Article 1 Subject matter
This Regulation lays down the conditions governing the statute and funding of political parties at European level ('European political parties') and political foundations at European level ('European political foundations').
Article 2 Definitions
For the purposes of this Regulation: (1) 'political party' means an association of citizens: — which pursues political objectives, and — which is either recognised by, or established in accordance with, the legal order of at least one Member State; (2) 'political alliance' means structured cooperation between political parties and/or citizens; (3) 'European political party' means a political alliance which pursues political objectives and is registered with the Authority for European political parties and foundations established in Article 6, in accordance with the conditions and procedures laid down in this Regulation; (4) 'European political foundation' means an entity which is formally affiliated with a European political party, which is registered with the Authority in accordance with the conditions and procedures laid down in this Regulation, and which through its activities, within the aims and fundamental values pursued by the Union, underpins and complements the objectives of the European political party by performing one or more of the following tasks: (a) observing, analysing and contributing to the debate on European public policy issues and on the process of European integration; (b) developing activities linked to European public policy issues, such as organising and supporting seminars, training, conferences and studies on such issues between relevant stakeholders, including youth organisations and other representatives of civil society; (c) developing cooperation in order to promote democracy, including in third countries; (d) serving as a framework for national political foundations, academics, and other relevant actors to work together at European level; (5) 'regional parliament' or 'regional assembly' means a body whose members either hold a regional electoral mandate or are politically accountable to an elected assembly; (6) 'funding from the general budget of the European Union' means a grant awarded in accordance with Title VI of Part One or a contribution awarded in accordance with Title VIII of Part Two of Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council ( 1 ) ('the Financial Regulation'); (7) 'donation' means any cash offering, any offering in kind, the provision below market value of any goods, services (including loans) or works, and/or any other transaction which constitutes an economic advantage for the European political party or the European political foundation concerned, with the exception of contributions from members and of usual political activities carried out on a voluntary basis by individuals; (8) 'contribution from members' means any payment in cash, including membership fees, or any contribution in kind, or the provision below market value of any goods, services (including loans) or works, and/or any other transaction which constitutes an economic advantage for the European political party or the European political foundation concerned, when provided to that European political party or to that European political foundation by one of its members, with the exception of usual political activities carried out on a voluntary basis by individual members; (9) 'annual budget' for the purposes of Articles 20 and 27 means the total amount of expenditure in a given year as reported in the annual financial statements of the European political party or of the European political foundation concerned; (10) 'National Contact Point' means any person or persons specifically designated by the relevant authorities in the Member States for the purpose of exchanging information in the application of this Regulation; (11) 'seat' means the location where the European political party or the European political foundation has its central administration; (12) 'concurrent infringements' means two or more infringements committed as part of the same unlawful act; (13) 'repeated infringement' means an infringement committed within five years of a sanction having been imposed on its perpetrator for the same type of infringement.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 2 Definitions):
For the purposes of this Regulation: (1) 'political party' means an association of citizens: — which pursues political objectives, and — which is either recognised by, or established in accordance with, the legal order of at least one Member State; (2) 'political alliance' means structured cooperation between political parties and/or citizens; (3) 'European political party' means a political alliance which pursues political objectives and is registered with the Authority for European political parties and foundations established in Article 6, in accordance with the conditions and procedures laid down in this Regulation; (5) 'regional parliament' or 'regional assembly' means a body whose members either hold a regional electoral mandate or are politically accountable to an elected assembly; (6) 'funding from the general budget of the European Union' means a grant awarded in accordance with Title VI of Part One or a contribution awarded in accordance with Title VIII of Part Two of Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council ( 1 ) ('the Financial Regulation'); (7) 'donation' means any cash offering, any offering in kind, the provision below market value of any goods, services (including loans) or works, and/or any other transaction which constitutes an economic advantage for the European political party or the European political foundation concerned, with the exception of contributions from members and of usual political activities carried out on a voluntary basis by individuals; (8) 'contribution from members' means any payment in cash, including membership fees, or any contribution in kind, or the provision below market value of any goods, services (including loans) or works, and/or any other transaction which constitutes an economic advantage for the European political party or the European political foundation concerned, when provided to that European political party or to that European political foundation by one of its members, with the exception of usual political activities carried out on a voluntary basis by individual members; (9) 'annual budget' for the purposes of Articles 20 and 27 means the total amount of expenditure in a given year as reported in the annual financial statements of the European political party or of the European political foundation concerned; (10) 'National Contact Point' means any person or persons specifically designated by the relevant authorities in the Member States for the purpose of exchanging information in the application of this Regulation; (11) 'seat' means the location where the European political party or the European political foundation has its central administration; (12) 'concurrent infringements' means two or more infringements committed as part of the same unlawful act; (13) 'repeated infringement' means an infringement committed within five years of a sanction having been imposed on its perpetrator for the same type of infringement.
Article 3 Conditions for registration
1. A political alliance shall be entitled to apply to register as a European political party subject to the following conditions: (a) it must have its seat in a Member State as indicated in its statutes; (b) its member parties must be represented by, in at least one quarter of the Member States, members of the European Parliament, of national parliaments, of regional parliaments or of regional assemblies, or it or its member parties must have received, in at least one quarter of the Member States, at least three per cent of the votes cast in each of those Member States at the most recent elections to the European Parliament; (ba) its member parties are not members of another European political party; (c) it must observe, in particular in its programme and in its activities, the values on which the Union is founded, as expressed in Article 2 TEU, namely respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities; (d) it or its members must have participated in elections to the European Parliament, or have expressed publicly the intention to participate in the next elections to the European Parliament; and (e) it must not pursue profit goals. 2. An applicant shall be entitled to apply to register as a European political foundation subject to the following conditions: (a) it must be affiliated with a European political party registered in accordance with the conditions and procedures laid down in this Regulation; (d) its objectives must complement the objectives of the European political party with which it is formally affiliated; (e) its governing body must be composed of members from at least one quarter of the Member States; and 3. A European political party can have only one formally affiliated European political foundation. Each European political party and the affiliated European political foundation shall ensure a separation between their respective day-to-day management, governing structures and financial accounts.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 3 Conditions for registration):
3. A European political party can have only one formally affiliated European political foundation. Each European political party and the affiliated European political foundation shall ensure a separation between their respective day-to-day management, governing structures and financial accounts.
Article 4 Governance of European political parties
1. The statutes of a European political party shall comply with the applicable law of the Member State in which it has its seat and shall include provisions covering at least the following: (a) its name and logo, which must be clearly distinguishable from those of any existing European political party or European political foundation; (b) the address of its seat; (c) a political programme setting out its purpose and objectives; (d) a statement, in conformity with point (e) of Article 3(1), that it does not pursue profit goals; (e) where relevant, the name of its affiliated political foundation and a description of the formal relationship between them; (f) its administrative and financial organisation and procedures, specifying in particular the bodies and offices holding the powers of administrative, financial and legal representation and the rules on the establishment, approval and verification of annual accounts; and (g) the internal procedure to be followed in the event of its voluntary dissolution as a European political party. 2. The statutes of a European political party shall include provisions on internal party organisation covering at least the following: (a) the modalities for the admission, resignation and exclusion of its members, the list of its member parties being annexed to the statutes; (b) the rights and duties associated with all types of membership and the relevant voting rights; (c) the powers, responsibilities and composition of its governing bodies, specifying for each the criteria for the selection of candidates and the modalities for their appointment and dismissal; (d) its internal decision-making processes, in particular the voting procedures and quorum requirements; (e) its approach to transparency, in particular in relation to bookkeeping, accounts and donations, privacy and the protection of personal data; and (f) the internal procedure for amending its statutes. 3. The Member State of the seat may impose additional requirements for the statutes, provided those additional requirements are not inconsistent with this Regulation.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 4 Governance of European political parties):
3. The Member State of the seat may impose additional requirements for the statutes, provided those additional requirements are not inconsistent with this Regulation.
