Article 1 Subject matter
1. This Regulation establishes a European fund for strategic investments (EFSI), an EU guarantee and an EU guarantee fund. In addition, this Regulation establishes a European investment advisory hub (EIAH) and a European investment project portal (EIPP). 2. For the purposes of paragraph 1, this Regulation provides for the Commission to conclude an agreement with the European Investment Bank (EIB) on the EFSI and an agreement with the EIB on the implementation of the EIAH.
Article 2 Definitions
For the purposes of this Regulation, the following definitions apply: (1) ‘EFSI Agreement’ means the legal instrument whereby the Commission and the EIB specify the conditions laid down in this Regulation for the management of the EFSI; (2) ‘EIAH Agreement’ means the legal instrument whereby the Commission and the EIB specify the conditions laid down in this Regulation for the implementation of the EIAH; (3) ‘national promotional banks or institutions’ means legal entities carrying out financial activities on a professional basis which are given a mandate by a Member State or a Member State's entity at central, regional or local level, to carry out development or promotional activities; (4) ‘investment platforms’ means special purpose vehicles, managed accounts, contract-based co-financing or risk-sharing arrangements or arrangements established by any other means by which entities channel a financial contribution in order to finance a number of investment projects, and which may include: (a) national or sub-national platforms that group together several investment projects on the territory of a given Member State; (b) multi-country or regional platforms that group together partners from several Member States or third countries interested in projects in a given geographic area; (c) thematic platforms that group together investment projects in a given sector; (4) ‘investment platforms’ means special purpose vehicles, managed accounts, contract-based co-financing or risk-sharing arrangements or arrangements established by any other means by which entities channel a financial contribution in order to finance a number of investment projects, and which may include: (a) national or sub-national platforms that group together several investment projects on the territory of a given Member State; (b) multi-country or regional platforms that group together partners from several Member States or third countries interested in projects in a given geographic area; (c) thematic platforms that group together investment projects in a given sector; (5) ‘small and medium-sized enterprises’ or ‘SMEs’ means micro, small and medium-sized enterprises as defined in Article 2 of the Annex to Commission Recommendation 2003/361/EC ( 1 ); (6) ‘small mid-cap companies’ means entities having up to 499 employees that are not SMEs; (7) ‘mid-cap companies’ means entities having up to 3 000 employees that are not SMEs or small mid-cap companies; (8) ‘additionality’ means additionality as defined in Article 5(1).
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Since the Investment Plan for Europe was presented in November 2014, the conditions for an uptake in investment have improved and confidence in Europe’s economy and growth are returning. The Union is now in its fourth year of moderate recovery, with GDP growing at 2% in 2015. The comprehensive efforts initiated with the Investment Plan are already delivering concrete results, despite the fact that macroeconomic effects of larger investment projects cannot be immediate. Investment is expected to pick up gradually throughout 2016 and 2017 although it remains below historical levels. 1 On 1 June 2016, the Commission issued a Communication entitled ‘Europe investing again – Taking stock of the Investment Plan for Europe and next steps’ outlining the achievements of the Investment Plan so far and the envisaged next steps, including the extension of the duration of the European Fund for Strategic Investments (EFSI) beyond its initial three-year period, the scaling-up of the SME window within the existing framework and the enhancement of the EIAH. On 28 June 2016, the European Council concluded that "[t]he Investment Plan for Europe, in particular the EFSI, has already delivered concrete results and is a major step to help mobilise private investment while making smart use of scarce budgetary resources. The Commission intends to soon put forward proposals on the future of the EFSI, which should be examined as a matter of urgency by the European Parliament and the Council". The EFSI was established for an initial period of three years and with the aim of mobilising at least EUR 315 billion in investments. Given its success, the Commission is committed to the doubling of the EFSI, both in terms of duration and financial capacity. The legal extension presented today covers the period of the current Multiannual Financial Framework and should provide a total of at least half a trillion euro investments by 2020. The proposal is consistent with the revision of Regulation (EU, Euratom) 966/2012 on the Financial Regulation that the Commission is proposing at the same time to set up a robust framework for the management of the financial liabilities of the Union. In order to enhance the firepower of the EFSI even further and reach the aim of doubling the investment target, the Commission calls on Member States to also contribute as a matter of priority. In this context, the Commission has today adopted a proposal to facilitate contributions at the level of the risk-bearing capacity of the EFSI by catering for the possibility for Member States to transfer resources from European Structural and Investment Funds (ESIF) allocated to them under shared implementation in order to further enhance the firepower of the EFSI. For the period after 2020, the Commission intends to put forward the necessary proposals to ensure that strategic investment will continue at a sustainable level. Since its launch one year ago, the EFSI, implemented and co-sponsored by the Commission's strategic partner for investments, the European Investment Bank (EIB) Group, is firmly on track to deliver the objective of mobilising at least EUR 315 billion in additional investments in the real economy by mid-2018 while endeavouring to maximise private sector contributions. The market absorption has been particularly quick under the Small and Medium-sized Enterprises (SME) window where the EFSI is delivering well beyond expectations. To ensure that sufficient funding is available to continue providing finance to SMEs with EFSI support, in July 2016 the SME Window was scaled-up by EUR 500 million within the existing parameters of Regulation (EU) 2015/1017. The projects approved by the EIB Group by July 2016 for coverage under the EFSI are expected to mobilise EUR 115.7 billion in total investments across 26 Member States and to support some 200,000 SMEs, thereby contributing to Europe's future job creation including youth employment, growth and competitiveness. The European Investment Advisory Hub (EIAH) and the European Investment Project Portal (EIPP) have also made a positive start. The EIAH has already dealt with some 230 requests from 27 Member States and the EIPP has already published more than 100 investment projects since its launch on 1 June 2016, allowing investors to access investment opportunities across Europe instantly. As part of the Commission's efforts to improve Europe's investment environment, the Commission has tabled a number of initiatives to help support investment and facilitate the financing of the real economy, such as the lowering of capital charges for insurance and reinsurance companies as regards infrastructure investments and the adoption of practical guidance on the application of State aid rules in the context of public funding of infrastructure. In addition, the Energy Union, the Capital Markets Union, the Single Market and the Digital Single Market Strategies, and the Circular Economy package all contain specific measures that will remove concrete obstacles and further improve the environment for investment, if fully implemented. For instance, upcoming proposals relating to the internal electricity market, renewable energy and governance of the Energy Union will create more long-term regulatory clarity and stability, enabling investments in the energy sector. In this context, the Commission notes that the EIB has become a global leader in the issuance of green bonds to help finance sustainable projects. The Capital Markets Union will help remove financial barriers to investment, the Single Market Strategy will contribute to more efficient public procurement markets, and the Digital Single Market Strategy will enhance regulatory certainty in the digital sector. Financing under the EFSI does not substitute the need for Member States to implement the necessary reforms to remove obstacles to investment identified in the context of the European Semester, in areas such as insolvency, public procurement, judicial systems and the efficiency of public administration or sector-specific regulations. The Commission has already issued a number of Country-Specific Recommendations for reforms in the area of investment. These reforms are a necessary condition to sustain and increase investment levels in Member States. The positive momentum generated by the Investment Plan should be maintained and efforts need to be continued to bring investment back to its long-term sustainable trend. The mechanisms of the Investment Plan work and should be reinforced to continue the mobilisation of private investments in sectors important to Europe's future and where market failures or sub-optimal investment situations remain. The aim of the EFSI continues to be to support investments that could not have been carried out in the same period or not to the same extent by the EIB, the EIF or under existing Union financial instruments without EFSI support. In line with the initial investment period, private investment should be attracted to the maximum extent possible, and SMEs will be a key beneficiary of the support provided for under this proposal. Particular attention will also be paid to projects that contribute to reaching the objectives of COP21. The extension of the duration of the EFSI will not only allow the prolongation of a successful scheme, it will also pass an important message to project promoters and encourage them to submit projects to the EIB. A key element of the proposal is a further reinforcement of additionality of the projects supported under the EFSI. It has been made even clearer that the projects under the EFSI address sub-optimal investment situations and market gaps, as part of the eligibility criteria. In view of their importance for Europe, cross-border infrastructure projects, including related services, have been specifically identified as providing additionality. Beyond the extension of the duration of the EFSI, the proposal foresees a number of technical enhancements for the EFSI and the EIAH, incorporating the lessons learnt in the first year of implementation of the EFSI. An important objective of the proposal is to reinforce the take-up of EFSI in less-developed regions and transition regions. In that respect, an easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and the Connecting Europe Facility with EFSI support is a key element and contributes to mobilising additional private sector investment. In parallel, the Commission has today adopted a proposal aimed at simplifying the Common Provisions Regulation so as to facilitate such combination. In this context, it would be appropriate to allow that the control and assurance mechanisms relating to operations benefiting from EFSI support could be used to fulfil the corresponding requirements under other EU funding for the same project in order to streamline procedures and gain in efficiency. The support to less-developed regions and transition regions in Europe is enlarged by an explicit reference to any industry that would not otherwise be covered in the general objectives. In addition, EFSI-supported investments in motorways which should be in general avoided would be allowed in cohesion countries under certain conditions. The Commission also proposes to better focus the EFSI on EU political priorities as regards climate change, for example by setting a minimum target for climate-friendly projects and by confining support to motorways only to those involving private investment in cohesion countries or in cross-border transport projects involving at least one cohesion country. Moreover, the Commission recognises the importance of using part of the Union budget, such as the one available under the CEF, in the form of grants for blending with the EFSI. The combined use of grants and the EFSI will help projects become economically and financially viable, thus enhancing the added value of Union spending by attracting additional resources from private investors. Furthermore, taking into account the significant economic multiplier effect that investments in the defence sector have in terms of creation of spin-offs and technology-transfer on other sectors, as well as the creation of jobs, it would be appropriate to consider including defence-related investment projects under the EFSI and, thus, to consider modifying the eligibility criteria in the EIB lending policy to that effect. For the EIAH, the proposal foresees more targeted technical assistance services for projects involving several Member States, projects that contribute to reaching the objectives of COP21 and for the combination of other sources of Union funding, such as European Structural and Investment Funds (ESIF), Horizon 2020 and the Connecting Europe Facility, with the EFSI. This support will focus on needs not covered adequately under current arrangements. In addition, the proposal foresees that the EIAH should actively contribute to the objective of sectorial and geographical diversification of the EFSI, by supporting the EIB to originate projects where needed.
Revised version (Article 2 Definitions):
For the purposes of this Regulation, the following definitions apply: (1) ‘EFSI Agreement’ means the legal instrument whereby the Commission and the EIB specify the conditions laid down in this Regulation for the management of the EFSI; (2) ‘EIAH Agreement’ means the legal instrument whereby the Commission and the EIB specify the conditions laid down in this Regulation for the implementation of the EIAH; (3) ‘national promotional banks or institutions’ means legal entities carrying out financial activities on a professional basis which are given a mandate by a Member State or a Member State's entity at central, regional or local level, to carry out development or promotional activities; (4) ‘investment platforms’ means special purpose vehicles, managed accounts, contract-based co-financing or risk-sharing arrangements or arrangements established by any other means by which entities channel a financial contribution in order to finance a number of investment projects, and which may include: (a) national or sub-national platforms that group together several investment projects on the territory of a given Member State; (b) cross-border, multi-country, regional or macro-regional platforms that group together partners from several Member States, regions or third countries interested in projects in a given geographic area; (c) thematic platforms that group together investment projects in a given sector; (5) ‘small and medium-sized enterprises’ or ‘SMEs’ means micro, small and medium-sized enterprises as defined in Article 2 of the Annex to Commission Recommendation 2003/361/EC ( 1 ); (6) ‘small mid-cap companies’ means entities having up to 499 employees that are not SMEs; (7) ‘mid-cap companies’ means entities having up to 3 000 employees that are not SMEs or small mid-cap companies; (8) ‘additionality’ means additionality as defined in Article 5(1).
Article 3 Purpose
The purpose of the EFSI shall be to support, in the Union, through the supply of risk-bearing capacity to the EIB, the following: (a) investments; (b) increased access to financing for entities having up to 3 000 employees, with a particular focus on SMEs and small mid-cap companies.
Article 4 Terms of the EFSI Agreement
1. The Commission shall conclude an agreement with the EIB on the management of the EFSI and on the granting of the EU guarantee, in accordance with the requirements of this Regulation. 2. The EFSI Agreement shall contain, in particular, provisions concerning: (a) the establishment of the EFSI, including: (i) the establishment of the EFSI as a distinct, clearly identifiable and transparent facility and as a separate account managed by the EIB, the operations of which are clearly distinguished from other operations of the EIB; (ii) the amount, of no less than EUR 5 000 000 000 in guarantees or cash, and the terms of the financial contribution which is to be provided by the EIB through the EFSI; (iii) the terms of the funding or the guarantees which are to be provided by the EIB through the EFSI to the EIF; (iv) the pricing of operations under the EU guarantee which is to be in line with the EIB's general pricing policy; (a) the establishment of the EFSI, including: (i) the establishment of the EFSI as a distinct, clearly identifiable and transparent facility and as a separate account managed by the EIB, the operations of which are clearly distinguished from other operations of the EIB; (ii) the amount, of no less than EUR 5 000 000 000 in guarantees or cash, and the terms of the financial contribution which is to be provided by the EIB through the EFSI; (iii) the terms of the funding or the guarantees which are to be provided by the EIB through the EFSI to the EIF; (iv) the pricing of operations under the EU guarantee which is to be in line with the EIB's general pricing policy; (b) governance arrangements concerning the EFSI, in accordance with Article 7, without prejudice to Protocol No 5 on the Statute of the European Investment Bank annexed to the TEU and to the TFEU (the EIB Statute), including: (i) the composition and number of members of the Steering Board; (ii) a provision that a representative of the Commission is to chair the Steering Board meetings; (iii) a provision that the Steering Board is to take decisions by consensus; (iv) the procedure for the appointment of the Managing Director and of the Deputy Managing Director, their remuneration and working conditions, in accordance with the Staff Regulations of the EIB, the rules and procedures on their replacement in their functions and on accountability, without prejudice to this Regulation; (v) the procedure for the appointment and dismissal of the members of the Investment Committee, their remuneration and working conditions and the voting arrangements within the Investment Committee, specifying the quorum and allocating one vote to each member; (vi) the requirement that the Steering Board and the Investment Committee adopt their respective rules of procedure; (vii) the requirement that financing and investment operations covered by this Regulation are to be ultimately approved by the EIB governing bodies in accordance with the EIB Statute; (viii) provisions on avoidance and handling of possible conflicts of interest; (b) governance arrangements concerning the EFSI, in accordance with Article 7, without prejudice to Protocol No 5 on the Statute of the European Investment Bank annexed to the TEU and to the TFEU (the EIB Statute), including: (i) the composition and number of members of the Steering Board; (ii) a provision that a representative of the Commission is to chair the Steering Board meetings; (iii) a provision that the Steering Board is to take decisions by consensus; (iv) the procedure for the appointment of the Managing Director and of the Deputy Managing Director, their remuneration and working conditions, in accordance with the Staff Regulations of the EIB, the rules and procedures on their replacement in their functions and on accountability, without prejudice to this Regulation; (v) the procedure for the appointment and dismissal of the members of the Investment Committee, their remuneration and working conditions and the voting arrangements within the Investment Committee, specifying the quorum and allocating one vote to each member; (vi) the requirement that the Steering Board and the Investment Committee adopt their respective rules of procedure; (vii) the requirement that financing and investment operations covered by this Regulation are to be ultimately approved by the EIB governing bodies in accordance with the EIB Statute; (viii) provisions on avoidance and handling of possible conflicts of interest; (c) the EU guarantee, which is to be an unconditional, irrevocable, first demand guarantee in favour of the EIB, including: (i) in accordance with Article 11, detailed rules on the provision of the EU guarantee, including its arrangements on coverage and its defined coverage of portfolios of specific types of instruments; (ii) requirements that remuneration for risk-taking be allocated among contributors to the EFSI in proportion to their respective share in the risk-taking and that remuneration to the Union and payments on the EU guarantee are to be made in a timely manner and only after remuneration and losses from operations have been netted; (iii) in accordance with Article 9, requirements for the use of the EU guarantee, including the payment conditions, such as specific time frames, the interest to be paid on due amounts and the necessary liquidity arrangements; (iv) in accordance with Article 11(5), provisions and procedures relating to the recovery of claims that is to be entrusted to the EIB; (c) the EU guarantee, which is to be an unconditional, irrevocable, first demand guarantee in favour of the EIB, including: (i) in accordance with Article 11, detailed rules on the provision of the EU guarantee, including its arrangements on coverage and its defined coverage of portfolios of specific types of instruments; (ii) requirements that remuneration for risk-taking be allocated among contributors to the EFSI in proportion to their respective share in the risk-taking and that remuneration to the Union and payments on the EU guarantee are to be made in a timely manner and only after remuneration and losses from operations have been netted; (iii) in accordance with Article 9, requirements for the use of the EU guarantee, including the payment conditions, such as specific time frames, the interest to be paid on due amounts and the necessary liquidity arrangements; (iv) in accordance with Article 11(5), provisions and procedures relating to the recovery of claims that is to be entrusted to the EIB; (d) in accordance with this Regulation, and in particular Articles 7(12) and 9(5) thereof, Annex II thereto, and any delegated act adopted pursuant to this Regulation, the arrangements for approval by the Investment Committee of the use of the EU guarantee for individual projects or for supporting investment platforms or funds, or