution shall comply with the Directives (')
             ing of goods, for the provision of services            adopted by the Council, pursuant to the Treaty
             or for building works is within the limit              establishing the European Economic Com-
             laid down in the implementing measures                 munity, in respect of public works and sup-
             provided for in Article 123, the institution           plies, whenever the amounts involved are
             concerned being bound, however, as far as              equal to or greater than the amounts provided
             possible and by all appropriate means, to              for in those Directives.
             enable suppliers who are likely to be able             The implementing measures provided for in
             to supply the goods and services in ques-              Article 123 shall include the supplementary
             tion to compete;'                                      provisions which may be required in order to
       (b) In item (b) 'Article 51' is replaced by                  implement this Article.'
             'Article 57'.
                                                                70. Article 59 becomes Article 65. The first para-
  64. Article 53 becomes Article 59.                                graph is replaced by the following:
                                                                    'Permanent inventories showing the quantity
                                                                    and value of all movable and immovable pro-
  65. Article 54 becomes Article 60. This Article is
                                                                    perty belonging to the Communities shall be
       replaced by the following:
                                                                    kept in accordance with a model drawn up by
       'Each institution shall set up its own advisory              the Commission. Only movable property
       committee on procurements and contracts to                   exceeding a specific value laid down in the
       express an opinion on contracts before the                   implementing measures provided for in
       authorizing officer takes a decision.                        Article 123 shall be entered in those inven-
       Details of the operation of this committee and               tories.'
       the limit values for the contracts on which it is
       to be consulted shall be laid down in the                71. Article 60 becomes Article 66. In the first para-
       implementing measures provided for in                         graph 'Article 106' is replaced by 'Article 123'.
       Article 123.'
                                                                72. Article 61 becomes Article 67. The first para-
  66. Article 55 becomes Article 61. In the first para-             graph is replaced by the following:
       graph 'Article 54' is replaced by 'Article 60'.
                                                                     'A statement or record shall be drawn up by
                                                                    the authorizing officer and authenticated by
                                                                    the financial controller whenever any property
  67. Article 56 becomes Article 62:                                in the inventory is sold, given away free of
       (a) First paragraph: 'Article 106' is replaced                charge, scrapped, hired out, or missing on
             by'Article 123'.                                        account of loss, theft or any other reason.'
       (b) The third paragraph is replaced by the fol-
             lowing:                                            73. Article 62 becomes Article 68. In the first para-
             'Within the limit laid down by the imple-              graph 'Article 59' is replaced by 'Article 65'.
             menting measures provided for in
             Article 123, the provision of security shall
             be obligatory. A guarantee may be                  74. Article 63 becomes Article 69. This Article is
             retained until final acceptance.'                       replaced by the following:
                                                                     'The accounts shall be kept in ECU by the
                                                                     double entry method, on the basis of the calen-
  68. Article 57 becomes Article 63: This Article is                 dar year. They shall show all revenue and
       replaced by the following:                                    expenditure for the financial year. They shall
                                                                     be authenticated by supporting documents.
        'Contracts may be made against invoice or bill               The revenue and expenditure account and the
        of costs within the limits laid down by the                  balance sheet shall be drawn up in ECU.
        implementing measures provided for in
        Article 123.'                                                 However, when debts or commitments are in
                                                                      national currency, the accounting system
   69. Article 58 becomes Article 64. This Article is
        replaced by the following:                                  (') The following Directives were in force at the
                                                                          time this Regulation was drawn up:
         'Without prejudice to the provisions laid down                   (a) Public works: Directive 71/305/EEC, as
         in this Financial Regulation, when concluding                        amended by Directive 78/669/EEC;
         contracts referred to in this Regulation, each                   (b) Supplies: Directive 77/62/EEC.
 ---pagebreak--- No C 97/18                         Official Journal of the European Communities                               9. 4. 84
     should make it possible, where necessary, for                 orders or are, without justification, late in issu-
     them to be recorded in the national currency as                ing them, thereby rendering the institution
     well as in ECU.'                                               liable to civil action by third parties.'
                                                               80. Article 69 becomes Article 74.
 75. Article 64 becomes Article 70. This Article is
     replaced by the following:
                                                               81. Article 70 becomes Article 75:
      'The chart of accounts shall make a clear dis-
     tinction between budgetary accouns and cash                   (a) In the first subparagraph of paragraph 1
     accounts.                                                          'the third paragraph of Article 46' is
                                                                        replaced by 'the third paragraph of
      It shall comprise two parts:                                      Article 51'.
     (a) accounts of budgetary expenditure and                     (b) In the second subparagraph of para-
           revenue, which show the detailed imple-                      graph 3 'Article 106' is replaced by
           mentation of the budget;                                     'Article 123'.
     (b) the balance sheet accounts, which disclose                (c) The third subparagraph of paragraph 3
           the assets of the institutions.                              becomes paragraph 4.
     The detailed conditions for the establishment
     and operation of the chart of accounts for                    (d) Paragraph 4 becomes paragraph 5.
     transactions relating both to assets and to the
     implementation of the budget shall be deter-              82. Article 71 becomes Article 76.
     mined by the implementing measures provided
     for in Article 123.                                       83. Article 72 becomes Article 77.
     These accounts shall make it possible to draw
     up an annual balance of assets and a monthly              84. Article 73 becomes Article 78. This Article is
     statement of revenue and expenditure by chap-                 replaced by the following:
     ter and article.                                              'The Commission shall draw up, not later than
     These statements shall be forwarded to the                    1 June of the following year, a consolidated
     financial controller, the authorizing officer,                revenue and expenditure account of the gen-
     and the Court of Auditors.'                                   eral budget of the European Communities for
                                                                   the financial year ended 31 December. The
                                                                   consolidated revenue and expenditure account
                                                                   shall include:
 76. Article 65 becomes Article 71:
                                                                   1. a table of revenue including:
     (a) In the first paragraph 'Articles 96 and 102'
           is replaced by 'Articles 98 and 118'.                        — estimated revenue for the financial
                                                                             year,
     (b) In the second paragraph 'the third para-
           graph of Article 42' is replaced by 'the                     — amendments to the revenue estimates
           third paragraph of Article 46'.                                   as a result of supplementary or
                                                                             amending budgets and additional
                                                                             revenue as specified in the second
 77. Article 66 is deleted.                                                  subparagraph of Article 4 (2),
                                                                        — entitlements established in the course
                                                                             of the financial year,
 78. Article 67 becomes Article 72.                                     — entitlements still to be collected from
                                                                             the preceding financial year,
                                                                        — revenue collected during the financial
 79. Article 68 becomes Article 73: This Article is                          year and revenue carried over pur-
     replaced by the following:                                              suant to Article 7 (5),
     'Authorizing officers who, when establishing                       — amounts still to be collected at the end
     entitlements to be recovered or issuing recov-                          of the financial year.