Article 5 Governance of European political foundations
1. The statutes of a European political foundation shall comply with the applicable law of the Member State in which it has its seat and shall include provisions covering at least the following: (a) its name and logo, which must be clearly distinguishable from those of any existing European political party or European political foundation; (b) the address of its seat; (c) a description of its purpose and objectives, which must be compatible with the tasks listed in point (4) of Article 2; (d) a statement, in conformity with point (f) of Article 3(2), that it does not pursue profit goals; (e) the name of the European political party with which it is directly affiliated, and a description of the formal relationship between them; (f) a list of its bodies, specifying for each its powers, responsibilities and composition, and including the modalities for the appointment and dismissal of the members and managers of such bodies; (g) its administrative and financial organisation and procedures, specifying in particular the bodies and offices holding the powers of administrative, financial and legal representation and the rules on the establishment, approval and verification of annual accounts; (h) the internal procedure for amending its statutes; and (i) the internal procedure to be followed in the event of its voluntary dissolution as a European political foundation. 2. The Member State of the seat may impose additional requirements for the statutes, provided those additional requirements are not inconsistent with this Regulation.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 5 Governance of European political foundations):
2. The Member State of the seat may impose additional requirements for the statutes, provided those additional requirements are not inconsistent with this Regulation.
Article 6 Authority for European political parties and European political foundations
1. An Authority for European political parties and European political foundations (the 'Authority') is hereby established for the purpose of registering, controlling and imposing sanctions on European political parties and European political foundations in accordance with this Regulation. 2. The Authority shall have legal personality. It shall be independent and shall exercise its functions in full compliance with this Regulation. The Authority shall decide on the registration and de-registration of European political parties and European political foundations in accordance with the procedures and conditions laid down in this Regulation. In addition, the Authority shall regularly verify that the registration conditions laid down in Article 3 and the governance provisions set out in accordance with points (a), (b) and (d) to (f) of Article 4(1) and in points (a) to (e) and (g) of Article 5(1) continue to be complied with by the registered European political parties and European political foundations. In its decisions, the Authority shall give full consideration to the fundamental right of freedom of association and to the need to ensure pluralism of political parties in Europe. The Authority shall be represented by its Director who shall take all decisions of the Authority on its behalf. 3. The Director of the Authority shall be appointed for a five-year non-renewable term by the European Parliament, the Council and the Commission (jointly referred to as the 'appointing authority') by common accord, on the basis of proposals made by a selection committee composed of the Secretaries-General of those institutions following an open call for candidates. The Director of the Authority shall be selected on the basis of his or her personal and professional qualities. He or she shall not be a member of the European Parliament, hold any electoral mandate or be a current or former employee of a European political party or a European political foundation. The Director selected shall not have a conflict of interests between his or her duty as Director of the Authority and any other official duties, in particular in relation to the application of the provisions of this Regulation. A vacancy caused by resignation, retirement, dismissal or death shall be filled in accordance with the same procedure. In the event of a normal replacement or voluntary resignation the Director shall continue his or her functions until a replacement has taken up his or her duties. If the Director of the Authority no longer fulfils the conditions required for the performance of his or her duties, he or she may be dismissed by common accord by at least two of the three institutions referred to in the first subparagraph and on the basis of a report drawn up by the selection committee referred to in the first subparagraph on its own initiative or following a request from any of the three institutions. The Director of the Authority shall be independent in the performance of his or her duties. When acting on behalf of the Authority, the Director shall neither seek nor take instructions from any institution or government or from any other body, office or agency. The Director of the Authority shall refrain from any act which is incompatible with the nature of his or her duties. The European Parliament, the Council and the Commission shall exercise jointly, with regard to the Director, the powers conferred on the appointing authority by the Staff Regulations of Officials (and the Conditions of Employment of Other Servants of the Union) laid down in Council Regulation (EEC, Euratom, ECSC) No 259/68 ( 2 ). Without prejudice to decisions on appointment and dismissal, the three institutions may agree to entrust the exercise of some or all of the remaining powers conferred on the appointing authority to any one of them. The appointing authority may assign the Director to other tasks provided that such tasks are not incompatible with the workload resulting from his or her duties as Director of the Authority and are not liable to create any conflict of interests or to jeopardise the full independence of the Director. 4. The Authority shall be physically located in the European Parliament, which shall provide the Authority with the necessary offices and administrative support facilities. 5. The Director of the Authority shall be assisted by staff from one or more institutions of the Union. When working for the Authority, such staff shall act under the sole authority of the Director of the Authority. The selection of the staff shall not be liable to result in a conflict of interests between their duties at the Authority and any other official duties, and they shall refrain from any act which is incompatible with the nature of their duties. 6. The Authority shall conclude agreements with the European Parliament and, if appropriate, with other institutions on any administrative arrangements necessary to enable it to carry out its tasks, in particular agreements regarding the staff, services and support provided pursuant to paragraphs 4, 5 and 8. 7. The appropriations for the expenditure of the Authority shall be provided under a separate Title in the Section for the European Parliament in the general budget of the European Union. The appropriations shall be sufficient to ensure the full and independent operation of the Authority. A draft budgetary plan for the Authority shall be submitted to the European Parliament by the Director, and shall be made public. The European Parliament shall delegate the duties of Authorising Officer with respect to those appropriations to the Director of the Authority. 8. Council Regulation No 1 ( 3 ) shall apply to the Authority. The translation services required for the functioning of the Authority and the Register shall be provided by the Translation Centre for the Bodies of the European Union. 9. The Authority and the Authorising Officer of the European Parliament shall share all information necessary for the execution of their respective responsibilities under this Regulation. 10. The Director shall submit annually a report to the European Parliament, the Council and the Commission on the activities of the Authority. 11. The Court of Justice of the European Union shall review the legality of the decisions of the Authority in accordance with Article 263 TFEU and shall have jurisdiction in disputes relating to compensation for damage caused by the Authority in accordance with Articles 268 and 340 TFEU. Should the Authority fail to take a decision where it is required to do so by this Regulation, proceedings for failure to act may be brought before the Court of Justice of the European Union in accordance with Article 265 TFEU.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 6 Authority for European political parties and European political foundations):
