Article 1 Nature of an EGTC
1. A European grouping of territorial cooperation, hereinafter referred to as ‘EGTC’, may be established on Community territory under the conditions and subject to the arrangements provided for by this Regulation. 2. The objective of an EGTC shall be to facilitate and promote cross-border, transnational and/or interregional cooperation, hereinafter referred to as ‘territorial cooperation’, between its members as set out in Article 3(1), with the exclusive aim of strengthening economic and social cohesion. 3. An EGTC shall have legal personality. 4. An EGTC shall have in each Member State the most extensive legal capacity accorded to legal persons under that Member State's national law. It may, in particular, acquire or dispose of movable and immovable property and employ staff and may be a party to legal proceedings.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 1 Nature of an EGTC):
1. A European grouping of territorial cooperation (‘EGTC’) may be established on Union territory under the conditions and subject to the arrangements provided for by this Regulation. 2. The objective of an EGTC shall be to facilitate and promote, in particular, territorial cooperation, including one or more of the cross-border, transnational and interregional strands of cooperation, between its members as set out in Article 3(1), with the aim of strengthening Union economic, social and territorial cohesion. 3. An EGTC shall have legal personality. 4. An EGTC shall have in each Member State the most extensive legal capacity accorded to legal persons under that Member State's national law. It may, in particular, acquire or dispose of movable and immovable property and employ staff and may be a party to legal proceedings. 5. The registered office of an EGTC shall be located in a Member State under whose law at least one of the EGTC's members is established.
Article 2 Applicable law
1. An EGTC shall be governed by the following: (a) this Regulation; (b) where expressly authorised by this Regulation, the provisions of the convention and the statutes referred to in Articles 8 and 9; (c) in the case of matters not, or only partly, regulated by this Regulation, the laws of the Member State where the EGTC has its registered office. Where it is necessary under Community or international private law to establish the choice of law which governs an EGTC's acts, an EGTC shall be treated as an entity of the Member State where it has its registered office. 2. Where a Member State comprises several territorial entities which have their own rules of applicable law, the reference to the law applicable under paragraph 1(c) shall include the law of those entities, taking into account the constitutional structure of the Member State concerned.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 2 Applicable law):
1. Where it is necessary to determine the applicable law under Union law or private international law, an EGTC shall be considered to be an entity of the Member State where it has its registered office. 1a. The activities of an EGTC relating to carrying out tasks, referred to in Article 7(2) and (3), inside the Union shall be governed by applicable Union law and national law as specified in the convention referred to in Article 8. The activities of an EGTC that are co-financed from the Union budget shall comply with the requirements set out in applicable Union law and the national law relating to the application of that Union law. 2. Where a Member State comprises several territorial entities which have their own rules of applicable law, the reference to the law applicable under paragraph 1(c) shall include the law of those entities, taking into account the constitutional structure of the Member State concerned.
Article 3 Composition of an EGTC
1. An EGTC shall be made up of members, within the limits of their competences under national law, belonging to one or more of the following categories: (a) Member States; (b) regional authorities; (c) local authorities; (d) bodies governed by public law within the meaning of the second subparagraph of Article 1(9) of Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts ( 6 ) . Associations consisting of bodies belonging to one or more of these categories may also be members. 2. An EGTC shall be made up of members located on the territory of at least two Member States.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 3 Composition of an EGTC):
2. An EGTC shall be made up of members located on the territory of at least two Member States, except as provided for in Article 3a(2) and (5).
