CELEX: 52013PC0445
Language: en
Date: 2013-06-26
Title: Proposal for a COUNCIL REGULATION on the implementation of the 11th European Development Fund

|
			
		
		
		52013PC0445
		
			Proposal for a COUNCIL REGULATION on the implementation of the 11th European Development Fund /* COM/2013/0445 final - 2013/0211 (NLE) */
			
				
		
		
			
			   	EXPLANATORY MEMORANDUM
1.           CONTEXT OF THE PROPOSAL
Poverty remains a major problem in African,
Caribbean and Pacific (ACP) States. Many of them are off-track towards the
achievement of the Millennium Development Goals (MDGs) and they
do not benefit from sustainable development. The EU is helping ACP countries
address these problems. It is necessary for the EU to continue to support ACP
countries' efforts towards reducing and eventually eradicating poverty, while
attaining the objectives of sustainable development and achieving their gradual
integration into the global economy. 
The EU maintains privileged relations with
the ACP group of developing countries under the Partnership Agreement between
the ACP States of the one part, and the European Community and its Member
States of the other part, signed in Cotonou on 23 June 2000 for a period of 20
years[1] (hereinafter referred to as the Cotonou Agreement). The European Development Fund (EDF) is the main
instrument for providing EU assistance for development cooperation under the
Cotonou Agreement with ACP countries and for cooperation with Overseas
Countries and Territories (OCTs) under the Overseas Association Decision (OAD).
The EDF is funded outside the EU budget by the EU Member States on the basis of
specific contribution keys. Each EDF is concluded for a multi-annual period. 
For the post-2013 multiannual financial
framework, the European Commission proposed in its Communication ‘A budget for
Europe 2020’[2] the overall volume (EUR 30 318.7 million in 2011 prices, i.e. EUR
34 275.6 million in current prices) for the 11th EDF for cooperation with ACP
countries and OCTs. The Commission also adopted a Communication describing the
main elements that could figure in the Internal Agreement for the 11th EDF, for
the period from 1 January 2014 to 31 December 2020[3]. The
assumption of the European Commission is that an agreement will be reached by
the European Union and its Member States on laying down the financing mechanism
(the 11th EDF), the exact period to be covered (2014-2020) and the amount
of funds to be allocated to that mechanism, for implementing the ACP-EU
Partnership, and that the Representatives of the Governments of the Member
States will agree on an Internal Agreement for an 11th EDF. The European
Council set the global amount of the 11th EDF in its Conclusions on
February 8th 2013, i.e. EUR 30 506 million in current prices[4].
New challenges, together with the priorities
set out in the Europe 2020 Strategy, have prompted the Commission to make a
proposal to adapt the 11th EDF Implementation Regulation in line with the Communication
'Increasing the Impact of EU Development Policy: An Agenda for Change'[5] of 13 October 2011. The European Consensus on Development adopted
on 22 December 2005 and the internationally agreed principles on aid
effectiveness including the Busan Outcome Document (2011) also form part of the
general policy framework for the programming and implementation of the 11th
EDF. 
2.           RESULTS OF THE CONSULTATIONS WITH THE
INTERESTED PARTIES AND IMPACT ASSESSMENT
Public Consultation
The Commission held a public consultation on
future funding for EU external action between 26 November 2010 and 31 January
2011. This process was based on an online questionnaire accompanied by a
background paper 'What funding for EU external action after 2013?'. In general,
the replies did not suggest the need for a substantial change in the current
implementing mechanisms, although a significant majority of respondents
supported increased flexibility and simplification in implementation.
Impact Assessment
The Commission carried out an Impact Assessment
(IA)[6] that considered 3 basic policy
alternatives for each objective identified (more differentiation and
concentration, strengthened coordination with EU Member States, more use of
innovative financial instruments, further flexibility): a status quo option (no
change compared to the 10th EDF), and an alternative option with two
sub-options for amending the EDF framework. The status quo option was not
accepted because it would not have solved the problems identified. The sub-options
solved the identified problems to different extents, each having particular
implications. The IA concluded that for each objective identified, the second sub-option
which better adressed the new revised strategic orientations of the EU external
action should be chosen as it:
–              
contributed through a sharpened geographical
focus to targeting resources where they were most needed having the greatest
possible impact and value added ;
–              
contributed through a sharpened sectoral focus
to concentrating resources on a limited number of sectors, thus increasing the
EU's critical mass; 
–              
reinforced the efficiency and the political
leverage of EU aid through increased division of labour among donors, joint
programming and use of EU Trust Funds;
–              
increased the financial leverage of EU grant
resources through use of innovative financial instruments;
–              
allowed the adaption of aid allocations
rapidly to take into account evolving circumstances or specific situations
(such as crisis, fragility or transition), or to implement a more
incentives-based approach.
3.           LEGAL ELEMENTS OF THE PROPOSAL
The main policy objectives of EU external
action are set in the Lisbon Treaty (Art. 21 TEU). In addition, the main
objective of EU development cooperation (Art. 208 TFEU) is the reduction and,
in the long term, the eradication of poverty. In this context the EU will
comply with the commitments and take account of the objectives they have
approved in the context of the United Nations and other international
organisations.
Regarding cooperation with ACP countries and
regions, this legal framework is complemented by the Cotonou Agreement.
This proposal is presented by the Commission on
the basis of an Internal Agreement for the 11th EDF[7] which foresees that a Council
Regulation on the implementation of the 11th EDF under the Cotonou Agreement should
be adopted by unanimity, on a proposal by the Commission and after consulting
the European Investment Bank (EIB).
4.           BUDGETARY
IMPLICATION
N/A 
5.           MAIN ELEMENTS
The 11th EDF Implementation
Regulation was prepared with the following objectives:
–                        
in line with the key principles of
simplification and increased effectiveness, to align
the text as much as possible with the main provisions
of the Commission proposal for a Regulation of the European Parliament and of
the Council establishing a financing instrument for development cooperation
(DCI)[8]
(in particular on programming) and of the Commission proposal for a Regulation
of the European Parliament and of the Council establishing common rules and
procedures for the implementation of the Union's instruments for external
action (CIR)[9] (in particular on implementation) which
entails simplified and harmonised implementing rules and procedures for all
external action instruments (except the EDF and Greenland). This effort for
alignment also takes into account the results of the negotiations in Council on
these texts (Coreper level) as well as in Parliament Committees when this
proposal was drafted, regarding compromises being acceptable for the
Commission. Moreover, the Commission reserves the right to adapt this proposal
after its adoption, during the negotiations with the Council, in order to
continue to ensure coherence with the texts of the DCI and the CIR being negotiated
in parallel. This alignment will help pave the way towards possible inclusion
of the EDF into the EU budget in the Multiannual Financial Framework post 2020,
in line with the Commission proposals made in the above mentioned Communication
‘A budget for Europe 2020' and
with the European Council Conclusions of February 8th 2013.
–                        
to ensure the compliance of the text with the
provisions of the Cotonou Agreement, in particular its annex IV on
implementation and management procedures, while simplifying the text compared
to the 10th EDF Implementing Regulation[10].
Title I: Objectives and general principles
– Articles 1 and 2
Article 1 (Objectives and eligibility
criteria) is aligned as far as possible with
Article 2 of the Commission proposal for the DCI Regulation on objectives and
eligibility criteria, while including also a reference to the broader
objectives, principles and values described in the Cotonou Agreement, as well
as to the development objectives and cooperation strategies set out in the policies
developed by the Union, including the Agenda for Change. This Article also
requires fulfilling the criteria for Official Development Assistance (ODA)
established by the OECD/DAC to the greatest extent possible. It also explains
complementarity between the Humanitarian and EDF instruments.
Article 2 (General principles) is aligned with Article 3(5) to 3(10) of the Commission
proposal for the DCI Regulation. It sets out the main principles governing the
implementation of the Regulation, which are strengthened coherence of EU
external action, improved coordination with the Member States and other
bilateral or multilateral donors, and a partner country-led and region-led
development process with mutual accountability, through an inclusive and
participatory approach to development, using effective and innovative
cooperation modalities in line with OECD/DAC best practices, thus improving the
impact of aid and reducing overlap and duplication.