1. An Authority for European political parties and European political foundations (the 'Authority') is hereby established for the purpose of registering, controlling and imposing sanctions on European political parties and European political foundations in accordance with this Regulation. 2. The Authority shall have legal personality. It shall be independent and shall exercise its functions in full compliance with this Regulation. The Authority shall decide on the registration and de-registration of European political parties and European political foundations in accordance with the procedures and conditions laid down in this Regulation. In addition, the Authority shall regularly verify that the registration conditions laid down in Article 3 and the governance provisions set out in accordance with points (a), (b) and (d) to (f) of Article 4(1) and in points (a) to (e) and (g) of Article 5(1) continue to be complied with by the registered European political parties and European political foundations. In its decisions, the Authority shall give full consideration to the fundamental right of freedom of association and to the need to ensure pluralism of political parties in Europe. The Authority shall be represented by its Director who shall take all decisions of the Authority on its behalf. 3. The Director of the Authority shall be appointed for a five-year non-renewable term by the European Parliament, the Council and the Commission (jointly referred to as the 'appointing authority') by common accord, on the basis of proposals made by a selection committee composed of the Secretaries-General of those institutions following an open call for candidates. The Director of the Authority shall be selected on the basis of his or her personal and professional qualities. He or she shall not be a member of the European Parliament, hold any electoral mandate or be a current or former employee of a European political party or a European political foundation. The Director selected shall not have a conflict of interests between his or her duty as Director of the Authority and any other official duties, in particular in relation to the application of the provisions of this Regulation. A vacancy caused by resignation, retirement, dismissal or death shall be filled in accordance with the same procedure. In the event of a normal replacement or voluntary resignation the Director shall continue his or her functions until a replacement has taken up his or her duties. If the Director of the Authority no longer fulfils the conditions required for the performance of his or her duties, he or she may be dismissed by common accord by at least two of the three institutions referred to in the first subparagraph and on the basis of a report drawn up by the selection committee referred to in the first subparagraph on its own initiative or following a request from any of the three institutions. The Director of the Authority shall be independent in the performance of his or her duties. When acting on behalf of the Authority, the Director shall neither seek nor take instructions from any institution or government or from any other body, office or agency. The Director of the Authority shall refrain from any act which is incompatible with the nature of his or her duties. The European Parliament, the Council and the Commission shall exercise jointly, with regard to the Director, the powers conferred on the appointing authority by the Staff Regulations of Officials (and the Conditions of Employment of Other Servants of the Union) laid down in Council Regulation (EEC, Euratom, ECSC) No 259/68 ( 2 ). Without prejudice to decisions on appointment and dismissal, the three institutions may agree to entrust the exercise of some or all of the remaining powers conferred on the appointing authority to any one of them. The appointing authority may assign the Director to other tasks provided that such tasks are not incompatible with the workload resulting from his or her duties as Director of the Authority and are not liable to create any conflict of interests or to jeopardise the full independence of the Director. 4. The Authority shall be physically located in the European Parliament, which shall provide the Authority with the necessary offices and administrative support facilities. 5. The Director of the Authority shall be assisted by staff in respect of whom he or she shall exercise the powers conferred on the appointing authority by the Staff Regulations of Officials of the European Union and the powers conferred on the authority empowered to conclude contracts of employment of other servants by the Conditions of Employment of Other Servants of the Union, laid down in Council Regulation (EEC, Euratom, ECSC) No 259/68 (‘the appointing authority's powers’). The Authority may make use in any areas of its work of other seconded national experts or of other staff not employed by the Authority. The Staff Regulations and the Conditions of Employment of Other Servants and the rules adopted by agreement between the institutions of the Union for giving effect to those Staff Regulations and Conditions of Employment of Other Servants shall apply to the staff of the Authority. The selection of the staff shall not be liable to result in a conflict of interests between their duties at the Authority and any other official duties, and they shall refrain from any act which is incompatible with the nature of their duties. 6. The Authority shall conclude agreements with the European Parliament and, if appropriate, with other institutions on any administrative arrangements necessary to enable it to carry out its tasks, in particular agreements regarding the staff, services and support provided pursuant to paragraphs 4, 5 and 8. 7. The appropriations for the expenditure of the Authority shall be provided under a separate Title in the Section for the European Parliament in the general budget of the European Union. The appropriations shall be sufficient to ensure the full and independent operation of the Authority. A draft budgetary plan for the Authority shall be submitted to the European Parliament by the Director, and shall be made public. The European Parliament shall delegate the duties of Authorising Officer with respect to those appropriations to the Director of the Authority. 8. Council Regulation No 1 ( 3 ) shall apply to the Authority. The translation services required for the functioning of the Authority and the Register shall be provided by the Translation Centre for the Bodies of the European Union. 9. The Authority and the Authorising Officer of the European Parliament shall share all information necessary for the execution of their respective responsibilities under this Regulation. 10. The Director shall submit annually a report to the European Parliament, the Council and the Commission on the activities of the Authority. 11. The Court of Justice of the European Union shall review the legality of the decisions of the Authority in accordance with Article 263 TFEU and shall have jurisdiction in disputes relating to compensation for damage caused by the Authority in accordance with Articles 268 and 340 TFEU. Should the Authority fail to take a decision where it is required to do so by this Regulation, proceedings for failure to act may be brought before the Court of Justice of the European Union in accordance with Article 265 TFEU.
Article 7 Register of European political parties and foundations
1. The Authority shall establish and manage a Register of European political parties and European political foundations. Information from the Register shall be available online in accordance with Article 32. 2. In order to ensure the proper functioning of the Register, the Commission shall be empowered to adopt delegated acts in accordance with Article 36 and within the scope of the relevant provisions of this Regulation concerning: (a) the information and supporting documents held by the Authority for which the Register is to be the competent repository, which shall include the statutes of a European political party or European political foundation, any other documents submitted as part of an application for registration in accordance with Article 8(2), any documents received from the Member State of the seat as referred to in Article 15(2), and information on the identity of the persons who are members of bodies or hold offices that are vested with powers of administrative, financial and legal representation, as referred to in point (f) of Article 4(1) and point (g) of Article 5(1); (b) materials from the Register as referred to in point (a) of this paragraph for which the Register is to be competent to certify legality as established by the Authority pursuant to its competences under this Regulation. The Authority shall not be competent to verify compliance by a European political party or European political foundation with any obligation or requirement imposed on the party or foundation in question by the Member State of the seat pursuant to Articles 4, 5 and Article 14(2) which is additional to the obligations and requirements laid down by this Regulation. 3. The Commission shall by implementing acts specify the details of the registration number system to be applied for the Register and standard extracts from the Register to be made available to third parties upon request, including the content of letters and documents. Such extracts shall not include personal data other than the identity of the persons who are members of bodies or hold offices that are vested with powers of administrative, financial and legal representation, as referred to in point (f) of Article 4(1) and point (g) of Article 5(1). Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 37.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 7 Register of European political parties and foundations):
1. The Authority shall establish and manage a Register of European political parties and European political foundations. Information from the Register shall be available online in accordance with Article 32. 3. The Commission shall by implementing acts specify the details of the registration number system to be applied for the Register and standard extracts from the Register to be made available to third parties upon request, including the content of letters and documents. Such extracts shall not include personal data other than the identity of the persons who are members of bodies or hold offices that are vested with powers of administrative, financial and legal representation, as referred to in point (f) of Article 4(1) and point (g) of Article 5(1). Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 37.