national promotional banks or institutions; (e) the procedures for the submission and approval of investment proposals for the use of the EU guarantee, including: (i) the procedure for the transmission of investment proposals to the Investment Committee; (ii) provisions on the information to be provided when submitting investment proposals to the Investment Committee; (iii) the requirement that the procedure for submission and approval of investment proposals for the use of the EU guarantee be without prejudice to the EIB decision-making rules laid down in the EIB Statute, and in particular Article 19 thereof; (iv) rules further detailing the transitional provisions which comply with Article 24 of this Regulation, and in particular the manner in which operations approved by the EIB during the period referred to in that Article are to be included under the EU guarantee coverage; (e) the procedures for the submission and approval of investment proposals for the use of the EU guarantee, including: (i) the procedure for the transmission of investment proposals to the Investment Committee; (ii) provisions on the information to be provided when submitting investment proposals to the Investment Committee; (iii) the requirement that the procedure for submission and approval of investment proposals for the use of the EU guarantee be without prejudice to the EIB decision-making rules laid down in the EIB Statute, and in particular Article 19 thereof; (iv) rules further detailing the transitional provisions which comply with Article 24 of this Regulation, and in particular the manner in which operations approved by the EIB during the period referred to in that Article are to be included under the EU guarantee coverage; (f) the reporting, monitoring and accountability with regard to the EFSI, including: (i) in accordance with Article 16, the operational reporting obligations incumbent on the EIB, where appropriate in cooperation with the EIF; (ii) the financial reporting obligations with regard to the EFSI; (iii) in accordance with Articles 20 and 21, rules on auditing and fraud prevention; (iv) key performance indicators, in particular as regards the use of the EU guarantee, the fulfilment of the objectives and criteria laid down in Articles 6 and 9 and Annex II, the mobilisation of private capital, and the macro-economic impact of the EFSI, including its effect on supporting investment; (f) the reporting, monitoring and accountability with regard to the EFSI, including: (i) in accordance with Article 16, the operational reporting obligations incumbent on the EIB, where appropriate in cooperation with the EIF; (ii) the financial reporting obligations with regard to the EFSI; (iii) in accordance with Articles 20 and 21, rules on auditing and fraud prevention; (iv) key performance indicators, in particular as regards the use of the EU guarantee, the fulfilment of the objectives and criteria laid down in Articles 6 and 9 and Annex II, the mobilisation of private capital, and the macro-economic impact of the EFSI, including its effect on supporting investment; (g) evaluations of the functioning of the EFSI in accordance with Article 18; (h) the communication and promotion strategy of the EFSI; (i) the procedures and conditions for the amendment of the EFSI Agreement, upon the initiative of the Commission or of the EIB, including the obligation to report to the European Parliament and the Council on such amendment; (j) any other administrative or organisational conditions necessary for the management of the EFSI in so far as they permit the proper use of the EU guarantee; (k) the arrangements concerning the contributions by Member States to the EFSI in the form of guarantees or cash, and by other third parties only in the form of cash, that are not to confer upon those Member States or other third parties any right to participate in the decision-making and voting of the Steering Board. 3. The EFSI Agreement shall also provide that: (a) EFSI activities conducted by the EIF are to be governed by the EIF governing bodies; (b) EFSI activities conducted by the EIF are to be subject to reporting requirements in accordance with Article 16; (c) remuneration attributable to the Union from financing and investment operations covered by this Regulation is to be provided following the deduction of payments due to calls on the EU guarantee and, subsequently, of costs in accordance with Article 9(6) and with the EIAH Agreement.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Since the Investment Plan for Europe was presented in November 2014, the conditions for an uptake in investment have improved and confidence in Europe’s economy and growth are returning. The Union is now in its fourth year of moderate recovery, with GDP growing at 2% in 2015. The comprehensive efforts initiated with the Investment Plan are already delivering concrete results, despite the fact that macroeconomic effects of larger investment projects cannot be immediate. Investment is expected to pick up gradually throughout 2016 and 2017 although it remains below historical levels. 1 On 1 June 2016, the Commission issued a Communication entitled ‘Europe investing again – Taking stock of the Investment Plan for Europe and next steps’ outlining the achievements of the Investment Plan so far and the envisaged next steps, including the extension of the duration of the European Fund for Strategic Investments (EFSI) beyond its initial three-year period, the scaling-up of the SME window within the existing framework and the enhancement of the EIAH. On 28 June 2016, the European Council concluded that "[t]he Investment Plan for Europe, in particular the EFSI, has already delivered concrete results and is a major step to help mobilise private investment while making smart use of scarce budgetary resources. The Commission intends to soon put forward proposals on the future of the EFSI, which should be examined as a matter of urgency by the European Parliament and the Council". The EFSI was established for an initial period of three years and with the aim of mobilising at least EUR 315 billion in investments. Given its success, the Commission is committed to the doubling of the EFSI, both in terms of duration and financial capacity. The legal extension presented today covers the period of the current Multiannual Financial Framework and should provide a total of at least half a trillion euro investments by 2020. The proposal is consistent with the revision of Regulation (EU, Euratom) 966/2012 on the Financial Regulation that the Commission is proposing at the same time to set up a robust framework for the management of the financial liabilities of the Union. In order to enhance the firepower of the EFSI even further and reach the aim of doubling the investment target, the Commission calls on Member States to also contribute as a matter of priority. In this context, the Commission has today adopted a proposal to facilitate contributions at the level of the risk-bearing capacity of the EFSI by catering for the possibility for Member States to transfer resources from European Structural and Investment Funds (ESIF) allocated to them under shared implementation in order to further enhance the firepower of the EFSI. For the period after 2020, the Commission intends to put forward the necessary proposals to ensure that strategic investment will continue at a sustainable level. Since its launch one year ago, the EFSI, implemented and co-sponsored by the Commission's strategic partner for investments, the European Investment Bank (EIB) Group, is firmly on track to deliver the objective of mobilising at least EUR 315 billion in additional investments in the real economy by mid-2018 while endeavouring to maximise private sector contributions. The market absorption has been particularly quick under the Small and Medium-sized Enterprises (SME) window where the EFSI is delivering well beyond expectations. To ensure that sufficient funding is available to continue providing finance to SMEs with EFSI support, in July 2016 the SME Window was scaled-up by EUR 500 million within the existing parameters of Regulation (EU) 2015/1017. The projects approved by the EIB Group by July 2016 for coverage under the EFSI are expected to mobilise EUR 115.7 billion in total investments across 26 Member States and to support some 200,000 SMEs, thereby contributing to Europe's future job creation including youth employment, growth and competitiveness. The European Investment Advisory Hub (EIAH) and the European Investment Project Portal (EIPP) have also made a positive start. The EIAH has already dealt with some 230 requests from 27 Member States and the EIPP has already published more than 100 investment projects since its launch on 1 June 2016, allowing investors to access investment opportunities across Europe instantly. As part of the Commission's efforts to improve Europe's investment environment, the Commission has tabled a number of initiatives to help support investment and facilitate the financing of the real economy, such as the lowering of capital charges for insurance and reinsurance companies as regards infrastructure investments and the adoption of practical guidance on the application of State aid rules in the context of public funding of infrastructure. In addition, the Energy Union, the Capital Markets Union, the Single Market and the Digital Single Market Strategies, and the Circular Economy package all contain specific measures that will remove concrete obstacles and further improve the environment for investment, if fully implemented. For instance, upcoming proposals relating to the internal electricity market, renewable energy and governance of the Energy Union will create more long-term regulatory clarity and stability, enabling investments in the energy sector. In this context, the Commission notes that the EIB has become a global leader in the issuance of green bonds to help finance sustainable projects. The Capital Markets Union will help remove financial barriers to investment, the Single Market Strategy will contribute to more efficient public procurement markets, and the Digital Single Market Strategy will enhance regulatory certainty in the digital sector. Financing under the EFSI does not substitute the need for Member States to implement the necessary reforms to remove obstacles to investment identified in the context of the European Semester, in areas such as insolvency, public procurement, judicial systems and the efficiency of public administration or sector-specific regulations. The Commission has already issued a number of Country-Specific Recommendations for reforms in the area of investment. These reforms are a necessary condition to sustain and increase investment levels in Member States. The positive momentum generated by the Investment Plan should be maintained and efforts need to be continued to bring investment back to its long-term sustainable trend. The mechanisms of the Investment Plan work and should be reinforced to continue the mobilisation of private investments in sectors important to Europe's future and where market failures or sub-optimal investment situations remain. The aim of the EFSI continues to be to support investments that could not have been carried out in the same period or not to the same extent by the EIB, the EIF or under existing Union financial instruments without EFSI support. In line with the initial investment period, private investment should be attracted to the maximum extent possible, and SMEs will be a key beneficiary of the support provided for under this proposal. Particular attention will also be paid to projects that contribute to reaching the objectives of COP21. The extension of the duration of the EFSI will not only allow the prolongation of a successful scheme, it will also pass an important message to project promoters and encourage them to submit projects to the EIB. A key element of the proposal is a further reinforcement of additionality of the projects supported under the EFSI. It has been made even clearer that the projects under the EFSI address sub-optimal investment situations and market gaps, as part of the eligibility criteria. In view of their importance for Europe, cross-border infrastructure projects, including related services, have been specifically identified as providing additionality. Beyond the extension of the duration of the EFSI, the proposal foresees a number of technical enhancements for the EFSI and the EIAH, incorporating the lessons learnt in the first year of implementation of the EFSI. An important objective of the proposal is to reinforce the take-up of EFSI in less-developed regions and transition regions. In that respect, an easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and the Connecting Europe Facility with EFSI support is a key element and contributes to mobilising additional private sector investment. In parallel, the Commission has today adopted a proposal aimed at simplifying the Common Provisions Regulation so as to facilitate such combination. In this context, it would be appropriate to allow that the control and assurance mechanisms relating to operations benefiting from EFSI support could be used to fulfil the corresponding requirements under other EU funding for the same project in order to streamline procedures and gain in efficiency. The support to less-developed regions and transition regions in Europe is enlarged by an explicit reference to any industry that would not otherwise be covered in the general objectives. In addition, EFSI-supported investments in motorways which should be in general avoided would be allowed in cohesion countries under certain conditions. The Commission also proposes to better focus the EFSI on EU political priorities as regards climate change, for example by setting a minimum target for climate-friendly projects and by confining support to motorways only to those involving private investment in cohesion countries or in cross-border transport projects involving at least one cohesion country. Moreover, the Commission recognises the importance of using part of the Union budget, such as the one available under the CEF, in the form of grants for blending with the EFSI. The combined use of grants and the EFSI will help projects become economically and financially viable, thus enhancing the added value of Union spending by attracting additional resources from private investors. Furthermore, taking into account the significant economic multiplier effect that investments in the defence sector have in terms of creation of spin-offs and technology-transfer on other sectors, as well as the creation of jobs, it would be appropriate to consider including defence-related investment projects under the EFSI and, thus, to consider modifying the eligibility criteria in the EIB lending policy to that effect. For the EIAH, the proposal foresees more targeted technical assistance services for projects involving several Member States, projects that contribute to reaching the objectives of COP21 and for the combination of other sources of Union funding, such as European Structural and Investment Funds (ESIF), Horizon 2020 and the Connecting Europe Facility, with the EFSI. This support will focus on needs not covered adequately under current arrangements. In addition, the proposal foresees that the EIAH should actively contribute to the objective of sectorial and geographical diversification of the EFSI, by supporting the EIB to originate projects where needed.
Revised version (Article 4 Terms of the EFSI Agreement):
1. The Commission shall conclude an agreement with the EIB on the management of the EFSI and on the granting of the EU guarantee, in accordance with the requirements of this Regulation. 2. The EFSI Agreement shall contain, in particular, provisions concerning: (a) the establishment of the EFSI, including: (i) the establishment of the EFSI as a distinct, clearly identifiable and transparent facility and as a separate account managed by the EIB, the operations of which are clearly distinguished from other operations of the EIB; (ii) the amount, of no less than EUR 7 500 000 000 in guarantees or cash, and the terms of the financial contribution which is to be provided by the EIB through the EFSI; (iii) the terms of the funding or the guarantees which are to be provided by the EIB through the EFSI to the EIF; (iv) the pricing of operations under the EU guarantee which is to be in line with the EIB’s pricing policy; (v) the procedures to contribute, without prejudice to Protocol No 5 on the Statute of the European Investment Bank annexed to the TEU and to the TFEU and the EIB prerogatives set out therein, to a reduction of the financing cost of the operation borne by the beneficiary of the EIB financing under EFSI, in particular by modulating the remuneration of the EU guarantee, where necessary in particular in situations where stressed financial market conditions would prevent the realisation of a viable project or where necessary to facilitate the establishment of investment platforms or the funding of projects in sectors or areas experiencing a significant market failure or suboptimal investment situation, to the extent it does not significantly impact the necessary financing of the provisioning of the Guarantee Fund; (b) governance arrangements concerning the EFSI, in accordance with Article 7, without prejudice to Protocol No 5 on the Statute of the European Investment Bank annexed to the TEU and to the TFEU (the EIB Statute), including: (i) the composition and number of members of the Steering Board; (ii) a provision that a representative of the Commission is to chair the Steering Board meetings; (iii) a provision that the Steering Board is to take decisions in accordance with the procedure laid down in Article 7(3); (iv) the procedure for the appointment of the Managing Director and of the Deputy Managing Director, their remuneration and working conditions, in accordance with the Staff Regulations of the EIB, the rules and procedures on their replacement in their functions and on accountability, without prejudice to this Regulation; (v) the procedure for the appointment and dismissal of the members of the Investment Committee, their remuneration and working conditions and the voting arrangements within the Investment Committee, specifying the quorum and allocating one vote to each member; (vi) the requirement that the Steering Board and the Investment Committee adopt their respective rules of procedure; (vii) the requirement that financing and investment operations covered by this Regulation are to be ultimately approved by the EIB governing bodies in accordance with the EIB Statute; (viii) provisions on avoidance and handling of possible conflicts of interest; (c) the EU guarantee, which is to be an unconditional, irrevocable, first demand guarantee in favour of the EIB, including: (i) in accordance with Article 11, detailed rules on the provision of the EU guarantee, including its arrangements on coverage, its defined coverage of portfolios of specific types of instruments and the respective events triggering possible calls on the EU guarantee; (ii) requirements that remuneration for risk-taking be allocated among contributors to the EFSI in proportion to their respective share in the risk-taking and that remuneration to the Union and payments on the EU guarantee are to be made in a timely manner and only after remuneration and losses from operations have been netted; (iii) in accordance with Article 9, requirements for the use of the EU guarantee, including the payment conditions, such as specific time frames, the interest to be paid on due amounts and the necessary liquidity arrangements; (iv) in accordance with Article 11(5), provisions and procedures relating to the recovery of claims that is to be entrusted to the EIB; (d) in accordance with this Regulation, and in particular Articles 7(12) and 9(5) thereof, Annex II thereto, and any delegated act adopted pursuant to this Regulation, the arrangements for approval by the Investment Committee of the use of the EU guarantee for individual projects or for supporting investment platforms or funds, or national promotional banks or institutions; (e) the procedures for the submission and approval of investment proposals for the use of the EU guarantee, including: (i) the procedure for the transmission of investment proposals to the Investment Committee; (ii) provisions on the information to be provided when submitting investment proposals to the Investment Committee; (iii) the requirement that the procedure for submission and approval of investment proposals for the use of the EU guarantee be without prejudice to the EIB decision-making rules laid down in the EIB Statute, and in particular Article 19 thereof; (iv) rules further detailing the transitional provisions which comply with Article 24 of this Regulation, and in particular the manner in which operations approved by the EIB during the period referred to in that Article are to be included under the EU guarantee coverage; (f) the reporting, monitoring and accountability with regard to the EFSI, including: (i) in accordance with Article 16, the operational reporting obligations incumbent on the EIB, where appropriate in cooperation with the EIF; (ii) the financial reporting obligations with regard to the EFSI; (iii) in accordance with Articles 20 and 21, rules on auditing and fraud prevention; (iv) key performance indicators, in particular as regards the use of the EU guarantee, the fulfilment of the objectives and criteria laid down in Articles 6 and 9 and Annex II, the mobilisation of private capital, and the macro-economic impact of the EFSI, including its effect on supporting investment; (g) evaluations of the functioning of the EFSI in accordance with Article 18; (h) the communication and promotion strategy of the EFSI; (i) the procedures and conditions for the amendment of the EFSI Agreement, upon the initiative of the Commission or of the EIB, including the obligation to report to the European Parliament and the Council on such amendment; (j) any other administrative or organisational conditions necessary for the management of the EFSI in so far as they permit the proper use of the EU guarantee; (k) the arrangements concerning the contributions by Member States to the EFSI in the form of guarantees or cash, and by other third parties only in the form of cash, that are not to confer upon those Member States or other third parties any right to participate in the decision-making and voting of the Steering Board. 3. The EFSI Agreement shall also provide that: (a) EFSI activities conducted by the EIF are to be governed by the EIF governing bodies; (b) EFSI activities conducted by the EIF are to be subject to reporting requirements in accordance with Article 16; (c) remuneration attributable to the Union from financing and investment operations covered by this Regulation is to be provided following the deduction of payments due to calls on the EU guarantee and, subsequently, of costs in accordance with Article 9(6) and with the EIAH Agreement.