     ery orders, entering into a commitment of
     expenditure or signing a payment order do so                       Statements shall be attached to this table
     without complying with this Financial Regula-                      showing revenue carried over pursuant to
     tion and the implementing measures, shall ren-                     Article 7 (5) and, where appropriate, the
     der themselves liable to disciplinary action                       balances and gross amounts of the opera-
     and, where appropriate, to payment of com-                         tions referred to in Article 26 (2);
     pensation. The same shall apply if they omit to               2. tables showing the changes in appropria-
     draw up a document establishing a debt or if                       tions for the financial year and, with a dis-
     they neglect to issue recovery or payment                          tinction being made between commitment
 ---pagebreak--- 9. 4. 84                           Official Journal of the European Communities                          No C 97/19
           appropriations, payment appropriations                           year and calculation of the sums still
           and non-differentiated appropriations,                           to be paid at the end of the current
           indicating:                                                      financial year,
          — initial appropriations,                                     — amount lapsing, a distinction being
          — any changes made by means of sup-                               made between commitment appro-
                plementary or amending budgets,                             priations, payment appropriations and
                                                                            non-differentiated appropriations;
          — any changes made to appropriations
               by means of transfers,                               5. tables showing capital operations and debt
                                                                        management and indicating:
          — final appropriations for the financial
               year,                                                    — loans raised,
          — appropriations remaining or carried                         — capital repayments, interest payments
               over under Article 7;                                        and costs received in respect of loans
                                                                            granted,
       3.  tables showing the use of the appropria-                     — loans granted,
          tions allocated for the financial year and,
           with a distinction being made between                        — capital repayments and interest and
           commitment appropriations, payment                               costs paid in respect of loans raised,
           appropriations and         non-differentiated                — Community indebtedness.'
           appropriations, indicating:
          — commitments entered into and charge-
                able to the financial year,                    85. Article 74 becomes Article 79. This Article is
          — payments made and chargeable to the                    replaced by the following:
               financial year,                                     'Each institution shall, not later than 1 March,
          — settlement of the commitments of the                   transmit to the Commission, after submitting it
                financial year and calculation of the              to its financial controller, the information
                sums still to be paid at the close of              required for drawing up the revenue and
               that financial year,                                expenditure account and the balance sheet,
                                                                   together with a contribution to the analysis of
          — commitment appropriations remaining                    the financial management referred to in
               under Articles 7 and 92 (4),                        Article 80.'
          — payment appropriations carried over
               under Article 7,
          — non-differentiated appropriations car-             86. Article 75 becomes Article 80.
               ried over under Article 7,
          — appropriations lapsing.
                                                               87. Article 76 becomes Article 81. This Article is
          Where appropriate, a statement shall be                  replaced by the following:
          attached to this table showing the bal-
          ances and gross amounts of the operations                (1) The Commission shall draw up, not later
          referred to in Article 26 (2);                           than 1 June, a consolidated balance sheet of
                                                                   assets and liabilities of the Communities as at
       4. tables showing the use of the appropria-                 31 December of the preceding financial year.
          tions available from previous financial                  A statement, showing the movements and bal-
          years and indicating:                                    ances of the accounts, drawn up on the same
          — the amount of appropriations remain-                   date, shall be attached thereto.
               ing or carried over, a dinstinction                 (2) These documents shall be submitted to
               being made between commitment                       the financial controller.'
               appropriations, payment appropria-
               tions and non-differentiated appro-
               priations,
          — commitments entered into and charge-               88. Article 77 becomes Article 82.
               able to available commitment appro-
               priations,
          — payments made against payment                      89. Article 78 becomes Article 83. This Article is
               appropriations and non-differentiated               replaced by the following:
               appropriations which have been car-                 '(1) The Court of Auditors and its members
               ried over,                                          may, in carrying out the task of the Court, be
          — settlement of sums still to be paid at                 assisted by officers of the Court. The Court
               the close of the preceding financial                itself or one of its members shall notify the
 ---pagebreak--- No C 97/20                         Official Journal of the European Communities                              9. 4. 84
     authorities with which the delegated officer is               tion (EEC, Euratom, ECSC) No 2891/77. This
     to work of the tasks delegated to him.                        measure shall also apply to the inspection of
     (2) Parliament, the Council and the Commis-                   any fund set up by the Communities.
     sion shall inform the Court of Auditors, as                   At the request of the Court of Auditors, each
     soon as possible, of all decisions and measures               institution shall authorize outside persons to
     taken pursuant to Articles 4 (4), 7 (4), 9, 17 (1)            permit the Court to make any checks to ensure
     and 25.                                                       that external data correspond to the accounts.'
     (3) The insitutions shall transmit to the Court
     of Auditors any rules of procedure in respect
     of financial matters.
                                                               92. Article 81 becomes Article 86.
     (4) The Court of Auditors shall be informed
     of the appointment of authorizing officers,
     financial controllers, accounting officers and
     administrators of imprest accounts and of the
     acts of delegation or appointment under                   93. Article 82 becomes Article 87. The final para-
     Articles 22, 23, 24 and 54.'                                  graph is replaced by the following:
                                                                   'The granting of Community funds to benefi-
                                                                   ciaries outside the institutions shall be subject
                                                                   to the agreement in writing by the recipients to
 90. Article 79 becomes Article 84. The phrase:                    an audit being carried out by the Court of
                                                                   Auditors on the utilization of the amounts
      'subject to Article 19 of Council Regulation                 granted.'
     (EEC, Euratom, ECSC) No 2891/77 and to
      Article 80 of this Financial Regulation' is
     replaced by 'subject to Article 18 of Council
      Regulation       (EEC,       Euratom,      ECSC)         94. Article 83 becomes Article 88. This Article is
      No 2891/77 and to Article 85 of this Financial               replaced by the following:
      Regulation.'
