Article 47 Rules for area related payments
1. The number of hectares to which a commitment pursuant to Articles 28, 29 and 34 applies may vary from year to year where: (a) this possibility is provided for in the rural development programme; (b) the commitment in question does not apply to fixed parcels; and (c) the achievement of the commitment's objective is not jeopardised. 2. Where all or part of the land under commitment or the entire holding is transferred to another person during the period of that commitment, the commitment, or part thereof corresponding to the land transferred, may be taken over for the remainder of the period by that other person or may expire and reimbursement shall not be required in respect of the period during which the commitment was effective. 3. Where a beneficiary is unable to continue to comply with commitments given because the holding or part of the holding is re-parcelled or is the subject of public land consolidation measures or land consolidation measures approved by the competent public authorities, Member States shall take the measures necessary to allow the commitments to be adapted to the new situation of the holding. If such adaptation proves impossible, the commitment shall expire and reimbursement shall not be required in respect of the period during which the commitment was effective. 4. Reimbursement of the aid received shall not be required in cases of force majeure and exceptional circumstances as referred to in Article 2 of Regulation (EU) No 1306/2013. 5. Paragraph 2, as regards cases of transfer of the entire holding, and paragraph 4 shall also apply to commitments under Article 33. 6. In order to ensure the efficient implementation of area related measures and secure the financial interests of the Union, the Commission shall be empowered to adopt delegated acts in accordance with Article 83 laying down conditions applicable to conversion or adjustment of commitments under the measures referred to in Articles 28, 29, 33 and 34 and, specifying other situations in which reimbursement of the aid shall not be required.
Article 48 Revision clause
A revision clause shall be provided for operations undertaken pursuant to Articles 28, 29, 33 and 34 in order to ensure their adjustment in the case of amendments to the relevant mandatory standards, requirements or obligations referred to in those Articles beyond which the commitments have to go. The revision clause shall also cover adjustments needed to avoid double funding of the practices referred to in Article 43 of Regulation (EU) No 1307/2013 in the case of amendments to those practices. Operations undertaken pursuant to Articles 28, 29, 33 and 34 which extend beyond the current programming period shall contain a revision clause in order to allow for their adjustment to the legal framework of the following programming period. If such adjustment is not accepted by the beneficiary, the commitment shall expire and reimbursement shall not be required in respect of the period during which the commitment was effective.
Article 49 Selection of operations
1. Without prejudice to point (d) of Article 34(3) of Regulation (EU) No 1303/2013, the Managing Authority of the rural development programme shall define selection criteria for operations following consultation with the Monitoring Committee. Selection criteria shall aim to ensure equal treatment of applicants, better use of financial resources and targeting of measures in accordance with the Union priorities for rural development. In defining and applying selection criteria the principle of proportionality shall be taken into account in relation to the size of the operation. 2. The Member State authority responsible for the selection of operations shall ensure that operations, with the exception of operations under Articles 28 to 31, 33 to 34 and 36 to 39, are selected in accordance with the selection criteria referred to in paragraph 1 and according to a transparent and well documented procedure. 3. Where appropriate, the beneficiaries may be selected on the basis of calls for proposals, applying economic and environmental efficiency criteria.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Financial Regulation 1 sets out the principles and procedures governing the establishment and implementation of the EU budget and the control of the EU funds. Over the last 30 years, the number of general financial rules contained in the Financial Regulation has increased sharply 2 . In addition, a number of sectoral financial rules have emerged: the rules for participation to the Framework Programme for Research and Innovation 3 , the Common Provisions to the European Structural and Investment Funds 4 and the Common Implementing Rules for the External Action 5 . Users of EU funds have repeatedly complained about the proliferation of rules both at general and at sectoral level, their heterogeneity and their complexity due to the fact that they follow the architecture of the programme and multiple layers of controls. In addition, the complexity of the financial set of rules has slowed down implementation of the EU funds, making it costly and prone to errors. A first step towards more coherent and simpler financial rules was achieved in 2012: the Commission tabled proposals for the programmes covered by the MFF 2014-2020 which reduced the number of programmes and instruments, grouped them under a single framework with common rules, simplified procedures for application and declaration of costs by final beneficiaries, facilitated the deployment of innovative financial instruments, enabled EU Trust-Funds and improved the cost-efficiency of controls. Recent revisions have aligned the Financial Regulation on the results of the negotiation to the MFF 2014-2020 (2013 revision) as well as to the new Procurement Directive (2015 revision). However, there is room for further simplification . This is confirmed by the experience gained since 2014 and by the work of the High Level Group of Independent Experts on Monitoring Simplification for Beneficiaries of the European Structural and Investment Funds 6 . The public consultation on the revision of the Financial Regulation 7 also shows stakeholders’ clear expectations in the area. Efforts must therefore continue in order to remove bottlenecks, ensure synergies and complementarities between ESI Funds and the other EU funds and improve efficiency of delivery and control requirements. Simpler and more flexible financial rules will contribute to optimising spending and impact of the MFF 2014-2020 and constitute as such one of the key elements of the Commission's initiative for a Budget Focused on Results (BFOR) which aims at making sure that resources are allocated to priorities and that every action delivers maximum performance and added value 8 . In addition, this will reduce the costs related to implementation of EU rules as well the number of errors. Simpler and more flexible EU financial rules are key in enhancing EU budget’s ability to adapt to changing circumstances and to respond to unexpected developments. The present legislative proposal forms an integral part of the mid-term review/revision of the multiannual financial framework (MFF) 2014-2020 9 . It contributes to two of its main objectives: simplification and flexibility . The Commission therefore proposes in a single act an ambitious revision of the general financial rules accompanied by corresponding changes to the sectorial financial rules set out in 15 legislative acts concerning multiannual programmes. The inclusion of sectoral changes in the same legislative proposal aims at ensuring a coherent negotiation process as well as at facilitating a speedy adoption by the legislator. The focus is put on the following key areas: 1 . Simplification for recipients of EU funds: many measures aim at simplifying life for recipients of EU funds. They relate to grants (removal of the non-cumulative award check for low-value grants and of the non-profit principle; simpler rules for "contribution in kind" valuation ; recognition of volunteer work ; grant awards without calls for proposal under specific conditions) and simplified forms of grants (Title VIII). 2 . From multi ple layers of controls to cross reliance on audit, assessment or authorisation, and harmonisation of reporting requirements: the aim of these measures is to encourage reliance as far as possible on one single audit, assessment or authorisation (conformity to State aids for instance), when the audit , assessment or authorisation meet s the necessary conditions to be taken into account in the EU system. More generally, rules for implementing partners (international organisations, EIB/EIF, national promotional banks, national agencies, NGOs) will be simplified by relying increasingly on their procedures and policies once assessed positively. Financial f ramework partnership agreements concluded with long term partners will allow progressing in the harmonisation of audit, reporting and other administrative requirements among donors (Title V Articles 122, 123 and 126). 3 . Allowing the application of only one set of rules to hybrid actions or in the case of combination of measures or instruments: the proposal aims at achieving further simplification for the partners of the EU by a number of measures to avoid the parallel application of different rules and procedures, notably through facilitating the combination of European Structural and Investment Funds (ESIF) funding with financial instruments and the European Fund for Strategic Investments (Title V). 4 . More effective use of financial instruments: optimise use of reflows, ensuring a level playing field among key EU implementing partners, reducing burdensome requirements related to publication of individual data of final recipients or to the exclusion criteria (Title X). 5 . More flexible budget management: the proposal sets out several ways for more budgetary flexibility, in order to allow the Union to respond to unforeseen challenges and new tasks more effectively and to achieve swifter crisis management - among which the creation of a " flexibility cushion" for unforeseen needs and new crises in the external actions geographic instruments budget , a more efficient activation of the solidarity and globalization adjustment funds, and the extension of Trust-Funds to internal policies (Articles 14 and 22 7 ) , the creation of a EU crisis reserve with the reuse of decommitted appropriations, and for the next Multiannual Financial Framework, the possibility that financial operations other than financial instruments generate a contingent liability for the Union exceeding the financial assets provided to cover the financial liability of the Union (Article 203) and the creation of a common provisioning fund holding the resources provisioned for financial operations (Article 2 05 ). R ecent initiatives (such as the European Fund for Strategic Investments (EFSI) or the European Fund for Sustainable Development (EFSD)), have indeed shown the need to fully use the leverage of the EU budget by creating non-provisioned contingent liabilities. Title X sets the framework to authorise, manage and control these financial risks. 6 . F ocus on results and streamlining of reporting: a stronger focus on results through lump sums, prizes, payment based on output and results rather than on reimbursement of costs, payment against conditions to be fulfilled (Article 121, Title X III ). This should contribute to further reducing the costs of implementing EU funds as well as the number of errors. On the reporting side, reports are regrouped around the draft budget and the integrated financial reporting package, in order to increase efficiency and transparency both towards the general public and the budgetary authority (Articles 39 and 23 9 -24 5 ). 7. Simpler and leaner EU administration: facilitating agreements or delegations between Institutions or bodies in order to pool the implementation of administrative appropriations in European Offices or within Executive Agencies (Articles 57, 58, 64, 65 and 6 8 ); merging consultative panels competent for financial irregularities (Article 73 (6)) with the EDES panel (Article 139 ) and moving from annual to multiannual financing decisions (Article 10 8 ). 8. Providing possibility for citizen engagement : t he proposal provides a possibility for citizens to be consulted on the implementation of the Union budget by the Commission, Member States and any other entity implementing the Union budget (А rticle 54 ) . In simplifying and making EU financial rules more flexible, the present proposal paves the way for the preparation of the next generation of spending programmes (post-2020).