Article 5 Additionality
1. For the purposes of this Regulation, ‘additionality’ means the support by the EFSI of operations which address market failures or sub-optimal investment situations and which could not have been carried out in the period during which the EU guarantee can be used, or not to the same extent, by the EIB, the EIF or under existing Union financial instruments without EFSI support. Projects supported by the EFSI shall typically have a higher risk profile than projects supported by EIB normal operations and the EFSI portfolio shall have overall a higher risk profile than the portfolio of investments supported by the EIB under its normal investment policies before the entry into force of this Regulation. The projects supported by the EFSI, while striving to create employment and sustainable growth, shall be considered to provide additionality if they carry a risk corresponding to EIB special activities, as defined in Article 16 of the EIB Statute and by the credit risk policy guidelines of the EIB. EIB projects carrying a risk lower than the minimum risk under EIB special activities may also be supported by the EFSI if the use of the EU guarantee is required to ensure additionality as defined in the first subparagraph of this paragraph. 2. In line with the investment guidelines laid down in Annex II, the Steering Board shall adjust the project mix as regards sectors and countries, on the basis of an ongoing monitoring of the developments of market conditions in the Member States and of the investment environment to help overcome market failures and sub-optimal investment situations including problems resulting from financial fragmentation. When carrying out that adjustment, the Steering Board shall avoid an approach which would be riskier than necessary. Where the risk level so requires, EIB special activities shall be more broadly used under this Regulation than before the entry into force thereof. This shall in particular apply with respect to those Member States where EIB special activities have not been used or have been used only exceptionally before the entry into force of this Regulation, in order to allow for the implementation of additional operations and projects, as well as additional financing by the EIB and national promotional banks or institutions or investment platforms.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Since the Investment Plan for Europe was presented in November 2014, the conditions for an uptake in investment have improved and confidence in Europe’s economy and growth are returning. The Union is now in its fourth year of moderate recovery, with GDP growing at 2% in 2015. The comprehensive efforts initiated with the Investment Plan are already delivering concrete results, despite the fact that macroeconomic effects of larger investment projects cannot be immediate. Investment is expected to pick up gradually throughout 2016 and 2017 although it remains below historical levels. 1 On 1 June 2016, the Commission issued a Communication entitled ‘Europe investing again – Taking stock of the Investment Plan for Europe and next steps’ outlining the achievements of the Investment Plan so far and the envisaged next steps, including the extension of the duration of the European Fund for Strategic Investments (EFSI) beyond its initial three-year period, the scaling-up of the SME window within the existing framework and the enhancement of the EIAH. On 28 June 2016, the European Council concluded that "[t]he Investment Plan for Europe, in particular the EFSI, has already delivered concrete results and is a major step to help mobilise private investment while making smart use of scarce budgetary resources. The Commission intends to soon put forward proposals on the future of the EFSI, which should be examined as a matter of urgency by the European Parliament and the Council". The EFSI was established for an initial period of three years and with the aim of mobilising at least EUR 315 billion in investments. Given its success, the Commission is committed to the doubling of the EFSI, both in terms of duration and financial capacity. The legal extension presented today covers the period of the current Multiannual Financial Framework and should provide a total of at least half a trillion euro investments by 2020. The proposal is consistent with the revision of Regulation (EU, Euratom) 966/2012 on the Financial Regulation that the Commission is proposing at the same time to set up a robust framework for the management of the financial liabilities of the Union. In order to enhance the firepower of the EFSI even further and reach the aim of doubling the investment target, the Commission calls on Member States to also contribute as a matter of priority. In this context, the Commission has today adopted a proposal to facilitate contributions at the level of the risk-bearing capacity of the EFSI by catering for the possibility for Member States to transfer resources from European Structural and Investment Funds (ESIF) allocated to them under shared implementation in order to further enhance the firepower of the EFSI. For the period after 2020, the Commission intends to put forward the necessary proposals to ensure that strategic investment will continue at a sustainable level. Since its launch one year ago, the EFSI, implemented and co-sponsored by the Commission's strategic partner for investments, the European Investment Bank (EIB) Group, is firmly on track to deliver the objective of mobilising at least EUR 315 billion in additional investments in the real economy by mid-2018 while endeavouring to maximise private sector contributions. The market absorption has been particularly quick under the Small and Medium-sized Enterprises (SME) window where the EFSI is delivering well beyond expectations. To ensure that sufficient funding is available to continue providing finance to SMEs with EFSI support, in July 2016 the SME Window was scaled-up by EUR 500 million within the existing parameters of Regulation (EU) 2015/1017. The projects approved by the EIB Group by July 2016 for coverage under the EFSI are expected to mobilise EUR 115.7 billion in total investments across 26 Member States and to support some 200,000 SMEs, thereby contributing to Europe's future job creation including youth employment, growth and competitiveness. The European Investment Advisory Hub (EIAH) and the European Investment Project Portal (EIPP) have also made a positive start. The EIAH has already dealt with some 230 requests from 27 Member States and the EIPP has already published more than 100 investment projects since its launch on 1 June 2016, allowing investors to access investment opportunities across Europe instantly. As part of the Commission's efforts to improve Europe's investment environment, the Commission has tabled a number of initiatives to help support investment and facilitate the financing of the real economy, such as the lowering of capital charges for insurance and reinsurance companies as regards infrastructure investments and the adoption of practical guidance on the application of State aid rules in the context of public funding of infrastructure. In addition, the Energy Union, the Capital Markets Union, the Single Market and the Digital Single Market Strategies, and the Circular Economy package all contain specific measures that will remove concrete obstacles and further improve the environment for investment, if fully implemented. For instance, upcoming proposals relating to the internal electricity market, renewable energy and governance of the Energy Union will create more long-term regulatory clarity and stability, enabling investments in the energy sector. In this context, the Commission notes that the EIB has become a global leader in the issuance of green bonds to help finance sustainable projects. The Capital Markets Union will help remove financial barriers to investment, the Single Market Strategy will contribute to more efficient public procurement markets, and the Digital Single Market Strategy will enhance regulatory certainty in the digital sector. Financing under the EFSI does not substitute the need for Member States to implement the necessary reforms to remove obstacles to investment identified in the context of the European Semester, in areas such as insolvency, public procurement, judicial systems and the efficiency of public administration or sector-specific regulations. The Commission has already issued a number of Country-Specific Recommendations for reforms in the area of investment. These reforms are a necessary condition to sustain and increase investment levels in Member States. The positive momentum generated by the Investment Plan should be maintained and efforts need to be continued to bring investment back to its long-term sustainable trend. The mechanisms of the Investment Plan work and should be reinforced to continue the mobilisation of private investments in sectors important to Europe's future and where market failures or sub-optimal investment situations remain. The aim of the EFSI continues to be to support investments that could not have been carried out in the same period or not to the same extent by the EIB, the EIF or under existing Union financial instruments without EFSI support. In line with the initial investment period, private investment should be attracted to the maximum extent possible, and SMEs will be a key beneficiary of the support provided for under this proposal. Particular attention will also be paid to projects that contribute to reaching the objectives of COP21. The extension of the duration of the EFSI will not only allow the prolongation of a successful scheme, it will also pass an important message to project promoters and encourage them to submit projects to the EIB. A key element of the proposal is a further reinforcement of additionality of the projects supported under the EFSI. It has been made even clearer that the projects under the EFSI address sub-optimal investment situations and market gaps, as part of the eligibility criteria. In view of their importance for Europe, cross-border infrastructure projects, including related services, have been specifically identified as providing additionality. Beyond the extension of the duration of the EFSI, the proposal foresees a number of technical enhancements for the EFSI and the EIAH, incorporating the lessons learnt in the first year of implementation of the EFSI. An important objective of the proposal is to reinforce the take-up of EFSI in less-developed regions and transition regions. In that respect, an easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and the Connecting Europe Facility with EFSI support is a key element and contributes to mobilising additional private sector investment. In parallel, the Commission has today adopted a proposal aimed at simplifying the Common Provisions Regulation so as to facilitate such combination. In this context, it would be appropriate to allow that the control and assurance mechanisms relating to operations benefiting from EFSI support could be used to fulfil the corresponding requirements under other EU funding for the same project in order to streamline procedures and gain in efficiency. The support to less-developed regions and transition regions in Europe is enlarged by an explicit reference to any industry that would not otherwise be covered in the general objectives. In addition, EFSI-supported investments in motorways which should be in general avoided would be allowed in cohesion countries under certain conditions. The Commission also proposes to better focus the EFSI on EU political priorities as regards climate change, for example by setting a minimum target for climate-friendly projects and by confining support to motorways only to those involving private investment in cohesion countries or in cross-border transport projects involving at least one cohesion country. Moreover, the Commission recognises the importance of using part of the Union budget, such as the one available under the CEF, in the form of grants for blending with the EFSI. The combined use of grants and the EFSI will help projects become economically and financially viable, thus enhancing the added value of Union spending by attracting additional resources from private investors. Furthermore, taking into account the significant economic multiplier effect that investments in the defence sector have in terms of creation of spin-offs and technology-transfer on other sectors, as well as the creation of jobs, it would be appropriate to consider including defence-related investment projects under the EFSI and, thus, to consider modifying the eligibility criteria in the EIB lending policy to that effect. For the EIAH, the proposal foresees more targeted technical assistance services for projects involving several Member States, projects that contribute to reaching the objectives of COP21 and for the combination of other sources of Union funding, such as European Structural and Investment Funds (ESIF), Horizon 2020 and the Connecting Europe Facility, with the EFSI. This support will focus on needs not covered adequately under current arrangements. In addition, the proposal foresees that the EIAH should actively contribute to the objective of sectorial and geographical diversification of the EFSI, by supporting the EIB to originate projects where needed.
Revised version (Article 5 Additionality):
1. For the purposes of this Regulation, ‘additionality’ means support by the EFSI for operations which address market failures or sub-optimal investment situations and which could not have been carried out during the period in which the EU guarantee can be used, or not to the same extent, by the EIB, the EIF or under existing Union financial instruments, without EFSI support. Projects supported by the EFSI shall support the general objectives laid down in Article 9(2), shall strive to create employment and sustainable growth and shall typically have a higher risk profile than projects supported by normal EIB operations. Overall, the EFSI portfolio shall have a higher risk profile than the portfolio of investments supported by the EIB under its normal investment policies before the entry into force of this Regulation. To better address market failures or sub-optimal investment situations, and to facilitate, in particular, the use of investment platforms for small-scale projects, thereby ensuring complementarity and thus avoiding crowding out participants in the same market, EIB special activities supported by the EFSI shall, as a preferred way and if duly justified: (a) have features of subordination, including the taking of junior positions vis-à-vis other investors; (b) participate in risk-sharing instruments; (c) demonstrate cross-border characteristics; (d) be exposed to specific risks; or (e) have other aspects as further described in point (d) of Section 3 of Annex II. Without prejudice to the requirement to meet the definition of additionality as set out in the first subparagraph, the following elements are strong indications of additionality: — projects that carry a risk corresponding to EIB special activities, as defined in Article 16 of the EIB Statute, especially if such projects present country-, sector- or region-specific risks, in particular those experienced in less developed regions and transition regions and/or if such projects present risks associated with innovation, in particular in growth-, sustainability- and productivity-enhancing unproven technologies, — projects that consist of physical infrastructure, including e-infrastructure, linking two or more Member States or of the extension of such infrastructure or services linked to such infrastructure from one Member State to one or more Member States. 2. In line with the investment guidelines laid down in Annex II, the Steering Board shall adjust the project mix as regards sectors and countries, on the basis of an ongoing monitoring of the developments of market conditions in the Member States and of the investment environment to help overcome market failures and sub-optimal investment situations including problems resulting from financial fragmentation. When carrying out that adjustment, the Steering Board shall avoid an approach which would be riskier than necessary. Where the risk level so requires, EIB special activities shall be more broadly used under this Regulation than before the entry into force thereof. This shall in particular apply with respect to those Member States where EIB special activities have not been used or have been used only exceptionally before the entry into force of this Regulation, in order to allow for the implementation of additional operations and projects, as well as additional financing by the EIB and national promotional banks or institutions or investment platforms.
Article 6 Eligibility criteria for the use of the EU guarantee
1. The EFSI Agreement shall provide that the EFSI is to support projects which: (a) are economically viable according to a cost-benefit analysis following Union standards, taking into account possible support from, and co-financing by, private and public partners to a project; (b) are consistent with Union policies, including the objective of smart, sustainable and inclusive growth, quality job creation, and economic, social and territorial cohesion; (c) provide additionality; (d) maximise where possible the mobilisation of private sector capital; and (e) are technically viable. 2. There shall be no restriction on the size of projects eligible for EFSI support for the operations conducted by the EIB or the EIF via financial intermediaries.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Since the Investment Plan for Europe was presented in November 2014, the conditions for an uptake in investment have improved and confidence in Europe’s economy and growth are returning. The Union is now in its fourth year of moderate recovery, with GDP growing at 2% in 2015. The comprehensive efforts initiated with the Investment Plan are already delivering concrete results, despite the fact that macroeconomic effects of larger investment projects cannot be immediate. Investment is expected to pick up gradually throughout 2016 and 2017 although it remains below historical levels. 1 On 1 June 2016, the Commission issued a Communication entitled ‘Europe investing again – Taking stock of the Investment Plan for Europe and next steps’ outlining the achievements of the Investment Plan so far and the envisaged next steps, including the extension of the duration of the European Fund for Strategic Investments (EFSI) beyond its initial three-year period, the scaling-up of the SME window within the existing framework and the enhancement of the EIAH. On 28 June 2016, the European Council concluded that "[t]he Investment Plan for Europe, in particular the EFSI, has already delivered concrete results and is a major step to help mobilise private investment while making smart use of scarce budgetary resources. The Commission intends to soon put forward proposals on the future of the EFSI, which should be examined as a matter of urgency by the European Parliament and the Council". The EFSI was established for an initial period of three years and with the aim of mobilising at least EUR 315 billion in investments. Given its success, the Commission is committed to the doubling of the EFSI, both in terms of duration and financial capacity. The legal extension presented today covers the period of the current Multiannual Financial Framework and should provide a total of at least half a trillion euro investments by 2020. The proposal is consistent with the revision of Regulation (EU, Euratom) 966/2012 on the Financial Regulation that the Commission is proposing at the same time to set up a robust framework for the management of the financial liabilities of the Union. In order to enhance the firepower of the EFSI even further and reach the aim of doubling the investment target, the Commission calls on Member States to also contribute as a matter of priority. In this context, the Commission has today adopted a proposal to facilitate contributions at the level of the risk-bearing capacity of the EFSI by catering for the possibility for Member States to transfer resources from European Structural and Investment Funds (ESIF) allocated to them under shared implementation in order to further enhance the firepower of the EFSI. For the period after 2020, the Commission intends to put forward the necessary proposals to ensure that strategic investment will continue at a sustainable level. Since its launch one year ago, the EFSI, implemented and co-sponsored by the Commission's strategic partner for investments, the European Investment Bank (EIB) Group, is firmly on track to deliver the objective of mobilising at least EUR 315 billion in additional investments in the real economy by mid-2018 while endeavouring to maximise private sector contributions. The market absorption has been particularly quick under the Small and Medium-sized Enterprises (SME) window where the EFSI is delivering well beyond expectations. To ensure that sufficient funding is available to continue providing finance to SMEs with EFSI support, in July 2016 the SME Window was scaled-up by EUR 500 million within the existing parameters of Regulation (EU) 2015/1017. The projects approved by the EIB Group by July 2016 for coverage under the EFSI are expected to mobilise EUR 115.7 billion in total investments across 26 Member States and to support some 200,000 SMEs, thereby contributing to Europe's future job creation including youth employment, growth and competitiveness. The European Investment Advisory Hub (EIAH) and the European Investment Project Portal (EIPP) have also made a positive start. The EIAH has already dealt with some 230 requests from 27 Member States and the EIPP has already published more than 100 investment projects since its launch on 1 June 2016, allowing investors to access investment opportunities across Europe instantly. As part of the Commission's efforts to improve Europe's investment environment, the Commission has tabled a number of initiatives to help support investment and facilitate the financing of the real economy, such as the lowering of capital charges for insurance and reinsurance companies as regards infrastructure investments and the adoption of practical guidance on the application of State aid rules in the context of public funding of infrastructure. In addition, the Energy Union, the Capital Markets Union, the Single Market and the Digital Single Market Strategies, and the Circular Economy package all contain specific measures that will remove concrete obstacles and further improve the environment for investment, if fully implemented. For instance, upcoming proposals relating to the internal electricity market, renewable energy and governance of the Energy Union will create more long-term regulatory clarity and stability, enabling investments in the energy sector. In this context, the Commission notes that the EIB has become a global leader in the issuance of green bonds to help finance sustainable projects. The Capital Markets Union will help remove financial barriers to investment, the Single Market Strategy will contribute to more efficient public procurement markets, and the Digital Single Market Strategy will enhance regulatory certainty in the digital sector. Financing under the EFSI does not substitute the need for Member States to implement the necessary reforms to remove obstacles to investment identified in the context of the European Semester, in areas such as insolvency, public procurement, judicial systems and the efficiency of public administration or sector-specific regulations. The Commission has already issued a number of Country-Specific Recommendations for reforms in the area of investment. These reforms are a necessary condition to sustain and increase investment levels in Member States. The positive momentum generated by the Investment Plan should be maintained and efforts need to be continued to bring investment back to its long-term sustainable trend. The mechanisms of the Investment Plan work and should be reinforced to continue the mobilisation of private investments in sectors important to Europe's future and where market failures or sub-optimal investment situations remain. The aim of the EFSI continues to be to support investments that could not have been carried out in the same period or not to the same extent by the EIB, the EIF or under existing Union financial instruments without EFSI support. In line with the initial investment period, private investment should be attracted to the maximum extent possible, and SMEs will be a key beneficiary of the support provided for under this proposal. Particular attention will also be paid to projects that contribute to reaching the objectives of COP21. The extension of the duration of the EFSI will not only allow the prolongation of a successful scheme, it will also pass an important message to project promoters and encourage them to submit projects to the EIB. A key element of the proposal is a further reinforcement of additionality of the projects supported under the EFSI. It has been made even clearer that the projects under the EFSI address sub-optimal investment situations and market gaps, as part of the eligibility criteria. In view of their importance for Europe, cross-border infrastructure projects, including related services, have been specifically identified as providing additionality. Beyond the extension of the duration of the EFSI, the proposal foresees a number of technical enhancements for the EFSI and the EIAH, incorporating the lessons learnt in the first year of implementation of the EFSI. An important objective of the proposal is to reinforce the take-up of EFSI in less-developed regions and transition regions. In that respect, an easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and the Connecting Europe Facility with EFSI support is a key element and contributes to mobilising additional private sector investment. In parallel, the Commission has today adopted a proposal aimed at simplifying the Common Provisions Regulation so as to facilitate such combination. In this context, it would be appropriate to allow that the control and assurance mechanisms relating to operations benefiting from EFSI support could be used to fulfil the corresponding requirements under other EU funding for the same project in order to streamline procedures and gain in efficiency. The support to less-developed regions and transition regions in Europe is enlarged by an explicit reference to any industry that would not otherwise be covered in the general objectives. In addition, EFSI-supported investments in motorways which should be in general avoided would be allowed in cohesion countries under certain conditions. The Commission also proposes to better focus the EFSI on EU political priorities as regards climate change, for example by setting a minimum target for climate-friendly projects and by confining support to motorways only to those involving private investment in cohesion countries or in cross-border transport projects involving at least one cohesion country. Moreover, the Commission recognises the importance of using part of the Union budget, such as the one available under the CEF, in the form of grants for blending with the EFSI. The combined use of grants and the EFSI will help projects become economically and financially viable, thus enhancing the added value of Union spending by attracting additional resources from private investors. Furthermore, taking into account the significant economic multiplier effect that investments in the defence sector have in terms of creation of spin-offs and technology-transfer on other sectors, as well as the creation of jobs, it would be appropriate to consider including defence-related investment projects under the EFSI and, thus, to consider modifying the eligibility criteria in the EIB lending policy to that effect. For the EIAH, the proposal foresees more targeted technical assistance services for projects involving several Member States, projects that contribute to reaching the objectives of COP21 and for the combination of other sources of Union funding, such as European Structural and Investment Funds (ESIF), Horizon 2020 and the Connecting Europe Facility, with the EFSI. This support will focus on needs not covered adequately under current arrangements. In addition, the proposal foresees that the EIAH should actively contribute to the objective of sectorial and geographical diversification of the EFSI, by supporting the EIB to originate projects where needed.