Article 4 Establishment of an EGTC
1. The decision to establish an EGTC shall be taken at the initiative of its prospective members. 2. Each prospective member shall: (a) notify the Member State under whose law it has been formed of its intention to participate in an EGTC; and (b) send that Member State a copy of the proposed convention and statutes referred to in Articles 8 and 9. 3. Following notification under paragraph 2 by a prospective member, the Member State concerned shall, taking into account its constitutional structure, approve the prospective member's participation in the EGTC, unless it considers that such participation is not in conformity with this Regulation or national law, including the prospective member's powers and duties, or that such participation is not justified for reasons of public interest or of public policy of that Member State. In such a case, the Member State shall give a statement of its reasons for withholding approval. The Member State shall, as a general rule, reach its decision within a deadline of three months from the date of receipt of an admissible application in accordance with paragraph 2. In deciding on the prospective member's participation in the EGTC, Member States may apply the national rules. 4. Member States shall designate the competent authorities to receive the notifications and documents as set out in paragraph 2. 5. The members shall agree on the convention referred to in Article 8 and the statutes referred to in Article 9 ensuring consistency with the approval of the Member States in accordance with paragraph 3 of this Article. 6. Any amendment to the convention and any substantial amendment to the statutes shall be approved by the Member States according to the procedure set out in this Article. Substantial amendments to the statutes shall be those entailing, directly or indirectly, an amendment to the convention.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 4 Establishment of an EGTC):
1. The decision to establish an EGTC shall be taken at the initiative of its prospective members. 2. Each prospective member shall: (a) notify the Member State under whose law it has been formed of its intention to participate in an EGTC; and (b) send that Member State a copy of the proposed convention and statutes referred to in Articles 8 and 9. In the event of non-approval, the Member State shall state its reasons for withholding approval and shall, where appropriate, suggest the necessary amendments to the convention. The Member State shall reach its decision, with regard to approval, within a period of six months from the date of receipt of a notification in accordance with paragraph 2. If the Member State which has received the notification, does not raise an objection within that period, the participation of the prospective member and the convention shall be deemed to be approved. However, the Member State where the proposed registered office of the EGTC is to be located shall formally approve the convention in order to allow the EGTC to be established. Any request for additional information from the Member State to a prospective member shall interrupt the deadline referred to in the third subparagraph. The period of interruption shall start from the day following the date on which the Member State has sent its observations to the prospective member and shall last until the prospective member has responded to the observations. However, an interruption of the deadline referred to in the third subparagraph shall not occur if the prospective member submits a reply to the observations by the Member State within ten working days of the start of the period of interruption. In deciding on a prospective member's participation in an EGTC, Member States may apply their national rules. 3a. In the case of an EGTC with prospective members from one or more third countries the Member State where the proposed registered office of the EGTC is to be located shall, in consultation with the other Member States concerned, satisfy itself that the conditions laid down in Article 3a are fulfilled and that each third country has approved the prospective members' participation in accordance with either: (a) equivalent conditions and procedures to those laid down in this Regulation; or (b) an agreement concluded between at least one Member State under whose law a prospective member is established and that third country. 4. Member States shall designate the competent authorities to receive the notifications and documents as set out in paragraph 2. 5. The members shall agree on the convention referred to in Article 8 while ensuring consistency with the approval in accordance with paragraph 3 of this Article. 6. Any amendment to the convention or to the statutes shall be notified by the EGTC to the Member States under whose law the EGTC's members are established. Any amendment to the convention, except solely in the event of accession of a new member under point (a) of paragraph 6a, shall be approved by those Member States in accordance with the procedure set out in this Article.
Article 5 Acquisition of legal personality and publication in the Official Journal
1. The statutes referred to in Article 9 and any subsequent amendments thereto shall be registered and/or published in accordance with the applicable national law in the Member State where the EGTC concerned has its registered office. The EGTC shall acquire legal personality on the day of registration or publication, whichever occurs first. The members shall inform the Member States concerned and the Committee of the Regions of the convention and the registration and/or publication of the statutes. 2. The EGTC shall ensure that, within 10 working days from registration and/or publication of the statutes, a request is sent to the Office for Official Publications of the European Communities for publication of a notice in the Official Journal of the European Union announcing the establishment of the EGTC, with details of its name, objectives, members and registered office.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 5 Acquisition of legal personality and publication in the Official Journal):
1. The convention and the statutes and any subsequent amendments thereto shall be registered or published, or both, in the Member State where the EGTC concerned has its registered office, in accordance with the applicable national law of that Member State. The EGTC shall acquire legal personality on the date of registration or publication of the convention and the statutes, whichever occurs first. The members shall inform the Member States concerned and the Committee of the Regions of the registration or publication of the convention and the statutes. 2. The EGTC shall ensure that, within ten working days of the registration or publication of the convention and the statutes, a request is sent to the Committee of the Regions following the template set out in the Annex to this Regulation. The Committee of the Regions shall then transfer that request to the Publications Office of the European Union for publication of a notice, in the C series of the Official Journal of the European Union , announcing the establishment of the EGTC, along with the details set out in the Annex to this Regulation.