Revised version (Article 49 Selection of operations):
1. Without prejudice to point (d) of Article 34(3) of Regulation (EU) No 1303/2013, the Managing Authority of the rural development programme shall define selection criteria for operations following consultation with the Monitoring Committee. Selection criteria shall aim to ensure equal treatment of applicants, better use of financial resources and targeting of measures in accordance with the Union priorities for rural development. In defining and applying selection criteria the principle of proportionality shall be taken into account in relation to the size of the operation. By way of derogation from the first subparagraph, in exceptional and duly justified cases where it is not possible to establish selection criteria due to the nature of the type of operations concerned, the Managing Authority may define another selection method to be described in the rural development programme following consultation with the Monitoring Committee. 2. The Member State authority responsible for the selection of operations shall ensure that operations, with the exception of operations under point (b) of Article 18(1), point (d) of Article 24(1) and Articles 28 to 31, 33 to 34 and 36 to 39a, are selected in accordance with the selection criteria referred to in paragraph 1 and according to a transparent and well documented procedure. 3. Beneficiaries may be selected on the basis of calls for proposals, applying economic, social and environmental efficiency criteria. 4. Paragraphs 1 and 2 shall not apply where support is provided in the form of financial instruments.
Article 50 Rural area definition
For the purposes of this Regulation the Managing Authority shall define "rural area" at programme level. Member States may establish such a definition for a measure or type of operation if duly justified.
Article 51 Funding technical assistance
1. In accordance with Article 6 of Regulation (EU) No 1306/2013 the EAFRD may use up to 0,25 % of its annual allocation to finance the tasks referred to in Article 58 of Regulation (EU) No 1303/2013, including the costs for setting up and operating the European network for rural development referred to in Article 52 of this Regulation and the EIP network referred to in Article 53 of this Regulation at the Commission's initiative and/or on its behalf, of which up to EUR 30 567 000 in current prices shall be allocated to the Structural Reform Support Programme established by Regulation (EU) 2017/825 of the European Parliament and of the Council ( 11 ) for use within the scope and purpose of that programme. The EAFRD may also finance the actions provided for in Article 41(2) of Regulation (EU) No 1151/2012 of the European Parliament and of the Council ( 12 ), in relation to Union quality scheme indications and symbols. Those actions shall be carried out in accordance with Article 58 of Regulation (EU, EURATOM) No 966/2012 of the European Parliament and of the Council ( 13 ) and any other provisions of that Regulation and of its implementing provisions that are applicable to this form of execution of the budget. 2. At the initiative of the Member States up to 4 % of the total amount of each rural development programme may be devoted to the tasks referred to in Article 59 of Regulation (EC) No 1303/2013 and costs related to preparatory work for the delimitation of areas facing natural or other specific constraints referred to in Article 32. Costs relating to the certification body referred to in Article 9 of Regulation (EU) No 1306/2013 shall not be eligible under this paragraph. Within that 4 % limit an amount shall be reserved for establishing and operating the national rural network referred to in Article 54. 3. In case of rural development programmes covering both less-developed regions and other regions, the EAFRD contribution rate for technical assistance referred to in Article 59(3) may be determined by taking into account the predominant type of regions, by their number, in the programme.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The direct and indirect effects of the COVID-19 outbreak continue to increase across all Member States. The current situation is unprecedented and requires exceptional measures adapted to the situation to be applied in these circumstances. In the farming and food sectors, many difficulties have been reported, arising from the extensive movement restrictions put in place in the Member States, as well as mandatory closures of shops, outdoor markets, restaurants and other hospitality establishments. Economic disruption to the agricultural sector and rural communities has led to liquidity and cash-flow problems for farmers and small rural businesses processing agricultural products. As a consequence, certain small businesses and farmers are in urgent need of emergency support in order to maintain their activities. In view of the parallel difficulties of administrations, which make it be inapropriate for advisers to attend in person to support potential benefiaries, or for controlers to carry out in situ or ex-ante controls, it is indispensible to offer easy-to-use solutions which can be rolled out by Member States, and which can support diverse situations on the ground and which are easily accessible to beneficiaries. The support will need to be in the form of a temporary aid, for a very targeted purpose in unprecendented circumstances. In order to achieve these goals, the support will take the form of a one-off lump sum for farmers and for SMEs active in processing, marketing and/or development of agricultural products. Payments by the Commission shall be made in accordance with budget appropriations and subject to available funding. With a view to ensuring the most efficient use of resources available under existing rural development programmes, Member States will be required to substantiate the targeting of the support to those most affected, based on objective and non-discriminatory criteria. Member States would need to include the measure in the RDPs via a modification, although expenditure would be eligible from the moment of the commencement of the catastrophic event (Covid-19 outbreak). Consistency with existing policy provisions in the policy area The proposal is consistent with the overall legal framework established for the Common Agricultural Policy and the European Structural and Investment Funds (ESIF) and is limited to a targeted amendment of Regulation (EU) No 1305/2013. The proposal complements all other measures aimed at addressing the current unprecedented situation taken by the Union, in particular those measures aimed at providing support to markets. The proposal is without prejudice to the minimum spending requirements defined in paragraphs 5 and 6 of Article 59 of Regulation (EU) 1305/2013. Consistency with other Union policies The proposal is limited to targeted amendments of Regulation (EU) No 1305/2013 and maintains consistency with other Union policies.

EUROPEAN COMMISSIONBrussels, 30.4.2020COM(2020) 186 final2020/0075(COD)Proposal for aREGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCILamending Regulation (EU) No 1305/2013 as regards specific measures to provide exceptional temporary support under EAFRD in response to the COVID-19 outbreakEXPLANATORY MEMORANDUM1.CONTEXT OF THE PROPOSAL•Reasons for and objectives of the proposalThe direct and indirect effects of the COVID-19 outbreak continue to increase across all Member States. The current situation is unprecedented and requires exceptional measures adapted to the situation to be applied in these circumstances.In the farming and food sectors, many difficulties have been reported, arising from the extensive movement restrictions put in place in the Member States, as well as mandatory closures of shops, outdoor markets, restaurants and other hospitality establishments. Economic disruption to the agricultural sector and rural communities has led to liquidity and cash-flow problems for farmers and small rural businesses processing agricultural products.As a consequence, certain small businesses and farmers are in urgent need of emergency support in order to maintain their activities.In view of the parallel difficulties of administrations, which make it be inapropriate for advisers to attend in person to support potential benefiaries, or for controlers to carry out in situ or ex-ante controls, it is indispensible to offer easy-to-use solutions which can be rolled out by Member States, and which can support diverse situations on the ground and which are easily accessible to beneficiaries.The support will need to be in the form of a temporary aid, for a very targeted purpose in unprecendented circumstances.  In order to achieve these goals, the support will take the form of a one-off lump sum for farmers and for SMEs active in processing, marketing and/or development of agricultural products. Payments by the Commission shall be made in accordance with budget appropriations and subject to available funding.With a view to ensuring the most efficient use of resources available under existing rural development programmes, Member States will be required to substantiate the targeting of the support to those most affected, based on objective and non-discriminatory criteria. Member States would need to include the measure in the RDPs via a modification, although expenditure would be eligible from the moment of the commencement of the catastrophic event (Covid-19 outbreak).
Revised version (Article 51 Funding technical assistance):
1. In accordance with Article 6 of Regulation (EU) No 1306/2013 the EAFRD may use up to 0,25 % of its annual allocation to finance the tasks referred to in Article 58 of Regulation (EU) No 1303/2013, including the costs for setting up and operating the European network for rural development referred to in Article 52 of this Regulation and the EIP network referred to in Article 53 of this Regulation at the Commission's initiative and/or on its behalf, of which up to EUR 30 567 000 in current prices shall be allocated to the Structural Reform Support Programme established by Regulation (EU) 2017/825 of the European Parliament and of the Council ( 11 ) for use within the scope and purpose of that programme. The EAFRD may finance activities preparing for the implementation of the CAP in the subsequent programming period. The EAFRD may also finance the actions provided for in Article 41(2) of Regulation (EU) No 1151/2012 of the European Parliament and of the Council ( 12 ), in relation to Union quality scheme indications and symbols. Those actions shall be carried out in accordance with Article 58 of Regulation (EU, EURATOM) No 966/2012 of the European Parliament and of the Council ( 13 ) and any other provisions of that Regulation and of its implementing provisions that are applicable to this form of execution of the budget. 2. At the initiative of the Member States up to 4 % of the total amount of each rural development programme may be devoted to the tasks referred to in Article 59 of Regulation (EC) No 1303/2013 and costs related to preparatory work for the delimitation of areas facing natural or other specific constraints referred to in Article 32. Costs relating to the certification body referred to in Article 9 of Regulation (EU) No 1306/2013 shall not be eligible under this paragraph. Within that 4 % limit an amount shall be reserved for establishing and operating the national rural network referred to in Article 54. 3. In case of rural development programmes covering both less-developed regions and other regions, the EAFRD contribution rate for technical assistance referred to in Article 59(3) may be determined by taking into account the predominant type of regions, by their number, in the programme.