Article 8 Application for registration
1. An application for registration shall be filed with the Authority. An application for registration as a European political foundation shall be filed only through the European political party with which the applicant is formally affiliated. 2. The application shall be accompanied by: (a) documents proving that the applicant satisfies the conditions laid down in Article 3, including a standard formal declaration in the form set out in the Annex; (b) the statutes of the party or foundation, containing the provisions required by Articles 4 and 5, including the relevant annexes and, where applicable, the statement of the Member State of the seat referred to in Article 15(2). 3. The Commission shall be empowered to adopt delegated acts in accordance with Article 36 and within the scope of the relevant provisions of this Regulation: (a) to identify any supplementary information or supporting document in relation to paragraph 2 necessary to allow the Authority to fully discharge its responsibilities under this Regulation in relation to the operation of the Register; (b) to amend the standard formal declaration in the Annex in respect of the particulars to be filled in by the applicant where necessary, in order to ensure that sufficient information is being held in relation to the signatory, his or her mandate and the European political party or European political foundation which he or she is mandated to represent for the purposes of the declaration. 4. Documentation submitted to the Authority as part of the application shall be published immediately on the website referred to in Article 32.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 8 Application for registration):
1. An application for registration shall be filed with the Authority. An application for registration as a European political foundation shall be filed only through the European political party with which the applicant is formally affiliated. 3. The Commission shall be empowered to adopt delegated acts in accordance with Article 36 and within the scope of the relevant provisions of this Regulation: (a) to identify any supplementary information or supporting document in relation to paragraph 2 necessary to allow the Authority to fully discharge its responsibilities under this Regulation in relation to the operation of the Register; (b) to amend the standard formal declaration in the Annex in respect of the particulars to be filled in by the applicant where necessary, in order to ensure that sufficient information is being held in relation to the signatory, his or her mandate and the European political party or European political foundation which he or she is mandated to represent for the purposes of the declaration. 4. Documentation submitted to the Authority as part of the application shall be published immediately on the website referred to in Article 32.
Article 9 Examination of the application and decision of the Authority
1. The application shall be examined by the Authority in order to determine whether the applicant satisfies the conditions for registration laid down in Article 3 and whether the statutes contain the provisions required by Articles 4 and 5. 2. The Authority shall adopt a decision to register the applicant, unless it establishes that the applicant does not satisfy the conditions for registration laid down in Article 3 or that the statutes do not contain the provisions required by Articles 4 and 5. The Authority shall publish its decision to register the applicant within one month following receipt of the application for registration or, where the procedures set out in Article 15(4) are applicable, within four months following receipt of the application for registration. Where an application is incomplete, the Authority shall ask the applicant without delay to submit any additional information required. For the purposes of the deadline laid down in the second subparagraph, time shall only start to run from the date of receipt by the Authority of a complete application. 3. The standard formal declaration referred to in point (a) of Article 8(2) shall be considered sufficient for the Authority to ascertain that the applicant complies with the conditions specified in point (c) of Article 3(1) or point (c) of Article 3(2), whichever is applicable. 4. A decision of the Authority to register an applicant shall be published in the Official Journal of the European Union , together with the statutes of the party or foundation concerned. A decision not to register an applicant shall be published in the Official Journal of the European Union , together with the detailed grounds for rejection. 5. Any amendments to the documents or statutes submitted as part of the application for registration in accordance with Article 8(2) shall be notified to the Authority, which shall update the registration in accordance with the procedures set out in Article 15(2) and (4), mutatis mutandis. 6. The updated list of member parties of a European political party, annexed to the party statutes in accordance with Article 4(2), shall be sent to the Authority each year. Any changes following which the European political party might no longer satisfy the condition laid down in point (b) of Article 3(1) shall be communicated to the Authority within four weeks of any such change.
Article 10 Verification of compliance with registration conditions and requirements
1. Without prejudice to the procedure laid down in paragraph 3, the Authority shall regularly verify that the conditions for registration laid down in Article 3, and the governance provisions set out in points (a), (b) and (d) to (f) of Article 4(1) and points (a) to (e) and (g) of Article 5(1), continue to be complied with by registered European political parties and European political foundations. 2. If the Authority finds that any of the conditions for registration or governance provisions referred to in paragraph 1, with the exception of the conditions in point (c) of Article 3(1) and point (c) of Article 3(2), are no longer complied with, it shall notify the European political party or foundation concerned. 3. The European Parliament, acting on its own initiative or following a reasoned request from a group of citizens, submitted in accordance with the relevant provisions of its Rules of Procedure, or the Council or the Commission, may lodge with the Authority a request for verification of compliance by a specific European political party or European political foundation with the conditions laid down in point (c) of Article 3(1) and point (c) of Article 3(2). In such cases, and in the cases referred to in point (a) of Article 16(3), the Authority shall ask the committee of independent eminent persons established by Article 11 for an opinion on the subject. The committee shall give its opinion within two months. Where the Authority becomes aware of facts which may give rise to doubts concerning compliance by a specific European political party or European political foundation with the conditions laid down in point (c) of Article 3(1) and point (c) of Article 3(2), it shall inform the European Parliament, the Council and the Commission with a view to allowing any of them to lodge a request for verification as referred to in the first subparagraph. Without prejudice to the first subparagraph, the European Parliament, the Council and the Commission shall indicate their intention within two months of receiving that information. The procedures laid down in the first and second subparagraphs shall not be initiated within a period of two months prior to elections to the European Parliament. Having regard to the committee's opinion, the Authority shall decide whether to de-register the European political party or European political foundation concerned. The decision of the Authority shall be duly reasoned. A decision of the Authority to de-register on grounds of non-compliance with the conditions set out in point (c) of Article 3(1) or point (c) of Article 3(2) may only be adopted in the event of manifest and serious breach of those conditions. It shall be subject to the procedure set out in paragraph 4. 4. A decision of the Authority to de-register a European political party or foundation on the ground of a manifest and serious breach as regards compliance with the conditions set out in point (c) of Article 3(1) or point (c) of Article 3(2) shall be communicated to the European Parliament and the Council. The decision shall enter into force only if no objection is expressed by the European Parliament and the Council within a period of three months of the communication of the decision to the European Parliament and the Council or if, before the expiry of that period, the European Parliament and the Council have both informed the Authority that they will not object. In the event of an objection by the European Parliament and by the Council, the European political party or foundation shall remain registered. The European Parliament and the Council may object to the decision only on grounds related to the assessment of compliance with the conditions for registration set out in point (c) of Article 3(1) and point (c) of Article 3(2). The European political party or European political foundation concerned shall be informed that objections have been raised to the decision of the Authority to de-register it. The European Parliament and the Council shall adopt a position in accordance with their respective decision-making rules as established in conformity with the Treaties. Any objection shall be duly reasoned and shall be made public. 5. A decision of the Authority to de-register a European political party or a European political foundation, to which no objections have been raised under the procedure laid down in paragraph 4, shall be published in the Official Journal of the European Union , together with the detailed grounds for de-registration, and shall enter into force three months following the date of such publication. 6. A European political foundation shall automatically forfeit its status as such if the European political party with which it is affiliated is removed from the Register.