Title II: Programming and allocation of
funds – Articles 3 to 7 
Article 3 (General framework for
allocating funds) lays down the framework for
allocation of funds under the EDF. It is aligned as far as possible with
Article 3(2) of the Commission proposal for the DCI Regulation on the
principles of a differentiated approach towards the partner countries. Article
3 provides for the application of the principles of the Communication
'Increasing the Impact of EU Development Policy: An Agenda for Change' to the
EDF, while also ensuring that the requirements of the Cotonou Agreement
regarding resource allocation (criteria described in article 3 of annex IV of
the Cotonou Agreement) are respected. Therefore the allocation criteria are
described in two paragraphs: paragraph 1 recalls the Cotonou requirements on
needs and performance and paragraph 2 provides more specifically the
differentiation principles of the Agenda for Change in the determination of the
indicative national allocations (needs, capacities, commitments, performance
and impact).
Article 4 (General framework for programming)
lays down the general framework for EDF programming
under this Regulation. The Article recalls the principles of partnership and
alignment of the Cotonou Agreement, i.e. that programming should be done
whenever possible jointly with the partner country or region concerned and
increasingly aligned with their poverty reduction strategies. The Article also
takes elements from Article 10(2) of the Commission proposal for the DCI Regulation:
in order to ensure synergies and complementarity of the Union’s measures and
those of the Member States, the latter will be fully involved in the
programming process, including through joint programming. The participation of
all Member States including those not locally represented is foreseen because
of the specific nature of EDF funding. Consultation processes will also involve
other donors and development actors as well as civil society and regional and
local authorities. 
Article 4(3) describes circumstances foreseen
in the Cotonou Agreement where the Commission can establish specific provisions
for programming and implementing development aid unilaterally.
Article 4(4) recalls the EU's objective of
concentrating assistance announced in the Communication 'Increasing the Impact
of EU Development Policy: An Agenda for Change', with a limitation to 3 sectors
of intervention for bilateral programming, in line with Article 5(4) of the
Commission proposal for the DCI Regulation. 
Article 5 (Programming documents) is aligned as far as possible with Article 11 of the Commission
proposal for the DCI Regulation. It outlines the requirement and principles for
preparing strategy papers for the countries and regions and, based on these,
multiannual indicative programmes. The article also lists the cases when a
strategy paper would not need to be prepared in order to simplify and
streamline the programming process as well as to favour joint programming with
Member States and alignment to the national programmes of developing countries.
Thus the Article also introduces the possibility of having a Joint Framework
Document that would lay down a comprehensive Union strategy, of which
development policy would be part of. In line with the principle of partnership
of the Cotonou Agreement, the agreement of the partner country government to use
alternative programming documents is required; otherwise a strategy paper will
have to be drafted.
Articles 5(5) and 5(6) provide for EDF-specific
types of programming as foreseen in the Cotonou Agreement, i.e. for intra-ACP
cooperation and special support programmes. 
Article 6 (Programming for countries and
regions in crisis, post-crisis or fragility situations) is aligned with Article 12 of the Commission proposal for the DCI Regulation.
It emphasises the special needs and circumstances of countries in crisis,
post-crisis or fragility situation, which ought to be considered at the time of
drafting of programming documents. 
Article 7 (Approval and modification of
programming documents) is aligned as far as
possible with Article 14 of the Commission proposal for the DCI Regulation on the
approval of strategy papers and on the adoption of multiannual indicative
programmes. The Article states that programming documents (i.e. strategy
papers, multiannual indicative programmes and special support programmes) are approved
by the Commission in accordance with Article 14 of this Regulation. It also
reflects the provisions in the Cotonou Agreement regarding transmission of
documents to the Joint Parliamentary Assembly and endorsement of programming
documents by the ACP State or region after adoption by the Commission. It
provides for the review of programming, and the revision where appropriate (in
case of substantial evolution of the strategy or of the programmed priorities)
of the corresponding documents. The Article provides flexibility and
simplification by establishing cases of non-substantial modifications, of which
the EDF Committee is informed. The Article also foresees a special urgency
procedure for modifying the programming documents on duly justified grounds of
urgency, equivalent to the comitology procedure in article 8 of Regulation
182/2011[11], as provided for by Article 14(10) of this Regulation.
Title III: Implementation – Articles 8 to
13 
Article 8 (General framework for
implementation) sets the general framework for
implementation of EU assistance in relation with the Financial Regulation of
the 11th EDF.
Article 9 (Adoption of action programmes,
individual measures and special measures) is
aligned as far as possible with Article 2 of the Commission proposal for the
CIR Regulation. It provides the principle that financing decisions taken by the
Commission are to be in the form of action programmes, based on the multiannual
programming documents. However, in line with the multiannual programming documents,
individual measures can be also adopted outside the action programme framework.
In the event of specific cases (exceptional circumstances or unforeseen needs) provided
for in the Cotonou Agreement, the Commission may also adopt special measures
not provided for in the multiannual programming documents. The Article establishes
the procedures for the adoption of the mentioned financing decisions. It also provides
for specific environmental screening, including Climate Change and Biodiversity
impact.
Article 10 (Additional Member State
contributions) describes the conditions for the
management of voluntary contributions which can be provided by Member States to
the Commission or the EIB in accordance with the 11th EDF Internal Agreement.
Article 11 (Taxes, duties and charges) describes possible arrangements with respect to taxes, duties and
charges, in line with Article 5 of the Commission proposal for the CIR Regulation,
while respecting the provisions of Article 31 of Annex IV of the Cotonou
Agreement.
Article 12 (Protection of the financial
interests of the Union) is aligned with Article 7
of the Commission proposal for the CIR Regulation. It lays down measures
to protect the Union's financial interests, and in particular to enable it
(notably the Commission, the Court of Auditors and OLAF) to carry out all the
necessary controls and checks on the measures implemented.
Article 13 (Rules on nationality and
origin for public procurement, grants and other award procedures) is not aligned with Articles 8 and 9 of the Commission proposal for
the CIR Regulation, as it refers to the provisions on rules on nationality and
origin which are defined in Article 20 of annex IV of the Cotonou Agreement.
Title IV: Decision-making procedures –
Articles 14 to 16 
Article 14 (Responsibilities of the EDF
Committee) describes the tasks and the involvement
of the EDF Committee in the implementation of this Regulation. It aligns EDF
procedures with Article 15 of the Commission proposal for the CIR, which refers
to the Regulation on comitology procedures. The procedures are equivalent
'mutatis mutandis' to Article 3 (common provisions), 5 (examination procedure)
and 8 (urgency procedure) of Regulation 182/2011 on comitology. 
Article 15 (The African Peace Facility) establishes ad hoc procedures for the management of the African
Peace Facility.
Article 16 (The Investment Facility
Committee) describes the structure and the functioning
of the Investment Facility Committee, set up under the auspices of the EIB
according to the Internal Agreement, in the implementation of this Regulation.
It also describes the modus operandi and conditions for EIB operations.
Title V - Final provisions – Articles 17 to
22
Article 17 (Participation by a third
country or region) is based on the 10th EDF implementing
Regulation, taking into account Article 15 of the Commission proposal for the DCI
Regulation. It provides for the possibility to extend the eligibility of
funding under the EDF envelope dedicated to ACP countries to non-ACP developing
countries and regional integration bodies with ACP participation. It also
promotes the reinforcement of regional cooperation programmes between ACP
countries, OCTs and Union's outermost regions.
Article 18 (Monitoring, reporting and
evaluation of EDF assistance) is aligned with
Articles 12 and 13 of the Commission proposal for the CIR Regulation. It
commits the Commission and the EIB to regularly evaluate the results of the
implemented policies and programmes and projects, and for the Commission, to
look at the effectiveness of programming itself, and to prepare a biennial
Commission report on the progress and implementation of this Regulation. It
also provides for a Performance review to assess the degree of realisation of
commitments and disbursements and the results and impact of the aid provided,
and for a mid-term and end-term evaluations of the ACP Investment Facility, as foreseen
in Annex II to the Cotonou Agreement.
Article 19 (Climate action and
biodiversity expenditure) is aligned with Article
14 of the Commission proposal for the CIR Regulation. It provides for a
specific tracking system based on the OECD methodology (‘Rio markers’).
Article 20 (European External Action
Service) is a horizontal article to be found in all
Commission proposals for the Regulations on external action, such as Article 21
of the Commission proposal for the DCI Regulation. It highlights that this
Regulation is to be applied in accordance with the Council Decision
establishing the organisation and functioning of the European External Action
Service[12], in particular Article 9 thereof.