Article 52 European network for rural development
1. A European network for rural development for the networking of national networks, organisations, and administrations active in the field of rural development at Union level shall be put in place in accordance with Article 51(1). 2. Networking through the European network for rural development shall aim to: (a) increase the involvement of all stakeholders, and in particular agricultural, forestry and other rural development stakeholders in the implementation of rural development; (b) improve the quality of rural development programmes; (c) play a role in informing the broader public on the benefits of rural development policy; (d) support the evaluation of rural development programmes. 3. The tasks of the network shall be to: (a) collect, analyse and disseminate information on action in the field of rural development; (b) provide support on evaluation processes and on data collection and management; (c) collect, consolidate and disseminate at Union level good rural development practices, including on evaluation methodologies and tools; (d) set up and run thematic groups and/or workshops with a view to facilitating the exchange of expertise and to supporting the implementation, monitoring and further development of rural development policy; (e) provide information on developments in rural areas of the Union and in third countries; (f) organise meetings and seminars at Union level for those actively involved in rural development; (g) support the national networks and transnational co-operation initiatives and the exchange concerning actions and experience in the field of rural development with networks in third countries; (h) specifically for local action groups: (i) create synergies with the activities carried out at national or regional level, or at both by the respective networks with regard to capacity building actions and exchange of experience; and (ii) cooperate with the networking and technical support bodies for local development set up by the ERDF, the ESF and the EMFF as regards their local development activities and transnational co-operation. 4. The Commission shall adopt implementing acts, setting out the organisational structure and operation of the European network for rural development network. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 84.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The direct and indirect effects of the COVID-19 outbreak continue to increase across all Member States. The current situation is unprecedented and requires exceptional measures adapted to the situation to be applied in these circumstances. In the farming and food sectors, many difficulties have been reported, arising from the extensive movement restrictions put in place in the Member States, as well as mandatory closures of shops, outdoor markets, restaurants and other hospitality establishments. Economic disruption to the agricultural sector and rural communities has led to liquidity and cash-flow problems for farmers and small rural businesses processing agricultural products. As a consequence, certain small businesses and farmers are in urgent need of emergency support in order to maintain their activities. In view of the parallel difficulties of administrations, which make it be inapropriate for advisers to attend in person to support potential benefiaries, or for controlers to carry out in situ or ex-ante controls, it is indispensible to offer easy-to-use solutions which can be rolled out by Member States, and which can support diverse situations on the ground and which are easily accessible to beneficiaries. The support will need to be in the form of a temporary aid, for a very targeted purpose in unprecendented circumstances. In order to achieve these goals, the support will take the form of a one-off lump sum for farmers and for SMEs active in processing, marketing and/or development of agricultural products. Payments by the Commission shall be made in accordance with budget appropriations and subject to available funding. With a view to ensuring the most efficient use of resources available under existing rural development programmes, Member States will be required to substantiate the targeting of the support to those most affected, based on objective and non-discriminatory criteria. Member States would need to include the measure in the RDPs via a modification, although expenditure would be eligible from the moment of the commencement of the catastrophic event (Covid-19 outbreak). Consistency with existing policy provisions in the policy area The proposal is consistent with the overall legal framework established for the Common Agricultural Policy and the European Structural and Investment Funds (ESIF) and is limited to a targeted amendment of Regulation (EU) No 1305/2013. The proposal complements all other measures aimed at addressing the current unprecedented situation taken by the Union, in particular those measures aimed at providing support to markets. The proposal is without prejudice to the minimum spending requirements defined in paragraphs 5 and 6 of Article 59 of Regulation (EU) 1305/2013. Consistency with other Union policies The proposal is limited to targeted amendments of Regulation (EU) No 1305/2013 and maintains consistency with other Union policies.

EUROPEAN COMMISSIONBrussels, 30.4.2020COM(2020) 186 final2020/0075(COD)Proposal for aREGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCILamending Regulation (EU) No 1305/2013 as regards specific measures to provide exceptional temporary support under EAFRD in response to the COVID-19 outbreakEXPLANATORY MEMORANDUM1.CONTEXT OF THE PROPOSAL•Reasons for and objectives of the proposalThe direct and indirect effects of the COVID-19 outbreak continue to increase across all Member States. The current situation is unprecedented and requires exceptional measures adapted to the situation to be applied in these circumstances.In the farming and food sectors, many difficulties have been reported, arising from the extensive movement restrictions put in place in the Member States, as well as mandatory closures of shops, outdoor markets, restaurants and other hospitality establishments. Economic disruption to the agricultural sector and rural communities has led to liquidity and cash-flow problems for farmers and small rural businesses processing agricultural products.As a consequence, certain small businesses and farmers are in urgent need of emergency support in order to maintain their activities.In view of the parallel difficulties of administrations, which make it be inapropriate for advisers to attend in person to support potential benefiaries, or for controlers to carry out in situ or ex-ante controls, it is indispensible to offer easy-to-use solutions which can be rolled out by Member States, and which can support diverse situations on the ground and which are easily accessible to beneficiaries.The support will need to be in the form of a temporary aid, for a very targeted purpose in unprecendented circumstances.  In order to achieve these goals, the support will take the form of a one-off lump sum for farmers and for SMEs active in processing, marketing and/or development of agricultural products. Payments by the Commission shall be made in accordance with budget appropriations and subject to available funding.With a view to ensuring the most efficient use of resources available under existing rural development programmes, Member States will be required to substantiate the targeting of the support to those most affected, based on objective and non-discriminatory criteria. Member States would need to include the measure in the RDPs via a modification, although expenditure would be eligible from the moment of the commencement of the catastrophic event (Covid-19 outbreak).
Revised version (Article 52 European network for rural development):
1. A European network for rural development for the networking of national networks, organisations, and administrations active in the field of rural development at Union level shall be put in place in accordance with Article 51(1). 2. Networking through the European network for rural development shall aim to: (a) increase the involvement of all stakeholders, and in particular agricultural, forestry and other rural development stakeholders in the implementation of rural development; (b) improve the quality of rural development programmes; (c) play a role in informing the broader public on the benefits of rural development policy; (d) support the evaluation of rural development programmes. 3. The tasks of the network shall be to: (a) collect, analyse and disseminate information on action in the field of rural development; (b) provide support on evaluation processes and on data collection and management; (c) collect, consolidate and disseminate at Union level good rural development practices, including on evaluation methodologies and tools; (d) set up and run thematic groups and/or workshops with a view to facilitating the exchange of expertise and to supporting the implementation, monitoring and further development of rural development policy; (e) provide information on developments in rural areas of the Union and in third countries; (f) organise meetings and seminars at Union level for those actively involved in rural development; (g) support the national networks and transnational co-operation initiatives and the exchange concerning actions and experience in the field of rural development with networks in third countries; specifically for local action groups: (i) create synergies with the activities carried out at national or regional level, or at both by the respective networks with regard to capacity building actions and exchange of experience; and (ii) cooperate with the networking and technical support bodies for local development set up by the ERDF, the ESF and the EMFF as regards their local development activities and transnational co-operation. specifically for local action groups: (i) create synergies with the activities carried out at national or regional level, or at both by the respective networks with regard to capacity building actions and exchange of experience; and (ii) cooperate with the networking and technical support bodies for local development set up by the ERDF, the ESF and the EMFF as regards their local development activities and transnational co-operation. 4. The Commission shall adopt implementing acts, setting out the organisational structure and operation of the European network for rural development network. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 84.
Article 53 European Innovation Partnership network
1. A EIP network shall be put in place to support the EIP for agricultural productivity and sustainability referred to in Article 55, in accordance with Article 51(1). It shall enable the networking of operational groups, advisory services and researchers. 2. The aim of the EIP network shall be to: (a) facilitate the exchange of expertise and good practices; (b) establish a dialogue between farmers and the research community and facilitate the inclusion of all stakeholders in the knowledge exchange process. 3. The tasks of the EIP network shall be to: (a) provide a help desk function and provide information to key actors concerning the EIP; (b) encourage the setting up of operational groups and provide information about the opportunities provided by Union policies; (c) facilitate the setting up of cluster initiatives and pilot or demonstration projects which may relate, inter alia, to the following issues:: (i) increased agricultural productivity, economic viability, sustainability, output and resource efficiency; (ii) innovation in support of the bio-based economy; (iii) biodiversity, ecosystem services, soil functionality and sustainable water management; (iv) innovative products and services for the integrated supply chain; (v) opening up new product and market opportunities for primary producers; (vi) food quality, food safety and healthy diet; (vii) reduce post-harvest losses and food wastage. (d) collect and disseminate information in the field of the EIP, including research findings and new technologies relevant to innovation and knowledge exchange and exchanges in the field of innovation with third countries. 4. The Commission shall adopt implementing acts, setting out the organisational structure and operation of the EIP network. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 84.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal As stated in the Commission Communication on safeguarding food security and reinforcing the resilience of food systems of 23 March 2022 (COM(2022)133 final), the unprovoked Russia’s invasion of Ukraine has further destabilised already fragile agricultural markets. Before the invasion, commodity markets were witnessing a significant price surge, which agricultural markets felt through the increases in energy, fertiliser and animal feed costs. Now the costs for farmers and small and medium enterprises (SMEs) active in processing, marketing or development of agricultural products further increases and affects the price of food, which exposes the vulnerabilities of the European food system, notably the dependence on imports and raising concerns as regards the income of farmers and producers in the agri-food chain. This adds to the pressure on European agriculture following the Covid-19 pandemic. Climate change and environmental challenges need also to be addressed. In the above-mentioned Communication, the Commission called “for addressing the deficiencies revealed by the developing crisis in ways that enhance the transition towards sustainable, resilient and fair food systems in the EU and globally”. The trade disruption raises serious concerns about global food security stemming from the short-term impact of the war and the longer-term uncertainties that surround it. While the stable food supply in the EU is not jeopardised, if the significantly higher production costs at farm level are not compensated by higher prices, this may impact supply certainties. The Common Agricultural Policy (CAP) provides for a range of measures, including a price safety net and the possibility to take exceptional measures. In its Communication of 23 March 2022 the Commission already presented a number of exceptional initiatives to safeguard food security and to reinforce the resilience of food systems. The current situation, however, is unprecedented and requires additional initiatives, as certain small businesses and farmers are in urgent need of emergency support in order to maintain their activities. The Commission therefore proposes an additional measure, funded by the European Agricultural Fund for Rural Development (EAFRD), which allows the Member States to provide liquidity support to farmers and agri-food businesses affected by significant increases in input costs, in particular to feed and fertiliser undertakings as well as energy-intensive undertakings in the processing industry which experience increased gas and electricity costs. By directly addressing the cash-flow challenges of such businesses, the support will contribute to global food security and address the market disturbance due to increased input costs. In order to achieve these goals, the support will take the form of a one-off lump sum for farmers and for SMEs active in processing, marketing or development of agricultural products. Payments by the Commission shall be made in accordance with budget appropriations and subject to available funding. With a view to ensuring the most efficient use of resources available under existing rural development programmes, Member States will be required to substantiate the targeting of the support to those most affected, based on objective and non-discriminatory criteria. Member States would need to include the measure in the rural development programmes via a programme modification. The Member States may start payments to the beneficiaries once they have submitted a programme modification introducing the new measure. This submission can take place after the adoption of this proposal, as well as the amendments of the related secondary legislation (Commission Implementing Regulations (EU) No 808/2014 and 809/2014). 