                                                                    'The annual report of the Court of Auditors
                                                                    provided for in Article 78 of the ECSC Treaty,
                                                                    Article 206a of the EEC Treaty and Article
 91. Article 80 becomes Article 85. This Article is                 180a of the Euratom Treaty shall be governed
      replaced by the following:                                   by the following provisions:
      'The audit carried out by the Court of Auditors               (1) The Court of Auditors shall transmit to
      shall be based on records and, if necessary,                 the Commission and the institutions con-
      performed on the spot. Its purpose shall be to                cerned, by 15 July at the latest, any comments
      establish that all revenue has been received                  which are, in its opinion, of such a nature that
      and all expenditure incurred in a lawful and                 they should appear in the annual reports.
      proper manner having regard to the provisions                 These comments must remain confidential.
      of the Treaties, the budget, the Financial                    Each institution shall address its reply to the
      Regulations and all other acts adopted pur-                   Court of Auditors by 31 October at the latest.
      suant to the Treaties, and that the financial                 The replies of the institutions other than the
      management has been sound.                                    Commission shall be forwarded simulta-
                                                                    neously to the Commission.
       For the performance of its task, the Court of
      Auditors shall be entitled to consult, in the                 (2) The annual report shall contain an assess-
      manner provided for in Article 87, all docu-                  ment of the soundness of financial manage-
      ments and information relating to the financial               ment.
      management of the departments or bodies sub-                  (3) The annual report shall comprise a sec-
      ject to its inspection; it has the power to make              tion for each institution. Each section shall
       inquiries of any official responsible for a                  contain all the comments of the Court of Aud-
      revenue or expenditure operation, and to use                  itors on the relevant institution. The replies of
       any of the auditing procedures appropriate to                each institution shall be published immedia-
      those departments or bodies.                                  tely following the comments relating to that
       The Court of Auditors, in order to obtain all                institution.
       the necessary information for the performance                (4) The Court of Auditors shall transmit to
       of the task entrusted to it by the Treaties and              the authorities responsible for giving discharge
       the acts adopted pursuant thereto, may be                     and to the other institutions, by 30 November
       present, at its request, during the operations                at the latest, its annual report accompanied by
       carried out by the Commission pursuant to                     the replies, and it shall ensure publication
       Articles 8 and 9 of Regulation (EEC)                          thereof in the Official Journal of the European
       No 729/70 and Articles 17 and 18 of Regula-                    Communities.'
 ---pagebreak--- 9. 4. 84                            Official Journal of the European Communities                           No C 97/21
  95. Article 84 becomes Article 89. This Article is                The institution concerned shall have two and a
       replaced by the following:                                   half months in which to inform the Court of
       '(1) Parliament, upon a recommendation                       Auditors of any comments it wishes to make
       from the Council, acting by a qualified major-               on the observations in question.
       ity, shall, before 30 April of the next year, give           Should the Court of Auditors decide to have
       a discharge to the Commission in respect of                  such observations published in the Official
       the implementation of the budget. If that date               Journal of the European Communities, it shall
       cannot be met, Parliament or the Council shall               include after them any comments submitted by
       inform the Commission of the reasons for the                 the institution or institutions concerned.
       postponement.                                                (3) If the opinions referred to in paragraph 1
       (2) The European Parliament shall deliver its                do not relate to proposals for legislation or
       opinion on the discharge, in particular on the               draft legislation on which it has been con-
       basis of all revenue and expenditure of the                  sulted, the Court of Auditors shall not publish
       Communities audited by the Court of                          them unless the institution which has
       Auditors.                                                    requested the opinion and the institution con-
       (3) The financial controller shall take                      cerned agree. In this case, these opinions shall
       account of the comments made in the deci-                    be accompanied by the replies of the institu-
       sions giving discharge.                                      tion or institutions concerned.'
       (4) The institutions shall take all appropriate          97. Title VII. The title is replaced by the follow-
       steps to act on the comments appearing in the                ing:
       decisions giving discharge.                                                      TITLE VII
       (5) At the request of Parliament or the Coun-                SPECIAL PROVISIONS                 APPLICABLE
       cil, the institutions shall report on the mea-               TO RESEARCH AND DEVELOPMENT
       sures taken in the light of these comments and,                AND TECHNOLOGICAL INNOVATION'
       in particular, on the instructions given to those
       of their departments which are responsible for           98. Articles 86 to 94 are deleted and are replaced
       the implementation of the budget. Such                       by the following:
       reports shall also be transmitted to the Court
       of Auditors.                                                  'Article 91
       (6) Without prejudice to the reports provided
                                                                    'The provisions of this title shall apply, by way
       for in paragraph 5, the institutions must give
                                                                    of derogation from the provisions of this
       an account, in an annex to the revenue and
                                                                    Regulation, to appropriations for research and
       expenditure account for the financial year
                                                                    development and technological innovation
       during which the discharge is given, of the
                                                                    activities, in particular those under pro-
       measures taken in the light of the comments in
                                                                    grammes adopted by the Council pursuant to
       the decisions giving discharge.
                                                                    Article 7 of the Euratom Treaty and Article 235
       (7) If Parliament decides to postpone the dis-               of the EEC Treaty, and any other activities in
       charge the Commission must as rapidly as pos-                this field, notably services performed in third-
       sible remove any obstacles to the discharge                  party accounts.
       decision.
       (8) Supporting documents pertaining to the                   Article 92
       accounts and the preparation of the revenue                  (1) The appropriations relating to the above
       and expenditure account and the balance sheet                activities, including those to cover the staff
       shall be kept for a period of five years follow-             and administrative expenditure provided for in
       ing the date of the decision giving discharge in             the corresponding decisions, shall be entered
       respect of the implementation of the budget.                 in as many titles as are required within a spe-
       However, the documents relating to transac-                  cific section of the general budget.
       tions not finally closed shall be kept for longer
       than the said period until the end of the year               (2) The nomenclature of the title relating to
       following the year in which such transactions                staff expenditure shall correspond to that of
       are finally closed.'                                         expenditure of the same type in all the institu-
                                                                    tions; it may, however, include certain addi-
  96. Article 85 becomes Article 90. This Article is                tional headings corresponding to expenditure
       replaced by the following:                                   specific to the activities referred to in this title.