Article 21 (Transitional measures) provides for a bridging facility to ensure the availability of
funds in case of late entry into force of the 11th EDF, in particular in view
of possible delays in the ratification process of the 11th EDF Internal
Agreement. Until the entry into force of the 11th EDF, action programmes,
individual measures, special measures and specific action programmes for
support expenditure should thus be financed within the limits of the balances
of the previous EDFs and from funds decommitted from projects under these EDFs.
Funds committed[13]
under the bridging facility should be accounted for under the 11th EDF. By
adopting the current regulation by unanimity, the Council takes the decision on
the use of the balances of previous EDFs, described in Article 1(5) of the 10th
EDF Internal Agreement and in Article 5 of Annex Ib to the Cotonou Agreement. This
Article also provides for the continuation of the 10th EDF Financial Regulation
pending the entry into force of the 11th EDF Financial Regulation. 
Article 22 (Entry into
force) provides that this Regulation shall apply from
1 January 2014 until the final date of application of the 11th EDF Internal
Agreement.
2013/0211 (NLE)
Proposal for a
COUNCIL REGULATION
on the implementation of the 11th European
Development Fund
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on European Union
and to the Treaty on the Functioning of the European Union,
Having regard to the Partnership Agreement
between the members of the African, Caribbean and Pacific Group of States of
the one part, and the European Community and its Member States, of the other
part, signed in Cotonou on 23 June 2000[14] (hereinafter referred to as the Cotonou Agreement),
Having regard to the Internal Agreement
between the Representatives of the Governments of the Member States, meeting
within the Council, on the financing of European Union aid under the
multiannual financial framework for the period 2014 to 2020, in accordance with
the Cotonou Agreement, and on the allocation of financial assistance for the
Overseas Countries and Territories to which Part Four of the Treaty on the
Functioning of the European Union applies[15]
("the Internal Agreement"), and in particular Article 10(1) thereof,
Having regard to the proposal from the European
Commission,
Having regard to the opinion of the European
Investment Bank (EIB),
Whereas:
(1)       Decision
No (…) of the ACP-EU Council of Ministers[16] establishes the multiannual financial framework for cooperation with
ACP countries for the period 2014 to 2020 by adopting a new Annex Ic to the
Cotonou Agreement.
(2)       The
Internal Agreement defines the various financial envelopes of the 11th European
Development Fund ("the 11th EDF"), the contribution key and
contributions to the 11th EDF, sets up the EDF Committee and the Investment
Facility Committee ("the IF Committee"), and determines the voting
weights and qualified majority rule therein.
(3)       Furthermore,
the Internal Agreement sets the aggregate amount of Union aid to the African,
Caribbean and Pacific Group of States ("the ACP States") (excluding
the Republic of South Africa) and to the Overseas Countries and Territories ("the
OCTs") for the seven-year period 2014 to 2020 at EUR 30 506 million
contributed by the Member States. From this amount, EUR (…) million are
allocated to the ACP States as specified in the multiannual financial framework
2014 to 2020 referred to in Annex Ic to the Cotonou Agreement, EUR (...)
million are allocated to the OCTs and EUR (…) million are allocated to the
Commission for support expenditures linked to programming and implementation of
the EDF by the Commission.
(4)       The
11th EDF allocation to the OCTs is governed by Council Decision (…) of (…) on
the association of the OCTs, with the European Union[17] and by its implementing rules and any subsequent updates thereof.
(5)       Measures
covered by, and eligible for funding under Council Regulation (EC) No 1257/96
of 20 June 1996 concerning humanitarian aid[18]
should only in exceptional circumstances be financed under the 11th EDF, where
such assistance is required to ensure continuity of cooperation from crisis to
stable conditions for development and cannot be financed from the general
budget of the European Union.
(6)       On 11
April 2006, the Council adopted the principle of funding the African Peace
Facility from the EDF.
(7)       The
ACP countries will also be eligible for Union assistance from thematic
programmes provided by Regulation (…) of the European Parliament and of the
Council of (…) establishing a financing instrument for development cooperation,
by Regulation (…) of the European Parliament and of the Council of (…)
establishing a Partnership Instrument for cooperation with third countries, by
Regulation (…) of the European Parliament and of the Council of (…)
establishing an Instrument for Stability and by Regulation (…) of the European
Parliament and of the Council of (…) establishing a financing instrument for
the promotion of democracy and human rights worldwide. Those programmes should
add value to, be consistent with and complementary to the programmes funded
under the 11th EDF.
(8)       As
referred to in Article 13(2) of Regulation (EU) No […/…] of the European
Parliament and of the Council establishing "Erasmus For All" The
Union Programme for Education, Training, Youth and Sport[19], in order to promote the
international dimension of higher education, an indicative amount of EUR 1 812
100 000 from the different external instruments (Development Cooperation
Instrument, European Neighbourhood Instrument, Instrument for Preaccession
Assistance, Partnership Instrument and the European Development Fund), will be
allocated to actions of learning mobility to or from non EU countries and to
cooperation and policy dialogue with authorities/ institutions/ organisations
from these countries. The provisions of the Regulation (EU) No […/…] ["Erasmus
for All"] will apply to the use of those funds. The funding should be made
available through 2 multiannual allocations only covering the first 4 years and
the remaining 3 years respectively. This funding should be reflected in the multiannual
indicative programming under this Regulation, in line with the identified needs
and priorities of the countries concerned. The allocations should be revised in
line with the EU external priorities in case of major unforeseen circumstances
or important political changes.
(9)       The
regional cooperation among the ACP States, the OCTs and the Union's outermost
regions should be further encouraged.
(10)     In
order to implement the 11th EDF, the procedure for programming, examining and
approving aid should be established and the detailed rules for supervising the
use of aid should be laid down. On (…) the representatives of the Governments
of the Member States meeting within the Council adopted Decision (…) on the
provisional application of the Internal Agreement[20], for the purpose of the
adoption of the Implementation Regulation and the Financial Regulation and,
inter alia, for the purposes of establishing the EDF Committee and the IF
Committee.
(11)     The
European Consensus on Development of 22 December 2005[21] and the Council Conclusions on
the Commission Communications 'Increasing the impact of EU development policy: an
Agenda for Change'[22], and on 'The future approach to EU budget support to third countries'[23], should provide the general policy framework to guide the programming
and implementation of the 11th EDF, including the internationally agreed
principles on aid effectiveness such as the principles set out in the Paris Declaration
on Aid Effectiveness (2005), the EU Code of Conduct on Division of Labour in
Development Policy (2007), the EU Guidelines for the Accra Agenda for Action
(2008), and the Busan Outcome Document (2011) and the United Nations Convention
on the Rights of Persons with Disabilities to which the Union is a party.
(12)     The Union also aims to
ensure coherence with other areas of its external action when formulating the
Union's development cooperation policy and its strategic planning programming
and implementation of measures.
(13)     Fighting climate change and
protecting the environment are among the great challenges which face the Union
and where the need for international action is urgent. In accordance with the
intent stated in Commission Communication "A budget for Europe 2020"
of 29 June 2011, this Regulation should as far as possible contribute to the
objective of addressing at least 20% of the overall EU funding to climate action objectives, while respecting the principle of
partnership with ACP countries enshrined in the Cotonou Agreement. Actions in
low carbon and climate resilient society should, wherever possible, be mutually
supportive in order to reinforce their impacts.
(14)     The Union and the Member
States should improve the consistency and the complementarity of their
respective policies on development cooperation, in particular by responding to
partner countries' and regions' priorities at country and regional level. To
ensure that the Union's development cooperation policy and that of the Member
States complement and reinforce each other, it is appropriate to provide for
joint programming procedures which should be implemented whenever possible and
relevant.
(15)     The
EU-Africa Summit in December 2007 adopted the Africa-EU Strategic Partnership[24], confirmed by the EU-Africa
summit in November 2010. The Council also adopted conclusions on the Joint
Caribbean-EU Partnership Strategy on November 19th 2012[25], replacing the Council
conclusions on the EU-Caribbean Partnership of April 11th
2006. For the Pacific, the Council adopted conclusions on a
renewed Development Partnership on May 14th 2012[26], updating and complementing
the strategy adopted in 2006 (Council Conclusions of July 17th 2006).