Article 11 Committee of independent eminent persons
1. A committee of independent eminent persons is hereby established. It shall consist of six members, with the European Parliament, the Council and the Commission each appointing two members. The members of the committee shall be selected on the basis of their personal and professional qualities. They shall neither be members of the European Parliament, the Council or the Commission, nor hold any electoral mandate, be officials or other servants of the European Union or be current or former employees of a European political party or a European political foundation. Members of the committee shall be independent in the performance of their duties. They shall neither seek nor take instructions from any institution or government or from any other body, office or agency, and shall refrain from any act which is incompatible with the nature of their duties. The committee shall be renewed within six months after the end of the first session of the European Parliament following each election to the European Parliament. The mandate of the members shall not be renewable. 2. The committee shall adopt its own rules of procedure. The chair of the committee shall be elected by its members from amongst their number in accordance with those rules. The secretariat and funding of the committee shall be provided by the European Parliament. The secretariat of the committee shall act under the sole authority of the committee. 3. When requested by the Authority, the committee shall give an opinion on any possible manifest and serious breach of the values on which the Union is founded, as referred to in point (c) of Article 3(1) and point (c) of Article 3(2), by a European political party or a European political foundation. To that end, the committee may request any relevant document and evidence from the Authority, the European Parliament, the European political party or European political foundation concerned, other political parties, political foundations or other stakeholders, and it may request to hear their representatives. In its opinions, the committee shall give full consideration to the fundamental right of freedom of association and to the need to ensure pluralism of political parties in Europe. The opinions of the committee shall be made public without delay.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 11 Committee of independent eminent persons):
1. A committee of independent eminent persons is hereby established. It shall consist of six members, with the European Parliament, the Council and the Commission each appointing two members. The members of the committee shall be selected on the basis of their personal and professional qualities. They shall neither be members of the European Parliament, the Council or the Commission, nor hold any electoral mandate, be officials or other servants of the European Union or be current or former employees of a European political party or a European political foundation. Members of the committee shall be independent in the performance of their duties. They shall neither seek nor take instructions from any institution or government or from any other body, office or agency, and shall refrain from any act which is incompatible with the nature of their duties. The committee shall be renewed within six months after the end of the first session of the European Parliament following each election to the European Parliament. The mandate of the members shall not be renewable. 2. The committee shall adopt its own rules of procedure. The chair of the committee shall be elected by its members from amongst their number in accordance with those rules. The secretariat and funding of the committee shall be provided by the European Parliament. The secretariat of the committee shall act under the sole authority of the committee. In the cases referred to in points (a) and (b) of the first subparagraph, the committee may request any relevant document or evidence from the Authority, the European Parliament, the European political party or European political foundation concerned, other political parties, political foundations or other stakeholders, and it may request to hear their representatives. In the case referred to in point (b) of the first subparagraph, the national supervisory authority referred to in Article 10a shall cooperate with the committee in accordance with applicable law. In its opinions, the committee shall give full consideration to the fundamental right of freedom of association and to the need to ensure pluralism of political parties in Europe. The opinions of the committee shall be made public without delay.
Article 12 Legal personality
European political parties and European political foundations shall have European legal personality.
Article 13 Legal recognition and capacity
European political parties and European political foundations shall enjoy legal recognition and capacity in all Member States.
Article 14 Applicable law
1. European political parties and European political foundations shall be governed by this Regulation. 2. For matters not regulated by this Regulation or, where matters are only partly regulated by it, for those aspects which are not covered by it, European political parties and European political foundations shall be governed by the applicable provisions of national law in the Member State in which they have their respective seats. Activities carried out by European political parties and European political foundations in other Member States shall be governed by the relevant national laws of those Member States. 3. For matters not regulated by this Regulation or by the applicable provisions pursuant to paragraph 2 or, where matters are only partly regulated by them, for those aspects which are not covered by them, European political parties and European political foundations shall be governed by the provisions of their respective statutes.
Article 15 Acquisition of European legal personality
1. A European political party or a European political foundation shall acquire European legal personality on the date of publication in the Official Journal of the European Union of the decision of the Authority to register it, pursuant to Article 9. 2. If the Member State in which an applicant for registration as a European political party or a European political foundation has its seat so requires, the application submitted pursuant to Article 8 shall be accompanied by a statement issued by that Member State, certifying that the applicant has complied with all relevant national requirements for application, and that its statutes are in conformity with the applicable law referred to in the first subparagraph of Article 14(2). 3. Where the applicant enjoys legal personality under the law of a Member State, the acquisition of European legal personality shall be regarded by that Member State as a conversion of the national legal personality into a successor European legal personality. The latter shall fully maintain any pre-existing rights and obligations of the former national legal entity, which shall cease to exist as such. The Member States concerned shall not apply prohibitive conditions in the context of such conversion. The applicant shall maintain its seat in the Member State concerned until a decision in accordance with Article 9 has been published. 4. If the Member State in which the applicant has its seat so requires, the Authority shall fix the date of the publication referred to in paragraph 1 only after consultation with that Member State.
Article 16 Termination of European legal personality
1. A European political party or a European political foundation shall lose its European legal personality upon the entry into force of a decision of the Authority to remove it from the Register as published in the Official Journal of the European Union . The decision shall enter into force three months after such publication unless the European political party or the European political foundation concerned requests a shorter period. 2. A European political party or a European political foundation shall be removed from the Register by a decision of the Authority: (a) as a consequence of a decision adopted pursuant to Article 10(2) to (5); (b) in the circumstances provided for in Article 10(6); (c) at the request of the European political party or European political foundation concerned; or (d) in the cases referred to in point (b) of the first subparagraph of paragraph 3 of this Article. 3. If a European political party or a European political foundation has seriously failed to fulfil relevant obligations under national law applicable by virtue of the first subparagraph of Article 14(2), the Member State of the seat may address to the Authority a duly reasoned request for de-registration which must identify precisely and exhaustively the illegal actions and the specific national requirements that have not been complied with. In such cases, the Authority shall: (a) for matters relating exclusively or predominantly to elements affecting respect for the values on which the Union is founded, as expressed in Article 2 TEU, initiate a verification procedure in accordance with Article 10(3). Article 10(4), (5) and (6) shall also apply; (b) for any other matter, and when the reasoned request of the Member State concerned confirms that all national remedies have been exhausted, decide to remove the European political party or European political foundation concerned from the Register. If a European political party or a European political foundation has seriously failed to fulfil relevant obligations under national law applicable by virtue of the second subparagraph of Article 14(2), and if the matter relates exclusively or predominantly to elements affecting respect of the values on which the Union is founded, as expressed in Article 2 TEU, the Member State concerned may address a request to the Authority in accordance with the provisions of the first subparagraph of this paragraph. The Authority shall proceed in accordance with point (a) of the first subparagraph of this paragraph. In all cases, the Authority shall act without undue delay. The Authority shall inform the Member State concerned and the European political party or European political foundation concerned of the follow-up given to the reasoned request for de-registration. 