       '(1) The Court of Auditors may also, at any                  (3) The appropriations entered in the title
       time, submit observations on specific ques-                  relating to staff expenditure shall be non-dif-
       tions and deliver opinions at the request of                 ferentiated appropriations; the appropriations
       one of the institutions of the Communities.                  for operating and administrative expenditure
       (2) It shall transmit any observations made to               in the other titles shall be differentiated appro-
       the institutions or body concerned.                          priations.
 ---pagebreak--- No C 97/22                        Official Journal of the European Communities                                 9.4.84
    (4) — By way of derogation from Article 7                     Article 95
              (2) (a), the commitment appropria-
              tions shall remain valid until the close            By way of derogation from Article 25, the fol-
              of the financial year following that in             lowing provisions shall apply to transfers:
               which the programme adopted by the                 1. The Commission is authorized to take
              Council ends.                                            decisions on:
          — The commitment appropriations for                          (a) all transfers within the title relating to
              other activities shall remain in exist-                      staff expenditure;
               ence for the following financial year in
                                                                       (b) transfers from one item to another,
               accordance with Article 7 (2) (a) of
                                                                           from one article to another and from
              this Regulation. •
                                                                           one chapter to another in each of the
     (5) Staff appropriations which are available                          titles relating to operating and admin-
     because the actual number of staff is temporar-                       istrative expenditure;
     ily lower than the number authorized may be
                                                                      (c) all transfers of payment appropria-
     used only for expenditure to make up the staff
                                                                           tions within and between the titles
     shortage.
                                                                           relating to operating and administra-
     The title relating to staff expenditure shall                         tive expenditure.
    therefore contain a heading to which expendi-                 2. The budgetary authority shall take deci-
    ture on replacements may be charged. This                          sions on the following in accordance with
     heading, which shall carry a token entry, shall                  the procedures laid down in Article 25:
     be allocated funds that are available during
     the financial year by means of transfers in                      (a) transfers between the title relating to
     accordance with Article 95 (1) (a).                                   staff expenditure and the titles relating
                                                                           to operating and administrative
     Article 93                                                            expenditure;
     For each of the titles, there shall be attached to               (b) transfers of commitment appropria-
     the specific section containing the appropria-                        tions between the titles relating to
     tions referred to here:                                               operating and administrative expendi-
                                                                           ture.
     — a table of equivalence breaking down
          these appropriations by programme and
          by instruments of implementation;                       Article 96
     — an indicative schedule of commitments                      With regard to the award of contracts in the
          and payments indicating the planned rate                fields falling under this title, the implementing
          for utilizing the appropriations for each               measures provided for in Article 123 may lay
          programme.                                              down special provisions on the operation and
                                                                  on the determination of the powers of the
     Article 94                                                   advisory committee on procurements and con-
                                                                  tracts and on the limit values determining the
     (1) Analytical expenditure accounts shall be
                                                                  procedure for concluding contracts.'
     drawn up in respect of the implementation of
     the programmes referred to in Article 91. These
     accounts must enable the expenditure allo-               99. Article 95 becomes Article 97. This Article is
     cated to each programme from the budget to                   replaced by the following:
     be identified.                                               'This title shall apply to the operations of the
      (2) These accounts shall show the corre-                    European Agricultural Guidance and Guaran-
      spondence between expenditure and the cost of               tee Fund, Guarantee Section, in accordance
     the main instruments of implementation such                  with Regulation (EEC) No 729/70 of 21 April
      as:                                                          1970.
      — staff;                                                    In accordance with Article 4 (2) of this Regula-
                                                                  tion, the Commission shall place the necessary
     — general technical services and administra-                 appropriations for these operations at the dis-
          tion ;                                                  posal of the Member States.
     — scientific and technical services and major                The operations of the EAGGF, Guarantee Sec-
          installations;                                          tion, shall normally be effected through the
     — the operating appropriations specific to                   authorities or bodies referred to in Article 4(1)
          the objectives.                                         of Regulation (EEC) No 729/70, under the
                                                                  implementing provisions adopted pursuant to
     (3) The detailed procedures for drawing up                   Article 5 (3) of the said Regulation.
     these analytical accounts shall be determined
     by the implementing measures provided for in                  Special operations which the Commission
      Article 123.                                                manages directly, shall be implemented in
 ---pagebreak--- 9. 4. 84                           Official Journal of the European Communities                           No C 97/23
        accordance with the rules laid down in Title                 (2) The commitments provided for in this
        III of this Regulation.'                                     Article shall be deducted from the global prov-
                                                                     isional commitments referred to in Article 98.
                                                                     (3) This Article shall apply without prejudice
                                                                     to the clearance of accounts provided for in
 100. Article 96 becomes Article 98. This Article is                 Article 101 of this Regulation.'
       replaced by the following:
       '(1) Global provisional commitments shall be
       entered into, corresponding to the advances to         102. Article 98 becomes Article 100.
       be made to the Member States, in respect of
       the appropriations for the Guarantee Section
       of the European Agricultural Guidance and
       Guarantee Fund.
                                                              103. Article 99 becomes Article 101. This Article is
       The Commission decisions fixing the amounts                  replaced by the following:
       of these advances in accordance with Article 5
       (2) (a) of Regulation (EEC) No 729/70 shall                  '(1) The object of the clearance of the
       constitute global provisional commitments.                   accounts provided for in Article 5 (2) (b) of
       The approval of the financial controller shall               Regulation (EEC) No 729/70 shall be:
       have the sole purpose of establishing that these             — to determine the amount of expenditure
       commitments correspond to the amount of the                       effected in each Member State during the
       advances decided by the Commission after                          financial year in question and acknowl-
       consultation with the EAGGF Committee, and                         edged as being to the account of the
       that they are within the limits of the total                       EAGGF,
       amount of appropriations entered in the Guar-                — to determine the amount of the funds
       antee Section of the European Agricultural                        remaining available in the Member States.
       Guidance and Guarantee Fund.