(16)     The
financial interests of the European Union should be protected through
proportionate measures throughout the expenditure cycle, including the
prevention, detection and investigation of irregularities, the recovery of
funds lost, wrongly paid or incorrectly used and, where appropriate, penalties.
These measures should be carried out in accordance with the applicable
agreements concluded with international organisations and third countries. 
(17)     According
to Article 1(5) of the 10th EDF Internal Agreement and to Article 5 of Annex Ib
to the Cotonou Agreement, the funds of the 10th EDF (apart from amounts
allocated to the Investment Facility, excluding the related interest rate
subsidies), should no longer be committed beyond 31 December 2013 unless the
Council decides otherwise unanimously, on a proposal from the Commission. It is
appropriate hereby to provide that these funds should be used to ensure
continuity in case of late entry into force of the 11th EDF. As a complement to
Article 10 of the 11th EDF Internal Agreement which foresees that
the 10th EDF Implementation Regulation should remain in force
pending the adoption of the 11th EDF Implementation Regulation, the
continuation of the 10th EDF Financial Regulation should also be
foreseen, pending the adoption of the 11th EDF Financial Regulation.
(18)     The organisation
and functioning of the European External Action Service are described in
Council Decision 2010/427/EU,
HAS ADOPTED THIS REGULATION:
TITLE I
OBJECTIVES AND GENERAL PRINCIPLES
Article 1
Objectives and eligibility criteria
1.           Geographic
cooperation with the ACP countries and regions in the context of the 11th EDF
shall be founded on the objectives, basic principles and values reflected in
the general provisions of the Cotonou Agreement.
2.           In
particular, and within the framework of the principles and objectives of the
Union's external action, the European Consensus on Development and subsequent
modifications and additions thereto: 
(a)         
the primary objective of cooperation under this
Regulation shall be the reduction and, in the long term, the eradication of
poverty;
(b)         
cooperation under this Regulation will also
contribute to:
(i) fostering sustainable economic, social and
environmental development, and
(ii) consolidating and supporting democracy, the
rule of law, good governance, human rights and the relevant principles of
international law.
The achievement of these objectives shall be
measured using relevant indicators, including human development indicators, in particular
Millennium Development Goal (MDG) 1 for subparagraph (a) and MDG 1 to 8 for
subparagraph (b) and, after 2015, other indicators agreed at international
level by the Union and its Member States.
3.           Programming
shall be designed so as to fulfill to the greatest extent possible the criteria
for official development assistance (hereinafter referred to in as 'ODA')
established by the OECD/DAC. 
4.           Actions
covered by Council Regulation (EC) No 1257/96 of 20 June 1996 concerning
humanitarian aid[27] and eligible for funding under that Regulation
shall not, in principle, be funded under this Regulation, without prejudice to
the need to ensure continuity of cooperation from crisis to stable conditions
for development. In those cases, special consideration shall be given to
ensuring that humanitarian relief, rehabilitation and development assistance
are effectively linked.
Article 2
General principles
1.           In
implementing this Regulation, consistency with other areas of Union external
action and with other relevant Union policies and policy coherence for
development shall be ensured, in accordance with Article 208 of the Treaty on
the Functioning of the EU. To this end, measures financed under this
Regulation, including those managed by the European Investment Bank (EIB),
shall be based on the cooperation policies set out in documents such as arrangements,
declarations and action plans between the Union and the third countries and
regions concerned, and on the Union’s decisions, specific interests, policy
priorities and strategies.
2.           The
Union and the Member States shall seek regular and frequent exchanges of
information, including with other donors, and promote better donor coordination
and complementarity by working towards joint multiannual programming, based on
partner countries' poverty reduction or equivalent development strategies. They
may undertake joint action including joint analysis of and joint response to
these strategies identifying priority sectors of intervention and in-country
division of labour, by joint donor-wide missions and by the use of co-financing
and delegated cooperation arrangements.
3.           The
Union shall promote a multilateral approach to global challenges and shall
cooperate with Member States and partner countries in this respect. Where
appropriate, it shall foster cooperation with international organisations and
bodies and other bilateral donors.
4.           Relations
between the EU and its Member States and partner countries are based on and
will promote shared values of human rights, democracy and the rule of law as
well as the principles of ownership and of mutual accountability. 
Further, relations with partner countries shall
take into account their commitment and track record in implementing
international agreements and contractual relations with the Union.
5.           The
Union shall promote effective cooperation with partner countries and regions in
line with international best practice. It shall align its support with
partners' national or regional development strategies, reform policies and
procedures wherever possible, and support democratic ownership and domestic
accountability. To that end, it shall promote: 
(a)         
a development process that is transparent, partner
country or region led and owned, including the promotion of local expertise;
(b)         
the empowerment of the population of partner
countries, inclusive and participatory approaches to development and a broad
involvement of all segments of society in the development process and in
national and regional dialogue, including political dialogue. Particular
attention shall be given to the respective roles of parliaments, local
authorities and civil society, inter alia regarding participation, oversight
and accountability;
(c)         
effective cooperation modalities and instruments in
line with OECD/DAC best practices, including the use of innovative instruments
such as blending grants and loans and other risk-sharing mechanisms in selected
sectors and countries and private-sector engagement, with due regard to the
issues of debt sustainability and the number of such mechanisms. All
programmes, interventions and cooperation modalities and instruments shall be
adapted to the particular circumstances of each partner country or region, with
a focus on programme-based approaches, on delivery of predictable aid funding,
on the mobilisation of private resources, including from the local private
sector, on universal and non-discriminatory access to basic services, and the
development and use of country systems; 
(d)         
mobilisation of domestic revenue and reinforcement
of partner countries’ fiscal policy with the purpose of reducing poverty and
aid dependence;
(e)         
improved impact of policies and programming through
coordination, consistency and harmonisation between donors to create synergies
and avoid overlap and duplication, to improve complementarity and to support
donor-wide initiatives;
(f)           
coordination in partner countries and regions using
agreed guidelines and best practice principles on coordination and aid
effectiveness;
(g)         
results-based approaches to development including
through transparent and country-led results frameworks based on, where
appropriate, internationally agreed targets and indicators such as those of the
MDGs to assess and communicate the results, including the outputs, outcomes and
impact of development aid.
6.           The
Union shall support as appropriate the implementation of bilateral, regional
and multilateral cooperation and dialogue, the development dimension of partnership
agreements and triangular cooperation. The Union shall promote south-south
cooperation.
7.           In its
development cooperation activities the Union shall as appropriate draw on and
share the reform and transition experiences of Member States and lessons
learned.
8.           The
Union shall seek regular exchanges of information with civil society.
TITLE II 
PROGRAMMING AND ALLOCATION OF FUNDS
Article 3
General framework for allocating funds
1.           The
Commission shall determine the multiannual indicative resource allocations for
each ACP country and region and for Intra-ACP cooperation on the basis of the criteria
provided for in Articles 3, 9 and 12c of Annex IV to the Cotonou Agreement,
within the financial limits set out in Article 2 of the Internal Agreement. 
2.           In
the determination of the indicative national allocations, a differentiated
approach shall be pursued, in order to ensure that partner countries are
provided with specific, tailor-made cooperation based on:
(a)         
their needs;
(b)         
their capacities to generate and access financial
resources and absorption capacities; 
(c)         
their commitments and performance; and
(d)         
the potential impact of Union assistance. 
The countries most in need, in particular the
least developed countries, low income countries and countries in crisis,
post-crisis, fragile and vulnerable situation, shall be given priority in the
resource allocation process. 
Article 4
General framework for programming
1.           The
process of programming for assistance to the ACP countries and regions under
the Cotonou Agreement shall be undertaken in accordance with the general
principles referred to in Articles 1 to 14 of Annex IV to that Agreement and in
Articles 1 and 2 of this Regulation.
2.           Programming
will, except in the cases provided for in paragraph 3, be undertaken jointly
with the partner country or region concerned and increasingly aligned with the
partner country or region's poverty reduction, or equivalent, strategies.
The Union and the Member States shall consult each
other at an early stage of the programming process in order to promote
complementarity and consistency among their cooperation activities. 
The Union shall consult the EIB on matters related
to its expertise and operations, and other donors and development actors
including representatives of civil society and regional and local authorities. 
The Commission and the Member States locally
represented shall strive to joint programming where possible and appropriate.