4. The Authority shall fix the date of the publication referred to in paragraph 1 after consultation with the Member State in which the European political party or European political foundation has its seat. 5. If the European political party or European political foundation concerned acquires legal personality under the law of the Member State of its seat, such acquisition shall be regarded by that Member State as a conversion of the European legal personality into a national legal personality that fully maintains the pre-existing rights and obligations of the former European legal entity. The Member State in question shall not apply prohibitive conditions in the context of such conversion. 6. If the European political party or European political foundation does not acquire legal personality under the law of the Member State of its seat, it shall be wound up in accordance with the applicable law of that Member State. The Member State concerned may require that such winding-up be preceded by the acquisition by the party or foundation concerned of national legal personality in accordance with paragraph 5. 7. In all situations referred to in paragraphs 5 and 6, the Member State concerned shall ensure that the not-for-profit condition laid down in Article 3 is fully respected. The Authority and the Authorising Officer of the European Parliament may agree with the Member State concerned the modalities for termination of the European legal personality, in particular in order to ensure the recovery of any funds received from the general budget of the European Union and the payment of any financial sanctions imposed in accordance with Article 27.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 16 Termination of European legal personality):
1. A European political party or a European political foundation shall lose its European legal personality upon the entry into force of a decision of the Authority to remove it from the Register as published in the Official Journal of the European Union . The decision shall enter into force three months after such publication unless the European political party or the European political foundation concerned requests a shorter period. If a European political party or a European political foundation has seriously failed to fulfil relevant obligations under national law applicable by virtue of the second subparagraph of Article 14(2), and if the matter relates exclusively or predominantly to elements affecting respect of the values on which the Union is founded, as expressed in Article 2 TEU, the Member State concerned may address a request to the Authority in accordance with the provisions of the first subparagraph of this paragraph. The Authority shall proceed in accordance with point (a) of the first subparagraph of this paragraph. In all cases, the Authority shall act without undue delay. The Authority shall inform the Member State concerned and the European political party or European political foundation concerned of the follow-up given to the reasoned request for de-registration. 4. The Authority shall fix the date of the publication referred to in paragraph 1 after consultation with the Member State in which the European political party or European political foundation has its seat. 5. If the European political party or European political foundation concerned acquires legal personality under the law of the Member State of its seat, such acquisition shall be regarded by that Member State as a conversion of the European legal personality into a national legal personality that fully maintains the pre-existing rights and obligations of the former European legal entity. The Member State in question shall not apply prohibitive conditions in the context of such conversion. 6. If the European political party or European political foundation does not acquire legal personality under the law of the Member State of its seat, it shall be wound up in accordance with the applicable law of that Member State. The Member State concerned may require that such winding-up be preceded by the acquisition by the party or foundation concerned of national legal personality in accordance with paragraph 5. 7. In all situations referred to in paragraphs 5 and 6, the Member State concerned shall ensure that the not-for-profit condition laid down in Article 3 is fully respected. The Authority and the Authorising Officer of the European Parliament may agree with the Member State concerned the modalities for termination of the European legal personality, in particular in order to ensure the recovery of any funds received from the general budget of the European Union and the payment of any financial sanctions imposed in accordance with Article 27.
Article 17 Funding conditions
1. A European political party which is registered in accordance with the conditions and procedures laid down in this Regulation, which is represented in the European Parliament by at least one of its members, and which is not in one of the situations of exclusion referred to in Article 106(1) of the Financial Regulation may apply for funding from the general budget of the European Union, in accordance with the terms and conditions published by the Authorising Officer of the European Parliament in a call for contributions. 2. A European political foundation which is affiliated with a European political party eligible to apply for funding under paragraph 1, which is registered in accordance with the conditions and procedures laid down in this Regulation, and which is not in one of the situations of exclusion referred to in Article 106(1) of the Financial Regulation may apply for funding from the general budget of the European Union, in accordance with the terms and conditions published by the Authorising Officer of the European Parliament in a call for proposals. 3. For the purposes of determining eligibility for funding from the general budget of the European Union in accordance with paragraph 1 of this Article and point (b) of Article 3(1), and for the application of Article 19(1), a member of the European Parliament shall be considered as a member of only one European political party, which shall, where relevant, be the one to which his or her national or regional political party is affiliated on the final date for the submission of applications for funding. 4. Financial contributions or grants from the general budget of the European Union shall not exceed 90 % of the annual reimbursable expenditure indicated in the budget of a European political party and 95 % of the eligible costs incurred by a European political foundation. European political parties may use any unused part of the Union contribution awarded to cover reimbursable expenditure within the financial year following its award. Amounts unused after that financial year shall be recovered in accordance with the Financial Regulation. 5. Within the limits set out in Articles 21 and 22, the expenditure reimbursable through a financial contribution shall include administrative expenditure and expenditure linked to technical assistance, meetings, research, cross-border events, studies, information and publications, as well as expenditure linked to campaigns.
Article 18 Application for funding
1. In order to receive funding from the general budget of the European Union, a European political party or European political foundation which satisfies the conditions of Article 17(1) or (2) shall file an application with the European Parliament following a call for contributions or proposals. 2. The European political party and the European political foundation must, at the time of its application, comply with the obligations listed in Article 23, and, from the date of its application until the end of the financial year or of the action covered by the contribution or grant, remain registered in the Register and may not be the subject of any of the sanctions provided for in Article 27(1) and in points (a)(v) and (vi) of Article 27(2). 2a. A European political party shall include in its application evidence demonstrating that its EU member parties have, as a rule, published on their websites, in a clearly visible and user-friendly manner, throughout the 12 months preceding the final date for submission of applications, the political programme and logo of the European political party. 3. A European political foundation shall include in its application its annual work programme or action plan. 4. The Authorising Officer of the European Parliament shall adopt a decision within three months after closure of the call for contributions or call for proposals, and shall authorise and manage the corresponding appropriations in accordance with the Financial Regulation. 5. A European political foundation may apply for funding from the general budget of the European Union only through the European political party with which it is affiliated.
Article 19 Award criteria and distribution of funding
1. The respective appropriations available to those European political parties and European political foundations which have been awarded contributions or grants in accordance with Article 18 shall be distributed annually on the basis of the following distribution key: — 10 % shall be distributed among the beneficiary European political parties in equal shares, — 90 % shall be distributed among the beneficiary European political parties in proportion to their share of elected members of the European Parliament. The same distribution key shall be used to award funding to European political foundations, on the basis of their affiliation with a European political party. 2. The distribution referred to in paragraph 1 shall be based on the number of elected members of the European Parliament who are members of the applicant European political party on the final date for the submission of applications for funding, taking into account Article 17(3). After that date, any changes to the number shall not affect the respective share of funding between European political parties or European political foundations. This is without prejudice to the requirement in Article 17(1) for a European political party to be represented in the European Parliament by at least one of its members.