                                                                    Not later than 30 June of the year following
       Payment of the advances shall be made within                 the financial year in question the Member
      the limits of the amounts so committed. The                   States shall, for the purpose of clearance of the
       appropriations made available for advances                   accounts, send to the Commission summary
      shall be to cover exclusively expenditure                     annual accounts for the financial year ended,
      which has given rise to payment in the Mem-                   amending where necessary the monthly
      ber States between 1 January and 31 December                  accounts. These summary accounts shall be
      of the financial year in question.                           accompanied by the appropriate reports drawn
      (2) Every month, at the same time as granting                up by the competent audit and control depart-
      the advances, the Commission shall inform                    ments and dealing with the expenditure
      Parliament and the Council of the breakdown                  referred to in the Articles relating to expendi-
      by chapter of expenditure corresponding to the               ture covered by the clearance.
      advances granted. It shall include whatever                  If the accounts of a paying agency or depart-
      information which it considers appropriate.'                 ment have not reached the Commission by 30
                                                                   June, the Commission may clear the accounts
                                                                   of that agency or department solely on the
101. Article 97 becomes Article 99. This Article is                basis of the financial statements referred to in
      replaced by the following:                                   Article 5 (1) (a) of Regulation (EEC) No
                                                                   729/70 as described by implementing mea-
      '(1) Expenditure effected by authorities and                 sures (') adopted pursuant to Article 5 (3) of
      bodies under Article 4 of Regulation (EEC)                   the said Regulation.
      No 729/70 shall be the subject of a commit-                  (2) On the basis of the abovementioned
      ment by chapter, article and item, and shall                 accounts or statements and of the findings of
      also be charged as a payment, after examina-                 audits of documents and on the spot under the
      tion of the statements forwarded by the Mem-                terms of Article 9 of Regulation (EEC) No
      ber States in accordance with the provisions                729/70, the Commission, after consulting the
      laid down pursuant to Article 5 (3) of the said              Fund Committee referred to in Article 13 of
      Regulation, and after the approval of the                   the Regulation, shall clear the accounts not
      financial controller.                                       later than 30 November of the second year fol-
      Subject to Article 100, the commitment shall                lowing the financial year in question.
      be entered into within two months following
      receipt of the statements forwarded by the
      Member States. The charging as a payment
      shall, in general, be carried out within the                (') Regulation (EEC) No 380/78 of 30 January
      same period.                                                       1978, OJ No L 56, 27. 2. 1978.
 ---pagebreak--- No C 97/24                        Official Journal of the European Communities                                9. 4. 84
      (3) The Commission shall transmit the clear-                (4) The Commission shall inform the budget-
      ance decisions to the Member States and pub-                ary authority of such transfers 15 days in
      lish them in the Official Journal of the Euro-              advance.'
      pean Communities.
      (4) The outcome of the clearance decision,
      i.e. any difference which may exist between            106. Title IX. This title is replaced by the following:
      the total expenditure charged to the accounts
      for a financial year pursuant to Articles 99 and
                                                                                       'TITLE IX
      100 and the total expenditure established by
      the Commission when clearing the accounts                   SPECIAL PROVISIONS APPLICABLE
      shall be charged, under a single article, as                              TO EXTERNAL AID
      over- or under-expenditure to the financial
      year in which the accounts are cleared. How-                                     SECTION I
      ever, if the procedures required for this pur-                           GENERAL PROVISIONS
      pose — transfers or a supplementary or
      amending budget — cannot be completed by
      the end of the year, the clearance decision                 Article 104
      shall be charged as soon as possible to the fol-
      lowing financial year.'                                     (1) Subject to derogation, the provisions of
                                                                  Titles I to VI and XI shall apply to foreign aid
                                                                  financed from the Community budget, in so
                                                                  far as they are not incompatible with the
104. Article 100 becomes Article 102. This Article is             express provisions of this title.
      replaced by the following:
                                                                  (2) The appropriations assigned by the Com-
       '(1) Global provisional commitments which                  munity to its development cooperation policy
       have been made for a financial year in accord-             shall be used either under global cooperation
       ance with Article 98 and which have not been               agreements of a contractual nature or as aid
       specifically committed under the budget                    granted unilaterally.
       nomenclature in accordance with Article 99 by              (3) These appropriations may be earmarked
       31 March of the following financial year, shall            for grants, special loans, risk capital, or interest
      be released under the original financial year.              rate subsidies, and shall be paid out by the
       (2) A global provisional commitment corre-                 Commission, which may confer on the Euro-
       sponding to the amount released shall be                   pean Investment Bank authority on behalf of
       made from the appropriations for the current               the Community to administer a part thereof.
       financial year.'                                           This provision shall not prejudice audit
                                                                   powers of the Court of Auditors under Article
                                                                   206a of the Treaty.
                                                                  (4) The appropriations paid out by the Com-
                                                                   mission shall be used in accordance with the
 105. Article 101 becomes Article 103. This Article is             following provisions.
       replaced by the following:                                  (5) The amount of speical loans and risk cap-
                                                                   ital granted shall be shown in the balance
       '(1) Appropriations made available in one                   sheet provided for in Article 81.
       chapter of expenditure may not be allocated to
       another chapter of expenditure.
                                                                   Article 105
       (2) Transfers from one chapter to another
        and transfers within a chapter shall be made               (1) A financing agreement shall be drawn up
       by decision of the Commission in accordance                 between the Commission, acting for the Com-
        with the procedure provided for in Article 13              munity, and the government or the competent
        of Regulation (EEC) No 729/70, which must                  authority of the recipient State in respect of
        be completed not later than 31 March.                      any investment project on which the Commis-
                                                                   sion takes a financing decision.
        (3) The procedure referred to in paragraph 2
        shall also apply to transfers between the                  (2) The financing agreement shall determine
        EAGGF Guarantee chapters and the food-aid                  the financial commitment of the Community
        chapter, in so far as such transfers are made              for the measure concerned. No item of
        necessary by changes, in relation to the appro-            expenditure in excess of this amount may be
        priations authorized, in the parts of the                  charged to the budget without an additional
        expenditure chargeable to the respective                   commitment in accordance with the terms of
        chapters.                                                  Article 107.
 ---pagebreak--- 9. 4. 84                           Official Journal of the European Communities                           No C 97/25
       (3) In addition, a loan contract shall be                        excess is 15 % or less of the initial commit-
       drawn up between the Commission, acting for                      ment set in the financing decision.
       the Community, and the borrower in respect of
       any investment project financed by a special
       loan.