Revised version (Article 6 Eligibility criteria for the use of the EU guarantee):
1. The EFSI Agreement shall provide that the EFSI is to support projects which address market failures or sub-optimal investment situations and which: (a) are economically viable according to a cost-benefit analysis following Union standards, taking into account possible support from, and co-financing by, private and public partners to a project; (b) are consistent with Union policies, including the objective of smart, sustainable and inclusive growth, quality job creation, and economic, social and territorial cohesion; (c) provide additionality; (d) maximise where possible the mobilisation of private sector capital; and (e) are technically viable. 2. There shall be no restriction on the size of projects eligible for EFSI support for the operations conducted by the EIB or the EIF via financial intermediaries. In order to ensure that EFSI support also covers small-scale projects, the EIB and the EIF shall, where necessary and to the extent possible, extend cooperation with national promotional banks or institutions and support the possibilities provided, including through facilitating the creation of investment platforms.
Article 7 Governance of the EFSI
1. When carrying out their tasks under this Regulation, the Steering Board, the Investment Committee and the Managing Director shall pursue only the objectives set out in this Regulation. 2. The EFSI Agreement shall provide that the EFSI is to be governed by a steering board, which, for the purpose of the use of the EU guarantee, is to determine, in conformity with the general objectives set out in Article 9(2): (a) the strategic orientation of the EFSI, including the allocation of the EU guarantee within the infrastructure and innovation windows and any decision to be taken under Article 11(3) and Section 7(b) of Annex II; (b) the operating policies and procedures necessary for the functioning of the EFSI; (c) the rules applicable to the operations with investment platforms and national promotional banks or institutions; (d) the risk profile of the EFSI. 3. The Steering Board shall comprise four members: three appointed by the Commission and one by the EIB. The Steering Board shall elect a Chairperson from among its members for a fixed term of three years, renewable once. The Steering Board shall take its decisions by consensus. The minutes of Steering Board meetings shall be published as soon as they have been approved by the Steering Board. The Steering Board shall regularly organise a consultation of relevant stakeholders - in particular co-investors, public authorities, experts, education, training and research institutions, the relevant social partners and representatives of civil society - on the orientation and implementation of the investment policy carried out by the EIB under this Regulation. The instruments used by the EIF for carrying out operations covered by this Regulation shall be approved jointly by the Steering Board and the Managing Director, after consulting the Investment Committee. 4. Member States and other third parties may - subject in the case of other third parties to the agreement of the Steering Board - contribute to the EFSI in the form of guarantees or cash as regards Member States, and only in the form of cash as regards other third parties. Neither Member States nor other third parties shall be granted membership of the Steering Board, nor shall they be granted a role in the appointment of other EFSI staff including members of the Investment Committee, nor shall they have any right concerning other aspects of governance of the EFSI as set out in this Regulation. 5. The EFSI Agreement shall provide that the EFSI is to have a managing director, who is to be responsible for the day-to-day management of the EFSI and the preparation and chairing of meetings of the Investment Committee referred to in paragraph 6. The Managing Director shall be assisted by a deputy managing director. The Managing Director shall report every quarter on the activities of the EFSI to the Steering Board. 6. Following an open and transparent selection process in line with EIB procedures, the Steering Board shall select a candidate for each of the positions of Managing Director and Deputy Managing Director. The European Parliament and the Council shall be kept duly informed in a timely manner at all stages of the selection procedure, subject to strict confidentiality requirements. That applies regardless of the conclusion of the agreement between the European Parliament and the EIB referred to in Article 17(5). The European Parliament shall organise as rapidly as possible, and at the latest within four weeks from the communication of the name of a selected candidate, a hearing with the candidate for each position. Following the approval from the European Parliament, the Managing Director and the Deputy Managing Director shall be appointed by the President of the EIB for a fixed term of three years, renewable once. 7. The EFSI Agreement shall provide that the EFSI is to have an investment committee, which is to be responsible for examining potential projects in line with the EFSI investment policies and for approving the support of the EU guarantee for EIB operations for projects that comply with the requirements of Articles 6 and 9, irrespective of the geographic location, in accordance with Article 8, of such projects. Furthermore, the Investment Committee shall be the competent body for approving operations with investment platforms and national promotional banks or institutions. 8. The Investment Committee shall be composed of eight independent experts and the Managing Director. The experts of the Investment Committee shall, following an open and transparent selection procedure, be appointed by the Steering Board for a fixed term of up to three years. Their term shall be renewable but shall not exceed six years in total. The independent experts shall have a high level of relevant market experience in project structuring and project financing, as well as micro- and macro-economic expertise. When appointing the experts of the Investment Committee, the Steering Board shall ensure that the composition of the Investment Committee is diversified, so as to ensure that it has a wide knowledge of the sectors referred to in Article 9 and of the geographic markets in the Union. The composition of the Investment Committee shall be gender-balanced. The Steering Board shall strive to select experts having experience in investment in one or more of the following fields: (a) research, development and innovation; (b) transport infrastructures and innovative technologies for transport; (c) energy infrastructures, energy efficiency and renewable energy; (d) information and communication technologies infrastructures; (e) environmental protection and management; (f) education and training; (g) health and medicine; (h) SMEs; (i) cultural and creative industries; (j) urban mobility; (k) social infrastructures and the social and solidarity economy. 9. When participating in the activities of the Investment Committee, its members shall perform their duties impartially and in the interests of the EFSI. When implementing the investment guidelines set out in Annex II and taking decisions on the use of the EU guarantee, they shall not seek or take instructions from the EIB, the institutions of the Union, Member States, or any other public or private body. Without prejudice to the provision of analytical, logistical and administrative support by the staff of the EIB to the Investment Committee, adequate organisational arrangements shall be established and maintained to ensure the operational independence of the Investment Committee. Any project assessment conducted by EIB staff shall not be binding on the Investment Committee for the purposes of granting the EU guarantee. 10. CVs and declarations of interest of each member of the Investment Committee shall be made public and constantly updated. Each member of the Investment Committee shall communicate without delay to the Steering Board all information needed to check on an ongoing basis the absence of any conflict of interest. 11. Following a request from the Steering Board, the contract of any member of the Investment Committee who breaches the obligations set out in paragraphs 9 and 10 shall be terminated, in accordance with applicable employment and labour law rules. 12. The Investment Committee shall decide on the use of the EU guarantee in accordance with this Regulation, including the investment guidelines set out in Annex II. Decisions of the Investment Committee shall be taken by simple majority. Decisions approving the use of the EU guarantee shall be public and accessible. The EIB shall submit twice a year to the European Parliament, the Council and the Commission a list of all decisions of the Investment Committee rejecting the use of the EU guarantee, subject to strict confidentiality requirements. 13. The Commission shall be empowered to adopt delegated acts in accordance with Article 23 to amend the non-essential elements of Sections 6 to 8 of the investment guidelines laid down in Annex II to this Regulation, without deleting any of those Sections altogether. Such delegated acts shall be prepared in close dialogue with the EIB. 14. The Commission shall be empowered to adopt delegated acts in accordance with Article 23(1) to (3) and (5) to supplement this Regulation by establishing a scoreboard of indicators to be used by the Investment Committee to ensure an independent and transparent assessment of the potential and actual use of the EU guarantee. Such delegated acts shall be prepared in close dialogue with the EIB.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Since the Investment Plan for Europe was presented in November 2014, the conditions for an uptake in investment have improved and confidence in Europe’s economy and growth are returning. The Union is now in its fourth year of moderate recovery, with GDP growing at 2% in 2015. The comprehensive efforts initiated with the Investment Plan are already delivering concrete results, despite the fact that macroeconomic effects of larger investment projects cannot be immediate. Investment is expected to pick up gradually throughout 2016 and 2017 although it remains below historical levels. 1 On 1 June 2016, the Commission issued a Communication entitled ‘Europe investing again – Taking stock of the Investment Plan for Europe and next steps’ outlining the achievements of the Investment Plan so far and the envisaged next steps, including the extension of the duration of the European Fund for Strategic Investments (EFSI) beyond its initial three-year period, the scaling-up of the SME window within the existing framework and the enhancement of the EIAH. On 28 June 2016, the European Council concluded that "[t]he Investment Plan for Europe, in particular the EFSI, has already delivered concrete results and is a major step to help mobilise private investment while making smart use of scarce budgetary resources. The Commission intends to soon put forward proposals on the future of the EFSI, which should be examined as a matter of urgency by the European Parliament and the Council". The EFSI was established for an initial period of three years and with the aim of mobilising at least EUR 315 billion in investments. Given its success, the Commission is committed to the doubling of the EFSI, both in terms of duration and financial capacity. The legal extension presented today covers the period of the current Multiannual Financial Framework and should provide a total of at least half a trillion euro investments by 2020. The proposal is consistent with the revision of Regulation (EU, Euratom) 966/2012 on the Financial Regulation that the Commission is proposing at the same time to set up a robust framework for the management of the financial liabilities of the Union. In order to enhance the firepower of the EFSI even further and reach the aim of doubling the investment target, the Commission calls on Member States to also contribute as a matter of priority. In this context, the Commission has today adopted a proposal to facilitate contributions at the level of the risk-bearing capacity of the EFSI by catering for the possibility for Member States to transfer resources from European Structural and Investment Funds (ESIF) allocated to them under shared implementation in order to further enhance the firepower of the EFSI. For the period after 2020, the Commission intends to put forward the necessary proposals to ensure that strategic investment will continue at a sustainable level. Since its launch one year ago, the EFSI, implemented and co-sponsored by the Commission's strategic partner for investments, the European Investment Bank (EIB) Group, is firmly on track to deliver the objective of mobilising at least EUR 315 billion in additional investments in the real economy by mid-2018 while endeavouring to maximise private sector contributions. The market absorption has been particularly quick under the Small and Medium-sized Enterprises (SME) window where the EFSI is delivering well beyond expectations. To ensure that sufficient funding is available to continue providing finance to SMEs with EFSI support, in July 2016 the SME Window was scaled-up by EUR 500 million within the existing parameters of Regulation (EU) 2015/1017. The projects approved by the EIB Group by July 2016 for coverage under the EFSI are expected to mobilise EUR 115.7 billion in total investments across 26 Member States and to support some 200,000 SMEs, thereby contributing to Europe's future job creation including youth employment, growth and competitiveness. The European Investment Advisory Hub (EIAH) and the European Investment Project Portal (EIPP) have also made a positive start. The EIAH has already dealt with some 230 requests from 27 Member States and the EIPP has already published more than 100 investment projects since its launch on 1 June 2016, allowing investors to access investment opportunities across Europe instantly. As part of the Commission's efforts to improve Europe's investment environment, the Commission has tabled a number of initiatives to help support investment and facilitate the financing of the real economy, such as the lowering of capital charges for insurance and reinsurance companies as regards infrastructure investments and the adoption of practical guidance on the application of State aid rules in the context of public funding of infrastructure. In addition, the Energy Union, the Capital Markets Union, the Single Market and the Digital Single Market Strategies, and the Circular Economy package all contain specific measures that will remove concrete obstacles and further improve the environment for investment, if fully implemented. For instance, upcoming proposals relating to the internal electricity market, renewable energy and governance of the Energy Union will create more long-term regulatory clarity and stability, enabling investments in the energy sector. In this context, the Commission notes that the EIB has become a global leader in the issuance of green bonds to help finance sustainable projects. The Capital Markets Union will help remove financial barriers to investment, the Single Market Strategy will contribute to more efficient public procurement markets, and the Digital Single Market Strategy will enhance regulatory certainty in the digital sector. Financing under the EFSI does not substitute the need for Member States to implement the necessary reforms to remove obstacles to investment identified in the context of the European Semester, in areas such as insolvency, public procurement, judicial systems and the efficiency of public administration or sector-specific regulations. The Commission has already issued a number of Country-Specific Recommendations for reforms in the area of investment. These reforms are a necessary condition to sustain and increase investment levels in Member States. The positive momentum generated by the Investment Plan should be maintained and efforts need to be continued to bring investment back to its long-term sustainable trend. The mechanisms of the Investment Plan work and should be reinforced to continue the mobilisation of private investments in sectors important to Europe's future and where market failures or sub-optimal investment situations remain. The aim of the EFSI continues to be to support investments that could not have been carried out in the same period or not to the same extent by the EIB, the EIF or under existing Union financial instruments without EFSI support. In line with the initial investment period, private investment should be attracted to the maximum extent possible, and SMEs will be a key beneficiary of the support provided for under this proposal. Particular attention will also be paid to projects that contribute to reaching the objectives of COP21. The extension of the duration of the EFSI will not only allow the prolongation of a successful scheme, it will also pass an important message to project promoters and encourage them to submit projects to the EIB. A key element of the proposal is a further reinforcement of additionality of the projects supported under the EFSI. It has been made even clearer that the projects under the EFSI address sub-optimal investment situations and market gaps, as part of the eligibility criteria. In view of their importance for Europe, cross-border infrastructure projects, including related services, have been specifically identified as providing additionality. Beyond the extension of the duration of the EFSI, the proposal foresees a number of technical enhancements for the EFSI and the EIAH, incorporating the lessons learnt in the first year of implementation of the EFSI. An important objective of the proposal is to reinforce the take-up of EFSI in less-developed regions and transition regions. In that respect, an easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and the Connecting Europe Facility with EFSI support is a key element and contributes to mobilising additional private sector investment. In parallel, the Commission has today adopted a proposal aimed at simplifying the Common Provisions Regulation so as to facilitate such combination. In this context, it would be appropriate to allow that the control and assurance mechanisms relating to operations benefiting from EFSI support could be used to fulfil the corresponding requirements under other EU funding for the same project in order to streamline procedures and gain in efficiency. The support to less-developed regions and transition regions in Europe is enlarged by an explicit reference to any industry that would not otherwise be covered in the general objectives. In addition, EFSI-supported investments in motorways which should be in general avoided would be allowed in cohesion countries under certain conditions. The Commission also proposes to better focus the EFSI on EU political priorities as regards climate change, for example by setting a minimum target for climate-friendly projects and by confining support to motorways only to those involving private investment in cohesion countries or in cross-border transport projects involving at least one cohesion country. Moreover, the Commission recognises the importance of using part of the Union budget, such as the one available under the CEF, in the form of grants for blending with the EFSI. The combined use of grants and the EFSI will help projects become economically and financially viable, thus enhancing the added value of Union spending by attracting additional resources from private investors. Furthermore, taking into account the significant economic multiplier effect that investments in the defence sector have in terms of creation of spin-offs and technology-transfer on other sectors, as well as the creation of jobs, it would be appropriate to consider including defence-related investment projects under the EFSI and, thus, to consider modifying the eligibility criteria in the EIB lending policy to that effect. For the EIAH, the proposal foresees more targeted technical assistance services for projects involving several Member States, projects that contribute to reaching the objectives of COP21 and for the combination of other sources of Union funding, such as European Structural and Investment Funds (ESIF), Horizon 2020 and the Connecting Europe Facility, with the EFSI. This support will focus on needs not covered adequately under current arrangements. In addition, the proposal foresees that the EIAH should actively contribute to the objective of sectorial and geographical diversification of the EFSI, by supporting the EIB to originate projects where needed.