Revised version (Article 53 European Innovation Partnership network):
1. A EIP network shall be put in place to support the EIP for agricultural productivity and sustainability referred to in Article 55, in accordance with Article 51(1). It shall enable the networking of operational groups, advisory services and researchers. 2. The aim of the EIP network shall be to: (a) facilitate the exchange of expertise and good practices; (b) establish a dialogue between farmers and the research community and facilitate the inclusion of all stakeholders in the knowledge exchange process. The aim of the EIP network shall be to: (a) facilitate the exchange of expertise and good practices; (b) establish a dialogue between farmers and the research community and facilitate the inclusion of all stakeholders in the knowledge exchange process. The tasks of the EIP network shall be to: (a) provide a help desk function and provide information to key actors concerning the EIP; (b) encourage the setting up of operational groups and provide information about the opportunities provided by Union policies; facilitate the setting up of cluster initiatives and pilot or demonstration projects which may relate, inter alia, to the following issues:: (i) increased agricultural productivity, economic viability, sustainability, output and resource efficiency; (ii) innovation in support of the bio-based economy; (iii) biodiversity, ecosystem services, soil functionality and sustainable water management; (iv) innovative products and services for the integrated supply chain; (v) opening up new product and market opportunities for primary producers; (vi) food quality, food safety and healthy diet; (vii) reduce post-harvest losses and food wastage. (d) collect and disseminate information in the field of the EIP, including research findings and new technologies relevant to innovation and knowledge exchange and exchanges in the field of innovation with third countries. 4. The Commission shall adopt implementing acts, setting out the organisational structure and operation of the EIP network. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 84.
Article 54 National rural network
1. Each Member State shall establish a national rural network, which groups the organisations and administrations involved in rural development. The partnership referred to in Article 5 of Regulation (EU) No 1303/2013 shall also be part of the national rural network. Member States with regional programmes may submit for approval a specific programme for the establishment and the operation of their national rural network. 2. Networking by the national rural network shall aim to: (a) increase the involvement of stakeholders in the implementation of rural development; (b) improve the quality of implementation of rural development programmes; (c) inform the broader public and potential beneficiaries on rural development policy and funding opportunities; (d) foster innovation in agriculture, food production, forestry and rural areas. 3. EAFRD support under Article 51(2) shall be used: (a) for the structures needed to run the network; (b) for the preparation and implementation of an action plan covering at least the following: (i) activities regarding the collection of examples of projects covering all priorities of the rural development programmes; (ii) activities regarding the facilitation of thematic and analytical exchanges between rural development stakeholders, sharing and dissemination of findings; (iii) activities regarding the provision of training and networking for local action groups and in particular technical assistance for inter-territorial and transnational co-operation, facilitation of co-operation among local action groups and the search of partners for the measure referred to in Article 35; (iv) activities regarding the provision of networking for advisors and innovation support services; (v) activities regarding the sharing and dissemination of monitoring and evaluation findings; (vi) a communication plan including publicity and information concerning the rural development programme in agreement with the Managing Authorities and information and communication activities aimed at a broader public; (vii) activities regarding the participation in and contribution to the European network for rural development. 4. The Commission shall adopt implementing acts, laying down rules for the establishment and operation of national rural networks and the content of the specific programmes referred to in paragraph 1. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 84.
Article 55 Aims
1. The EIP for agricultural productivity and sustainability shall: (a) promote a resource efficient, economically viable, productive, competitive, low emission, climate friendly and resilient agricultural and forestry sector, working towards agro-ecological production systems and working in harmony with the essential natural resources on which farming and forestry depend; (b) help deliver a steady and sustainable supply of food, feed and biomaterials, including existing and new types; (c) improve processes to preserve the environment, adapt to climate change and mitigate it; (d) build bridges between cutting-edge research knowledge and technology and farmers, forest managers, rural communities, businesses, NGOs and advisory services. 2. The EIP for agricultural productivity and sustainability shall seek to achieve its aims by: (a) creating added value by better linking research and farming practice and encouraging the wider use of available innovation measures; (b) promoting the faster and wider transposition of innovative solutions into practice; and (c) informing the scientific community about the research needs of farming practice. 3. The EAFRD shall contribute to the aims of the EIP for agricultural productivity and sustainability through support, in accordance with Article 35, of the EIP operational groups referred to in Article 56 and the EIP network referred to in Article 53.
Article 56 Operational groups
1. EIP operational groups shall form part of the EIP for agricultural productivity and sustainability. They shall be set up by interested actors such as farmers, researchers, advisors and businesses involved in the agriculture and food sector, who are relevant for achieving the objectives of the EIP. 2. EIP operational groups shall establish internal procedures that ensure, that their operation and decision-making is transparent and that situations of conflict of interest are avoided. 3. The Member States shall decide within the framework of their programmes to what extent they will support the operational groups.
Article 57 Tasks of operational groups
1. EIP operational groups shall draw up a plan that contains the following: (a) a description of the innovative project to be developed, tested, adapted or implemented; (b) a description of the expected results and the contribution to the EIP objective of enhancing productivity and sustainable resource management. 2. When implementing their innovative projects operational groups shall: (a) make decisions on the elaboration and implementation of innovative actions; and (b) implement innovative actions through measures financed through the rural development programmes. 3. Operational groups shall disseminate the results of their project, in particular through the EIP network.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal As stated in the Commission Communication on safeguarding food security and reinforcing the resilience of food systems of 23 March 2022 (COM(2022)133 final), the unprovoked Russia’s invasion of Ukraine has further destabilised already fragile agricultural markets. Before the invasion, commodity markets were witnessing a significant price surge, which agricultural markets felt through the increases in energy, fertiliser and animal feed costs. Now the costs for farmers and small and medium enterprises (SMEs) active in processing, marketing or development of agricultural products further increases and affects the price of food, which exposes the vulnerabilities of the European food system, notably the dependence on imports and raising concerns as regards the income of farmers and producers in the agri-food chain. This adds to the pressure on European agriculture following the Covid-19 pandemic. Climate change and environmental challenges need also to be addressed. In the above-mentioned Communication, the Commission called “for addressing the deficiencies revealed by the developing crisis in ways that enhance the transition towards sustainable, resilient and fair food systems in the EU and globally”. The trade disruption raises serious concerns about global food security stemming from the short-term impact of the war and the longer-term uncertainties that surround it. While the stable food supply in the EU is not jeopardised, if the significantly higher production costs at farm level are not compensated by higher prices, this may impact supply certainties. The Common Agricultural Policy (CAP) provides for a range of measures, including a price safety net and the possibility to take exceptional measures. In its Communication of 23 March 2022 the Commission already presented a number of exceptional initiatives to safeguard food security and to reinforce the resilience of food systems. The current situation, however, is unprecedented and requires additional initiatives, as certain small businesses and farmers are in urgent need of emergency support in order to maintain their activities. The Commission therefore proposes an additional measure, funded by the European Agricultural Fund for Rural Development (EAFRD), which allows the Member States to provide liquidity support to farmers and agri-food businesses affected by significant increases in input costs, in particular to feed and fertiliser undertakings as well as energy-intensive undertakings in the processing industry which experience increased gas and electricity costs. By directly addressing the cash-flow challenges of such businesses, the support will contribute to global food security and address the market disturbance due to increased input costs. In order to achieve these goals, the support will take the form of a one-off lump sum for farmers and for SMEs active in processing, marketing or development of agricultural products. Payments by the Commission shall be made in accordance with budget appropriations and subject to available funding. With a view to ensuring the most efficient use of resources available under existing rural development programmes, Member States will be required to substantiate the targeting of the support to those most affected, based on objective and non-discriminatory criteria. Member States would need to include the measure in the rural development programmes via a programme modification. The Member States may start payments to the beneficiaries once they have submitted a programme modification introducing the new measure. This submission can take place after the adoption of this proposal, as well as the amendments of the related secondary legislation (Commission Implementing Regulations (EU) No 808/2014 and 809/2014). 
Revised version (Article 57 Tasks of operational groups):
1. EIP operational groups shall draw up a plan that contains the following: (a) a description of the innovative project to be developed, tested, adapted or implemented; (b) a description of the expected results and the contribution to the EIP objective of enhancing productivity and sustainable resource management. EIP operational groups shall draw up a plan that contains the following: (a) a description of the innovative project to be developed, tested, adapted or implemented; (b) a description of the expected results and the contribution to the EIP objective of enhancing productivity and sustainable resource management. 2. When implementing their innovative projects operational groups shall: (a) make decisions on the elaboration and implementation of innovative actions; and (b) implement innovative actions through measures financed through the rural development programmes. When implementing their innovative projects operational groups shall: (a) make decisions on the elaboration and implementation of innovative actions; and (b) implement innovative actions through measures financed through the rural development programmes. 3. Operational groups shall disseminate the results of their project, in particular through the EIP network.