Article 20 Donations and contributions
1. European political parties and European political foundations may accept donations from natural or legal persons of up to a value of EUR 18 000 per year and per donor. 2. European political parties and European political foundations shall, at the time of the submission of their annual financial statements in accordance with Article 23, also transmit a list of all donors with their corresponding donations, indicating both the nature and the value of the individual donations. This paragraph shall also apply to contributions made by member parties of European political parties and member organisations of European political foundations. For donations from natural persons the value of which exceeds EUR 1 500 and is below or equal to EUR 3 000 , the European political party or European political foundation concerned shall indicate whether the corresponding donors have given their prior written consent to publication in accordance with point (e) of Article 32(1). 3. Donations received by European political parties and European political foundations within six months prior to elections to the European Parliament shall be reported on a weekly basis to the Authority in writing and in accordance with paragraph 2. 4. Single donations the value of which exceeds EUR 12 000 that have been accepted by European political parties and European political foundations shall be immediately reported to the Authority in writing and in accordance with paragraph 2. 5. European political parties and European political foundations shall not accept any of the following: (a) anonymous donations or contributions; (b) donations from the budgets of political groups in the European Parliament; (c) donations from any public authority from a Member State or a third country, or from any undertaking over which such a public authority may exercise, directly or indirectly, a dominant influence by virtue of its ownership of it, its financial participation therein, or the rules which govern it; or (d) donations from any private entities based in a third country or from individuals from a third country who are not entitled to vote in elections to the European Parliament. 6. Any donation that is not permitted under this Regulation shall within 30 days following the date of its receipt by a European political party or a European political foundation: (a) be returned to the donor or to any person acting on the donor's behalf; or (b) where it is not possible to return it, be reported to the Authority and the European Parliament. The Authorising Officer of the European Parliament shall establish the amount receivable and authorise the recovery in accordance with the provisions laid down in Articles 78 and 79 of the Financial Regulation. The funds shall be entered as general revenue in the European Parliament section of the general budget of the European Union. 7. Contributions to a European political party from its members shall be permitted. The value of such contributions shall not exceed 40 % of the annual budget of that European political party. 8. Contributions to a European political foundation from its members, and from the European political party with which it is affiliated, shall be permitted. The value of such contributions shall not exceed 40 % of the annual budget of that European political foundation and may not derive from funds received by a European political party pursuant to this Regulation from the general budget of the European Union. The burden of proof shall rest with the European political party concerned, which shall clearly indicate in its accounts the origin of funds used to finance its affiliated European political foundation. 9. Without prejudice to paragraphs 7 and 8, European political parties and European political foundations may accept from citizens who are their members contributions up to a value of EUR 18 000 per year and per member, where such contributions are made by the member concerned on his or her own behalf. The ceiling laid down in the first subparagraph shall not apply where the member concerned is also an elected member of the European Parliament, of a national parliament or of a regional parliament or regional assembly. 10. Any contribution that is not permitted under this Regulation shall be returned in accordance with paragraph 6.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Democracy is one of the fundamental values on which the European Union is founded. To ensure the functioning of a representative democracy on the European level, the treaties determine that the citizens of the European Union are directly represented in the European Parliament. The right to freedom of association and the right to freedom of expression are fundamental rights of every citizen of the Union. Political parties fulfil an essential role in a representative democracy, creating a direct link between the citizens and the political system, thereby enhancing the legitimacy of the system. The same happens at European level: according to Article 10 of the Treaty on European Union, " political parties at European level contribute to forming European political awareness and to expressing the will of citizens of the Union ". Article 12(2) of the Charter of Fundamental Rights of the European Union expresses the same principle. Fostering political debate across Europe on European issues through vibrant European political parties is a long standing Commission objective. In the run up to the 2014 European elections, the Commission issued a Recommendation 1 , calling on European and national political parties, supported by the institutions and the Member States, to take a numbe r of steps to strengthen the role of European political parties in contributing to forming European political awareness and to expressing the will of the citizens of the Union. One of these steps was the "Spitzenkandidat". European political parties responded to the Commission's call and the 2014 European Parliament elections were fundamentally different from previous ones. For the first time, they established a link between the results of the elections and the choice of the current European Commission President, Jean-Claude Juncker. "Spitzenkandidaten" or candidates for President of the European Commission, with different political programmes allowed voters to make an informed choice between alternative political platforms for Europe, rather than on exclusively national political issues, thus ‘europeanising’ the elections. Regulation No 1141/2014 of the European Parliament and of the Council of 22 October 2014 on the statute and funding of European political parties and European political foundations 2 was in troduced to increase the visibility, recognition, effectiveness, transparency and accountability of European political parties and their affiliated political foundations. Political parties and foundations satisfying a number of conditions were offered the opportunity to become European legal entities by registering at European level, and thereby enhancing access to European financial support. These conditions include representation in a sufficiently large number of EU Member States and respect, both in their programme and activities, of the values on which the EU is founded - respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of people belonging to minorities. An independent Authority for European political parties and foundations ("the Authority") was created, for the purpose of registering, controlling and, if necessary, imposing sanctions on European political parties and foundation, including to consider cases where such entities allegedly fail to respect these fundamental European values. Where doubts arise about whether a party or foundation is observing this requirement in practice, the European Parliament, the Council or the Commission may lodge a request with the Authority for European political parties and European political foundations to verify the situation. Before coming to a decision on whether to de-register a party or foundation, the Authority must consult a Committee of independent eminent persons. Nevertheless, the Com mission’s report on the 2014 European elections 3 found that work remained to be done to increase the participation of citizens and the inclusivity of elections, enhance the European dimension of the political debate, reverse the trend of low turnouts, furt her enhance the democratic legitimacy of the EU decision-making process, highlight affiliations between national and European parties, and promote political accountability. Moreover, despite the progress made with Regulation No 1141/2014, the existing rules have loopholes that need to be addressed. The European Parliament, as well as a number of European political parties, have called for improvements and adjustments to these rules. The European Parliament services in charge of the administration of this Regulation have worked on a number of cases resulting from inappropriate use of funding. In March 2017, Parliament held a plenary debate and issued an oral question inviting the Commission to respond both on the timing of any changes and on certain specific changes which concerned the level of co-financing, the possibility of multi-party membership of European Parliaments' Members, the number of members required for funding, the financing of referendum campaigns, the introduction of a financial capacity criterion and allowing the building of financial reserves. In this debate, the Commission e xpressed its willingness to engage with the Parliament, along with the Council, in monitoring the early stages of implementing the new rules. On 15 June 2017, Parliament adopted a resolution 4 calling upon the Commission to propose a revision of the current legal framework as soon as possible to address its shortcomings, especially with respect to the level of co-financing requested, and of the possibility of multi-party membership of European Parliaments' Members. Parliament and its political parties wrote to the Commission to restate their call for changes; a call elaborated in a comprehensive report provided to the Commission. Given the above and based on the extensive input obtained from various stakeholders (see section 3), the Commission has therefore decided to propose a limited number of targeted amendments to this Regulation. These aim to close the loopholes, improve transparency, to ensure the appropriate allocation and expenditure of limited resources from the EU budget, and thereby to strengthen the genuine electoral representation of European citizens by European political parties. The amendments will ensure that the existing rules are not circumvented or its provisions misused. The focused changes should be in place before the 2019 European elections. They will help address the challenges identified by the Commission in relation to the 2014 European elections, in particular in relation to the affiliations between