Revised version (Article 7 Governance of the EFSI):
1. When carrying out their tasks under this Regulation, the Steering Board, the Investment Committee and the Managing Director shall pursue only the objectives set out in this Regulation. 1a. All institutions and bodies involved in EFSI governing structures shall endeavour to ensure gender balance in relevant EFSI governing bodies. 2. The EFSI Agreement shall provide that the EFSI is to be governed by a steering board, which, for the purpose of the use of the EU guarantee, is to determine, in conformity with the general objectives set out in Article 9(2): (a) the strategic orientation of the EFSI, including the allocation of the EU guarantee within the infrastructure and innovation windows and any decision to be taken under Article 11(3) and Section 7(b) of Annex II; (b) the operating policies and procedures necessary for the functioning of the EFSI; (c) the rules applicable to the operations with investment platforms and national promotional banks or institutions; (d) the risk profile of the EFSI. 3. The Steering Board shall comprise five members: three appointed by the Commission, one by the EIB and one expert appointed as a non-voting member by the European Parliament. That expert shall not seek or take instructions from Union institutions, bodies, offices or agencies, from any Member State government or from any other public or private body, and shall act in full independence. The expert shall perform his or her duties impartially and in the interest of the EFSI. The Steering Board shall elect a Chairperson from among its voting members for a fixed term of three years, renewable once. The Steering Board shall discuss and take the utmost possible account of the positions of all members. If the members cannot converge in their position, the Steering Board shall take its decisions by unanimous vote among its voting members. The minutes of Steering Board meetings shall provide a substantive account of the positions of all members. The detailed minutes of Steering Board meetings shall be published as soon as they have been approved by the Steering Board. The European Parliament shall be immediately notified of their publication. The Steering Board shall regularly organise a consultation of relevant stakeholders - in particular co-investors, public authorities, experts, education, training and research institutions, the relevant social partners and representatives of civil society - on the orientation and implementation of the investment policy carried out by the EIB under this Regulation. The instruments used by the EIF for carrying out operations covered by this Regulation shall be approved jointly by the Steering Board and the Managing Director, after consulting the Investment Committee. 4. Member States and other third parties may - subject in the case of other third parties to the agreement of the Steering Board - contribute to the EFSI in the form of guarantees or cash as regards Member States, and only in the form of cash as regards other third parties. Neither Member States nor other third parties shall be granted membership of the Steering Board, nor shall they be granted a role in the appointment of other EFSI staff including members of the Investment Committee, nor shall they have any right concerning other aspects of governance of the EFSI as set out in this Regulation. 5. The EFSI Agreement shall provide that the EFSI is to have a managing director, who is to be responsible for the day-to-day management of the EFSI and the preparation and chairing of meetings of the Investment Committee referred to in paragraph 6. The Managing Director shall be assisted by a deputy managing director. The Managing Director and the Deputy Managing Director shall participate in the meetings of the Steering Board as observers. The Managing Director shall report every quarter on the activities of the EFSI to the Steering Board. 6. Following an open and transparent selection process in line with EIB procedures, the Steering Board shall select a candidate for each of the positions of Managing Director and Deputy Managing Director. The European Parliament and the Council shall be kept duly informed in a timely manner at all stages of the selection procedure, subject to strict confidentiality requirements. That applies regardless of the conclusion of the agreement between the European Parliament and the EIB referred to in Article 17(5). The European Parliament shall organise as rapidly as possible, and at the latest within four weeks from the communication of the name of a selected candidate, a hearing with the candidate for each position. Following the approval from the European Parliament, the Managing Director and the Deputy Managing Director shall be appointed by the President of the EIB for a fixed term of three years, renewable once. 7. The EFSI Agreement shall provide that the EFSI is to have an investment committee, which is to be responsible for examining potential projects in line with the EFSI investment policies and for approving the support of the EU guarantee for EIB operations for projects that comply with the requirements of Articles 6 and 9, irrespective of the geographic location, in accordance with Article 8, of such projects. Furthermore, the Investment Committee shall be the competent body for approving operations with investment platforms and national promotional banks or institutions. 8. The Investment Committee shall be composed of eight independent experts and the Managing Director. The experts of the Investment Committee shall, following an open and transparent selection procedure, be appointed by the Steering Board for a fixed term of up to three years. Their term shall be renewable but shall not exceed six years in total. The independent experts shall have a high level of relevant market experience in project structuring and project financing, as well as micro- and macro-economic expertise. When appointing the experts of the Investment Committee, the Steering Board shall ensure that the composition of the Investment Committee is diversified, so as to ensure that it has a wide knowledge of the sectors referred to in Article 9 and of the geographic markets in the Union. The composition of the Investment Committee shall be gender-balanced. The Steering Board shall strive to select experts having experience in investment in one or more of the following fields: (a) research, development and innovation; (b) transport infrastructures and innovative technologies for transport; (c) energy infrastructures, energy efficiency and renewable energy; (d) information and communication technologies infrastructures; (e) climate action, environmental protection and management; (f) education and training; (g) health and medicine; (h) SMEs; (i) cultural and creative industries; (j) urban mobility; (k) social infrastructures and the social and solidarity economy; (l) sustainable agriculture, forestry, fishery, aquaculture and other elements of the wider bioeconomy. 9. When participating in the activities of the Investment Committee, its members shall perform their duties impartially and in the interests of the EFSI. When implementing the investment guidelines set out in Annex II and taking decisions on the use of the EU guarantee, they shall not seek or take instructions from the EIB, the institutions of the Union, Member States, or any other public or private body. Without prejudice to the provision of analytical, logistical and administrative support by the staff of the EIB to the Investment Committee, adequate organisational arrangements shall be established and maintained to ensure the operational independence of the Investment Committee. Any project assessment conducted by EIB staff shall not be binding on the Investment Committee for the purposes of granting the EU guarantee. 10. CVs and declarations of interest of each member of the Investment Committee shall be made public and constantly updated. Each member of the Investment Committee shall communicate without delay to the Steering Board, the Managing Director and the Deputy Managing Director all information needed to check, on an ongoing basis, the absence of any conflict of interest. 11. Following a request from the Steering Board, the contract of any member of the Investment Committee who breaches the obligations set out in paragraphs 9 and 10 shall be terminated, in accordance with applicable employment and labour law rules. The Managing Director shall be responsible for informing the Steering Board of any such breach that comes to his or her knowledge and be responsible for proposing and following up on appropriate action. The Managing Director shall exercise his or her duty of care regarding potential conflicts of interest of any member of the Investment Committee. 12. The Investment Committee shall decide on the use of the EU guarantee in accordance with this Regulation, including the investment guidelines set out in Annex II. Decisions of the Investment Committee shall be taken by simple majority. Decisions approving the use of the EU guarantee shall be public and accessible, and shall include the rationale for the decision, with particular focus on compliance with the additionality criterion. They shall also refer to the global assessment stemming from the scoreboard of indicators referred to in paragraph 14. The publication shall not contain commercially sensitive information. In reaching its decision, the Investment Committee shall be supported by the documentation provided by the EIB. The scoreboard, which is a tool for the Investment Committee to prioritise the use of the EU guarantee for operations that display higher scores and added value, shall be publicly available after the signature of a project. The publication shall not contain commercially sensitive information. Commercially sensitive parts of the decisions of the Investment Committee shall be forwarded by the EIB to the European Parliament upon request subject to strict confidentiality requirements. Twice a year, the EIB shall submit to the European Parliament, to the Council and to the Commission a list of all decisions of the Investment Committee as well as the scoreboards relating to all those decisions. That submission shall be subject to strict confidentiality requirements. 13. The Commission shall be empowered to adopt delegated acts in accordance with Article 23 to amend the non-essential elements of Sections 6 to 8 of the investment guidelines laid down in Annex II to this Regulation, without deleting any of those Sections altogether. Such delegated acts shall be prepared in close dialogue with the EIB. 14. The Commission shall be empowered to adopt delegated acts in accordance with Article 23(1) to (3) and (5) to supplement this Regulation by establishing a scoreboard of indicators to be used by the Investment Committee to ensure an independent and transparent assessment of the potential and actual use of the EU guarantee. Such delegated acts shall be prepared in close dialogue with the EIB. The Steering Board shall, as part of the strategic orientation of the EFSI, establish a minimum score for each pillar in the scoreboard with a view to enhancing the assessment of projects. The Steering Board may, upon request from the EIB, allow the Investment Committee to examine a project whose score in any of the pillars is below the minimum score when the global assessment contained in the scoreboard concludes that the operation related to that project would either address a significant market failure or present a high level of additionality.
Article 8 EU guarantee
The Union shall provide an irrevocable and unconditional guarantee to the EIB for financing and investment operations covered by this Regulation and by the EFSI Agreement (EU guarantee) where those operations: (a) are carried out within the Union; or (b) involve entities located or established in one or more Member States and extend to one or more third countries falling within the scope of the European Neighbourhood Policy, including the Strategic Partnership, the enlargement policy, the European Economic Area or the European Free Trade Association, or to an overseas country or territory as set out in Annex II to the TFEU, whether or not there is a partner in those third countries or overseas countries or territories. The EU guarantee shall be granted as a guarantee on demand in respect of instruments referred to in Article 10.
Article 9 Requirements for the use of the EU guarantee
1. The granting of the EU guarantee shall be subject to the entry into force of the EFSI Agreement. 2. The EU guarantee shall be granted for EIB financing and investment operations approved by the Investment Committee referred to in Article 7(7) or for funding or guarantees to the EIF in order to conduct EIB financing and investment operations in accordance with Article 11(3). The operations concerned shall be consistent with Union policies and support any of the following general objectives: (a) research, development and innovation, in particular through: (i) projects that are in line with Horizon 2020; (ii) research infrastructures; (iii) demonstration projects and programmes as well as deployment of related infrastructures, technologies and processes; (iv) support to academia including collaboration with industry; (v) knowledge and technology transfer; (a) research, development and innovation, in particular through: (i) projects that are in line with Horizon 2020; (ii) research infrastructures; (iii) demonstration projects and programmes as well as deployment of related infrastructures, technologies and processes; (iv) support to academia including collaboration with industry; (v) knowledge and technology transfer; (b) development of the energy sector in accordance with the Energy Union priorities, including security of energy supply, and the 2020, 2030 and 2050 climate and energy frameworks, in particular through: (i) expansion of the use or supply of renewable energy; (ii) energy efficiency and energy savings (with a focus on reducing demand through demand-side management and the refurbishment of buildings); (iii) development and modernisation of energy infrastructure (in particular interconnections, smart grids at distribution level, energy storage and synchronisation of networks); (b) development of the energy sector in accordance with the Energy Union priorities, including security of energy supply, and the 2020, 2030 and 2050 climate and energy frameworks, in particular through: (i) expansion of the use or supply of renewable energy; (ii) energy efficiency and energy savings (with a focus on reducing demand through demand-side management and the refurbishment of buildings); (iii) development and modernisation of energy infrastructure (in particular interconnections, smart grids at distribution level, energy storage and synchronisation of networks); (c) development of transport infrastructures, and equipment and innovative technologies for transport, in particular through: (i) projects and horizontal priorities eligible under Regulations (EU) No 1315/2013 and (EU) No 1316/2013; (ii) smart and sustainable urban mobility projects (targeting accessibility, reduction of greenhouse gas emissions, energy consumption and accidents); (iii) projects connecting nodes to TEN-T infrastructures; (c) development of transport infrastructures, and equipment and innovative technologies for transport, in particular through: (i) projects and horizontal priorities eligible under Regulations (EU) No 1315/2013 and (EU) No 1316/2013; (ii) smart and sustainable urban mobility projects (targeting accessibility, reduction of greenhouse gas emissions, energy consumption and accidents); (iii) projects connecting nodes to TEN-T infrastructures; (d) financial support through the EIF and the EIB to entities having up to 3 000 employees, with a particular focus on SMEs and small mid-cap companies, in particular through: (i) provision of working capital and investment; (ii) provision of risk financing from seed to expansion stages for SMEs, start-ups, small mid-cap companies and mid-cap companies, to ensure technological leadership in innovative and sustainable sectors; (d) financial support through the EIF and the EIB to entities having up to 3 000 employees, with a particular focus on SMEs and small mid-cap companies, in particular through: (i) provision of working capital and investment; (ii) provision of risk financing from seed to expansion stages for SMEs, start-ups, small mid-cap companies and mid-cap companies, to ensure technological leadership in innovative and sustainable sectors; (e) development and deployment of information and communication technologies, in particular through: (i) digital content; (ii) digital services; (iii) telecommunications infrastructures of high speed; (iv) broadband network; (e) development and deployment of information and communication technologies, in particular through: (i) digital content; (ii) digital services; (iii) telecommunications infrastructures of high speed; (iv) broadband network; (f) environment and resource efficiency, in particular through: (i) projects and infrastructures in the field of environmental protection and management; (ii) strengthening of eco-system services; (iii) sustainable urban and rural development; (iv) climate change actions; (f) environment and resource efficiency, in particular through: (i) projects and infrastructures in the field of environmental protection and management; (ii) strengthening of eco-system services; (iii) sustainable urban and rural development; (iv) climate change actions; (g) human capital, culture and health, in particular through: (i) education and training; (ii) cultural and creative industries; (iii) innovative health solutions; (iv) new effective medicines; (v) social infrastructures, social and solidarity economy; (vi) tourism. (g) human capital, culture and health, in particular through: (i) education and training; (ii) cultural and creative industries; (iii) innovative health solutions; (iv) new effective medicines; (v) social infrastructures, social and solidarity economy; (vi) tourism. 3. The initial investment period during which the EU guarantee may be granted for supporting financing and investment operations covered by this Regulation shall last until: (a) 5 July 2019, for EIB operations for which a contract between the EIB and the beneficiary or financial intermediary has been signed by 30 June 2020; (b) 5 July 2019, for EIF operations for which a contract between the EIF and the financial intermediary has been signed by 30 June 2020. 4. A new investment period may be set in accordance with the procedure provided for in Article 18. 5. The EIB shall use the EU guarantee for supporting investment platforms or funds and national promotional banks or institutions that invest in operations meeting the requirements of this Regulation (eligible vehicles), after approval by the Investment Committee. The Steering Board shall specify policies, in accordance with Article 7(2), regarding eligible vehicles referred to in the first subparagraph of this paragraph. The Investment Committee shall evaluate the conformity of such vehicles and their specific instruments seeking support from the EFSI with the policies specified by the Steering Board. The Investment Committee may decide to retain the right to approve new projects put forward within approved eligible vehicles. 6. In accordance with Article 17 of the EIB Statute, the EIB shall require that all its expenses relating to the EFSI are met by the beneficiaries of the financing and investment operations. Without prejudice to the second and third subparagraphs of this paragraph, no administrative expenditure or any other fees of the EIB for its financing and investment operations covered by this Regulation shall be met by the general budget of the Union. The EIB may use the EU guarantee within a cumulated maximum limit corresponding to 1 % of the total outstanding EU guarantee obligations to cover expenses that would have been met by beneficiaries of the financing and investment operations but which have not been recovered as of the event of default. In addition, the EIB may use the EU guarantee to meet the relevant share of any recovery costs, unless deducted from recovery proceeds, and any costs linked to liquidity management. In the event that the EIB provides funding or guarantees to the EIF on behalf of the EFSI which are backed by the EU guarantee in accordance with Article 11(3), fees of the EIF may be met by the general budget of the Union to the extent that they are not deducted from the remuneration referred to in Article 4(2)(c)(ii) or from revenues, recoveries or other payments received by the EIF. 7. Member States may use any source of Union funding, including instruments under the European Structural and Investment Funds and the trans-European networks and industry policies, to contribute to the financing of eligible projects in which the EIB itself, or through the EIF, is investing with the support of the EU guarantee, provided that those projects comply with the eligibility criteria and the objectives and principles applicable under the legal framework of the relevant instruments and of the EFSI. The Commission shall, as appropriate, provide guidance on combining the use of Union instruments with EIB financing under the EU guarantee, so as to ensure coordination, complementarity and synergies.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Since the Investment Plan for Europe was presented in November 2014, the conditions for an uptake in investment have improved and confidence in Europe’s economy and growth are returning. The Union is now in its fourth year of moderate recovery, with GDP growing at 2% in 2015. The comprehensive efforts initiated with the Investment Plan are already delivering concrete results, despite the fact that macroeconomic effects of larger investment projects cannot be immediate. Investment is expected to pick up gradually throughout 2016 and 2017 although it remains below historical levels. 1 On 1 June 2016, the Commission issued a Communication entitled ‘Europe investing again – Taking stock of the Investment Plan for Europe and next steps’ outlining the achievements of the Investment Plan so far and the envisaged next steps, including the extension of the duration of the European Fund for Strategic Investments (EFSI) beyond its initial three-year period, the scaling-up of the SME window within the existing framework and the enhancement of the EIAH. On 28 June 2016, the European Council concluded that "[t]he Investment Plan for Europe, in particular the EFSI, has already delivered concrete results and is a major step to help mobilise private investment while making smart use of scarce budgetary resources. The Commission intends to soon put forward proposals on the future of the EFSI, which should be examined as a matter of urgency by the European Parliament and the Council". The EFSI was established for an initial period of three years and with the aim of mobilising at least EUR 315 billion in investments. Given its success, the Commission is committed to the doubling of the EFSI, both in terms of duration and financial capacity. The legal extension presented today covers the period of the current Multiannual Financial Framework and should provide a total of at least half a trillion euro investments by 2020. The proposal is consistent with the revision of Regulation (EU, Euratom) 966/2012 on the Financial Regulation that the Commission is proposing at the same time to set up a robust framework for the management of the financial liabilities of the Union. In order to enhance the firepower of the EFSI even further and reach the aim of doubling the investment target, the Commission calls on Member States to also contribute as a matter of priority. In this context, the Commission has today adopted a proposal to facilitate contributions at the level of the risk-bearing capacity of the EFSI by catering for the possibility for Member States to transfer resources from European Structural and Investment Funds (ESIF) allocated to them under shared implementation in order to further enhance the firepower of the EFSI. For the period after 2020, the Commission intends to put forward the necessary proposals to ensure that strategic investment will continue at a sustainable level. Since its launch one year ago, the EFSI, implemented and co-sponsored by the Commission's strategic partner for investments, the European Investment Bank (EIB) Group, is firmly on track to deliver the objective of mobilising at least EUR 315 billion in additional investments in the real economy by mid-2018 while endeavouring to maximise private sector contributions. The market absorption has been particularly quick under the Small and Medium-sized Enterprises (SME) window where the EFSI is delivering well beyond expectations. To ensure that sufficient funding is available to continue providing finance to SMEs with EFSI support, in July 2016 the SME Window was scaled-up by EUR 500 million within the existing parameters of Regulation (EU) 2015/1017. The projects approved by the EIB Group by July 2016 for coverage under the EFSI are expected to mobilise EUR 115.7 billion in total investments across 26 Member States and to support some 200,000 SMEs, thereby contributing to Europe's future job creation including youth employment, growth and competitiveness. The European Investment Advisory Hub (EIAH) and the European Investment Project Portal (EIPP) have also made a positive start. The EIAH has already dealt with some 230 requests from 27 Member States and the EIPP has already published more than 100 investment projects since its launch on 1 June 2016, allowing investors to access investment opportunities across Europe instantly. As part of the Commission's efforts to improve Europe's investment environment, the Commission has tabled a number of initiatives to help support investment and facilitate the financing of the real economy, such as the lowering of capital charges for insurance and reinsurance companies as regards infrastructure investments and the adoption of practical guidance on the application of State aid rules in the context of public funding of infrastructure. In addition, the Energy Union, the Capital Markets Union, the Single Market and the Digital Single Market Strategies, and the Circular Economy package all contain specific measures that will remove concrete obstacles and further improve the environment for investment, if fully implemented. For instance, upcoming proposals relating to the internal electricity market, renewable energy and governance of the Energy Union will create more long-term regulatory clarity and stability, enabling investments in the energy sector. In this context, the Commission notes that the EIB has become a global leader in the issuance of green bonds to help finance sustainable projects. The Capital Markets Union will help remove financial barriers to investment, the Single Market Strategy will contribute to more efficient public procurement markets, and the Digital Single Market Strategy will enhance regulatory certainty in the digital sector. Financing under the EFSI does not substitute the need for Member States to implement the necessary reforms to remove obstacles to investment identified in the context of the European Semester, in areas such as insolvency, public procurement, judicial systems and the efficiency of public administration or sector-specific regulations. The Commission has already issued a number of Country-Specific Recommendations for reforms in the area of investment. These reforms are a necessary condition to sustain and increase investment levels in Member States. The positive momentum generated by the Investment Plan should be maintained and efforts need to be continued to bring investment back to its long-term sustainable trend. The mechanisms of the Investment Plan work and should be reinforced to continue the mobilisation of private investments in sectors important to Europe's future and where market failures or sub-optimal investment situations remain. The aim of the EFSI continues to be to support investments that could not have been carried out in the same period or not to the same extent by the EIB, the EIF or under existing Union financial instruments without EFSI support. In line with the initial investment period, private investment should be attracted to the maximum extent possible, and SMEs will be a key beneficiary of the support provided for under this proposal. Particular attention will also be paid to projects that contribute to reaching the objectives of COP21. The extension of the duration of the EFSI will not only allow the prolongation of a successful scheme, it will also pass an important message to project promoters and encourage them to submit projects to the EIB. A key element of the proposal is a further reinforcement of additionality of the projects supported under the EFSI. It has been made even clearer that the projects under the EFSI address sub-optimal investment situations and market gaps, as part of the eligibility criteria. In view of their importance for Europe, cross-border infrastructure projects, including related services, have been specifically identified as providing additionality. Beyond the extension of the duration of the EFSI, the proposal foresees a number of technical enhancements for the EFSI and the EIAH, incorporating the lessons learnt in the first year of implementation of the EFSI. An important objective of the proposal is to reinforce the take-up of EFSI in less-developed regions and transition regions. In that respect, an easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and the Connecting Europe Facility with EFSI support is a key element and contributes to mobilising additional private sector investment. In parallel, the Commission has today adopted a proposal aimed at simplifying the Common Provisions Regulation so as to facilitate such combination. In this context, it would be appropriate to allow that the control and assurance mechanisms relating to operations benefiting from EFSI support could be used to fulfil the corresponding requirements under other EU funding for the same project in order to streamline procedures and gain in efficiency. The support to less-developed regions and transition regions in Europe is enlarged by an explicit reference to any industry that would not otherwise be covered in the general objectives. In addition, EFSI-supported investments in motorways which should be in general avoided would be allowed in cohesion countries under certain conditions. The Commission also proposes to better focus the EFSI on EU political priorities as regards climate change, for example by setting a minimum target for climate-friendly projects and by confining support to motorways only to those involving private investment in cohesion countries or in cross-border transport projects involving at least one cohesion country. Moreover, the Commission recognises the importance of using part of the Union budget, such as the one available under the CEF, in the form of grants for blending with the EFSI. The combined use of grants and the EFSI will help projects become economically and financially viable, thus enhancing the added value of Union spending by attracting additional resources from private investors. Furthermore, taking into account the significant economic multiplier effect that investments in the defence sector have in terms of creation of spin-offs and technology-transfer on other sectors, as well as the creation of jobs, it would be appropriate to consider including defence-related investment projects under the EFSI and, thus, to consider modifying the eligibility criteria in the EIB lending policy to that effect. For the EIAH, the proposal foresees more targeted technical assistance services for projects involving several Member States, projects that contribute to reaching the objectives of COP21 and for the combination of other sources of Union funding, such as European Structural and Investment Funds (ESIF), Horizon 2020 and the Connecting Europe Facility, with the EFSI. This support will focus on needs not covered adequately under current arrangements. In addition, the proposal foresees that the EIAH should actively contribute to the objective of sectorial and geographical diversification of the EFSI, by supporting the EIB to originate projects where needed.