Article 58 Resources and their distribution
1. Without prejudice to paragraphs 5, 6 and 7 of this Article, the total amount of Union support for rural development under this Regulation for the period from 1 January 2014 to 31 December 2020 shall be EUR 84 936 million, in 2011 prices, in accordance with the multiannual financial framework for the years 2014 to 2020. 2. 0,25 % of the resources referred to in paragraph 1 shall be devoted to technical assistance for the Commission, as referred to in Article 51(1). 3. For the purpose of their programming and subsequent inclusion in the general budget of the Union, the amounts referred to in paragraph 1 shall be indexed at 2 % per year. 4. The annual breakdown by Member State of the amounts referred to in paragraph 1, after deduction of the amount referred to in paragraph 2 is set out in Annex I. 5. Funds transferred by a Member State under Article 14(2) of Regulation (EU) No 1307/2013 shall be subtracted from the amounts allocated to that Member State in accordance with paragraph 4. 6. The funds transferred to the EAFRD in application of Article 136a(1) of Regulation (EC) No 73/2009 and Article 7(2) of Regulation (EU) No 1307/2013 and the funds transferred to the EAFRD in application of Articles 10b, 136 and 136b of Regulation (EC) No 73/2009 in respect of calendar years 2013 and 2014 shall also be included in the annual breakdown referred to in paragraph 4 of this Article. 7. In order to take account of the developments relating to the annual breakdown referred to in paragraph 4, including the transfers referred to in paragraphs 5 and 6; to make technical adjustments without changing the overall allocations; or to take account of any other change provided for by a legislative act after the adoption of this Regulation, the Commission shall be empowered to adopt delegated acts, in accordance with Article 83, to review the ceilings set out in Annex I. 8. For the purposes of the allocation of the performance reserve referred to in Article 22(3) and (4) of Regulation (EU) No 1303/2013, available assigned revenue collected in accordance with Article 43 of Regulation (EU) No 1306/2013 for the EAFRD shall be added to the amounts referred to in Article 20 of Regulation (EU) No 1303/2013. That available assigned revenue shall be allocated to Member States in proportion to their share of the total amount of support from the EAFRD.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal As stated in the Commission Communication on safeguarding food security and reinforcing the resilience of food systems of 23 March 2022 (COM(2022)133 final), the unprovoked Russia’s invasion of Ukraine has further destabilised already fragile agricultural markets. Before the invasion, commodity markets were witnessing a significant price surge, which agricultural markets felt through the increases in energy, fertiliser and animal feed costs. Now the costs for farmers and small and medium enterprises (SMEs) active in processing, marketing or development of agricultural products further increases and affects the price of food, which exposes the vulnerabilities of the European food system, notably the dependence on imports and raising concerns as regards the income of farmers and producers in the agri-food chain. This adds to the pressure on European agriculture following the Covid-19 pandemic. Climate change and environmental challenges need also to be addressed. In the above-mentioned Communication, the Commission called “for addressing the deficiencies revealed by the developing crisis in ways that enhance the transition towards sustainable, resilient and fair food systems in the EU and globally”. The trade disruption raises serious concerns about global food security stemming from the short-term impact of the war and the longer-term uncertainties that surround it. While the stable food supply in the EU is not jeopardised, if the significantly higher production costs at farm level are not compensated by higher prices, this may impact supply certainties. The Common Agricultural Policy (CAP) provides for a range of measures, including a price safety net and the possibility to take exceptional measures. In its Communication of 23 March 2022 the Commission already presented a number of exceptional initiatives to safeguard food security and to reinforce the resilience of food systems. The current situation, however, is unprecedented and requires additional initiatives, as certain small businesses and farmers are in urgent need of emergency support in order to maintain their activities. The Commission therefore proposes an additional measure, funded by the European Agricultural Fund for Rural Development (EAFRD), which allows the Member States to provide liquidity support to farmers and agri-food businesses affected by significant increases in input costs, in particular to feed and fertiliser undertakings as well as energy-intensive undertakings in the processing industry which experience increased gas and electricity costs. By directly addressing the cash-flow challenges of such businesses, the support will contribute to global food security and address the market disturbance due to increased input costs. In order to achieve these goals, the support will take the form of a one-off lump sum for farmers and for SMEs active in processing, marketing or development of agricultural products. Payments by the Commission shall be made in accordance with budget appropriations and subject to available funding. With a view to ensuring the most efficient use of resources available under existing rural development programmes, Member States will be required to substantiate the targeting of the support to those most affected, based on objective and non-discriminatory criteria. Member States would need to include the measure in the rural development programmes via a programme modification. The Member States may start payments to the beneficiaries once they have submitted a programme modification introducing the new measure. This submission can take place after the adoption of this proposal, as well as the amendments of the related secondary legislation (Commission Implementing Regulations (EU) No 808/2014 and 809/2014). 
Revised version (Article 58 Resources and their distribution):
1. Without prejudice to paragraphs 5, 6 and 7 of this Article, the total amount of Union support for rural development under this Regulation for the period from 1 January 2014 to 31 December 2020 shall be EUR 84 936 million, in 2011 prices, in accordance with the multiannual financial framework for the years 2014 to 2020. Without prejudice to paragraphs 5, 6 and 7, the total amount of Union support for rural development under this Regulation for the period from 1 January 2021 to 31 December 2022 shall be a maximum of EUR 26 896 831 880 , in current prices, in accordance with the multiannual financial framework for the years 2021 to 2027. 2. 0,25 % of the resources referred to in paragraph 1 shall be devoted to technical assistance for the Commission, as referred to in Article 51(1). 3. For the purpose of their programming and subsequent inclusion in the general budget of the Union, the amounts referred to in paragraph 1 shall be indexed at 2 % per year. 4. The annual breakdown by Member State of the amounts referred to in paragraph 1, after deduction of the amount referred to in paragraph 2 is set out in Annex I. 5. Funds transferred by a Member State under Article 14(2) of Regulation (EU) No 1307/2013 shall be subtracted from the amounts allocated to that Member State in accordance with paragraph 4. 6. The funds transferred to the EAFRD in application of Article 136a(1) of Regulation (EC) No 73/2009 and Article 7(2) of Regulation (EU) No 1307/2013 and the funds transferred to the EAFRD in application of Articles 10b, 136 and 136b of Regulation (EC) No 73/2009 in respect of calendar years 2013 and 2014 shall also be included in the annual breakdown referred to in paragraph 4 of this Article. 7. In order to take account of the developments relating to the annual breakdown referred to in paragraph 4 of this Article, including the transfers referred to in paragraphs 5 and 6 of this Article and the transfers resulting from the application of Article 1 of Regulation (EU) 2020/2220, to make technical adjustments without changing the overall allocations, or to take account of any other change provided for by a legislative act after the adoption of this Regulation, the Commission shall be empowered to adopt delegated acts, in accordance with Article 83 of this Regulation, to review the ceilings set out in Annex I to this Regulation. 8. For the purposes of the allocation of the performance reserve referred to in Article 22(3) and (4) of Regulation (EU) No 1303/2013, available assigned revenue collected in accordance with Article 43 of Regulation (EU) No 1306/2013 for the EAFRD shall be added to the amounts referred to in Article 20 of Regulation (EU) No 1303/2013. That available assigned revenue shall be allocated to Member States in proportion to their share of the total amount of support from the EAFRD.
Article 59 Fund contribution
1. The decision approving a rural development programme shall set the maximum contribution from the EAFRD to the programme. The decision shall clearly identify, where necessary, the appropriations allocated to the less developed regions. 2. The EAFRD contribution shall be calculated on the basis of the amount of eligible public expenditure. 3. The rural development programmes shall establish a single EAFRD contribution rate applicable to all measures. Where applicable, a separate EAFRD contribution rate shall be established for less-developed regions, for outermost regions and for the smaller Aegean islands within the meaning of Regulation (EU) No 229/2013, as well as for transition regions. e maximum EAFRD contribution rate shall be: (a) 85 % of the eligible public expenditure in the less developed regions, in the outermost regions and in the smaller Aegean islands within the meaning of Regulation (EU) No 229/2013; (b) 75 % of the eligible public expenditure for all regions whose GDP per capita for the 2007-2013 period was less than 75 % of the average of the EU-25 for the reference period but whose GDP per capita is above 75 % of the GDP average of the EU-27; (c) 63 % of the eligible public expenditure for the transition regions other than those referred to in point (b) of this paragraph; (d) 53 % of the eligible public expenditure in the other regions. The minimum EAFRD contribution rate shall be 20 %. 4. By way of derogation from paragraph 3, the maximum EAFRD contribution shall be: (a) 80 % for the measures referred to in Articles 14, 27 and 35, for the LEADER local development referred to in Article 32 of Regulation (EU) No 1303/2013 and for operations under point (a)(i) of Article 19(1). That rate may be increased to a maximum of 90 % for the programmes of less developed regions, of the outermost regions, of the smaller Aegean islands within the meaning of Regulation (EU) No 229/2013, and of transition regions referred to in points (b) and (c) of paragraph 3; (b) 75 % for operations contributing to the objectives of environment and climate change mitigation and adaptation under Article 17, points (a) and (b) of Article 21(1), Articles 28 29, 30 31 and 34; (c) 100 % for Union-level financial instruments referred to in point (a) of Article 38(1) of Regulation 1303/2013; (d) the contribution rate applicable to the measure concerned increased by an additional 10 percentage points for contributions to financial instruments referred to in point (b) of Article 38(1) of Regulation 1303/2013; (e) 100 % for operations receiving funding from funds transferred to the EAFRD in application of Article 136a(1) of Regulation (EC) No 73/2009 and Article 7(2) and Article 14(1) of Regulation (EU) No 1307/2013; (f) 100 % for an amount of EUR 100 million, in 2011 prices, allocated to Ireland, for an amount of EUR 500 million, in 2011 prices, allocated to Portugal and for an amount of EUR 7 million, in 2011 prices, allocated to Cyprus, on the condition that those Member States are receiving financial assistance in accordance with Articles 136 and 143 TFEU on 1 January 2014 or thereafter, until 2016 when the application of this provision shall be reassessed; (g) for Member States receiving on 1 January 2014 or thereafter financial assistance in accordance with Article 136 and 143 TFEU, the EAFRD contribution rate resulting from the application of Article 24(1) of Regulation (EU) No 1303/2013 may be increased by a maximum of an additional 10 percentage points up to a total maximum of 95 %, for expenditure to be paid by these Member States in the first two years of implementation of the rural development programme. The EAFRD contribution rate which would be applicable without this derogation shall, however, be respected for the total public expenditure made during the programming period. 5. At least 5 %, and in the case of Croatia 2,5 %, of the total EAFRD contribution to the rural development programme shall be reserved for LEADER. 6. At least 30 % of the total EAFRD contribution to the rural development programme shall be reserved for measures under the following Articles: Article 17 for environment and climate related investments; Articles 21, 28, 29 and 30, with the exception of Water Framework Directive related payments; and Articles 31, 32 and 34. The first subparagraph shall not apply to the outermost regions and the overseas territories of the Member States. 7. Where a Member State submits both a national programme and a set of regional programmes, paragraphs 5 and 6 shall not apply to the national programme. The EAFRD contribution to the national programme shall be taken into account for the purpose of calculating the percentages referred to in paragraphs 5 and 6 for each regional programme, in proportion to that regional programme's share of the national allocation. 