national and European parties and increased political accountability. Specific i ssues addressed In the first place, the current rules are prone to abuse regarding the issue of who can sponsor the registration of a European political party, because they allow the required level of representation (i.e. in seven Member States) to be met either (i) by support from member parties represented in regional parliaments, a national Parliament or the European Parliament; (ii) by support from individual members of such parliaments or (iii) by a mixture of the two. In the first years after the introduction of funding for European political parties, most of the beneficiaries were alliances made up of national parties coming from the same political family. However, several European political parties created in recent years are composed mainly of individual politicians and/or strongly dominated by one or two national political parties. There are several cases of different members of a single national party sponsoring more than one European political party; in some extreme cases, a single member has sponsored more than one party. The Authority has also been confronted with practical problems linked to the multiparty membership. It is often unclear how to avoid double counting for representation, how to deal with prior memberships, and how to make a connection between the representation and funding criteria - including the issue of a Member of the European Parliament counting for different European political parties as regards, on the one hand, registration and, on the other hand, funding. The second issue of concern regards proportionality of the EU funding received to representation in the European Parliament. Currently, European political parties can apply for funding if they are represented in the European Parliament by at least one Member. A number of European political parties as well as the European Parliament's administration, have asked to increase the threshold of representation to three Members, to prevent the misuse of public funding via "one-man parties". However, the practical impact of such a change would be minimal, as at present even the least represented European political parties eligible for funding currently have 3 Members 5 (see graph). More importantly such a change would raise serious legal concerns related to fundamental rights of fre edom of association and equality of opportunities for parties presenting candidates for elections and would unduly limit the pluralistic nature of European politics. There is another way of addressing this concern by changing the distribution key for the funding of the eligible European political parties and the European political foundations. Currently, 15% of the total amount available is distributed equally to all parties which meet the one Member threshold, leaving 85% to be distributed in proporti on to each party’s share of elected Members (the same distribution key is used for foundations). This leads to a rather unbalanced reflection of the electoral representation in Parliament. The tables below 6 , provided by administration of the European Parli ament, show the effect of changing the fixed portion of funding compared to the portion related to the level of representation in Parliament. Lowering the set aside amount to 5% could help restore a more proper balance and thus lead to a fairer and better reflection of electoral representation in Parliament. In the third place, next to abuse and proportionality issues, European political parties and – to a larger extent – the political foundations have difficulties meeting the current co-financing threshold of 15%. The European Parliament services have also been confronted by some dubious practices in this respect, such as some parties seeking to meet the letter of the co-financing requirement via circular financial flows. As regards financial capacity, in the financial year 2015, the Parliament's external auditor flagged concerns in 8 out of 28 reports. This indicates that the beneficiaries’ own resources are not sufficient. In many cases, the shortfall in own resources from membership contributions and donations can only be balanced by the use of contributions in kind. In 2015 parties received contributions in kind amounting to €238,009 and foundations to €283,649. The objective evaluation of these contributions poses significant problems. In several cases, the Parliament's administration has been unable to verify this valuation in detail and ascertain whether the contributions were actually necessary for and directly related to the activity mentioned, and to determine whether the underlying activities were in the interest of the European party exclusively or possibly shared with a partner organisation. Fourthly, there is a lack of clarity and transparency in the existing rules regarding the steps to be taken in cases where a party or foundation ceases to comply with the registration criteria or is found to have been registered on the basis of incorrect information. Fifthly, based on the experience of Parliament's administration, there is a need to extend the scope of possible measures to recover funds misspent by parties and foundations.
Revised version (Article 20 Donations and contributions):
1. European political parties and European political foundations may accept donations from natural or legal persons of up to a value of EUR 18 000 per year and per donor. 2. European political parties and European political foundations shall, at the time of the submission of their annual financial statements in accordance with Article 23, also transmit a list of all donors with their corresponding donations, indicating both the nature and the value of the individual donations. This paragraph shall also apply to contributions made by member parties of European political parties and member organisations of European political foundations. For donations from natural persons the value of which exceeds EUR 1 500 and is below or equal to EUR 3 000 , the European political party or European political foundation concerned shall indicate whether the corresponding donors have given their prior written consent to publication in accordance with point (e) of Article 32(1). 3. Donations received by European political parties and European political foundations within six months prior to elections to the European Parliament shall be reported on a weekly basis to the Authority in writing and in accordance with paragraph 2. 4. Single donations the value of which exceeds EUR 12 000 that have been accepted by European political parties and European political foundations shall be immediately reported to the Authority in writing and in accordance with paragraph 2. 6. Any donation that is not permitted under this Regulation shall within 30 days following the date of its receipt by a European political party or a European political foundation: (a) be returned to the donor or to any person acting on the donor's behalf; or (b) where it is not possible to return it, be reported to the Authority and the European Parliament. The Authorising Officer of the European Parliament shall establish the amount receivable and authorise the recovery in accordance with the provisions laid down in Articles 78 and 79 of the Financial Regulation. The funds shall be entered as general revenue in the European Parliament section of the general budget of the European Union. 7. Contributions to a European political party from its members shall be permitted. The value of such contributions shall not exceed 40 % of the annual budget of that European political party. 8. Contributions to a European political foundation from its members, and from the European political party with which it is affiliated, shall be permitted. The value of such contributions shall not exceed 40 % of the annual budget of that European political foundation and may not derive from funds received by a European political party pursuant to this Regulation from the general budget of the European Union. The burden of proof shall rest with the European political party concerned, which shall clearly indicate in its accounts the origin of funds used to finance its affiliated European political foundation. 9. Without prejudice to paragraphs 7 and 8, European political parties and European political foundations may accept from citizens who are their members contributions up to a value of EUR 18 000 per year and per member, where such contributions are made by the member concerned on his or her own behalf. The ceiling laid down in the first subparagraph shall not apply where the member concerned is also an elected member of the European Parliament, of a national parliament or of a regional parliament or regional assembly. 10. Any contribution that is not permitted under this Regulation shall be returned in accordance with paragraph 6.
Article 21 Financing of campaigns in the context of elections to the European Parliament
1. Subject to the second subparagraph, the funding of European political parties from the general budget of the European Union or from any other source may be used to finance campaigns conducted by the European political parties in the context of elections to the European Parliament in which they or their members participate as required by point (d) of Article 3(1). In accordance with Article 8 of the Act concerning the election of the members of the European Parliament by direct universal suffrage ( 4 ), the funding and possible limitation of election expenses for all political parties, candidates and third parties in, in addition to their participation in, elections to the European Parliament is governed in each Member State by national provisions. 2. Expenditure linked to the campaigns referred to in paragraph 1 shall be clearly identified as such by the European political parties in their annual financial statements.
Article 22 Prohibition of funding
1. Notwithstanding Article 21(1), the funding of European political parties from the general budget of the European Union or from any other source shall not be used for the direct or indirect funding of other political parties, and in particular national parties or candidates. Those national political parties and candidates shall continue to be governed by national rules. 2. The funding of European political foundations from the general budget of the European Union or from any other source shall not be used for any other purpose than for financing their tasks as listed in point (4) of Article 2 and to meet expenditure directly linked to the objectives set out in their statutes in accordance with Article 5. It shall in particular not be used for the direct or indirect funding of elections, political parties, or candidates or other foundations. 3. The funding of European political parties and European political foundations from the general budget of the European Union or from any other source shall not be used to finance referendum campaigns.