Revised version (Article 9 Requirements for the use of the EU guarantee):
1. The granting of the EU guarantee shall be subject to the entry into force of the EFSI Agreement. 2. The EU guarantee shall be granted for EIB financing and investment operations approved by the Investment Committee or for funding or guarantees to the EIF in order to conduct EIB financing and investment operations in accordance with Article 11(3). The EIB shall, where appropriate, delegate the appraisal, selection and monitoring of small-scale sub-projects to financial intermediaries or approved eligible vehicles, in particular investment platforms and national promotional banks or institutions as a means to increase and facilitate the access to finance for small-scale projects. Notwithstanding the third subparagraph of paragraph 5 of this Article, the Investment Committee shall not retain the right to approve the use of the EU guarantee for sub-projects delegated to financial intermediaries or approved eligible vehicles where the EFSI contribution to such sub-projects is below EUR 3 000 000 . Where necessary, the Steering Board shall provide guidance on the procedure by which the Investment Committee is to decide on the use of the EU guarantee for sub-projects for which the EFSI contribution is equal to or above EUR 3 000 000 . The operations concerned shall be consistent with Union policies and support any of the following general objectives: (a) research, development and innovation, in particular through: (i) projects that are in line with Horizon 2020; (ii) research infrastructures; (iii) demonstration projects and programmes as well as deployment of related infrastructures, technologies and processes; (iv) support to academia including collaboration with industry; (v) knowledge and technology transfer; (b) development of the energy sector in accordance with the Energy Union priorities, including security of energy supply, and the 2020, 2030 and 2050 climate and energy frameworks, in particular through: (i) expansion of the use or supply of renewable energy; (ii) energy efficiency and energy savings (with a focus on reducing demand through demand-side management and the refurbishment of buildings); (iii) development and modernisation of energy infrastructure (in particular interconnections, smart grids at distribution level, energy storage and synchronisation of networks); (c) development of transport infrastructures, and equipment and innovative technologies for transport, in particular through: (i) projects and horizontal priorities eligible under Regulations (EU) No 1315/2013 and (EU) No 1316/2013; (ii) smart and sustainable urban mobility projects (targeting accessibility, reduction of greenhouse gas emissions, energy consumption and accidents); (iii) projects connecting nodes to TEN-T infrastructures; (iv) railway infrastructure, other rail projects, and maritime ports; (d) financial support through the EIF and the EIB to entities having up to 3 000 employees, with a particular focus on SMEs and small mid-cap companies, in particular through: (i) provision of working capital and investment; (ii) provision of risk financing from seed to expansion stages for SMEs, start-ups, small mid-cap companies and mid-cap companies, to ensure technological leadership in innovative and sustainable sectors; (e) development and deployment of information and communication technologies, in particular through: (i) digital content; (ia) blockchain technology; (ib) internet of things; (ic) cybersecurity and network protection infrastructures; (ii) digital services; (iii) telecommunications infrastructures of high speed; (iv) broadband network; (f) environment and resource efficiency, in particular through: (i) projects and infrastructures in the field of environmental protection and management; (ii) strengthening of eco-system services; (iii) sustainable urban and rural development; (iv) climate change actions; (g) human capital, culture and health, in particular through: (i) education and training; (ii) cultural and creative industries, for which sector-specific financial mechanisms are to be authorised in interaction with the Creative Europe Programme established by Regulation (EU) No 1295/2013 of the European Parliament and of the Council ( 2 ) and the Cultural and Creative Sectors Guarantee Facility established pursuant to that Regulation, in order to provide fit-for-purpose loans for those industries; (iii) innovative health solutions; (iv) new effective medicines; (v) social infrastructures, social services, social and solidarity economy; (vi) tourism; (h) sustainable agriculture, forestry, fishery, aquaculture and other elements of the wider bioeconomy; (i) within the requirements of this Regulation for less developed regions and transition regions as listed respectively in Annexes I and II to Commission Implementing Decision 2014/99/EU ( 3 ), other industry and services eligible for EIB support. While recognising the demand-driven nature of the EFSI, the EIB shall target that at least 40 % of EFSI financing under the infrastructure and innovation window support project components that contribute to climate action, in line with the commitments made at the 21st Conference of the Parties to the United Nations Framework Convention on Climate Change (COP21). EFSI financing for SMEs and small mid-cap companies shall not be included in that computation. The EIB shall use its internationally agreed methodology to identify those climate action project components or cost shares. The Steering Board shall, where necessary, provide detailed guidance to that end. 3. The investment period during which the EU guarantee may be granted for supporting financing and investment operations covered by this Regulation shall last until: (a) 31 December 2020, for EIB operations for which a contract between the EIB and the beneficiary or financial intermediary has been signed by 31 December 2022; (b) 31 December 2020, for EIF operations for which a contract between the EIF and the financial intermediary has been signed by 31 December 2022. 4. The EIB shall, where necessary and to the extent possible, cooperate with national promotional banks or institutions and investment platforms. 5. The EIB shall use the EU guarantee for supporting investment platforms or funds and national promotional banks or institutions that invest in operations meeting the requirements of this Regulation (eligible vehicles), after approval by the Investment Committee. The Steering Board shall specify policies, in accordance with Article 7(2), regarding eligible vehicles referred to in the first subparagraph of this paragraph. The Investment Committee shall evaluate the conformity of such vehicles and their specific instruments seeking support from the EFSI with the policies specified by the Steering Board. The Investment Committee may decide to retain the right to approve new projects put forward by financial intermediaries or within approved eligible vehicles. 6. In accordance with Article 17 of the EIB Statute, the EIB shall require that all its expenses relating to the EFSI are met by the beneficiaries of the financing and investment operations. Without prejudice to the second and third subparagraphs of this paragraph, no administrative expenditure or any other fees of the EIB for its financing and investment operations covered by this Regulation shall be met by the general budget of the Union. The EIB may use the EU guarantee within a cumulated maximum limit corresponding to 1 % of the total outstanding EU guarantee obligations to cover expenses that would have been met by beneficiaries of the financing and investment operations but which have not been recovered as of the event of default. In addition, the EIB may use the EU guarantee to meet the relevant share of any recovery costs, unless deducted from recovery proceeds, and any costs linked to liquidity management. In the event that the EIB provides funding or guarantees to the EIF on behalf of the EFSI which are backed by the EU guarantee in accordance with Article 11(3), fees of the EIF may be met by the general budget of the Union to the extent that they are not deducted from the remuneration referred to in Article 4(2)(c)(ii) or from revenues, recoveries or other payments received by the EIF. 7. Member States may use any source of Union funding, including instruments under the European Structural and Investment Funds and the trans-European networks and industry policies, to contribute to the financing of eligible projects in which the EIB itself, or through the EIF, is investing with the support of the EU guarantee, provided that those projects comply with the eligibility criteria and the objectives and principles applicable under the legal framework of the relevant instruments and of the EFSI. The Commission shall, as appropriate, provide guidance on combining the use of Union instruments with EIB financing under the EU guarantee, so as to ensure coordination, complementarity and synergies.
Article 10 Eligible instruments
1. For the purposes of Article 9(2) and in accordance with Article 11, the EIB shall use the EU guarantee towards risk coverage for instruments referred to in paragraph 2 of this Article. 2. The following instruments shall be eligible for coverage by the EU guarantee: (a) EIB loans, guarantees, counter-guarantees, capital market instruments, any other form of funding or credit enhancement instrument, equity or quasi-equity participations, including in favour of national promotional banks or institutions, investment platforms or funds; (b) EIB funding or guarantees to the EIF enabling it to undertake loans, guarantees, counter-guarantees, any other form of credit enhancement instrument, capital market instruments and equity or quasi-equity participations, including in favour of national promotional banks or institutions, investment platforms or funds; (c) EIB guarantees to national promotional banks or institutions, investment platforms or funds under a counter-guarantee of the EU guarantee. The instruments referred to in points (a) and (b) of the first subparagraph shall be granted, acquired or issued for the benefit of operations referred to in Article 8 that meet the requirements of this Regulation, where the EIB or EIF financing has been granted in accordance with a financing agreement or transaction signed or entered into by the EIB or the EIF which has not expired or been cancelled. 3. EIB guarantees granted to a national promotional bank or institution under the counter-guarantee of the EU guarantee shall, where appropriate, seek to achieve capital relief. 4. In its operations under this Regulation, the EIF may grant a guarantee to a national promotional bank or institution or an investment platform or invest in an investment platform.
Article 11 Coverage and terms of the EU guarantee
1. The EU guarantee shall not, at any time, exceed EUR 16 000 000 000 , of which a part may be allocated for EIB funding or guarantees to the EIF in accordance with paragraph 3. Aggregate net payments from the general budget of the Union under the EU guarantee shall not exceed EUR 16 000 000 000 . 2. The remuneration for risk-taking of a portfolio shall be allocated amongst contributors in proportion to their respective share in the risk-taking. The EU guarantee shall be eligible to provide either first loss guarantees on a portfolio basis or a full guarantee. The EU guarantee may be granted on a pari passu basis with other contributors. 3. Where the EIB provides funding or guarantees to the EIF in order to conduct EIB financing and investment operations, the EU guarantee shall provide for a full guarantee on such funding or guarantees provided that an equal amount of funding or guarantees is provided by the EIB without coverage by the EU guarantee, up to an initial limit of EUR 2 500 000 000 . Without prejudice to paragraph 1, that limit may where appropriate be adjusted by the Steering Board up to a maximum of EUR 3 000 000 000 , without an obligation on the EIB to match the amounts over and above the initial limit. 4. Where the EIB calls on the EU guarantee in accordance with the EFSI Agreement, the Union shall pay on demand in accordance with the terms of that Agreement. 5. Where the Union makes a payment to the EIB upon a call on the EU guarantee, the Union shall be subrogated into the relevant rights of the EIB relating to any of its financing or investment operations covered by this Regulation and the EIB shall, on behalf of the Union, pursue the recovery of claims for the amounts paid and reimburse the Union from the sums recovered in accordance with the provisions and procedures referred to in Article 4(2)(c)(iv). 6. The EU guarantee shall be granted as a guarantee on demand in respect of the instruments referred to in Article 10 and shall cover: (a) for debt instruments referred to in Article 10(2)(a), the principal and all interest and amounts due to the EIB but not received by it in accordance with the terms of the financing operations until the event of default; (b) for equity investments referred to in Article 10(2)(a), the amounts invested and their associated funding cost; (c) for operations referred to in Article 10(2)(b), the amounts used and their associated funding costs. The EU guarantee shall also cover the amounts referred to in the second and third subparagraphs of Article 9(6).
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Since the Investment Plan for Europe was presented in November 2014, the conditions for an uptake in investment have improved and confidence in Europe’s economy and growth are returning. The Union is now in its fourth year of moderate recovery, with GDP growing at 2% in 2015. The comprehensive efforts initiated with the Investment Plan are already delivering concrete results, despite the fact that macroeconomic effects of larger investment projects cannot be immediate. Investment is expected to pick up gradually throughout 2016 and 2017 although it remains below historical levels. 1 On 1 June 2016, the Commission issued a Communication entitled ‘Europe investing again – Taking stock of the Investment Plan for Europe and next steps’ outlining the achievements of the Investment Plan so far and the envisaged next steps, including the extension of the duration of the European Fund for Strategic Investments (EFSI) beyond its initial three-year period, the scaling-up of the SME window within the existing framework and the enhancement of the EIAH. On 28 June 2016, the European Council concluded that "[t]he Investment Plan for Europe, in particular the EFSI, has already delivered concrete results and is a major step to help mobilise private investment while making smart use of scarce budgetary resources. The Commission intends to soon put forward proposals on the future of the EFSI, which should be examined as a matter of urgency by the European Parliament and the Council". The EFSI was established for an initial period of three years and with the aim of mobilising at least EUR 315 billion in investments. Given its success, the Commission is committed to the doubling of the EFSI, both in terms of duration and financial capacity. The legal extension presented today covers the period of the current Multiannual Financial Framework and should provide a total of at least half a trillion euro investments by 2020. The proposal is consistent with the revision of Regulation (EU, Euratom) 966/2012 on the Financial Regulation that the Commission is proposing at the same time to set up a robust framework for the management of the financial liabilities of the Union. In order to enhance the firepower of the EFSI even further and reach the aim of doubling the investment target, the Commission calls on Member States to also contribute as a matter of priority. In this context, the Commission has today adopted a proposal to facilitate contributions at the level of the risk-bearing capacity of the EFSI by catering for the possibility for Member States to transfer resources from European Structural and Investment Funds (ESIF) allocated to them under shared implementation in order to further enhance the firepower of the EFSI. For the period after 2020, the Commission intends to put forward the necessary proposals to ensure that strategic investment will continue at a sustainable level. Since its launch one year ago, the EFSI, implemented and co-sponsored by the Commission's strategic partner for investments, the European Investment Bank (EIB) Group, is firmly on track to deliver the objective of mobilising at least EUR 315 billion in additional investments in the real economy by mid-2018 while endeavouring to maximise private sector contributions. The market absorption has been particularly quick under the Small and Medium-sized Enterprises (SME) window where the EFSI is delivering well beyond expectations. To ensure that sufficient funding is available to continue providing finance to SMEs with EFSI support, in July 2016 the SME Window was scaled-up by EUR 500 million within the existing parameters of Regulation (EU) 2015/1017. The projects approved by the EIB Group by July 2016 for coverage under the EFSI are expected to mobilise EUR 115.7 billion in total investments across 26 Member States and to support some 200,000 SMEs, thereby contributing to Europe's future job creation including youth employment, growth and competitiveness. The European Investment Advisory Hub (EIAH) and the European Investment Project Portal (EIPP) have also made a positive start. The EIAH has already dealt with some 230 requests from 27 Member States and the EIPP has already published more than 100 investment projects since its launch on 1 June 2016, allowing investors to access investment opportunities across Europe instantly. As part of the Commission's efforts to improve Europe's investment environment, the Commission has tabled a number of initiatives to help support investment and facilitate the financing of the real economy, such as the lowering of capital charges for insurance and reinsurance companies as regards infrastructure investments and the adoption of practical guidance on the application of State aid rules in the context of public funding of infrastructure. In addition, the Energy Union, the Capital Markets Union, the Single Market and the Digital Single Market Strategies, and the Circular Economy package all contain specific measures that will remove concrete obstacles and further improve the environment for investment, if fully implemented. For instance, upcoming proposals relating to the internal electricity market, renewable energy and governance of the Energy Union will create more long-term regulatory clarity and stability, enabling investments in the energy sector. In this context, the Commission notes that the EIB has become a global leader in the issuance of green bonds to help finance sustainable projects. The Capital Markets Union will help remove financial barriers to investment, the Single Market Strategy will contribute to more efficient public procurement markets, and the Digital Single Market Strategy will enhance regulatory certainty in the digital sector. Financing under the EFSI does not substitute the need for Member States to implement the necessary reforms to remove obstacles to investment identified in the context of the European Semester, in areas such as insolvency, public procurement, judicial systems and the efficiency of public administration or sector-specific regulations. The Commission has already issued a number of Country-Specific Recommendations for reforms in the area of investment. These reforms are a necessary condition to sustain and increase investment levels in Member States. The positive momentum generated by the Investment Plan should be maintained and efforts need to be continued to bring investment back to its long-term sustainable trend. The mechanisms of the Investment Plan work and should be reinforced to continue the mobilisation of private investments in sectors important to Europe's future and where market failures or sub-optimal investment situations remain. The aim of the EFSI continues to be to support investments that could not have been carried out in the same period or not to the same extent by the EIB, the EIF or under existing Union financial instruments without EFSI support. In line with the initial investment period, private investment should be attracted to the maximum extent possible, and SMEs will be a key beneficiary of the support provided for under this proposal. Particular attention will also be paid to projects that contribute to reaching the objectives of COP21. The extension of the duration of the EFSI will not only allow the prolongation of a successful scheme, it will also pass an important message to project promoters and encourage them to submit projects to the EIB. A key element of the proposal is a further reinforcement of additionality of the projects supported under the EFSI. It has been made even clearer that the projects under the EFSI address sub-optimal investment situations and market gaps, as part of the eligibility criteria. In view of their importance for Europe, cross-border infrastructure projects, including related services, have been specifically identified as providing additionality. Beyond the extension of the duration of the EFSI, the proposal foresees a number of technical enhancements for the EFSI and the EIAH, incorporating the lessons learnt in the first year of implementation of the EFSI. An important objective of the proposal is to reinforce the take-up of EFSI in less-developed regions and transition regions. In that respect, an easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and the Connecting Europe Facility with EFSI support is a key element and contributes to mobilising additional private sector investment. In parallel, the Commission has today adopted a proposal aimed at simplifying the Common Provisions Regulation so as to facilitate such combination. In this context, it would be appropriate to allow that the control and assurance mechanisms relating to operations benefiting from EFSI support could be used to fulfil the corresponding requirements under other EU funding for the same project in order to streamline procedures and gain in efficiency. The support to less-developed regions and transition regions in Europe is enlarged by an explicit reference to any industry that would not otherwise be covered in the general objectives. In addition, EFSI-supported investments in motorways which should be in general avoided would be allowed in cohesion countries under certain conditions. The Commission also proposes to better focus the EFSI on EU political priorities as regards climate change, for example by setting a minimum target for climate-friendly projects and by confining support to motorways only to those involving private investment in cohesion countries or in cross-border transport projects involving at least one cohesion country. Moreover, the Commission recognises the importance of using part of the Union budget, such as the one available under the CEF, in the form of grants for blending with the EFSI. The combined use of grants and the EFSI will help projects become economically and financially viable, thus enhancing the added value of Union spending by attracting additional resources from private investors. Furthermore, taking into account the significant economic multiplier effect that investments in the defence sector have in terms of creation of spin-offs and technology-transfer on other sectors, as well as the creation of jobs, it would be appropriate to consider including defence-related investment projects under the EFSI and, thus, to consider modifying the eligibility criteria in the EIB lending policy to that effect. For the EIAH, the proposal foresees more targeted technical assistance services for projects involving several Member States, projects that contribute to reaching the objectives of COP21 and for the combination of other sources of Union funding, such as European Structural and Investment Funds (ESIF), Horizon 2020 and the Connecting Europe Facility, with the EFSI. This support will focus on needs not covered adequately under current arrangements. In addition, the proposal foresees that the EIAH should actively contribute to the objective of sectorial and geographical diversification of the EFSI, by supporting the EIB to originate projects where needed.