8. An expenditure co-financed by the EAFRD shall not be co-financed by way of a contribution from the Structural Funds, from the Cohesion Fund or from any other Union financial instrument. 9. Public expenditure on aid to enterprises shall comply with the aid limits laid down in respect of State aid, unless this Regulation provides otherwise.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Financial Regulation 1 sets out the principles and procedures governing the establishment and implementation of the EU budget and the control of the EU funds. Over the last 30 years, the number of general financial rules contained in the Financial Regulation has increased sharply 2 . In addition, a number of sectoral financial rules have emerged: the rules for participation to the Framework Programme for Research and Innovation 3 , the Common Provisions to the European Structural and Investment Funds 4 and the Common Implementing Rules for the External Action 5 . Users of EU funds have repeatedly complained about the proliferation of rules both at general and at sectoral level, their heterogeneity and their complexity due to the fact that they follow the architecture of the programme and multiple layers of controls. In addition, the complexity of the financial set of rules has slowed down implementation of the EU funds, making it costly and prone to errors. A first step towards more coherent and simpler financial rules was achieved in 2012: the Commission tabled proposals for the programmes covered by the MFF 2014-2020 which reduced the number of programmes and instruments, grouped them under a single framework with common rules, simplified procedures for application and declaration of costs by final beneficiaries, facilitated the deployment of innovative financial instruments, enabled EU Trust-Funds and improved the cost-efficiency of controls. Recent revisions have aligned the Financial Regulation on the results of the negotiation to the MFF 2014-2020 (2013 revision) as well as to the new Procurement Directive (2015 revision). However, there is room for further simplification . This is confirmed by the experience gained since 2014 and by the work of the High Level Group of Independent Experts on Monitoring Simplification for Beneficiaries of the European Structural and Investment Funds 6 . The public consultation on the revision of the Financial Regulation 7 also shows stakeholders’ clear expectations in the area. Efforts must therefore continue in order to remove bottlenecks, ensure synergies and complementarities between ESI Funds and the other EU funds and improve efficiency of delivery and control requirements. Simpler and more flexible financial rules will contribute to optimising spending and impact of the MFF 2014-2020 and constitute as such one of the key elements of the Commission's initiative for a Budget Focused on Results (BFOR) which aims at making sure that resources are allocated to priorities and that every action delivers maximum performance and added value 8 . In addition, this will reduce the costs related to implementation of EU rules as well the number of errors. Simpler and more flexible EU financial rules are key in enhancing EU budget’s ability to adapt to changing circumstances and to respond to unexpected developments. The present legislative proposal forms an integral part of the mid-term review/revision of the multiannual financial framework (MFF) 2014-2020 9 . It contributes to two of its main objectives: simplification and flexibility . The Commission therefore proposes in a single act an ambitious revision of the general financial rules accompanied by corresponding changes to the sectorial financial rules set out in 15 legislative acts concerning multiannual programmes. The inclusion of sectoral changes in the same legislative proposal aims at ensuring a coherent negotiation process as well as at facilitating a speedy adoption by the legislator. The focus is put on the following key areas: 1 . Simplification for recipients of EU funds: many measures aim at simplifying life for recipients of EU funds. They relate to grants (removal of the non-cumulative award check for low-value grants and of the non-profit principle; simpler rules for "contribution in kind" valuation ; recognition of volunteer work ; grant awards without calls for proposal under specific conditions) and simplified forms of grants (Title VIII). 2 . From multi ple layers of controls to cross reliance on audit, assessment or authorisation, and harmonisation of reporting requirements: the aim of these measures is to encourage reliance as far as possible on one single audit, assessment or authorisation (conformity to State aids for instance), when the audit , assessment or authorisation meet s the necessary conditions to be taken into account in the EU system. More generally, rules for implementing partners (international organisations, EIB/EIF, national promotional banks, national agencies, NGOs) will be simplified by relying increasingly on their procedures and policies once assessed positively. Financial f ramework partnership agreements concluded with long term partners will allow progressing in the harmonisation of audit, reporting and other administrative requirements among donors (Title V Articles 122, 123 and 126). 3 . Allowing the application of only one set of rules to hybrid actions or in the case of combination of measures or instruments: the proposal aims at achieving further simplification for the partners of the EU by a number of measures to avoid the parallel application of different rules and procedures, notably through facilitating the combination of European Structural and Investment Funds (ESIF) funding with financial instruments and the European Fund for Strategic Investments (Title V). 4 . More effective use of financial instruments: optimise use of reflows, ensuring a level playing field among key EU implementing partners, reducing burdensome requirements related to publication of individual data of final recipients or to the exclusion criteria (Title X). 5 . More flexible budget management: the proposal sets out several ways for more budgetary flexibility, in order to allow the Union to respond to unforeseen challenges and new tasks more effectively and to achieve swifter crisis management - among which the creation of a " flexibility cushion" for unforeseen needs and new crises in the external actions geographic instruments budget , a more efficient activation of the solidarity and globalization adjustment funds, and the extension of Trust-Funds to internal policies (Articles 14 and 22 7 ) , the creation of a EU crisis reserve with the reuse of decommitted appropriations, and for the next Multiannual Financial Framework, the possibility that financial operations other than financial instruments generate a contingent liability for the Union exceeding the financial assets provided to cover the financial liability of the Union (Article 203) and the creation of a common provisioning fund holding the resources provisioned for financial operations (Article 2 05 ). R ecent initiatives (such as the European Fund for Strategic Investments (EFSI) or the European Fund for Sustainable Development (EFSD)), have indeed shown the need to fully use the leverage of the EU budget by creating non-provisioned contingent liabilities. Title X sets the framework to authorise, manage and control these financial risks. 6 . F ocus on results and streamlining of reporting: a stronger focus on results through lump sums, prizes, payment based on output and results rather than on reimbursement of costs, payment against conditions to be fulfilled (Article 121, Title X III ). This should contribute to further reducing the costs of implementing EU funds as well as the number of errors. On the reporting side, reports are regrouped around the draft budget and the integrated financial reporting package, in order to increase efficiency and transparency both towards the general public and the budgetary authority (Articles 39 and 23 9 -24 5 ). 7. Simpler and leaner EU administration: facilitating agreements or delegations between Institutions or bodies in order to pool the implementation of administrative appropriations in European Offices or within Executive Agencies (Articles 57, 58, 64, 65 and 6 8 ); merging consultative panels competent for financial irregularities (Article 73 (6)) with the EDES panel (Article 139 ) and moving from annual to multiannual financing decisions (Article 10 8 ). 8. Providing possibility for citizen engagement : t he proposal provides a possibility for citizens to be consulted on the implementation of the Union budget by the Commission, Member States and any other entity implementing the Union budget (А rticle 54 ) . In simplifying and making EU financial rules more flexible, the present proposal paves the way for the preparation of the next generation of spending programmes (post-2020).
Revised version (Article 59 Fund contribution):
1. The decision approving a rural development programme shall set the maximum contribution from the EAFRD to the programme. The decision shall clearly identify, where necessary, the appropriations allocated to the less developed regions. 2. The EAFRD contribution shall be calculated on the basis of the amount of eligible public expenditure. 3. The rural development programmes shall establish a single EAFRD contribution rate applicable to all measures. Where applicable, a separate EAFRD contribution rate shall be established for less-developed regions, for outermost regions and for the smaller Aegean islands within the meaning of Regulation (EU) No 229/2013, as well as for transition regions. e maximum EAFRD contribution rate shall be: (a) 85 % of the eligible public expenditure in the less developed regions, in the outermost regions and in the smaller Aegean islands within the meaning of Regulation (EU) No 229/2013; (b) 75 % of the eligible public expenditure for all regions whose GDP per capita for the 2007-2013 period was less than 75 % of the average of the EU-25 for the reference period but whose GDP per capita is above 75 % of the GDP average of the EU-27; (c) 63 % of the eligible public expenditure for the transition regions other than those referred to in point (b) of this paragraph; (d) 53 % of the eligible public expenditure in the other regions. The minimum EAFRD contribution rate shall be 20 %. 4. By way of derogation from paragraph 3, the maximum EAFRD contribution shall be: (a) 80 % for the measures referred to in Articles 14, 27 and 35, for the LEADER local development referred to in Article 32 of Regulation (EU) No 1303/2013 and for operations under point (a)(i) of Article 19(1). That rate may be increased to a maximum of 90 % for the programmes of less developed regions, of the outermost regions, of the smaller Aegean islands within the meaning of Regulation (EU) No 229/2013, and of transition regions referred to in points (b) and (c) of paragraph 3; (b) 75 % for operations contributing to the objectives of environment and climate change mitigation and adaptation under Article 17, points (a) and (b) of Article 21(1), Articles 28 29, 30 31 and 34; (c) 100 % for Union-level financial instruments referred to in point (a) of Article 38(1) of Regulation 1303/2013; (d) the contribution rate applicable to the measure concerned increased by an additional 10 percentage points for contributions to financial instruments referred to in point (b) of Article 38(1) of Regulation 1303/2013; (e) 100 % for operations receiving funding from funds transferred to the EAFRD in application of Article 136a(1) of Regulation (EC) No 73/2009 and Article 7(2) and Article 14(1) of Regulation (EU) No 1307/2013; (f) 100 % for an amount of EUR 100 million, in 2011 prices, allocated to Ireland, for an amount of EUR 500 million, in 2011 prices, allocated to Portugal and for an amount of EUR 7 million, in 2011 prices, allocated to Cyprus; (g) for Member States receiving on 1 January 2014 or thereafter financial assistance in accordance with Article 136 and 143 TFEU, the EAFRD contribution rate resulting from the application of Article 24(1) of Regulation (EU) No 1303/2013 may be increased by a maximum of an additional 10 percentage points up to a total maximum of 95 %, for expenditure to be paid by these Member States in the first two years of implementation of the rural development programme. The EAFRD contribution rate which would be applicable without this derogation shall, however, be respected for the total public expenditure made during the programming period; (h) the contribution rate referred to in Article 39a(13) of Regulation (EU) No 1303/2013 for the financial instrument referred to in point (c) of Article 38(1) of that Regulation. 5. At least 5 %, and in the case of Croatia 2,5 %, of the total EAFRD contribution to the rural development programme shall be reserved for LEADER. 6. At least 30 % of the total EAFRD contribution to the rural development programme shall be reserved for measures under the following Articles: Article 17 for environment and climate related investments; Articles 21, 28, 29 and 30, with the exception of Water Framework Directive related payments; and Articles 31, 32 and 34. The first subparagraph shall not apply to the outermost regions and the overseas territories of the Member States. 7. Where a Member State submits both a national programme and a set of regional programmes, paragraphs 5 and 6 shall not apply to the national programme. The EAFRD contribution to the national programme shall be taken into account for the purpose of calculating the percentages referred to in paragraphs 5 and 6 for each regional programme, in proportion to that regional programme's share of the national allocation. 8. An expenditure co-financed by the EAFRD shall not be co-financed by way of a contribution from the Structural Funds, from the Cohesion Fund or from any other Union financial instrument. 9. Public expenditure on aid to enterprises shall comply with the aid limits laid down in respect of State aid, unless this Regulation provides otherwise.