Article 6 Control of management of public funds
1. Control of an EGTC's management of public funds shall be organised by the competent authorities of the Member State where the EGTC has its registered office. The Member State where the EGTC has its registered office shall designate the competent authority for this task before giving its approval to participation in the EGTC under Article 4. 2. Where required under the national legislation of the other Member States concerned, the authorities of the Member State where an EGTC has its registered office shall make arrangements for the appropriate authorities in the other Member States concerned to carry out controls on their territory for those acts of the EGTC which are performed in those Member States and to exchange all appropriate information. 3. All controls shall be carried out according to internationally accepted audit standards. 4. Notwithstanding paragraphs 1, 2 and 3, where the tasks of an EGTC mentioned under the first or second subparagraph of Article 7(3) include actions which are co-financed by the Community, the relevant legislation concerning the control of funds provided by the Community shall apply. 5. The Member State where an EGTC has its registered office shall inform the other Member States concerned of any difficulties encountered during the controls.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 6 Control of management of public funds):
1. Control of an EGTC's management of public funds shall be organised by the competent authorities of the Member State where the EGTC has its registered office. The Member State where the EGTC has its registered office shall designate the competent authority for this task before giving its approval to participation in the EGTC under Article 4. 2. Where required under the national legislation of the other Member States concerned, the authorities of the Member State where an EGTC has its registered office shall make arrangements for the appropriate authorities in the other Member States concerned to carry out controls on their territory for those acts of the EGTC which are performed in those Member States and to exchange all appropriate information. 3. All controls shall be carried out according to internationally accepted audit standards. 4. Notwithstanding paragraphs 1, 2 and 3 of this Article, where the tasks of an EGTC as refered to in Article 7(3) cover actions which are co-financed by the Union, the relevant legislation concerning the control of funds provided by the Union shall apply. 5. The Member State where an EGTC has its registered office shall inform the other Member States concerned of any difficulties encountered during the controls.
Article 7 Tasks
1. An EGTC shall carry out the tasks given to it by its members in accordance with this Regulation. Its tasks shall be defined by the convention agreed by its members, in conformity with Articles 4 and 8. 2. An EGTC shall act within the confines of the tasks given to it, which shall be limited to the facilitation and promotion of territorial cooperation to strengthen economic and social cohesion and be determined by its members on the basis that they all fall within the competence of every member under its national law. 3. Specifically, the tasks of an EGTC shall be limited primarily to the implementation of territorial cooperation programmes or projects co-financed by the Community through the European Regional Development Fund, the European Social Fund and/or the Cohesion Fund. An EGTC may carry out other specific actions of territorial cooperation between its members in pursuit of the objective referred to in Article 1(2), with or without a financial contribution from the Community. Member States may limit the tasks that EGTCs may carry out without a Community financial contribution. However, those tasks shall include at least the cooperation actions listed under Article 6 of Regulation (EC) No 1080/2006. 4. The tasks given to an EGTC by its members shall not concern the exercise of powers conferred by public law or of duties whose object is to safeguard the general interests of the State or of other public authorities, such as police and regulatory powers, justice and foreign policy. 5. The members of an EGTC may decide by unanimity to empower one of the members to execute its tasks.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 7 Tasks):
1. An EGTC shall carry out the tasks given to it by its members in accordance with this Regulation. Its tasks shall be defined by the convention agreed by its members, in conformity with Articles 4 and 8. 2. An EGTC shall act within the confines of the tasks given to it, namely the facilitation and promotion of territorial cooperation to strengthen Union economic, social and territorial cohesion, and the overcoming of internal market barriers. Each task shall be determined by its members as falling within the competence of every member, unless the Member State or third country approves the participation of a member established under its national law even where that member is not competent for all the tasks specified in the convention. 3. An EGTC may carry out specific actions of territorial cooperation between its members in pursuit of the objective referred to in Article 1(2), with or without financial support from the Union. Primarily, the tasks of an EGTC may concern the implementation of cooperation programmes, or parts thereof, or the implementation of operations supported by the Union through the European Regional Development Fund, the European Social Fund and/or the Cohesion Fund. Member States may limit the tasks that EGTCs may carry out without financial support from the Union. However, without prejudice to Article 13, Member States shall not exclude tasks concerning the investment priorities referred to in Article 7 of Regulation (EU) No 1299/2013 ( 3 ) of the European Parliament and of the Council. 4. The tasks given to an EGTC by its members shall not concern the exercise of powers conferred by public law or of duties whose object is to safeguard the general interests of the State or of other public authorities, such as police and regulatory powers, justice and foreign policy. However, in compliance with applicable Union and national law, the assembly of an EGTC, referred to in point (a) of Article 10(1), may define the terms and conditions of the use of an item of infrastructure the EGTC is managing, or the terms and conditions subject to which a service of general economic interest is provided, including the tariffs and fees to be paid by the users. 5. The members of an EGTC may decide by unanimity to empower one of the members to execute its tasks.