Revised version (Article 11 Coverage and terms of the EU guarantee):
1. The EU guarantee shall not, at any time, exceed EUR 26 000 000 000 , of which a part may be allocated for EIB funding or guarantees to the EIF in accordance with paragraph 3. Aggregate net payments from the general budget of the Union under the EU guarantee shall not exceed EUR 26 000 000 000 and not exceed EUR 16 000 000 000 before 6 July 2018. 2. The remuneration for risk-taking of a portfolio shall be allocated amongst contributors in proportion to their respective share in the risk-taking. The EU guarantee shall be eligible to provide either first loss guarantees on a portfolio basis or a full guarantee. The EU guarantee may be granted on a pari passu basis with other contributors. 3. Where the EIB provides funding or guarantees to the EIF in order to conduct EIB financing and investment operations, the EU guarantee shall provide for a full guarantee on such funding or guarantees up to an initial limit of EUR 6 500 000 000 , provided that an amount of at least EUR 4 000 000 000 of funding or guarantees is gradually provided by the EIB without coverage by the EU guarantee. Without prejudice to paragraph 1, the limit of EUR 6 500 000 000 may, where appropriate, be adjusted by the Steering Board up to a maximum of EUR 9 000 000 000 , without an obligation on the EIB to match the amounts above EUR 4 000 000 000 . 4. Where the EIB calls on the EU guarantee in accordance with the EFSI Agreement, the Union shall pay on demand in accordance with the terms of that Agreement. 5. Where the Union makes a payment to the EIB upon a call on the EU guarantee, the Union shall be subrogated into the relevant rights of the EIB relating to any of its financing or investment operations covered by this Regulation and the EIB shall, on behalf of the Union, pursue the recovery of claims for the amounts paid and reimburse the Union from the sums recovered in accordance with the provisions and procedures referred to in Article 4(2)(c)(iv). 6. The EU guarantee shall be granted as a guarantee on demand in respect of the instruments referred to in Article 10 and shall cover: (a) for debt instruments referred to in Article 10(2)(a): (i) the principal and all interest and amounts due to the EIB but not received by it in accordance with the terms of the financing operations until the event of default; for subordinated debt a deferral, reduction or required exit shall be considered to be an event of default; (ii) losses arising from fluctuations of currencies other than the euro in markets where possibilities for long-term hedging are limited; (b) for equity or quasi-equity investments referred to in Article 10(2)(a), the amounts invested and their associated funding cost and losses arising from fluctuations of currencies other than the euro; (c) for operations referred to in Article 10(2)(b), the amounts used and their associated funding costs. The EU guarantee shall also cover the amounts referred to in the second and third subparagraphs of Article 9(6).
Article 12 EU guarantee fund
1. An EU guarantee fund (guarantee fund) shall be established which shall constitute a liquidity cushion from which the EIB shall be paid in the event of a call on the EU guarantee. 2. The guarantee fund shall be endowed by: (a) contributions from the general budget of the Union; (b) returns on guarantee fund resources invested; (c) amounts recovered from defaulting debtors in accordance with the recovery procedure laid down in the EFSI Agreement as provided for in Article 4(2)(c)(iv); (d) revenues and any other payments received by the Union in accordance with the EFSI Agreement. 3. Endowments to the guarantee fund provided for in points (b), (c) and (d) of paragraph 2 of this Article shall constitute internal assigned revenue in accordance with Article 21(4) of Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council ( 2 ). 4. The resources of the guarantee fund provided to it under paragraph 2 shall be directly managed by the Commission and invested in accordance with the principle of sound financial management and shall follow appropriate prudential rules. 5. Endowments to the guarantee fund referred to in paragraph 2 shall be used to reach an appropriate level (target amount) to reflect the total EU guarantee obligations. The target amount shall be set at 50 % of the total EU guarantee obligations. The target amount shall initially be met by the gradual payment of resources referred to in point (a) of paragraph 2. If there have been calls on the EU guarantee during the initial constitution of the guarantee fund, endowments to the guarantee fund provided for in points (b), (c) and (d) of paragraph 2 shall contribute to meeting the target amount up to an amount equal to the calls on the EU guarantee. 6. Following an assessment of the adequacy of the level of the guarantee fund in accordance with the report provided for in Article 16(6), the following payments shall be made: (a) any surplus shall be paid to the general budget of the Union as internal assigned revenue in accordance with Article 21(4) of Regulation (EU, Euratom) No 966/2012 for any budget lines which may have been used as a source of redeployment to the guarantee fund; (b) any replenishment of the guarantee fund shall be paid in annual tranches during a maximum period of three years starting in the year n+1. 7. From 1 January 2019, if, as a result of calls on the EU guarantee, the level of the guarantee fund falls below 50 % of the target amount, the Commission shall submit a report on exceptional measures that may be required to replenish the guarantee fund. 8. After a call on the EU guarantee, endowments to the guarantee fund provided for in points (b) and (d) of paragraph 2 above the target amount shall be used within the limits of the investment period provided for in Article 9 to restore the EU guarantee up to its initial amount. 9. Endowments to the guarantee fund provided for in point (c) of paragraph 2 shall be used to restore the EU guarantee up to its initial amount. 10. In the event that the EU guarantee is fully restored up to its maximum initial amount of EUR 16 000 000 000 , any amount in the guarantee fund in excess of the target amount shall be paid to the general budget of the Union as internal assigned revenue in accordance with Article 21(4) of Regulation (EU, Euratom) No 966/2012 for any budget lines which may have been used as a source of redeployment to the guarantee fund.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Since the Investment Plan for Europe was presented in November 2014, the conditions for an uptake in investment have improved and confidence in Europe’s economy and growth are returning. The Union is now in its fourth year of moderate recovery, with GDP growing at 2% in 2015. The comprehensive efforts initiated with the Investment Plan are already delivering concrete results, despite the fact that macroeconomic effects of larger investment projects cannot be immediate. Investment is expected to pick up gradually throughout 2016 and 2017 although it remains below historical levels. 1 On 1 June 2016, the Commission issued a Communication entitled ‘Europe investing again – Taking stock of the Investment Plan for Europe and next steps’ outlining the achievements of the Investment Plan so far and the envisaged next steps, including the extension of the duration of the European Fund for Strategic Investments (EFSI) beyond its initial three-year period, the scaling-up of the SME window within the existing framework and the enhancement of the EIAH. On 28 June 2016, the European Council concluded that "[t]he Investment Plan for Europe, in particular the EFSI, has already delivered concrete results and is a major step to help mobilise private investment while making smart use of scarce budgetary resources. The Commission intends to soon put forward proposals on the future of the EFSI, which should be examined as a matter of urgency by the European Parliament and the Council". The EFSI was established for an initial period of three years and with the aim of mobilising at least EUR 315 billion in investments. Given its success, the Commission is committed to the doubling of the EFSI, both in terms of duration and financial capacity. The legal extension presented today covers the period of the current Multiannual Financial Framework and should provide a total of at least half a trillion euro investments by 2020. The proposal is consistent with the revision of Regulation (EU, Euratom) 966/2012 on the Financial Regulation that the Commission is proposing at the same time to set up a robust framework for the management of the financial liabilities of the Union. In order to enhance the firepower of the EFSI even further and reach the aim of doubling the investment target, the Commission calls on Member States to also contribute as a matter of priority. In this context, the Commission has today adopted a proposal to facilitate contributions at the level of the risk-bearing capacity of the EFSI by catering for the possibility for Member States to transfer resources from European Structural and Investment Funds (ESIF) allocated to them under shared implementation in order to further enhance the firepower of the EFSI. For the period after 2020, the Commission intends to put forward the necessary proposals to ensure that strategic investment will continue at a sustainable level. Since its launch one year ago, the EFSI, implemented and co-sponsored by the Commission's strategic partner for investments, the European Investment Bank (EIB) Group, is firmly on track to deliver the objective of mobilising at least EUR 315 billion in additional investments in the real economy by mid-2018 while endeavouring to maximise private sector contributions. The market absorption has been particularly quick under the Small and Medium-sized Enterprises (SME) window where the EFSI is delivering well beyond expectations. To ensure that sufficient funding is available to continue providing finance to SMEs with EFSI support, in July 2016 the SME Window was scaled-up by EUR 500 million within the existing parameters of Regulation (EU) 2015/1017. The projects approved by the EIB Group by July 2016 for coverage under the EFSI are expected to mobilise EUR 115.7 billion in total investments across 26 Member States and to support some 200,000 SMEs, thereby contributing to Europe's future job creation including youth employment, growth and competitiveness. The European Investment Advisory Hub (EIAH) and the European Investment Project Portal (EIPP) have also made a positive start. The EIAH has already dealt with some 230 requests from 27 Member States and the EIPP has already published more than 100 investment projects since its launch on 1 June 2016, allowing investors to access investment opportunities across Europe instantly. As part of the Commission's efforts to improve Europe's investment environment, the Commission has tabled a number of initiatives to help support investment and facilitate the financing of the real economy, such as the lowering of capital charges for insurance and reinsurance companies as regards infrastructure investments and the adoption of practical guidance on the application of State aid rules in the context of public funding of infrastructure. In addition, the Energy Union, the Capital Markets Union, the Single Market and the Digital Single Market Strategies, and the Circular Economy package all contain specific measures that will remove concrete obstacles and further improve the environment for investment, if fully implemented. For instance, upcoming proposals relating to the internal electricity market, renewable energy and governance of the Energy Union will create more long-term regulatory clarity and stability, enabling investments in the energy sector. In this context, the Commission notes that the EIB has become a global leader in the issuance of green bonds to help finance sustainable projects. The Capital Markets Union will help remove financial barriers to investment, the Single Market Strategy will contribute to more efficient public procurement markets, and the Digital Single Market Strategy will enhance regulatory certainty in the digital sector. Financing under the EFSI does not substitute the need for Member States to implement the necessary reforms to remove obstacles to investment identified in the context of the European Semester, in areas such as insolvency, public procurement, judicial systems and the efficiency of public administration or sector-specific regulations. The Commission has already issued a number of Country-Specific Recommendations for reforms in the area of investment. These reforms are a necessary condition to sustain and increase investment levels in Member States. The positive momentum generated by the Investment Plan should be maintained and efforts need to be continued to bring investment back to its long-term sustainable trend. The mechanisms of the Investment Plan work and should be reinforced to continue the mobilisation of private investments in sectors important to Europe's future and where market failures or sub-optimal investment situations remain. The aim of the EFSI continues to be to support investments that could not have been carried out in the same period or not to the same extent by the EIB, the EIF or under existing Union financial instruments without EFSI support. In line with the initial investment period, private investment should be attracted to the maximum extent possible, and SMEs will be a key beneficiary of the support provided for under this proposal. Particular attention will also be paid to projects that contribute to reaching the objectives of COP21. The extension of the duration of the EFSI will not only allow the prolongation of a successful scheme, it will also pass an important message to project promoters and encourage them to submit projects to the EIB. A key element of the proposal is a further reinforcement of additionality of the projects supported under the EFSI. It has been made even clearer that the projects under the EFSI address sub-optimal investment situations and market gaps, as part of the eligibility criteria. In view of their importance for Europe, cross-border infrastructure projects, including related services, have been specifically identified as providing additionality. Beyond the extension of the duration of the EFSI, the proposal foresees a number of technical enhancements for the EFSI and the EIAH, incorporating the lessons learnt in the first year of implementation of the EFSI. An important objective of the proposal is to reinforce the take-up of EFSI in less-developed regions and transition regions. In that respect, an easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and the Connecting Europe Facility with EFSI support is a key element and contributes to mobilising additional private sector investment. In parallel, the Commission has today adopted a proposal aimed at simplifying the Common Provisions Regulation so as to facilitate such combination. In this context, it would be appropriate to allow that the control and assurance mechanisms relating to operations benefiting from EFSI support could be used to fulfil the corresponding requirements under other EU funding for the same project in order to streamline procedures and gain in efficiency. The support to less-developed regions and transition regions in Europe is enlarged by an explicit reference to any industry that would not otherwise be covered in the general objectives. In addition, EFSI-supported investments in motorways which should be in general avoided would be allowed in cohesion countries under certain conditions. The Commission also proposes to better focus the EFSI on EU political priorities as regards climate change, for example by setting a minimum target for climate-friendly projects and by confining support to motorways only to those involving private investment in cohesion countries or in cross-border transport projects involving at least one cohesion country. Moreover, the Commission recognises the importance of using part of the Union budget, such as the one available under the CEF, in the form of grants for blending with the EFSI. The combined use of grants and the EFSI will help projects become economically and financially viable, thus enhancing the added value of Union spending by attracting additional resources from private investors. Furthermore, taking into account the significant economic multiplier effect that investments in the defence sector have in terms of creation of spin-offs and technology-transfer on other sectors, as well as the creation of jobs, it would be appropriate to consider including defence-related investment projects under the EFSI and, thus, to consider modifying the eligibility criteria in the EIB lending policy to that effect. For the EIAH, the proposal foresees more targeted technical assistance services for projects involving several Member States, projects that contribute to reaching the objectives of COP21 and for the combination of other sources of Union funding, such as European Structural and Investment Funds (ESIF), Horizon 2020 and the Connecting Europe Facility, with the EFSI. This support will focus on needs not covered adequately under current arrangements. In addition, the proposal foresees that the EIAH should actively contribute to the objective of sectorial and geographical diversification of the EFSI, by supporting the EIB to originate projects where needed.
Revised version (Article 12 EU guarantee fund):
1. An EU guarantee fund (guarantee fund) shall be established which shall constitute a liquidity cushion from which the EIB shall be paid in the event of a call on the EU guarantee. 2. The guarantee fund shall be endowed by: (a) contributions from the general budget of the Union; (b) returns on guarantee fund resources invested; (c) amounts recovered from defaulting debtors in accordance with the recovery procedure laid down in the EFSI Agreement as provided for in Article 4(2)(c)(iv); (d) revenues and any other payments received by the Union in accordance with the EFSI Agreement. 3. Endowments to the guarantee fund provided for in points (b), (c) and (d) of paragraph 2 of this Article shall constitute internal assigned revenue in accordance with Article 21(4) of Regulation (EU, Euratom) No 966/2012 of the European Parliament and of the Council ( 4 ). 4. The resources of the guarantee fund provided to it under paragraph 2 shall be directly managed by the Commission and invested in accordance with the principle of sound financial management and shall follow appropriate prudential rules. 5. Endowments to the guarantee fund referred to in paragraph 2 shall be used to reach an appropriate level (target amount) to reflect the total EU guarantee obligations. The target amount shall be set at 35 % of the total EU guarantee obligations. 6. Following an assessment of the adequacy of the level of the guarantee fund in accordance with the report provided for in Article 16(6), the following payments shall be made: (a) any surplus shall be paid to the general budget of the Union as internal assigned revenue in accordance with Article 21(4) of Regulation (EU, Euratom) No 966/2012 for any budget lines which may have been used as a source of redeployment to the guarantee fund; (b) any replenishment of the guarantee fund shall be paid in annual tranches during a maximum period of three years starting in the year n+1. 7. From 1 July 2018, if as a result of calls on the EU guarantee, the level of the guarantee fund falls below 50 % of the target amount, or it could fall below that level within a year according to a risk assessment by the Commission, the Commission shall submit a report on any exceptional measures that could be required. 8. After a call on the EU guarantee, endowments to the guarantee fund provided for in points (b) and (d) of paragraph 2 of this Article above the target amount shall be used within the limits of the investment period provided for in Article 9 to restore the EU guarantee to its full amount. 9. Endowments to the guarantee fund provided for in point (c) of paragraph 2 shall be used to restore the EU guarantee to its full amount. 10. In the event that the EU guarantee is fully restored to an amount of EUR 26 000 000 000 , any amount in the guarantee fund in excess of the target amount shall be paid to the general budget of the Union as internal assigned revenue in accordance with Article 21(4) of Regulation (EU, Euratom) No 966/2012 for any budget lines which could have been used as a source of redeployment to the guarantee fund.