Article 60 Eligibility of expenditure
1. By way of derogation from Article 65(9) of Regulation (EU) No 1303/2013, in cases of emergency measures due to natural disasters, the rural development programmes may provide that eligibility of expenditure relating to programme changes may start from the date when the natural disaster occurred. 2. Expenditure shall be eligible for an EAFRD contribution only where incurred for operations decided upon by the Managing Authority of the programme in question or under its responsibility, in accordance with selection criteria referred to in Article 49. With the exception of general costs as defined in Article 45(2)(c), in respect of investment operations under measures falling within the scope of Article 42 TFEU, only expenditure which has been incurred after an application has been submitted to the competent authority shall be considered eligible. Member States may provide in their programmes that only expenditure which has been incurred after the application for support has been approved by the competent authority shall be eligible. 3. Paragraphs 1 and 2 shall not apply to Article 51(1) and (2). 4. Payments by beneficiaries shall be supported by invoices and documents proving payment. Where this cannot be done, payments shall be supported by documents of equivalent probative value, except for forms of support under points (b), (c) and (d) of Article 67(1) of Regulation (EU) No 1303/2013.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Financial Regulation 1 sets out the principles and procedures governing the establishment and implementation of the EU budget and the control of the EU funds. Over the last 30 years, the number of general financial rules contained in the Financial Regulation has increased sharply 2 . In addition, a number of sectoral financial rules have emerged: the rules for participation to the Framework Programme for Research and Innovation 3 , the Common Provisions to the European Structural and Investment Funds 4 and the Common Implementing Rules for the External Action 5 . Users of EU funds have repeatedly complained about the proliferation of rules both at general and at sectoral level, their heterogeneity and their complexity due to the fact that they follow the architecture of the programme and multiple layers of controls. In addition, the complexity of the financial set of rules has slowed down implementation of the EU funds, making it costly and prone to errors. A first step towards more coherent and simpler financial rules was achieved in 2012: the Commission tabled proposals for the programmes covered by the MFF 2014-2020 which reduced the number of programmes and instruments, grouped them under a single framework with common rules, simplified procedures for application and declaration of costs by final beneficiaries, facilitated the deployment of innovative financial instruments, enabled EU Trust-Funds and improved the cost-efficiency of controls. Recent revisions have aligned the Financial Regulation on the results of the negotiation to the MFF 2014-2020 (2013 revision) as well as to the new Procurement Directive (2015 revision). However, there is room for further simplification . This is confirmed by the experience gained since 2014 and by the work of the High Level Group of Independent Experts on Monitoring Simplification for Beneficiaries of the European Structural and Investment Funds 6 . The public consultation on the revision of the Financial Regulation 7 also shows stakeholders’ clear expectations in the area. Efforts must therefore continue in order to remove bottlenecks, ensure synergies and complementarities between ESI Funds and the other EU funds and improve efficiency of delivery and control requirements. Simpler and more flexible financial rules will contribute to optimising spending and impact of the MFF 2014-2020 and constitute as such one of the key elements of the Commission's initiative for a Budget Focused on Results (BFOR) which aims at making sure that resources are allocated to priorities and that every action delivers maximum performance and added value 8 . In addition, this will reduce the costs related to implementation of EU rules as well the number of errors. Simpler and more flexible EU financial rules are key in enhancing EU budget’s ability to adapt to changing circumstances and to respond to unexpected developments. The present legislative proposal forms an integral part of the mid-term review/revision of the multiannual financial framework (MFF) 2014-2020 9 . It contributes to two of its main objectives: simplification and flexibility . The Commission therefore proposes in a single act an ambitious revision of the general financial rules accompanied by corresponding changes to the sectorial financial rules set out in 15 legislative acts concerning multiannual programmes. The inclusion of sectoral changes in the same legislative proposal aims at ensuring a coherent negotiation process as well as at facilitating a speedy adoption by the legislator. The focus is put on the following key areas: 1 . Simplification for recipients of EU funds: many measures aim at simplifying life for recipients of EU funds. They relate to grants (removal of the non-cumulative award check for low-value grants and of the non-profit principle; simpler rules for "contribution in kind" valuation ; recognition of volunteer work ; grant awards without calls for proposal under specific conditions) and simplified forms of grants (Title VIII). 2 . From multi ple layers of controls to cross reliance on audit, assessment or authorisation, and harmonisation of reporting requirements: the aim of these measures is to encourage reliance as far as possible on one single audit, assessment or authorisation (conformity to State aids for instance), when the audit , assessment or authorisation meet s the necessary conditions to be taken into account in the EU system. More generally, rules for implementing partners (international organisations, EIB/EIF, national promotional banks, national agencies, NGOs) will be simplified by relying increasingly on their procedures and policies once assessed positively. Financial f ramework partnership agreements concluded with long term partners will allow progressing in the harmonisation of audit, reporting and other administrative requirements among donors (Title V Articles 122, 123 and 126). 3 . Allowing the application of only one set of rules to hybrid actions or in the case of combination of measures or instruments: the proposal aims at achieving further simplification for the partners of the EU by a number of measures to avoid the parallel application of different rules and procedures, notably through facilitating the combination of European Structural and Investment Funds (ESIF) funding with financial instruments and the European Fund for Strategic Investments (Title V). 4 . More effective use of financial instruments: optimise use of reflows, ensuring a level playing field among key EU implementing partners, reducing burdensome requirements related to publication of individual data of final recipients or to the exclusion criteria (Title X). 5 . More flexible budget management: the proposal sets out several ways for more budgetary flexibility, in order to allow the Union to respond to unforeseen challenges and new tasks more effectively and to achieve swifter crisis management - among which the creation of a " flexibility cushion" for unforeseen needs and new crises in the external actions geographic instruments budget , a more efficient activation of the solidarity and globalization adjustment funds, and the extension of Trust-Funds to internal policies (Articles 14 and 22 7 ) , the creation of a EU crisis reserve with the reuse of decommitted appropriations, and for the next Multiannual Financial Framework, the possibility that financial operations other than financial instruments generate a contingent liability for the Union exceeding the financial assets provided to cover the financial liability of the Union (Article 203) and the creation of a common provisioning fund holding the resources provisioned for financial operations (Article 2 05 ). R ecent initiatives (such as the European Fund for Strategic Investments (EFSI) or the European Fund for Sustainable Development (EFSD)), have indeed shown the need to fully use the leverage of the EU budget by creating non-provisioned contingent liabilities. Title X sets the framework to authorise, manage and control these financial risks. 6 . F ocus on results and streamlining of reporting: a stronger focus on results through lump sums, prizes, payment based on output and results rather than on reimbursement of costs, payment against conditions to be fulfilled (Article 121, Title X III ). This should contribute to further reducing the costs of implementing EU funds as well as the number of errors. On the reporting side, reports are regrouped around the draft budget and the integrated financial reporting package, in order to increase efficiency and transparency both towards the general public and the budgetary authority (Articles 39 and 23 9 -24 5 ). 7. Simpler and leaner EU administration: facilitating agreements or delegations between Institutions or bodies in order to pool the implementation of administrative appropriations in European Offices or within Executive Agencies (Articles 57, 58, 64, 65 and 6 8 ); merging consultative panels competent for financial irregularities (Article 73 (6)) with the EDES panel (Article 139 ) and moving from annual to multiannual financing decisions (Article 10 8 ). 8. Providing possibility for citizen engagement : t he proposal provides a possibility for citizens to be consulted on the implementation of the Union budget by the Commission, Member States and any other entity implementing the Union budget (А rticle 54 ) . In simplifying and making EU financial rules more flexible, the present proposal paves the way for the preparation of the next generation of spending programmes (post-2020).
Revised version (Article 60 Eligibility of expenditure):
1. By way of derogation from Article 65(9) of Regulation (EU) No 1303/2013, in cases of emergency measures due to natural disasters, catastrophic events or adverse climatic events or a significant and sudden change in the socioeconomic conditions of the Member State or region, the rural development programmes may provide that eligibility of expenditure relating to programme changes may start from the date when the event occurred. 2. Expenditure shall be eligible for an EAFRD contribution only where incurred for operations decided upon by the Managing Authority of the programme in question or under its responsibility, in accordance with selection criteria referred to in Article 49. With the exception of general costs as defined in point (c) of Article 45(2), in respect of investment operations under measures falling within the scope of Article 42 TFEU, only expenditure which has been incurred after an application has been submitted to the competent authority shall be considered eligible. However, Member States may provide in their programme that expenditure which is related to emergency measures due to natural disasters, catastrophic events or adverse climatic events or a significant and sudden change in the socioeconomic conditions of the Member State or region, and which has been incurred by the beneficiary after the event occurs, is also eligible. Member States may provide in their programmes that only expenditure which has been incurred after the application for support has been approved by the competent authority shall be eligible. 3. Paragraphs 1 and 2 shall not apply to Article 51(1) and (2). 4. Payments by beneficiaries shall be supported by invoices and documents proving payment. Where this cannot be done, payments shall be supported by documents of equivalent probative value, except for the forms of support referred to in Article 67(1) of Regulation (EU) No 1303/2013 other than under point (a) thereof.