                                                                   Article 108
                          SECTION II                               (1) The Government of the recipient State
                     EXECUTIVE AGENTS                              shall appoint a national authorizing officer to
                                                                   represent the national authorities in all opera-
                                                                   tions relating to projects financed by the Com-
                                                                   munity.
       Article 106
       Where finance is provided by the Community                  (2) The national authorizing officer shall
       under a global cooperation agreement, the dis-              submit invitations to tender to the Commis-
       bursement of funds shall, as a rule, be                     sion for agreement before issuing them. On the
       entrusted to a chief authorizing officer, a                 basis of the decisions thus endorsed and in
       national authorizing officer, a Commission                  close cooperation with the chief authorizing
       delegate and a paying agent, as specified                   officer and with the delegate referred to in
       below.                                                      Article 107 where such a delegate has been
                                                                   appointed, the national authorizing officer
                                                                   shall issue invitations to tender, receive ten-
                                                                   ders, preside over the examination of tenders
       Article 107                                                 and establish the results of the tendering
       (1) The Commission shall perform the func-                  procedure.
       tions of chief authorizing officer, which shall
       be to ensure that financing decisions are car-
       ried out and to be responsible for the manage-             (3) He shall transmit to the Commission for
       ment of resources. In this capacity it commits,            agreement the results of the examinations of
       clears and authorizes expenditure.                         the tendering procedure and a proposal for the
                                                                  award of the contract. He shall sign contracts
       (2) The chief authorizing officer, in close                and riders thereto and estimates and notify the
       cooperation with the national authorizing offi-            Commission thereof. For contracts, riders
       cer, shall ensure that participants in tendering           thereto and estimates, the Commission shall
       procedures can compete on an equal footing,                enter into individual commitments in accord-
       that there is no discrimination and that the               ance with the procedures laid down in
       tender selected is economically the most                   Articles 36 to 39. Individual commitments shall
       advantageous. In particular, he shall approve              be set against the commitments under the financ-
       the terms of the invitation to tender before it is         ing agreements provided for in Article 105 (2).
       issued, be apprised of the results of the exami-
       nation of the tenders, and approve the propo-
       sal for the award of the contract, save where               (4) The national authorizing officer shall
       such powers are conferred on the Commission                 clear and authorize expenditure against appro-
       delegate.                                                   priations committed by the Commission. He
                                                                   shall remain financially liable to the Commis-
       (3) The chief authorizing officer shall make               sion until the Commission clears the
        any adjustments and take commitment deci-                 operations for the execution of which he is
        sions which prove necessary to ensure the                 responsible.
        proper execution of approved projects and
        programmes in the best economic and tech-
        nical conditions.
       (4) Decisions concerning additional commit-                Article 109
       ments to cover any amounts in excess of the
       allocation for a project shall be taken:                    (1) For the purposes of applying the agree-
                                                                   ment or convention between the Community
       — by the procedures for the adoption of                     and the recipient State, and in respect of the
            financing decisions, where the excess is               appropriations for which it is the authorizing
            more than 15 % of the initial commitment               officer, the Commission may be represented in
            set in the financing decision,                         the recipient State by a delegate approved by
       — by the chief authorizing officer, where                   that State.
 ---pagebreak--- No C 97/26                      Official Journal of the European Communities                               9. 4. 84
    (2) At the request of the recipient State, the              (5) Within the limits of the funds available,
    delegate shall give technical assistance in pre-            the paying agent shall make the payments
    paring and appraising projects.                             authorized after verifying that the supporting
                                                                documents provided are substantively accurate
    (3) The delegate shall, regularly, and in cer-              and in order, and that the discharge is valid.
    tain cases acting on special instruction from
    the Commission, inform the authorities of the               (6) At regular intervals, and at least once a
     State to which he has been appointed of Com-               quarter, the paying agent shall send the Com-
     munity activities which may directly concern               mission a statement of expenditure effected,
     cooperation between the Community and that                 together with supporting documents.
     State.                                                     (7) Payments made in the currency of the
                                                                recipient State shall be subject to a clearance
     (4) While operations are in progress the dele-             procedure before they are finally charged to
     gate shall verify, on the basis of documents               the budget appropriations. Clearance shall
     and on the spot, that the work or services com-            consist of an examination by the competent
     ply with their description in the financing                department of the Commission and by the
     agreements, contracts or estimates.                        financial controller to establish that validation,
                                                                authorization and payment have been properly
     For these purposes he shall approve all pay-               effected.
     ment authorizations issued by the national
     authorizing officer. This approval shall not
     constitute clearance by the Commission of the
     operation concerned, within the terms of
     Article 110 (7), and shall not discharge the
     national authorizing officer from his liability
                                                                                   SECTION III
     under Article 108 (4). The delegate shall be
     bound to comply with this Financial Regula-                            AWARD OR CONTRACTS
     tion in the performance of his duties.
                                            I
    The delegate shall be responsible to the Com-
     mission for failure to observe the provisions of
    this Regulation or serious misconduct or neg-                Article 111
     ligence in the performance of his duties.                   By way of derogation from Title IV of this
                                                                 Financial Regulation, the award of contracts
                                                                financed by the Community shall be governed
                                                                by the following provisions.
     Article 110
     (1) For payments in a currency other than
     that of the recipient State, the Commission
                                                                Article 112
     shall make payment direct for services pro-
     vided in connection with projects financed                 The procedure to be followed prior to the
     with grant aid.                                            award of works, supply or service contracts, or
                                                                the conclusion of technical cooperation con-
     (2) For payments in the currency of the reci-              tracts, shall be specified in the technical and
     pient State, accounts denominated in the cur-              administrative provisions annexed to the
     rency of a Member State shall be opened on                 financing agreement, subject to the following
     behalf of the Commission with the recipient                principles.
     State's central bank, which shall exercise the
     functions of paying agent.
     (3) The accounts referred to in paragraph 2                 Article 113
     shall be replenished to meet actual cash
     requirements. Transfers shall be made in the                1. Participation in tendering procedures shall
     currency of a Member State and converted                    be open on equal terms to all natural persons
     into the currency of the recipient State as pay-            and firms coming within the scope of applica-
     ments fall due, at the exchange rate ruling on              tion of the Treaty and to all natural persons
     the day of payment.                                         and firms in the recipient State.
                                                                 The specifications shall therefore require ten-
     (4) The paying agent shall not be remuner-                  derers to state their nationality and to present
     ated for his services; no interest shall be paid            the supporting evidence normally acceptable
     on the funds deposited.                                     under their own law.
 ---pagebreak--- 9. 4. 84                            Official Journal of the European Communities                          No C 97/27
       2. By way of exception, it may be decided, by                Articles 114 and 115 are observed for each opera-
       mutual agreement between the Commission                      tion and that the tender selected is economi-
       and the recipient State, to allow nationals of               cally the most advantageous, with due regard
       non-member countries to compete for con-                     notably to the price, utilization costs, technical
       tracts financed by the Community.                            value, the qualifications of and the guarantees
                                                                    offered by the tenderers, the nature and condi-
       3. For financial and technical cooperation
                                                                    tions of execution of the works or supplies.
       projects in favour of non-associated develop-
       ing countries funded from the budget appro-
       priations earmarked for that purpose, eligibil-              The Commission and the relevant authorities
       ity to participate in tendering procedures and               of the recipient State shall ensure that all the
       contracts may be extended to other developing                selection criteria are specified in the invitation
       countries which have received Community aid                  to tender dossier.
       from these appropriations in the current finan-
       cial year and the two preceding years.                       The result of invitations to tender shall be pub-
                                                                    lished at the earliest possible date in the
                                                                     Official Journal of the European Communities.
       Article 114
       The Commission and the relevant authorities
       of the recipient State shall take the necessary              Article 117
       implementing measures to ensure that parti-
       cipants in tendering procedures and other pro-
       cedures for the award of contracts financed by
       the Community can compete on an equal foot-                  (1) For technical cooperation projects, ser-
       ing.                                                         vice contracts shall be concluded with a con-
       To this end, without prejudice to Article 115,               sultancy bureau, a consultant engineer or an
       care shall be taken in particular to:                        expert. Such contracts shall be made by private
                                                                    treaty or, where justified on technical, econo-
       (a) ensure advance publication in reasonable                 mic or financial grounds, following competi-
            time of invitations to tender in the Official           tive tendering.
            Journal of the European Communities and
            the official journal of the recipient State;            (2) For each technical cooperation project
       (b) eliminate any discriminatory practice or                 the Commission shall select one or more can-
            technical specification liable to hamper                didates according to criteria guaranteeing their
            participation on equal terms by all natural             qualifications, experience and independence
            or legal persons of the Member States and               and taking into account their availability for
            of the recipient State.                                 the proposed project.
                                                                    Where a private treaty procedure is used and
                                                                    the Commission has selected a number of can-
        Article 115                                                 didates, the recipient State shall choose freely
                                                                    which of these candidates it wishes to deal
        In urgent cases or where the nature, small scale            with.
       or particular characteristics of certain works or
        supplies so warrant, the relevant authorities of
                                                                    Where a tendering procedure is used, the con-
       the recipient State may, by agreement with the
                                                                    tract shall be awarded to the candidate who, in
        Commission stating the reasons therefor,
                                                                    the opinion of the Commission and the State
        exceptionally authorize:
                                                                     concerned, has entered the economically most
       — the award of contracts after restricted invi-               advantageous bid.
            tations to tender,
       — the conclusion of contracts by private                      (3) Service contracts shall, as a rule, be pre-
             treaty,                                                 pared, negotiated and concluded by the rel-
                                                                     evant authorities of the recipient State, with
        — the performance of contracts through                       the agreement and assistance of the Commis-
             public works departments.                               sion delegate.
                                                                     However, they may be prepared, negotiated
                                                                     and concluded by the Commission where they
        Article 116                                                  relate to urgent, short-term expert services in
        The Commission and the relevant authorities                  connection with the preparation, appraisal,
        of the recipient State shall ensure that                     execution or utilization of projects, or where
 ---pagebreak--- No C 97/28                        Official Journal of the European Communities                               9.4.84
     special provisions in the financing agreements               accounts as over- or under-expenditure in re-
     referred to in Article 105 (1) so stipulate.                 spect of the financial year in which the clear-
                                                                  ance took place.
                                                                  However, if the procedures required for this
                                                                  purpose — transfers or a supplementary and/
                        SECTION IV                                or amending budget — cannot be completed
                                                                  by the end of the year, the clearance decision
                         FOOD AID                                 shall be charged as soon as possible to the fol-
                                                                  lowing financial year.
                                                                  (7) The provisions of Article 103 (3) shall
     Article 118                                                  apply to transfers made necessary by changes
                                                                  in relation to the appropriations authorized, in
     (1) Every food-aid programme shall as soon                   the parts of the expenditure chargeable to the
     as possible be made the subject of a proposal                EAGGF Guarantee chapters and the food-aid
     for commitment in accordance with the proce-                 chapter.
     dure laid down in Articles 36 to 39.
     The advances paid to Member States shall be
     entered globally against the abovementioned
     commitments; the sum set aside for the com-                                     SECTION V
     mitments may not be exceeded.
                                                                            AUDITING OF ACCOUNTS
     (2) Expenditure effected by the Member
     States using the funds advanced by the Com-
     mission pursuant to Article 3 of Regulation
     (EEC) No 2681/74 shall be entered as pay-                    Article 119
     ments following examination of the statements
     transmitted by the Member States in accord-                  (1) Each agreement for the financing of an
     ance with the implementing measures under                    investment project and each agreement relat-
     Article 5 of the abovementioned Regulation                   ing to a food-aid operation shall make express
     and approval by the financial controller.                    provision for the Court's power of audit.
     Subject to paragraph 3 of this Article, expendi-             (2) Should the Court of Auditors wish to
     ture shall be entered as payments within two                 carry out audits on the territory of recipient
     months of receipt of the statements transmit-                States, or States in which recipients are
     ted by the Member States.                                    located, it shall do so by agreement with the
                                                                  relevant authorities of the State concerned.
     This Article shall apply without prejudice to
                                                                  Such audits would be limited to the inspection
     the clearance of accounts provided for in
                                                                  arrangments implemented pursuant to the
     Article 8 of Regulation (EEC) No 249/77.
                                                                  provisions governing Community aid and
     (3) Articles 36 to 53 shall apply as regards the             would not apply in respect of the execution
     commitment and payment of expenditure                        arrangements which are the responsibility of
     effected by the Commission direct, particularly              the national authorizing officer.'
     in respect of purchases on the world market,
     the occasional transport or storage of goods, or
     quality controls on products supplied.