Article 13 Financing of the guarantee fund from the general budget of the Union
Regulation (EU) No 1291/2013 and Regulation (EU) No 1316/2013 are amended as set out in Annex I to this Regulation. If necessary, payment appropriations may be entered in the general budget of the Union beyond 2020 and up to and including the financial year 2023 to fulfil the obligations stemming from the second subparagraph of Article 12(5). The annual appropriations from the general budget of the Union for provisioning the guarantee fund shall be authorised by the European Parliament and by the Council within the framework of the annual budgetary procedure in full compliance with Council Regulation (EU, Euratom) No 1311/2013 ( 3 ).
Article 14 European Investment Advisory Hub
1. The European Investment Advisory Hub (EIAH) shall have as its objective to build upon existing EIB and Commission advisory services in order to provide advisory support for the identification, preparation and development of investment projects and to act as a single technical advisory hub for project financing within the Union. Such support shall include providing targeted support on the use of technical assistance for project structuring, on the use of innovative financial instruments and on the use of public-private partnerships and advice, as appropriate, on relevant issues relating to Union law, taking into account the specificities and needs of Member States with less-developed financial markets. The EIAH shall be able to provide technical assistance in the areas listed in Article 9(2), in particular energy efficiency, TEN-T and urban mobility. 2. The EIAH shall provide services in addition to those already available under other Union programmes, including: (a) providing a single point of entry for technical assistance for authorities and project promoters; (b) assisting project promoters, where appropriate, in developing their projects so that they fulfil the eligibility criteria set out in Article 6; (c) leveraging local knowledge to facilitate EFSI support across the Union; (d) providing a platform for peer-to-peer exchange and sharing of know-how regarding project development; (e) providing advice on the establishment of investment platforms. 3. EIAH services shall be available for public and private project promoters, including national promotional banks or institutions and investment platforms or funds and regional and local public entities. 4. Fees charged by the EIB for EIAH services under paragraph 2 shall be used for covering costs of the EIAH operations and for providing those services. Fees charged to SMEs shall be capped at one third of the cost of the technical assistance provided to them. EIAH services provided to public project promoters in addition to those already available under Union programmes shall be free of charge. 5. In order to achieve the objective referred to in paragraph 1, the EIAH shall seek to use the expertise of the EIB, the Commission, national promotional banks or institutions, and the managing authorities of the European Structural and Investment Funds. 6. In order to ensure broad coverage of services provided by the EIAH across the whole Union, the EIAH shall cooperate where possible with providers of similar services at Union, regional, national or sub-national level. Cooperation between, on the one hand, the EIAH and, on the other hand, a national promotional bank or institution or an institution or a managing authority, including those acting as a national advisor, having expertise relevant for the purposes of the EIAH, may take the form of a contractual partnership. 7. The Union shall contribute up to a maximum of EUR 20 000 000 per annum towards covering the costs of EIAH operations until 31 December 2020 for the services provided by the EIAH under paragraph 2 which are in addition to those already available under other Union programmes, insofar as those costs are not covered by the remaining amount from fees referred to in paragraph 4. 8. The Commission shall conclude an agreement with the EIB for the implementation of the EIAH within the EIB (EIAH Agreement). The EIAH Agreement shall contain in particular provisions on the necessary financing of the EIAH in accordance with paragraph 7. 9. By 1 September 2016, and annually thereafter, the EIB shall submit a report to the European Parliament, to the Council and to the Commission with regard to the services provided by the EIAH under paragraph 2 and the execution of its budget. That report shall include information on the fees received and the use thereof.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal Since the Investment Plan for Europe was presented in November 2014, the conditions for an uptake in investment have improved and confidence in Europe’s economy and growth are returning. The Union is now in its fourth year of moderate recovery, with GDP growing at 2% in 2015. The comprehensive efforts initiated with the Investment Plan are already delivering concrete results, despite the fact that macroeconomic effects of larger investment projects cannot be immediate. Investment is expected to pick up gradually throughout 2016 and 2017 although it remains below historical levels. 1 On 1 June 2016, the Commission issued a Communication entitled ‘Europe investing again – Taking stock of the Investment Plan for Europe and next steps’ outlining the achievements of the Investment Plan so far and the envisaged next steps, including the extension of the duration of the European Fund for Strategic Investments (EFSI) beyond its initial three-year period, the scaling-up of the SME window within the existing framework and the enhancement of the EIAH. On 28 June 2016, the European Council concluded that "[t]he Investment Plan for Europe, in particular the EFSI, has already delivered concrete results and is a major step to help mobilise private investment while making smart use of scarce budgetary resources. The Commission intends to soon put forward proposals on the future of the EFSI, which should be examined as a matter of urgency by the European Parliament and the Council". The EFSI was established for an initial period of three years and with the aim of mobilising at least EUR 315 billion in investments. Given its success, the Commission is committed to the doubling of the EFSI, both in terms of duration and financial capacity. The legal extension presented today covers the period of the current Multiannual Financial Framework and should provide a total of at least half a trillion euro investments by 2020. The proposal is consistent with the revision of Regulation (EU, Euratom) 966/2012 on the Financial Regulation that the Commission is proposing at the same time to set up a robust framework for the management of the financial liabilities of the Union. In order to enhance the firepower of the EFSI even further and reach the aim of doubling the investment target, the Commission calls on Member States to also contribute as a matter of priority. In this context, the Commission has today adopted a proposal to facilitate contributions at the level of the risk-bearing capacity of the EFSI by catering for the possibility for Member States to transfer resources from European Structural and Investment Funds (ESIF) allocated to them under shared implementation in order to further enhance the firepower of the EFSI. For the period after 2020, the Commission intends to put forward the necessary proposals to ensure that strategic investment will continue at a sustainable level. Since its launch one year ago, the EFSI, implemented and co-sponsored by the Commission's strategic partner for investments, the European Investment Bank (EIB) Group, is firmly on track to deliver the objective of mobilising at least EUR 315 billion in additional investments in the real economy by mid-2018 while endeavouring to maximise private sector contributions. The market absorption has been particularly quick under the Small and Medium-sized Enterprises (SME) window where the EFSI is delivering well beyond expectations. To ensure that sufficient funding is available to continue providing finance to SMEs with EFSI support, in July 2016 the SME Window was scaled-up by EUR 500 million within the existing parameters of Regulation (EU) 2015/1017. The projects approved by the EIB Group by July 2016 for coverage under the EFSI are expected to mobilise EUR 115.7 billion in total investments across 26 Member States and to support some 200,000 SMEs, thereby contributing to Europe's future job creation including youth employment, growth and competitiveness. The European Investment Advisory Hub (EIAH) and the European Investment Project Portal (EIPP) have also made a positive start. The EIAH has already dealt with some 230 requests from 27 Member States and the EIPP has already published more than 100 investment projects since its launch on 1 June 2016, allowing investors to access investment opportunities across Europe instantly. As part of the Commission's efforts to improve Europe's investment environment, the Commission has tabled a number of initiatives to help support investment and facilitate the financing of the real economy, such as the lowering of capital charges for insurance and reinsurance companies as regards infrastructure investments and the adoption of practical guidance on the application of State aid rules in the context of public funding of infrastructure. In addition, the Energy Union, the Capital Markets Union, the Single Market and the Digital Single Market Strategies, and the Circular Economy package all contain specific measures that will remove concrete obstacles and further improve the environment for investment, if fully implemented. For instance, upcoming proposals relating to the internal electricity market, renewable energy and governance of the Energy Union will create more long-term regulatory clarity and stability, enabling investments in the energy sector. In this context, the Commission notes that the EIB has become a global leader in the issuance of green bonds to help finance sustainable projects. The Capital Markets Union will help remove financial barriers to investment, the Single Market Strategy will contribute to more efficient public procurement markets, and the Digital Single Market Strategy will enhance regulatory certainty in the digital sector. Financing under the EFSI does not substitute the need for Member States to implement the necessary reforms to remove obstacles to investment identified in the context of the European Semester, in areas such as insolvency, public procurement, judicial systems and the efficiency of public administration or sector-specific regulations. The Commission has already issued a number of Country-Specific Recommendations for reforms in the area of investment. These reforms are a necessary condition to sustain and increase investment levels in Member States. The positive momentum generated by the Investment Plan should be maintained and efforts need to be continued to bring investment back to its long-term sustainable trend. The mechanisms of the Investment Plan work and should be reinforced to continue the mobilisation of private investments in sectors important to Europe's future and where market failures or sub-optimal investment situations remain. The aim of the EFSI continues to be to support investments that could not have been carried out in the same period or not to the same extent by the EIB, the EIF or under existing Union financial instruments without EFSI support. In line with the initial investment period, private investment should be attracted to the maximum extent possible, and SMEs will be a key beneficiary of the support provided for under this proposal. Particular attention will also be paid to projects that contribute to reaching the objectives of COP21. The extension of the duration of the EFSI will not only allow the prolongation of a successful scheme, it will also pass an important message to project promoters and encourage them to submit projects to the EIB. A key element of the proposal is a further reinforcement of additionality of the projects supported under the EFSI. It has been made even clearer that the projects under the EFSI address sub-optimal investment situations and market gaps, as part of the eligibility criteria. In view of their importance for Europe, cross-border infrastructure projects, including related services, have been specifically identified as providing additionality. Beyond the extension of the duration of the EFSI, the proposal foresees a number of technical enhancements for the EFSI and the EIAH, incorporating the lessons learnt in the first year of implementation of the EFSI. An important objective of the proposal is to reinforce the take-up of EFSI in less-developed regions and transition regions. In that respect, an easier combination of other sources of Union funding such as the ESIF, Horizon 2020 and the Connecting Europe Facility with EFSI support is a key element and contributes to mobilising additional private sector investment. In parallel, the Commission has today adopted a proposal aimed at simplifying the Common Provisions Regulation so as to facilitate such combination. In this context, it would be appropriate to allow that the control and assurance mechanisms relating to operations benefiting from EFSI support could be used to fulfil the corresponding requirements under other EU funding for the same project in order to streamline procedures and gain in efficiency. The support to less-developed regions and transition regions in Europe is enlarged by an explicit reference to any industry that would not otherwise be covered in the general objectives. In addition, EFSI-supported investments in motorways which should be in general avoided would be allowed in cohesion countries under certain conditions. The Commission also proposes to better focus the EFSI on EU political priorities as regards climate change, for example by setting a minimum target for climate-friendly projects and by confining support to motorways only to those involving private investment in cohesion countries or in cross-border transport projects involving at least one cohesion country. Moreover, the Commission recognises the importance of using part of the Union budget, such as the one available under the CEF, in the form of grants for blending with the EFSI. The combined use of grants and the EFSI will help projects become economically and financially viable, thus enhancing the added value of Union spending by attracting additional resources from private investors. Furthermore, taking into account the significant economic multiplier effect that investments in the defence sector have in terms of creation of spin-offs and technology-transfer on other sectors, as well as the creation of jobs, it would be appropriate to consider including defence-related investment projects under the EFSI and, thus, to consider modifying the eligibility criteria in the EIB lending policy to that effect. For the EIAH, the proposal foresees more targeted technical assistance services for projects involving several Member States, projects that contribute to reaching the objectives of COP21 and for the combination of other sources of Union funding, such as European Structural and Investment Funds (ESIF), Horizon 2020 and the Connecting Europe Facility, with the EFSI. This support will focus on needs not covered adequately under current arrangements. In addition, the proposal foresees that the EIAH should actively contribute to the objective of sectorial and geographical diversification of the EFSI, by supporting the EIB to originate projects where needed.
Revised version (Article 14 European Investment Advisory Hub):
1. The European Investment Advisory Hub (EIAH) shall have as its objective to build upon existing EIB and Commission advisory services in order to provide advisory support for the identification, preparation and development of investment projects and to act as a single technical advisory hub for project financing within the Union. Such support shall include the provision of targeted support on the use of technical assistance for project structuring, on the use of innovative financial instruments, on the use of public-private partnerships and on the provision of information, as appropriate, on relevant issues relating to Union law, taking into account the specificities and needs of Member States with less developed financial markets, as well as the situation in different sectors. The EIAH shall be able to provide technical assistance in the areas listed in Article 9(2), in particular energy efficiency, TEN-T and urban mobility. It shall also support the preparation of climate action and circular economy projects or components thereof, in particular in the context of COP21, the preparation of projects in the digital sector, as well as the preparation of projects referred to in the second indent of the third subparagraph of Article 5(1). 2. The EIAH shall provide services in addition to those already available under other Union programmes, including: (a) providing a single point of entry for technical assistance for authorities and project promoters; (b) assisting project promoters, where appropriate, in developing their projects so that they fulfil the eligibility criteria set out in Article 6; (c) leveraging local knowledge to facilitate EFSI support across the Union and contributing actively where possible to the objective of sectorial and geographical diversification of the EFSI referred to in Section 8 of Annex II by supporting the EIB and national promotional banks or institutions to originate and develop operations, in particular in less developed regions and transition regions, and, where necessary, by helping to structure demand for EFSI support; (d) providing a platform for peer-to-peer exchange and sharing of know-how regarding project development; (e) providing proactive, advisory support, where necessary by means of local presence, on the establishment of investment platforms, in particular cross-border and macroregional investment platforms involving several Member States and/or regions; (f) using the potential of attracting and financing small-scale projects, including through investment platforms; (g) providing advice on the combination of other sources of Union funding, such as the European Structural and Investment Funds, Horizon 2020 and the Connecting Europe Facility established by Regulation (EU) No 1316/2013, with the EFSI with a view to resolving practical problems linked to the use of such combined sources of funding; (h) providing proactive support to promote and encourage the operations referred to in point (b) of the first paragraph of Article 8. 3. EIAH services shall be available for public and private project promoters, including national promotional banks or institutions and investment platforms or funds and regional and local public entities. 4. Fees charged by the EIB for EIAH services under paragraph 2 shall be used for covering costs of the EIAH operations and for providing those services. Fees charged to SMEs shall be capped at one third of the cost of the technical assistance provided to them. EIAH services provided to public project promoters in addition to those already available under Union programmes shall be free of charge. 5. In order to achieve the objective referred to in paragraph 1 and to facilitate the provision of advisory support at local level, the EIAH shall seek to use the expertise of the EIB, the Commission, national promotional banks or institutions, and the managing authorities of the European Structural and Investment Funds. 5a. The EIB shall propose to project promoters applying for EIB financing, including in particular small-scale projects, to refer their projects to the EIAH in order to enhance, where appropriate, the preparation of their projects and/or to allow for the assessment of the possibility of bundling projects through investment platforms. It shall also inform promoters of projects for which EIB financing has been denied, or which are experiencing a financing gap in spite of possible EIB financing, of the possibility of listing their projects on the European Investment Project Portal. 6. In order to ensure broad coverage of services provided by the EIAH across the whole Union, the EIAH shall cooperate where possible with providers of similar services at Union, regional, national or sub-national level. Cooperation between, on the one hand, the EIAH and, on the other hand, a national promotional bank or institution, an international financial institution or an institution or a managing authority, including those acting as a national advisor, having expertise relevant for the purposes of the EIAH, may take the form of a contractual partnership. The EIAH shall endeavour to conclude at least one cooperation agreement with a national promotional bank or institution per Member State. In Member States where national promotional banks or institutions do not exist, the EIAH shall provide, where appropriate, and at the request of the Member State concerned, proactive advisory support on the establishment of such bank or institution. 6a. In order to develop a wide geographic outreach of the advisory services across the Union and to successfully leverage local knowledge about the EFSI, a local presence of the EIAH shall be ensured where necessary, taking into account existing support schemes, with a view to providing tangible, proactive, tailor-made assistance on the ground. It shall be established in particular in Member States or regions that face difficulties in developing projects under the EFSI. The EIAH shall assist in the transfer of knowledge to the regional and local level with a view to building up regional and local capacity and expertise. 7. An annual reference amount of EUR 20 000 000 shall be made available from the general budget of the Union to contribute towards covering the costs of EIAH operations until 31 December 2020 for the services referred to in paragraph 2, insofar as those costs are not covered by the remaining amount from fees referred to in paragraph 4. 8. The Commission shall conclude an agreement with the EIB for the implementation of the EIAH within the EIB (EIAH Agreement). The EIAH Agreement shall contain in particular provisions on the necessary financing of the EIAH in accordance with paragraph 7. 9. By 1 September 2016, and annually thereafter, the EIB shall submit a report to the European Parliament, to the Council and to the Commission with regard to the services provided by the EIAH under paragraph 2 and the execution of its budget. That report shall include information on the fees received and the use thereof.
Article 15 European Investment Project Portal
1. The Commission, with the support of the EIB, shall create a transparent European investment project portal (EIPP) gathering current and future investment projects in the Union. It shall constitute a publicly accessible and user-friendly project database, providing relevant information for each project. 2. The EIPP shall primarily be for the purpose of visibility to investors and for information purposes. The inclusion of projects in the EIPP shall be without prejudice to the decisions on the final projects selected for support under this Regulation, under any other instrument of the Union, or for public funding. 3. Member States may contribute to the establishment and management of the EIPP. 4. A non-refundable fee may be charged to private project promoters for processing project applications for admission to the EIPP. The fee revenue collected shall constitute external assigned revenue for the EIPP in accordance with Article 21(4) of Regulation (EU, Euratom) No 966/2012.