Article 61 Eligible expenditure
1. Where running costs are covered by support under this Regulation the following types of costs shall be eligible: (a) operating costs; (b) personnel costs; (c) training costs; (d) costs linked to public relations; (e) financial costs; (f) networking costs. 2. Studies shall only be eligible expenditure where they are linked to a specific operation under the programme or the specific objectives and targets of the programme. 3. Contributions in kind in the form of provision of works, goods, services, land and real estate for which no cash payment supported by invoices or documents of equivalent probative value has been made, may be eligible for support provided that the conditions of Article 69 of Regulation (EU) No 1303/2013 are fulfilled.
Article 62 Verifiability and controllability of measures
1. Member States shall ensure that all the rural development measures that they intend to implement are verifiable and controllable. To this end, the Managing Authority and the paying agency of each rural development programme shall provide an ex ante assessment of the verifiability and controllability of the measures to be included in the rural development programme. The Managing Authority and paying agency shall also undertake the assessment of the verifiability and controllability of measures during the implementation of the rural development programme. Ex ante assessment and assessment during the implementation period shall take into account the results of controls in the previous and current programming period. Where the assessment reveals that the requirements of verifiability and controllability are not met, the measures concerned shall be adjusted accordingly. 2. Where aid is granted on the basis of standard costs or additional costs and income foregone, Member States shall ensure that the relevant calculations are adequate and accurate and established in advance on the basis of a fair, equitable and verifiable calculation. To this end, a body that is functionally independent from the authorities responsible for the programme implementation and possesses the appropriate expertise shall perform the calculations or confirm the adequacy and accuracy of the calculations. A statement confirming the adequacy and accuracy of the calculations shall be included in the rural development programme.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Financial Regulation 1 sets out the principles and procedures governing the establishment and implementation of the EU budget and the control of the EU funds. Over the last 30 years, the number of general financial rules contained in the Financial Regulation has increased sharply 2 . In addition, a number of sectoral financial rules have emerged: the rules for participation to the Framework Programme for Research and Innovation 3 , the Common Provisions to the European Structural and Investment Funds 4 and the Common Implementing Rules for the External Action 5 . Users of EU funds have repeatedly complained about the proliferation of rules both at general and at sectoral level, their heterogeneity and their complexity due to the fact that they follow the architecture of the programme and multiple layers of controls. In addition, the complexity of the financial set of rules has slowed down implementation of the EU funds, making it costly and prone to errors. A first step towards more coherent and simpler financial rules was achieved in 2012: the Commission tabled proposals for the programmes covered by the MFF 2014-2020 which reduced the number of programmes and instruments, grouped them under a single framework with common rules, simplified procedures for application and declaration of costs by final beneficiaries, facilitated the deployment of innovative financial instruments, enabled EU Trust-Funds and improved the cost-efficiency of controls. Recent revisions have aligned the Financial Regulation on the results of the negotiation to the MFF 2014-2020 (2013 revision) as well as to the new Procurement Directive (2015 revision). However, there is room for further simplification . This is confirmed by the experience gained since 2014 and by the work of the High Level Group of Independent Experts on Monitoring Simplification for Beneficiaries of the European Structural and Investment Funds 6 . The public consultation on the revision of the Financial Regulation 7 also shows stakeholders’ clear expectations in the area. Efforts must therefore continue in order to remove bottlenecks, ensure synergies and complementarities between ESI Funds and the other EU funds and improve efficiency of delivery and control requirements. Simpler and more flexible financial rules will contribute to optimising spending and impact of the MFF 2014-2020 and constitute as such one of the key elements of the Commission's initiative for a Budget Focused on Results (BFOR) which aims at making sure that resources are allocated to priorities and that every action delivers maximum performance and added value 8 . In addition, this will reduce the costs related to implementation of EU rules as well the number of errors. Simpler and more flexible EU financial rules are key in enhancing EU budget’s ability to adapt to changing circumstances and to respond to unexpected developments. The present legislative proposal forms an integral part of the mid-term review/revision of the multiannual financial framework (MFF) 2014-2020 9 . It contributes to two of its main objectives: simplification and flexibility . The Commission therefore proposes in a single act an ambitious revision of the general financial rules accompanied by corresponding changes to the sectorial financial rules set out in 15 legislative acts concerning multiannual programmes. The inclusion of sectoral changes in the same legislative proposal aims at ensuring a coherent negotiation process as well as at facilitating a speedy adoption by the legislator. The focus is put on the following key areas: 1 . Simplification for recipients of EU funds: many measures aim at simplifying life for recipients of EU funds. They relate to grants (removal of the non-cumulative award check for low-value grants and of the non-profit principle; simpler rules for "contribution in kind" valuation ; recognition of volunteer work ; grant awards without calls for proposal under specific conditions) and simplified forms of grants (Title VIII). 2 . From multi ple layers of controls to cross reliance on audit, assessment or authorisation, and harmonisation of reporting requirements: the aim of these measures is to encourage reliance as far as possible on one single audit, assessment or authorisation (conformity to State aids for instance), when the audit , assessment or authorisation meet s the necessary conditions to be taken into account in the EU system. More generally, rules for implementing partners (international organisations, EIB/EIF, national promotional banks, national agencies, NGOs) will be simplified by relying increasingly on their procedures and policies once assessed positively. Financial f ramework partnership agreements concluded with long term partners will allow progressing in the harmonisation of audit, reporting and other administrative requirements among donors (Title V Articles 122, 123 and 126). 3 . Allowing the application of only one set of rules to hybrid actions or in the case of combination of measures or instruments: the proposal aims at achieving further simplification for the partners of the EU by a number of measures to avoid the parallel application of different rules and procedures, notably through facilitating the combination of European Structural and Investment Funds (ESIF) funding with financial instruments and the European Fund for Strategic Investments (Title V). 4 . More effective use of financial instruments: optimise use of reflows, ensuring a level playing field among key EU implementing partners, reducing burdensome requirements related to publication of individual data of final recipients or to the exclusion criteria (Title X). 5 . More flexible budget management: the proposal sets out several ways for more budgetary flexibility, in order to allow the Union to respond to unforeseen challenges and new tasks more effectively and to achieve swifter crisis management - among which the creation of a " flexibility cushion" for unforeseen needs and new crises in the external actions geographic instruments budget , a more efficient activation of the solidarity and globalization adjustment funds, and the extension of Trust-Funds to internal policies (Articles 14 and 22 7 ) , the creation of a EU crisis reserve with the reuse of decommitted appropriations, and for the next Multiannual Financial Framework, the possibility that financial operations other than financial instruments generate a contingent liability for the Union exceeding the financial assets provided to cover the financial liability of the Union (Article 203) and the creation of a common provisioning fund holding the resources provisioned for financial operations (Article 2 05 ). R ecent initiatives (such as the European Fund for Strategic Investments (EFSI) or the European Fund for Sustainable Development (EFSD)), have indeed shown the need to fully use the leverage of the EU budget by creating non-provisioned contingent liabilities. Title X sets the framework to authorise, manage and control these financial risks. 6 . F ocus on results and streamlining of reporting: a stronger focus on results through lump sums, prizes, payment based on output and results rather than on reimbursement of costs, payment against conditions to be fulfilled (Article 121, Title X III ). This should contribute to further reducing the costs of implementing EU funds as well as the number of errors. On the reporting side, reports are regrouped around the draft budget and the integrated financial reporting package, in order to increase efficiency and transparency both towards the general public and the budgetary authority (Articles 39 and 23 9 -24 5 ). 7. Simpler and leaner EU administration: facilitating agreements or delegations between Institutions or bodies in order to pool the implementation of administrative appropriations in European Offices or within Executive Agencies (Articles 57, 58, 64, 65 and 6 8 ); merging consultative panels competent for financial irregularities (Article 73 (6)) with the EDES panel (Article 139 ) and moving from annual to multiannual financing decisions (Article 10 8 ). 8. Providing possibility for citizen engagement : t he proposal provides a possibility for citizens to be consulted on the implementation of the Union budget by the Commission, Member States and any other entity implementing the Union budget (А rticle 54 ) . In simplifying and making EU financial rules more flexible, the present proposal paves the way for the preparation of the next generation of spending programmes (post-2020).
Revised version (Article 62 Verifiability and controllability of measures):
1. Member States shall ensure that all the rural development measures that they intend to implement are verifiable and controllable. To this end, the Managing Authority and the paying agency of each rural development programme shall provide an ex ante assessment of the verifiability and controllability of the measures to be included in the rural development programme. The Managing Authority and paying agency shall also undertake the assessment of the verifiability and controllability of measures during the implementation of the rural development programme. Ex ante assessment and assessment during the implementation period shall take into account the results of controls in the previous and current programming period. Where the assessment reveals that the requirements of verifiability and controllability are not met, the measures concerned shall be adjusted accordingly. 2. Where aid is granted on the basis of standard costs or additional costs and income foregone in accordance with points (a) and (b) of Article 21(1),as regards income foregone and maintenance costs, and with Articles 28 to 31, 33, and 34, Member States shall ensure that the relevant calculations are adequate and accurate and established in advance on the basis of a fair, equitable and verifiable calculation method. To this end, a body that is functionally independent from the authorities responsible for the programme implementation and possesses the appropriate expertise shall perform the calculations or confirm the adequacy and accuracy of the calculations. A statement confirming the adequacy and accuracy of the calculations shall be included in the rural development programme.
Article 63 Advances
1. Payment of advances shall be subject to the establishment of a bank guarantee or an equivalent guarantee corresponding to 100 % of the amount of the advance. As regards public beneficiaries, advances shall be paid to municipalities, regional authorities and associations thereof, as well as to public law bodies. A facility provided as a guarantee by a public authority shall be considered equivalent to the guarantee referred to in the first subparagraph, provided that the authority undertakes to pay the amount covered by that guarantee if entitlement to the advance paid is not established. 2. The guarantee may be released when the competent paying agency establishes that the amount of actual expenditure corresponding to the public contribution related to the operation exceeds the amount of the advance.
Article 64 Responsibilities of the Commission
To ensure, in the context of shared management, sound financial management in accordance with Article 317 TFEU, the Commission shall carry out the measures and controls laid down in Regulation (EU) No 1306/2013.
Article 65 Responsibilities of the Member States
1. