CELEX: 51985PC0250
Language: en
Date: 1985-06-07
Title: PROPOSAL FOR A COUNCIL DECISION EMPOWERING THE COMMISSION TO BORROW UNDER THE NEW COMMUNITY INSTRUMENT FOR THE PURPOSE OF PROMOTING INVESTMENT WITHIN THE COMMUNITY

No C 163/4                              Official Journal of the European Communities                                     3.7.85
                                                                II
                                                        (Preparatory Acts)
                                                  COMMISSION
              Proposal for a Council Decision empowering the Commission to borrow under the New
                  Community Instrument for the purpose of promoting investment within the Community
                                                       COM(85) 250 final
                                 (Submitted by the Commission to the Council on 7 June 1985)
                                                         (85/C 163/06)
THE COUNCIL OF THE EUROPEAN COMMUNITIES,                            Whereas        special  financing      arrangments    should
                                                                     consequently be provided for a deal with such problems,
 Having regard to the Treaty establishing the European               in particular by extending the financing base and by
 Economic Community, and in particular Article 235                   encouraging the supply of equity funding from financial
thereof,                                                             intermediaries;
 Having regard to the proposal from the Commission,                 Whereas the New Community Instrument must make a
                                                                     contribution to the implementation of the Integrated
Having regard to the proposal of the European Parl-                  Mediterranean Programmes;
iament,
                                                                    Whereas       the Commission         should   therefore   be
Having regard to the opinion of the Economic and                    empowered to borrow amounts enabling it to grant loans
Social Committee,                                                   equivalent to 1 500 million ECU in principal;
Whereas the Community's investment financing facilities             Whereas the European Investment Bank has stated that it
should continue to operate and be intensified, with a               is willing to contribute to the implementation of the
view to correcting structural shortcomings in the                   facility,
productive apparatus and increasing the pace of
economic growth so as to deflect the disturbing trend of
                                                                    HAS DECIDED AS FOLLOWS:
unemployment;
Whereas loan applications already approved by the                                              Article 1
Commission account for over two-thirds of the
borrowing authorized by the Council in Decision                     The Commission shall be empowered to borrow on
83/200/EEC of 19 April 1983 (*);                                    behalf of the European Economic Community under the
                                                                    new Community instrument for an amount enabling it to
                                                                    grant loans of up to the equivalent of 1 500 million ECU
Whereas action in favour of small and medium-sized                  in principal.
enterprises under the new Community instrument, as last
defined by Decision 83/200/EEC, should be continued
and reinforced;                                                                                Article 2
                                                                    The proceeds of the borrowings referred to in Article 1
Whereas it is vital in order to strengthen the
                                                                    shall be on-lent to finance investment projects that
Community's      technological      base    and     industrial
                                                                    contribute to the industrial adjustment and the
competitiveness to encourage the capacity of under-
                                                                    competitiveness of the Community, in particular by
takings for industrial innovation and commercial
                                                                    means of the application of new technologies and
enterprise;
                                                                    innovation.
Whereas investment by small and medium-sized under-
takings involving the application of new technologies and           These projects, to be carried out on Community
innovation, has features which raise special financing              territory, shall be such that they serve the Community's
problems;                                                           priority objectives relating to the financing of investment
                                                                    by small and medium-sized undertakings in industry and
                                                                    other productive sectors taking into account inter alia
                                                                    their regional impact and the need to combat
0) OJ No L 112, 28. 4. 1983, p. 26.                                 unemployment.
 ---pagebreak--- 3.7.85                                  Official Journal of the European Communities                              No C 163/5
                            Article 3                              Where       borrowings    are     expressed,  payable    or
                                                                   reimbursable in the currency of a Member State, they
The Commission shall decide whether or not projects are            may be concluded only with the agreement of the
eligible in accordance with the following priorities and           competent authorities of that State.
guidelines for eligibility:
                                                                                             Article 7
— the investment projects of small and medium-sized
    enterprises in industry and other productive sectors,          A mandate shall be given to the Bank to grant and
    in particular with a view to the application of new            administer loans pursuant to this Decision. T o this end, a
    technologies and innovation and to improving the               cooperation agreement shall be drawn up between the
    rational use of energy shall be eligible; the projects of      Bank and the Commission. The Bank shall carry out
    small enterprises shall have priority;                         transactions under this mandate on behalf of, for and at
— projects shall comply, in terms both of their nature             the risk of the Community.
    and of their application, with the provisions of the           The Commission shall decide, in accordance with Article
    treaty and of secondary law, in particular provisions          3, whether projects are eligible. Where the Commission
    relating to competition, and with the rules and                gives favourable decision, the Bank shall decide whether
    requirements of the relevant Community policies.               and on what terms to grant the loans, in accordance with
                                                                   its usual criteria and with the procedures laid down in its
                            Article 4                              statute.
Leans may be granted through the agency of financial               Loan procedure as provided for in this Decision shall be
intermediaires. Capital and interest payments may be               as follows:
deferred. Loans may be used to finance intangible assets           — loan applications shall be transmitted simultaneously
such as patents, licences, know-how, research and                       to the Commission and to the Bank either directly or
development expenditure directly linked to the                          through a Member State,
investment concerned. The intermediary may pass the
                                                                   — the Commission and the Bank shall sign the loan
loan on to undertakings either in the form of a loan or
                                                                        contracts,
in the form of capital. In both cases, the intermediary
shall be responsible for the service and associated risk.          — the Bank shall report to the Commission on the use
                                                                        made of the funds.
                            Article 5
                                                                                             Article 8
Connected borrowing and lending transactions shall be
                                                                   The Commission shall inform the European Parliament
expressed in the same monetary units.
                                                                   and the Council every six months of the rate of
                                                                   utilization of the loans. No later than the date on which
Lending terms as regards the reimbursement of the
                                                                   total loans signed amount to two-thirds of the total, it
principal and the rate and payment of interest shall be
                                                                   shall notify them of a new proposal.
fixed in such a way that, overall, they cover the costs
and expenses incurred in concluding and performing
                                                                                             Article 9
both the borrowing and the lending side of the
transactions.                                                      The Commission shall annually inform the European
                                                                   Parliament and the Council of reciepts and expenses
                            Article 6                              resulting from borrowing and lending transactions and
                                                                   present at the same time an assessment of the functioning
The terms of borrowings shall be negotiated by the                 of the new Community instrument in all these respects.
Commission in the best interests of the Community,
having regard to the conditions on capital markets and in                                    Article 10
accordance with the constraints imposed by the duration
and other financial aspects of the loans to be granted.            The financial control and audit of the Commission's
Funds borrowed shall be deposited with the European                accounts shall be carried out in accordance with the
Investment Bank, to be invested on a temporary basis if            Financial Regulations applicable to the general budget of
necessary.                                                         the European Communities.