Article 8 Convention
1. An EGTC shall be governed by a convention concluded unanimously by its members in accordance with Article 4. 2. The convention shall specify: (a) the name of the EGTC and its registered office, which shall be located in a Member State under whose laws at least one of the members is formed; (b) the extent of the territory in which the EGTC may execute its tasks; (c) the specific objective and tasks of the EGTC, its duration and the conditions governing its dissolution; (d) the list of the EGTC's members; (e) the law applicable to the interpretation and enforcement of the convention, which shall be the law of the Member State where the EGTC has its registered office; (f) the appropriate arrangements for mutual recognition, including for the purposes of financial control; and (g) the procedures for amending the convention, which shall comply with the obligations set out in Articles 4 and 5.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 8 Convention):
1. An EGTC shall be governed by a convention concluded unanimously by its members in accordance with Article 4. 3. Where the tasks of an EGTC concern only the management of a cooperation programme, or part thereof, under Regulation (EU) No 1299/2013, or where an EGTC concerns interregional cooperation or networks, information under point (b) of paragraph 2 shall not be required.
Article 9 Statutes
1. The statutes of an EGTC shall be adopted on the basis of the convention by its members acting unanimously. 2. The statutes of an EGTC shall contain, as a minimum, all the provisions of the convention together with the following: (a) the operating provisions of the EGTC's organs and their competencies, as well as the number of representatives of the members in the relevant organs; (b) the decision-making procedures of the EGTC; (c) the working language or languages; (d) the arrangements for its functioning, notably concerning personnel management, recruitment procedures and the nature of personnel contracts; (e) the arrangements for the members' financial contributions and the applicable accounting and budgetary rules, including on financial issues, of each of the members of the EGTC with respect to it; (f) the arrangements for members' liability in accordance with Article 12(2); (g) the authorities responsible for the designation of independent external auditors; and (h) the procedures for amending the statutes, which shall comply with the obligations set out in Articles 4 and 5.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 9 Statutes):
1. The statutes of an EGTC shall be adopted on the basis of, and in accordance with, its convention, by its members acting unanimously.
Article 10 Organisation of an EGTC
1. An EGTC shall have at least the following organs: (a) an assembly, which is made up of representatives of its members; (b) a director, who represents the EGTC and acts on its behalf. 2. The statutes may provide for additional organs with clearly defined powers. 3. An EGTC shall be liable for the acts of its organs as regards third parties, even where such acts do not fall within the tasks of the EGTC.
Article 11 Budget
1. An EGTC shall establish an annual budget which shall be adopted by the assembly, containing, in particular, a component on running costs and, if necessary, an operational component. 2. The preparation of its accounts including, where required, the accompanying annual report, and the auditing and publication of those accounts, shall be governed as provided for by Article 2(1)(c).
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 11 Budget):
1. An EGTC shall establish an annual budget which shall be adopted by the assembly, containing, in particular, a component on running costs and, if necessary, an operational component. 2. The preparation of its accounts including, where required, the accompanying annual report, and the auditing and publication of those accounts, shall be governed by the national law of the Member State where the EGTC has its registered office.