                                                             107. Article 103 becomes Article 118. Paragraphs 2, 3
     (4) The Commission may decide, up to
                                                                  and 4 are replaced by the following:
     31 March of the following financial year, to
     transfer appropriations from one article to                  '(2) The appropriations for the Office, the
     another within the chapter relating to food aid.             total amount of which shall be entered under a
                                                                  special budget heading within the section of
     (5) Expenditure shall be taken into account
                                                                  the budget relating to the Commission con-
     in respect of a financial year on the basis of
                                                                  cerning appropriations for staff and adminis-
     payments made up to 31 December by the
                                                                  tration shall be set out in detail in an annex to
     departments referred to in Article 3 of Regula-
                                                                  that section. The appropriations shown under
     tion (EEC) No 2681/74 provided that their
                                                                  this specific budget heading may be trans-
     authorization has reached the accounting
                                                                  ferred in accordance with the conditions set
      officer by 31 March following.
                                                                  out in Article 25.
     (6) Any differences between the expenditure
                                                                  The annex shall take the form of a statement
     charged to the accounts of a financial year
                                                                   of revenue and expenditure, subdivided in the
     pursuant to paragraph 5 above and that estab-
     lished by the Commission when clearing the                    same way as the sections of the budget.
      accounts as provided for in Article 8 of Regu-               The appropriations entered in that annex shall
      lation (EEC) No 249/77 shall be entered in the               cover all the financial requirements of the
 ---pagebreak--- 9. 4. 84                            Official Journal of the European Communities                          No C 97/29
         Office in the performance of its duties in the              (a) where they relate to payments remaining
         service of the Community's institutions.                         due under commitments, they shall be car-
                                                                         ried over automatically for a period of five
        (3) Where necessary, the estimates may be
                                                                         years reckoned from 31 December of the
        adjusted during the financial year by the Man-
                                                                          financial year during which they were
        agement Committee of the Office, which shall
                                                                          committed;
        decide on the transfer required within the
        annex as a result of such adjustments. It shall             (b) upon expiry of that period, the Commis-
        inform the budgetary authority three weeks                       sion may submit to the Council and for-
        before effecting transfers from one chapter to                    ward to Parliament, by 31 March, the lists
        another.                                                         of appropriations remaining committed,
                                                                         for which a duly substantiated request for
        (4) The remarks relating to the specific
                                                                         carryover is being made. The decision
        budget heading under which is entered the
                                                                         shall be taken in accordance with
        total appropriation for the Office shall show
                                                                         Article 7 (4).'
        an estimate of the cost of services rendered by
        the Office to each of the institutions.
        The total costs of these services shall corre-         114. The following new Article 126 is added:
        spond to the total expenditure shown in its                 'Until the entry into force of the implementing
        statement of expenditure.'                                  measures provided for in Article 123, the limit
                                                                    values to be specified in the implementing
                                                                    measures for Articles 58, 60, 62, 63 and 96 shall
108. The following new Article 121 is added:                        be as follows:
       'The financial rules of Community bodies with                — Article 58,        first paragraph,    subpara-
       legal personality which receive subsidies from                    graph (a): the limit below which contracts
       the general budget shall take over as far as                      may be made by private treaty shall be
       possible the provisions of this Regulation and                     12 000 ECU;
       diverge from it only when their specific opera-
       tional requirements warrant.'                                — Article 60: the limit above which the pow-
                                                                         ers of the Advisory Committee on Procure-
                                                                         ments and Contracts take effect shall be
109. Article 104 becomes Article 122.                                    36 000 ECU;
                                                                    — third paragraph of Article 62: the threshold
110. Article 105 is deleted.                                             for compulsory security shall be 350 000
                                                                         ECU;
                                                                    — Article 63: the limits below which con-
111. Article 106 becomes Article 123. This Article is                    tracts may be made against invoice or bill
      replaced by the following:                                         of costs shall be 600 ECU and 1 500 ECU
       'After consulting the other institutions, whose                   respectively for expenditure outside the
       opinions must be given within two months, the                     provisional places of work;
       Commission shall adopt measures for imple-                   — Article 96: the limit below which contracts
       menting this Financial Regulation. It shall                       may be made by private treaty shall be
      inform all the institutions of these provisions.'                  60 000 ECU.'
112. Article 107 becomes Article 124. This Article is          115. Article 109 becomes Article 127. This Article is
       replaced by the following:                                   replaced by the following:
       'Amendments to this Financial Regulation,                    'The following shall be repealed:
       proposed by the Commission, shall be adopted                 — the Financial Regulations of 25 April
       by the Council after conciliation with the                         1973 (»), 18 March 1975 (2), 21 December
        European Parliament.'                                             1977 (3), 25 June 1979 (4) and 16 December
                                                                          1980( 5 );
                                                                    — all other provisions contrary to this Finan-
113. Article 108 becomes Article 125. This Article is                     cial Regulation.'
      replaced by the following:
       'Appropriations for the Guidance Section of
       the European Agricultural Guidance and
       Guarantee Fund entered in the budget for the                 (') OJ No LI 16, 1.5. 1973, p. 1.
                                                                    O3 OJ No L 73, 21. 3. 1975, p. 45.
       financial year 1976 and in the budgets of                    ( ) OJ No L 356, 31. 12. 1977, p. 1.
       earlier financial years shall be carried over                (45) OJ No L 160, 28. 6. 1979, p. 1.
       under the following conditions:                              ( ) OJ No L 345, 20. 12. 1980, p. 23
 ---pagebreak--- No C 97/30                        Official Journal of the- European Communities                          9. 4. 84
                       Article 2                                                    Article 3
1. In Articles 22, 23, 27, 28, 36, 37, 38, 45, 46, 53,        References to provisions of the Financial Regula-
57, 60, 62, 65, 66 and 75 (') the references to former        tion of 21 December 1977 shall be understood as
Article 106 concerning implementing measures shall            being to the corresponding provisions as amended
be understood as being to Article 123.                        by this Regulation.
2. The name 'the European Parliament' in the
present text of the Financial Regulation is replaced                                Article 4
by Parliament.
                                                              This Regulation shall enter into force on
                                                              It shall be binding in its entirety and directly
(') New numbers.                                              applicable in all Member States.