All other Member States are invited to contribute for the purpose of
reinforcing joint external action of the Union. Joint programming should build
on the comparative advantages of all Union donors.
3.           In
circumstances such as those referred to in Article 3(3) and Article 4(5) of
Annex IV to the Cotonou Agreement, the Commission may establish specific
provisions for programming and implementing development aid unilaterally in
accordance with the relevant Union policies.
4.           The
Union will in principle concentrate its bilateral assistance on a maximum of
three sectors.
Article 5
Programming documents
1.           Strategy
papers are documents drawn up by the Union and the partner country or region
concerned to provide a coherent policy framework for development cooperation,
consistent with the overall purpose and scope, objectives and general principles
of the Cotonou Agreement, and in line with the principles established in
Articles 2, 8 and 12a of Annex IV to that Agreement.
The preparation and implementation of strategy
papers must comply with the principles of aid effectiveness: national
ownership, partnership, coordination, harmonisation, alignment with recipient
country or regional systems, transparency, mutual accountability and results
orientation as laid down in Article 2 of this Regulation. The programming
period must become, in principle, synchronised with partner country strategy
cycles.
2.           With
the consent of the partner country or region concerned, no strategy paper will
be required for:
(a)         
countries or regions having a development strategy
in the form of a development plan or a similar development document accepted by
the Commission as a basis for the corresponding multiannual indicative
programme, when adopting the latter document; 
(b)         
countries or regions for which a joint multiannual
programming document between the Union and Member States has been agreed;
(c)         
countries or regions where a Joint Framework
Document (JFD) already exists that provides a comprehensive Union approach to
the relations with that partner country or region, including Union development
policy;
(d)         
regions having a jointly agreed strategy with the Union;
(e)         
countries where the Union intends to synchronise
its strategy with a new national cycle starting before 1 January 2017; in such
cases the multiannual indicative programme for the interim period between 2014
and the beginning of the new national cycle will contain the Union's response
for that country.
3.           Strategy
papers shall not be required for the countries or regions receiving an initial allocation
of Union funds under this Regulation not exceeding EUR 50 million for the
2014-2020 period. In such cases, the multiannual indicative programmes will contain
the Union's response for these countries or regions. 
If the options referred to in paragraphs 2 and 3 are
not acceptable for the partner country or region, a strategy paper shall be
prepared.
4.           Except
in the circumstances referred to in Article 4(3), multiannual indicative
programmes will be based on a dialogue with the partner country or region and
be drawn up on the basis of the strategy papers or similar documents referred
to in this Article, and will be the subject of an agreement with the country or
region concerned. 
For the purpose of this Regulation, the joint
multiannual programming document provided for in paragraph 2(b) and complying
with the principles and conditions established in this paragraph, including an indicative
allocation of funds, may in accordance with the
procedure set out in Article 14 be considered as the
multiannual indicative programme in agreement with the partner country or
region.
Multiannual indicative programmes will set out the
priority areas selected for Union financing, the specific objectives, the
expected results, the performance indicators and the indicative financial
allocation, both overall and per priority area. 
5.           In
addition to programming documents for countries and regions, an intra-ACP
strategy paper and related multiannual indicative programme will be prepared
jointly by the Commission and the ACP through the ACP secretariat, in line with
the principles established in Articles 12 to 14 of Annex IV to the Cotonou
Agreement. 
6.           The
specific provisions referred to in Article 4(3) of this Regulation may take the
form of special support programmes, taking into account the special
considerations referred to in Article 6(1) of this Regulation. 
Article 6
Programming for countries and regions in crisis,
post-crisis or fragility situations
1.           When
drawing up programming documents for countries and regions in crisis,
post-crisis, or fragility situations, due account will be taken of the
vulnerability, special needs and circumstances of the countries or regions
concerned. 
Proper attention will be given to conflict
prevention, state and peace building, post-conflict reconciliation and
reconstruction measures as well as to the role of women in these processes.
Where partner countries or regions are directly
involved in, or affected by, a crisis, post-crisis or fragility situation,
special emphasis will be placed on stepping up coordination between relief,
rehabilitation and development amongst all relevant actors to help the
transition from an emergency situation to the development phase and to increase
resilience. Programming for countries and regions in fragility or regularly
subject to natural disasters will provide for disaster preparedness and
prevention and for managing the consequences of such disasters.
2.           For
countries or regions experiencing crisis, post-crisis or fragility situations,
an ad hoc review of the country's or region's cooperation strategy may be
carried out. Such reviews may propose a specific and adapted strategy to ensure
the transition to long-term cooperation and development, promoting a better
coordination and transition between the humanitarian and development policy
instruments.
Article 7
Approval and modification of programming documents
1.           The
programming documents, including the indicative allocations therein, shall be
approved by the Commission in accordance with the procedure set out in Article
14. 
At the same time as the programming documents are
transmitted to the EDF Committee referred to in Article 14, the Commission
shall also transmit them to the Joint Parliamentary Assembly for information.
The programming documents shall subsequently be
endorsed by the ACP State or region concerned. Countries or regions without a
signed programming document remain eligible to funding under the conditions
laid down in Article 4(3) of this Regulation. 
2.           Strategy
papers and multiannual indicative programmes, including the indicative allocations
therein, may be adjusted taking into account reviews as foreseen in Articles 5,
11 and 14 of Annex IV of the Cotonou Agreement. 
3.           The
procedure set out in Article 14 shall also apply to substantial modifications which
have the effect of significantly modifying the strategy, its programming
documents and/or its programmable resource allocation. Where applicable, the
corresponding addenda to the programming documents shall be subsequently
endorsed by the ACP State or region concerned.
4.           The
procedure referred to in paragraph 1 shall not apply to non-substantial
modifications to programming documents, making technical adjustments,
reassigning funds within the indicative allocations per priority area, or
increasing or decreasing the size of the initial indicative allocation by less
than 20%, provided that these modifications do not affect the priority areas
and objectives set out in these documents. In such case, the Commission shall
inform the EDF committee of these modifications within one month.
5.           On duly
justified imperative grounds of urgency, such as crises or immediate threats to
democracy, the rule of law, human rights or fundamental freedoms, including
those cases referred to in Article 6(2), the procedure referred to in Article 14(10)
may be used to modify the programming documents referred to in Article 5. 
TITLE III 
IMPLEMENTATION
Article 8
General framework for implementation
The implementation of the assistance
provided to the ACP countries and regions managed by the Commission and the EIB
under the Cotonou Agreement shall be undertaken in accordance with the
Financial Regulation referred to in Article 10(2) of the Internal Agreement
(hereinafter the "EDF Financial Regulation").
Article 9
Adoption of action programmes, individual measures and
special measures
1.           The
Commission shall adopt annual action programmes, where required based on the
indicative programming documents referred to in Article 5.
In the case of recurrent actions, it may also
adopt multi-annual action programmes for a period of up to three years.
When necessary, an action may be adopted as an
individual measure before or after the adoption of annual or multi-annual
action programmes. 
2.           The
action programmes and individual measures shall be prepared by the Commission
with the partner country or region, involving the Member States locally
represented and coordinating where appropriate with other donors, notably in
cases of joint programming, and with the EIB. 
Action programmes shall specify for each action
the objectives pursued, the expected results and main activities, methods of
implementation, budget and indicative timetable, any associated support
measures and performance monitoring arrangements. 
They shall state how they take current or planned
EIB activities into account. 
3.           In
the cases referred to in Article 4(3) and in cases of unforeseen needs, the
Commission may adopt special measures.
4.           The
action programmes and the individual measures provided for in paragraph 1 for
which the Union's financial assistance exceeds EUR 10 million and special
measures for which the Union's financial assistance exceeds EUR 30 million
shall be adopted by the Commission in accordance with the procedure set out in
Article 14 of this Regulation. 
That procedure shall not be required for action
programmes and measures below those thresholds, and for non-substantial
amendments thereto. Non-substantial amendments are technical adjustments such
as extending the implementation period, reassigning funds within the forecast
budget, or increasing or reducing the size of the budget by less than 20 % of
the initial budget, provided these amendments do not substantially affect the
objectives of the initial action programme or measure. In such case, action
programmes and measures and non-substantial amendments thereto shall be adopted
by the Commission, which shall inform the EDF Committee within one month. 
On duly justified imperative grounds of urgency,
such as crises, or immediate threats to democracy, the rule of law, human
rights or fundamental freedoms, the Commission may adopt individual or special
measures or amendments to existing action programmes and measures, in
accordance with the procedure referred to in Article 14(10). 
5.           The
Commission shall adopt specific action programmes for support expenditures
referred to in Article 6(2) of the Internal Agreement in accordance with the
procedure set out in Article 14. Any changes in the action programmes for
support expenditures shall be adopted in accordance with the same procedure.
6.           Appropriate
environmental screening, including climate change and biodiversity impacts,
shall be undertaken at project level including where applicable environmental
impact assessment (EIA) for environmentally sensitive projects, in particular
for major new infrastructure. Where relevant, strategic environmental
assessments (SEA) shall be used in the implementation of sectoral programmes.
The involvement of interested stakeholders in environmental assessments and
public access to the results shall be ensured.
Article 10
Additional Member State contributions
1.           At
their own initiative, Member States may provide the Commission or the EIB with voluntary
contributions in accordance with Article 1(9) of the Internal Agreement to help
achieve the objectives of the Cotonou Agreement outside joint co-financing
arrangements. Such contributions shall not affect the overall allocation of
funds under the 11th EDF. They shall be treated in the same way as Member
States' regular contributions referred to in Article 1(2) of the Internal
Agreement except for the provisions in Articles 6 and 7 of the Internal
Agreement for which specific arrangements may be laid down in a bilateral
contribution agreement. 
2.           Earmarking
shall only be made in duly justified circumstances, for example in response to
the exceptional circumstances as referred to in Article 4(3). In this case,
voluntary contributions entrusted to the Commission or the EIB shall be treated
as assigned revenue in accordance with the EDF Financial Regulation. 
3.           The
additional funds shall be integrated in the programming and review process and
in the annual action programmes, individual measures and special measures
referred to in this Regulation as well as reflect partner country or region
ownership. 
4.           Any
resulting change in the action programmes, individual measures and special
measures shall be adopted by the Commission in accordance with the provisions
of Article 9. 
5.           Member
States entrusting the Commission or the EIB with additional voluntary
contributions to help achieve the objectives of the Cotonou Agreement shall
inform the Council and the EDF/IF Committee of these contributions in advance. 
Article 11
Taxes, duties and charges
Union assistance shall not generate, or
activate the collection of specific taxes, duties or charges.
Without prejudice to Article 31 of Annex IV
of the Cotonou Agreement, such
taxes, duties and charges may be eligible under the conditions laid down in the
EDF Financial Regulation referred to in Article 10(2) of the Internal
Agreement.
Article 12
Protection of the financial interests of the Union
1.           The Commission shall take
appropriate measures ensuring that, when actions financed under this Regulation
are implemented, the financial interests of the Union are protected by the
application of preventive measures against fraud, corruption and any other
illegal activities, by effective checks and, if irregularities are detected, by
the recovery, or where appropriate by the restitution of the amounts wrongly
paid and, where appropriate, by effective, proportionate and dissuasive
administrative and financial penalties.
2.           The Commission or its
representative and the Court of Auditors shall have the power of audit and
verification, on the basis of documents and on-the-spot checks, over all grant
beneficiaries, contractors and subcontractors who have received Union funds
under the Regulation. 
3.           The European Anti-fraud
Office (OLAF) may carry out investigations including on-the-spot checks and
inspections, in accordance with the provisions and procedures laid down in
Regulation (EC) No 1073/1999 of the European Parliament and of the Council[28] and Council Regulation
(Euratom, EC) No 2185/96[29]
with a view to establishing whether there has been fraud, corruption or any
other illegal activity affecting the financial interests of the Union in
connection with a grant agreement or grant decision or a contract funded under this
Regulation.
4.           Without prejudice to
paragraphs 1, 2 and 3, cooperation agreements with third countries and with
international organisations, contracts, grant agreements and grant decisions
resulting from the implementation of this Regulation shall contain provisions
expressly empowering the Commission, the Court of Auditors and OLAF to conduct
such audits, on-the-spot checks and inspections, according to their respective
competences.
Article 13
Rules on nationality and origin for public
procurement, grants and other award procedures
The rules on nationality and origin for
public procurement, grants and other award procedures are defined in Article 20
of Annex IV of the Cotonou Agreement.
TITLE IV 
DECISION-MAKING PROCEDURES
Article 14
Responsibilities of the EDF Committee
1.           The European
Development Fund Committee (the EDF Committee) established by Article 8 of the
Internal Agreement shall give its opinion in accordance with the procedure set
out in paragraphs 3 to 10. 
An observer from the EIB shall take part in the EDF
Committee's proceedings with regard to questions concerning the Bank.
2.           The
EDF Committee's tasks shall cover the responsibilities spelled out in Titles II
and III of this Regulation:
(a)         
programming of Union aid under the 11th EDF and
programming reviews focusing in particular on country, regional and intra-ACP
strategies; and
(b)         
monitoring the implementation of Union and its Member
States aid, covering amongst others the impact of assistance on the reduction
of poverty, sectoral aspects, cross-cutting issues, the functioning of
field-level coordination with Member States and other donors and progress on
the aid effectiveness principles referred to in Article 2.
3.           When
the EDF Committee is called upon to give its opinion, the representative of the
Commission shall submit to the EDF Committee within the time-limits set out in its
rules of procedure, a draft of the measures to be taken. The EDF Committee
shall deliver its opinion within a time-limit which the chairman may lay down
according to the urgency of the matter but which shall not exceed 30 days. 
Until the EDF Committee delivers an opinion, any EDF
Committee member may suggest amendments and the chair may present amended
versions of the draft measure.
The chair shall endeavour to find solutions which
command the widest possible support within the EDF Committee. The chair shall
inform the EDF Committee of the manner in which the discussions and suggestions
for amendments have been taken into account, in particular as regards those
suggestions which have been largely supported within the EDF Committee.
4.           The
opinion shall be delivered by the qualified majority laid down in Article 8(3)
of the Internal Agreement on the basis of the votes of the Member States
weighted in the manner set out in Article 8(2) of the Internal Agreement.
5.           Where
the EDF Committee delivers a positive opinion, the Commission shall adopt the
measures which shall apply immediately. 
6.           If
the EDF Committee delivers a negative opinion, the Commission shall not adopt
the measures. Where the measures are deemed necessary, the chair may either
submit an amended version of the draft measures to the EDF Committee within 2
months of delivery of the negative opinion or submit the draft measures within
1 month of such delivery to an appeal committee referred to in paragraph 9 for
further deliberation. 
7.           Where
no opinion is delivered, the Commission may adopt the draft measures, except in
the case provided in the second subparagraph below. Where the Commission does
not adopt the measures, the chair may submit to the EDF Committee an amended
version thereof.
The Commission shall not adopt the measures when a
simple majority of the members of the EDF Committee opposes it. In this case,
where the measures are deemed necessary, the chair may submit an amended
version of the draft measures to the EDF Committee within 2 months of the vote
or submit the draft measures within 1 month of such delivery to the appeal
committee referred to in paragraph 9 for further deliberation. 
8.           Where
the opinion of the EDF Committee is to be obtained by written procedure, the
procedure shall be terminated without result when, within the time limit for
delivery of the opinion, the chair of the EDF Committee so decides or a simple
majority of EDF Committee members so requests.
9.           The
appeal committee shall adopt its own rules of procedure by a simple majority of
its component members, on a proposal from the Commission. Where the appeal
committee is seized, it shall meet at the earliest 14 days, except in duly
justified cases, and at the latest 6 weeks, after the date of referral. Without
prejudice to the first subparagraph of paragraph 3, the appeal committee shall
deliver its opinion within 2 months of the date of referral by the qualified
majority laid down in Article 8(3) of the Internal Agreement on the basis of
the votes of the Member States weighted in the manner set out in Article 8(2)
of the Internal Agreement. A representative of the Commission shall chair the
appeal committee. 
The chair shall set the date of the appeal
committee meeting in close cooperation with the members of the committee, in
order to enable Member States, the Commission and the EIB with regard to
questions concerning the Bank, to ensure an appropriate level of
representation.
Where the appeal committee delivers a positive
opinion, the Commission shall adopt the measures. Where no opinion is delivered
by the appeal committee, the Commission may adopt the measures. Where the
appeal committee delivers a negative opinion, the Commission shall not adopt
the measures.
10.         Where
reference is made to this paragraph, the Commission shall adopt the measures
which shall apply immediately, without prior submission to the EDF Committee,
and which shall remain in force for the duration of the adopted or modified
document, action programme or measure. 
At the latest 14 days after its adoption, the
chair shall submit the measures to the EDF Committee in order to obtain its
opinion.
In the event of the EDF Committee delivering a
negative opinion in line with paragraphs 3 and 4 of this Article, the
Commission shall immediately repeal the measures adopted in accordance with the
first subparagraph.
Article 15
The African Peace Facility
The intra-ACP indicative programmes shall
earmark funding for the African Peace Facility. This funding may be
complemented by the regional indicative programmes. A specific procedure set
out in the following subparagraphs shall apply as follows:
(a)                   
on a request from the African Union, endorsed by
the ACP Committee of Ambassadors, pluriannual action programmes shall be
prepared by the Commission specifying the objectives pursued, the scope and
nature of the possible interventions and the implementation arrangements. An
annex to each action programme shall describe the specific decision making
procedures for each possible type of intervention according to its nature, size
and urgency;
(b)                   
the action programmes, including the annex referred
to in subparagraph (a), and any changes thereto shall be discussed by the
relevant preparatory Council working groups and the Political and Security
Committee and approved by Coreper by qualified majority as defined in Article
8(3) of the Internal Agreement, before being adopted by the Commission;
(c)                   
the action programmes, excluding the annex referred
to in subparagraph (a), shall be the basis for the financing agreement to be
concluded between the Commission and the African Union;
(d)                   
each intervention to be implemented under the
financing agreement shall be subject to prior endorsement by the Political and
Security Committee; the relevant preparatory Council working groups shall be
informed or consulted in due time prior to their transmission to the Political
and Security Committee according to the specific decision making procedures
referred to in subparagraph (b) in order to ensure that, besides the military
and security dimension, the development related aspects of the envisaged
measures are being taken into account;
(e)                   
the Commission shall prepare an activity report on
the use of the funds for information of the Council and the EDF Committee on an
annual basis and at the request of Council or the EDF Committee, distinguishing
between ODA and non-ODA related commitments and disbursements.
The Union shall continue to examine the
possibilities of alternative future sources of funding, including common
foreign and security policy funding.
Article 16
The Investment Facility Committee
1.           The Investment
Facility (IF) Committee set up under the auspices of the EIB by Article 9 of
the Internal Agreement shall consist of the representatives of the Member
States and a representative of the Commission. An
observer from the General Secretariat of the Council and another one from the
EEAS shall be invited to attend. Each Member State, as well as the Commission, shall nominate one
representative and one designated alternate. With a view to maintaining
continuity, the Chairman of the IF Committee shall be elected by and from among
the members of the IF Committee for a period of two years. The EIB shall
provide the Committee's secretariat and support services. Only the members of
the IF Committee designated by the Member States, or their alternates, shall
vote.
The Council, acting unanimously, shall adopt the
rules of procedure of the IF Committee on the basis of a proposal drawn up by
the EIB after consulting the Commission.
The IF Committee shall act by qualified majority.
The weighting of the votes shall be as laid down in Article 8 of the Internal
Agreement.
The IF Committee shall meet at least four times a
year. Additional meetings may be convened at the request of the EIB or of the
members of the Committee as set out in the rules of procedure. In addition, the
IF Committee may deliver an opinion by written procedure, in the terms
established by its Rules of Procedure.
2.           The
IF Committee shall approve:
(a)         
the operational guidelines
on the implementation of the IF;
(b)         
the investment strategies and business plans of the
IF, on the basis of the objectives of the Cotonou Agreement and of the general principles
of Union development policy;
(c)         
the annual reports of the IF;
(d)         
any general policy document, including evaluation
reports, concerning the IF.
3.           The
IF Committee shall deliver an opinion on:
(a)         
proposals to grant an interest subsidy under
Article 2(7), and Article 4(2)(b), of Annex II to the Cotonou Agreement. In
such cases, the IF Committee shall also deliver an opinion on the use of such
an interest subsidy;
(b)         
proposals for an IF investment for any project for
which the Commission has delivered a negative opinion;
(c)         
other proposals relating to the IF based on the
general principles defined in the operational guidelines of the IF.
In order to streamline the approval process for
small operations, the IF Committee may give its favourable opinion to proposals
from the EIB for a global allocation (interest subsidies, technical assistance) or global authorisation (lending,
equity), that shall subsequently, without further opinion from the IF Committee
and/or the Commission, be sub-allocated by the EIB to individual projects in
accordance with criteria set out in the global allocation/authorisation,
including the maximum sub-allocation per project.
In addition, the governing bodies of the EIB may,
from time to time, request that the IF Committee provides an opinion on all
financing proposals, or on certain categories of financing proposals.
4.           It
shall be EIB's responsibility to submit to the IF Committee in a timely manner
any matters that require the approval or opinion of the IF Committee, as
provided for in paragraphs 2 and 3 respectively.
Any proposal submitted to the IF Committee for an opinion shall be made in
accordance with the relevant criteria and principles set out in the operational
guidelines of the IF.
5.           The
EIB shall cooperate closely with the Commission and, where applicable, shall
coordinate its operations with other donors. In particular:
(a)         
the EIB shall prepare or revise jointly with the
Commission the operational guidelines of the IF
referred to in paragraph 2(a). The EIB shall be held accountable for compliance
with the guidelines and shall ensure that the projects it supports respect
international social and environmental standards and are coherent with the
objectives of the Cotonou Agreement and of the general principles of Union
development policy and with the relevant country or regional cooperation
strategies;
(b)         
the EIB shall request the opinion of the
Commission in preparation of the investment strategies, business plans and
general policy documents; 
(c)         
the EIB shall inform the Commission on the projects
it administers in accordance with Article 18(1). At the appraisal stage of a
project, it shall request the opinion of the
Commission on its coherence with the relevant country cooperation
strategy or regional cooperation strategy or, as the case may be, with the
general objectives of the IF;
(d)         
with the exception of interest subsidies falling
within the global allocation referred to in paragraph 3(a), the EIB shall also
request the agreement of the Commission at the appraisal stage of a project on
any proposal made to the IF Committee for an interest subsidy, as to its
compliance with Article 2(7) and Article 4(2) of Annex II to the Cotonou
Agreement, and with the criteria defined in the operational guidelines of the IF.
The Commission shall be deemed to have rendered a
favourable opinion on or to have agreed to a proposal unless it notifies a
negative opinion on such a proposal within three weeks following the submission
of the proposal. As regards opinions for financial or public sector projects,
as well as agreement to interest rate subsidies, the Commission may request
that the final project proposal be submitted for its opinion or approval two
weeks before being sent to the IF Committee.
6.           The EIB
shall not proceed with any action mentioned in paragraph 3 unless the IF
Committee has given a favourable opinion.
Following a favourable opinion of the IF
Committee, the EIB shall decide on the proposal in accordance with its own
procedures. In particular it may decide not to proceed with the proposal. The
EIB shall periodically inform the IF Committee and the Commission of cases
where it decides not to proceed.
For loans from its own resources and for IF
investments for which no opinion of the IF Committee is required, the EIB shall
decide on the proposal in accordance with its own procedures and, in the case
of the Investment Facility, in accordance with the operational
guidelines of the Investment Facility and the investment strategies
approved by the IF Committee.
Notwithstanding a negative opinion of the IF
Committee on a proposal to grant an interest subsidy, the EIB may proceed with
the loan in question without the benefit of the interest subsidy. The EIB shall
periodically inform the IF Committee and the Commission of each occasion on
which it so decides to proceed.
The EIB may, subject to conditions laid down in
the operational guidelines of the IF, and the
condition that the essential objective of the loan or IF investment in question
be unchanged, decide to modify the terms of an IF loan or investment on which
the IF Committee has given a favourable opinion under paragraph 3 or of any
loan on which the IF Committee has given a favourable opinion regarding
interest subsidies. In particular, the EIB may decide to increase the amount of
the loan or IF investment by up to 20 %.
Such an increase may, for projects with interest
subsidies referred to in Article 2(7) of Annex II to the Cotonou Agreement,
result in a proportionate increase in the value of the interest subsidy. The
EIB shall periodically inform the IF Committee and the Commission of each
occasion on which it so decides to proceed. For projects falling under Article
2(7) of Annex II to the Cotonou Agreement, if an increase in the value of the
subsidy is requested, the IF Committee shall be required to deliver an opinion
before the EIB proceeds.