Article 12 Liquidation, insolvency, cessation of payments and liability
1. As regards liquidation, insolvency, cessation of payments and similar procedures, an EGTC shall be governed by the laws of the Member State where it has its registered office, unless otherwise provided in paragraphs 2 and 3. 2. An EGTC shall be liable for its debts whatever their nature. To the extent that the assets of an EGTC are insufficient to meet its liabilities, its members shall be liable for the EGTC's debts whatever their nature, each member's share being fixed in proportion to its contribution, unless the national law under which a member is formed excludes or limits the liability of that member. The arrangements for contributions shall be fixed in the statutes. If the liability of at least one member of an EGTC is limited as a result of the national law under which it is formed, the other members may also limit their liability in the statutes. The members may provide in the statutes that they will be liable, after they have ceased to be members of an EGTC, for obligations arising out of activities of the EGTC during their membership. The name of an EGTC whose members have limited liability shall include the word ‘limited’. Publication of the convention, statutes and accounts of an EGTC whose members have limited liability shall be at least equal to that required for other kinds of legal entity whose members have limited liability, formed under the laws of the Member State where that EGTC has its registered office. A Member State may prohibit the registration on its territory of an EGTC whose members have limited liability. 3. Without prejudice to the financial responsibility of Member States in relation to any funding from the Structural and/or Cohesion Funds provided to an EGTC, no financial liability shall arise for Member States on account of this Regulation in relation to an EGTC of which they are not a member.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 12 Liquidation, insolvency, cessation of payments and liability):
1. As regards liquidation, insolvency, cessation of payments and similar procedures, an EGTC shall be governed by the laws of the Member State where it has its registered office, unless otherwise provided in paragraphs 2 and 3. An EGTC shall be liable for all its debts. 2. Without prejudice to paragraph 3, to the extent that the assets of an EGTC are insufficient to meet its liabilities, its members shall be liable for its debts irrespective of the nature of those debts, each member's share being fixed in proportion to its financial contribution. The arrangements for financial contributions shall be fixed in the statutes. The EGTC's members may provide in the statutes that they are to be liable, after they have ceased to be members of an EGTC, for obligations arising out of activities of the EGTC during their membership. 2a. If the liability of at least one member of an EGTC from a Member State is limited as a result of the national law under which it is established, the other members may also limit their liability in the convention where national law implementing this Regulation enables them to do so. The name of an EGTC whose members have limited liability shall include the word 'limited'. The requirements for the publication of the convention, statutes and accounts of an EGTC whose members have limited liability shall be at least equal to those required for other legal entities with limited liability under the laws of the Member State where that EGTC has its registered office. In the case of an EGTC whose members have limited liability, any Member State concerned may require that the EGTC take out appropriate insurance or that it be subject to a guarantee provided by a bank or other financial institution established in a Member State or that it be covered by a facility provided as a guarantee by a public entity or by a Member State to cover the risks specific to the activities of the EGTC. 3. Without prejudice to the financial responsibility of Member States in relation to any funding from the Structural and/or Cohesion Funds provided to an EGTC, no financial liability shall arise for Member States on account of this Regulation in relation to an EGTC of which they are not a member.
Article 13 Public interest
Where an EGTC carries out any activity in contravention of a Member State's provisions on public policy, public security, public health or public morality, or in contravention of the public interest of a Member State, a competent body of that Member State may prohibit that activity on its territory or require those members which have been formed under its law to withdraw from the EGTC unless the EGTC ceases the activity in question. Such prohibitions shall not constitute a means of arbitrary or disguised restriction on territorial cooperation between the EGTC's members. Review of the competent body's decision by a judicial authority shall be possible.
Article 14 Dissolution
1. Notwithstanding the provisions on dissolution contained in the convention, on an application by any competent authority with a legitimate interest, the competent court or authority of the Member State where an EGTC has its registered office shall order the EGTC to be wound up if it finds that the EGTC no longer complies with the requirements laid down in Articles 1(2) or 7 or, in particular, that the EGTC is acting outside the confines of the tasks laid down in Article 7. The competent court or authority shall inform all the Member States under whose law the members have been formed of any application to dissolve an EGTC. 2. The competent court or authority may allow the EGTC time to rectify the situation. If the EGTC fails to do so within the time allowed, the competent court or authority shall order it to be wound up.
Article 15 Jurisdiction
1. Third parties who consider themselves wronged by the acts or omissions of an EGTC shall be entitled to pursue their claims by judicial process. 2. Except where otherwise provided for in this Regulation, Community legislation on jurisdiction shall apply to disputes involving an EGTC. In any case which is not provided for in such Community legislation, the competent courts for the resolution of disputes shall be the courts of the Member State where the EGTC has its registered office. The competent courts for the resolution of disputes under Article 4(3) or (6) or under Article 13 shall be the courts of the Member State whose decision is challenged. 3. Nothing in this Regulation shall deprive citizens from exercising their national constitutional rights of appeal against public bodies which are members of an EGTC in respect of: (a) administrative decisions in respect of activities which are being carried out by the EGTC; (b) access to services in their own language; and (c) access to information. In these cases the competent courts shall be those of the Member State under whose constitution the rights of appeal arise.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 15 Jurisdiction):
1. Third parties who consider themselves wronged by the acts or omissions of an EGTC shall be entitled to pursue their claims by judicial process. 2. Except where otherwise provided for in this Regulation, Union law on jurisdiction shall apply to disputes involving an EGTC. In any case which is not provided for in such Union law, the competent courts for the resolution of disputes shall be the courts of the Member State where the EGTC has its registered office. The competent courts for the resolution of disputes under Article 4(3) or (6) or under Article 13 shall be the courts of the Member State whose decision is challenged.
Article 16 Final provisions
1. Member States shall make such provisions as are appropriate to ensure the effective application of this Regulation. Where required under the terms of that Member State's national law, a Member State may establish a comprehensive list of the tasks which the members of an EGTC within the meaning of Article 3(1) formed under its laws already have, as far as territorial cooperation within that Member State is concerned. The Member State shall inform the Commission and the other Member States accordingly of any provisions adopted under this Article. 2. Member States may provide for the payment of fees in connection with the registration of the convention and statutes. Those fees may not, however, exceed the administrative cost thereof.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 16 Final provisions):
1. Member States shall adopt provisions to ensure the effective application of this Regulation, including with regard to the determination of the competent authorities responsible for the approval procedure, in accordance with their legal and administrative arrangements. Where required under the terms of a Member State's national law, that Member State may establish a comprehensive list of the tasks which the members of an EGTC within the meaning of Article 3(1) established under its laws already have, as far as territorial cooperation within that Member State is concerned. The Member State shall submit to the Commission any provisions adopted under this Article, as well as any amendments thereof. The Commission shall transmit those provisions to the other Member States and the Committee of the Regions. 1a. The provisions referred to in paragraph 1 insofar as they concern a Member State to which an OCT is linked shall, taking into account the relationship of the Member State with that OCT, also ensure the effective application of this Regulation with regard to that OCT, neighbouring other Member States or outermost regions of those Member States. 2. Member States may provide for the payment of fees in connection with the registration of the convention and statutes. Those fees may not, however, exceed the administrative cost thereof.
Article 17 Report and review clause
By 1 August 2011, the Commission shall forward to the European Parliament and the Council a report on the application of this Regulation and proposals for amendments, where appropriate.
Amendment rationale: CONTEXT OF THE PROPOSAL The proposal is the second part of the fulfilment by the Commission of the obligation imposed by Article 17 of Regulation (EC) No 1082/2006. On 29 July 2011, the Commission transmitted a Report on the application of the Regulation[1]. The report identified areas that could be improved and this draft amending Regulation embodies the specific changes that will effect those improvements. The philosophy behind the changes can be expressed in three keywords: Continuity; Clarity; Flexibility. – Continuity: because the basic nature of an EGTC will not be changed and no existing EGTC should need to change its statutes or ways of operating; – Clarity: because the Regulation will be modified (a) to take account of the Lisbon Treaty, (b) to simplify and clarify certain aspects that have been shown to cause confusion and (c) to ensure more visibility and communication on the formation and operation of EGTCs; – Flexibility: by opening up EGTCs to any aspect of territorial cooperation (and not ‘primarily’ the managing of ERDF-funded programmes and projects) and by providing legal bases for the participation of authorities and regions from third countries to participate as members. 
Revised version (Article 17 Report):
By 1 August 2018 the Commission shall forward to the European Parliament, the Council and the Committee of the Regions a report on the application of this Regulation, evaluating, based on indicators, its effectiveness, efficiency, relevance, European added value and scope for simplification. The Commission shall be empowered to adopt delegated acts, in accordance with Article 17a, laying down the list of indicators referred to in the first paragraph.
Article 18 Entry into force
This Regulation shall enter into force on the day following its publication in the Official Journal of the European Union . It shall apply by 1 August 2007, with the exception of Article 16, which shall apply from 1 August 2006.