7.           The
EIB shall manage IF investments and all funds held on account of the IF in
accordance with the objectives of the Cotonou Agreement. It may, in particular,
take part in the management and supervisory bodies of legal persons in which
the IF is invested, and may compromise, discharge and modify the rights held on
account of the IF in accordance with the operational guidelines of the IF.
TITLE V
FINAL PROVISIONS
Article 17
Participation by a third country or region
In order to ensure the coherence and
effectiveness of Union assistance, the Commission may decide that non-ACP
developing countries and regional integration bodies with ACP participation
that promote regional cooperation and integration eligible for Union assistance
under other Union financing instruments for external action, where the project
or programme concerned is of a regional or cross-border nature and complies
with Article 6 of Annex IV to the Cotonou Agreement, are eligible for funds referred
to in Article 1(2)(a)(i) of the Internal Agreement. The Overseas Countries and
Territories ("OCTs") eligible for Union assistance under Decision […],
and the Union's outermost regions can also participate in regional cooperation
projects or programmes; the funding to enable participation of these
territories or outermost regions shall be additional to funds referred to in
Article 1(2)(a)(i) of the Internal Agreement. The objective of a reinforced cooperation
between the Member States, their outermost regions, the OCTs and the ACP
countries should be taken into account and, where appropriate, coordination
mechanisms be set up. Provision for this funding and for the types of financing
referred to in the 11th Financial Regulation may be made in the
strategy papers and multiannual indicative programmes and in the action
programmes and measures referred to in Article 9 of this Regulation. 
Article 18
Monitoring, reporting and evaluation of EDF assistance
1.           The
Commission and the EIB shall regularly monitor their actions and review
progress made towards delivering expected results. The Commission will also
conduct evaluations of the impact and effectiveness of its sectoral policies
and actions, and the effectiveness of programming, where appropriate by means
of independent external evaluations. Evaluations should be based on OECD-DAC
good practice principles, seeking to ascertain whether the specific objectives,
where applicable taking into account gender equality, have been met and to
formulate recommendations with a view to improving future operations. 
The EIB shall periodically inform the Commission
regarding the implementation of projects financed from the 11th EDF resources
it administers, following the procedures set out in the operational guidelines
of the Investment Facility.
2.           The
Commission shall send its evaluation reports to the Member States through the
EDF Committee and the EIB for information. The results shall feed back into
programme design and resource allocation.
3.           The
Commission shall associate to an appropriate extent all relevant stakeholders
in the evaluation phase of the Union assistance provided under this Regulation
and may, where appropriate, seek to undertake joint evaluations with EU Member
States, other donors and development partners.
4.           The
Commission shall examine the progress made in implementing the 11th EDF and
shall submit to the Council a report every two years starting in 2016 on the
implementation and results and, as far as possible, the main outcomes and
impacts of the Union's financial assistance. That report shall also be sent to
the European Parliament, the European Economic and Social Committee and the
Committee of the Regions.
5.           The biennial
report shall contain information relating to the previous year on the measures
financed, the results of monitoring and evaluation exercises, the involvement
of the relevant development partners, and the implementation of commitments and
of payments appropriations broken down by country, region and cooperation
sector. 
6.           The
report shall assess the results of the assistance, using as far as possible,
specific and measurable indicators of its role in meeting the objectives of the
Cotonou Agreement. It shall reflect the main lessons learned and the follow-up
to the recommendations of the evaluations of the previous years.
7.           The
Union and its Member States shall conduct a performance review, assessing the
degree of realisation of commitments and disbursements, and the results and
impact of the aid provided. The review shall be undertaken on the basis of a
proposal by the Commission.
8.           The
EIB shall provide the IF Committee with information as regards progress towards
the objectives of the IF. Following Article 6B of Annex II to the Cotonou
Agreement, the overall performance of the IF shall be subject to a joint review
at the mid- and end-term of the 11th EDF. The mid-term review shall be carried
out by an independent external expert, in cooperation with the EIB, and shall
be made available to the IF Committee.
Article 19
Climate action and biodiversity expenditure
An annual estimate of the overall
spending related to climate action and biodiversity shall be made on the basis
of the adopted indicative programming documents. The funding allocated in the
context of the EDF shall be subject to an annual tracking system based on the
OECD methodology (‘Rio markers’), without excluding the use of more precise
methodologies where such are available, integrated into the existing
methodology for performance management of Union programmes, to quantify the
expenditure related to climate action and biodiversity at the level of the
action programmes, individual and special measures referred to in Article 9,
and recorded within evaluations and biannual reports. 
Article 20
European External Action Service
The application of this Regulation shall
be in accordance with Council Decision 2010/427/EU, establishing the
organisation and functioning of the European External Action Service. 
Article 21
Transitional measures
Pending entry into force of the Internal
Agreement of the 11th EDF, transitional measures in the form of
action programmes, individual measures, special measures and specific action
programmes for support expenditure, referred to in Article 9, shall be financed
from a bridging facility for the 11th EDF, composed of balances from
the previous EDFs and from funds decommitted from projects under these EDFs.
This bridging facility may also cover the grants to finance the interest-rate
subsidies and project-related technical assistance referred to in Article 2(d)
of the Internal Agreement. These transitional measures shall aim at
facilitating the implementation of programming documents.
Funds committed under this bridging
facility shall be accounted for under the 11th EDF. The shares of
Member States contributions stated in Article 1(2)(a) of the Internal
Agreements of the 9th and 10th EDF shall be reduced
accordingly.
For the purpose of implementation of these
transitional measures, the Financial Regulation of the 10th EDF shall
continue to apply until the entry into force of the Financial Regulation of the
11th EDF.
Article 22
Entry into force
This Regulation shall enter into
force on the third day following that of its publication in the Official
Journal of the European Union.
It shall apply from 1 January 2014 until
the final date of application of the Internal Agreement
This Regulation shall be binding in
its entirety and directly applicable in all Member States
Done at Brussels, 
                                                                       For
the Council
                                                                       The
President
[1]               OJ L 317, 15.12.2000, p. 3. Agreement as amended by
the Agreement signed in Luxembourg on 25 June 2005 (OJ L 287, 28.10.2005, p. 4) and by
the Agreement signed in Ouagadougou on 22 June 2010 (OJ L 287, 4.11.2010, p. 3).

[2]               COM(2011) 500.
[3]               COM(2011) 837.
[4]               EUCO 37/13 + EUCO 37/13 COR 1 
[5]               COM(2011) 637.
[6]               http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=SEC:2011:1459:FIN:EN:PDF
[7]               Insert reference to the 11th EDF Internal
Agreement
[8]               COM(2011) 840.
[9]               COM(2011) 842.
[10]             Council regulation (EC) No 617/2007 – OJ L152 p.1 of
13.6.2007
[11]             Regulation of the European Parliament and of the
Council laying down the rules and general principles concerning mechanisms for
controls by Member States of the Commission's exercise of implementing powers
[12]             Council
Decision (EU) 2010/427
[13]             "Approved"
according to the EIB terminology
[14]             OJ L 317, 15.12.2000, p. 3. Agreement as amended by the Agreement signed in Luxembourg
on 25 June 2005
(OJ L 287, 28.10.2005, p. 4) and by the Agreement signed in Ouagadougou
on 22 June 2010 (OJ L 287, 4.11.2010, p. 3).
[15]             Insert
reference of the 11th EDF Internal Agreement: OJ (…)
[16]             Insert
reference of the ACP-EU Council decision: OJ (…)
[17]             Insert
reference of the revised OAD: OJ (…)
[18]             OJ L 163, 2.7.1996, p. 1.
[19]             OJ L […].
[20]             Insert reference to the decision on provisional
application 
[21]             OJ C 46, 24.2.2006, p. 1.
[22]             Council document 9369/12 of 14 May 2012
[23]             Council document 9371/12 of 14 May 2012
[24]             Council document 16344/07
[25]             Council document 16455/12
[26]             Council document 9877/12
[27]             OJ L 163, 2.7.1996, p. 1.
[28]             OJ L 136, 31.5.1999, p. 1.
[29]             OJ L 292, 15.11.1996, p. 2.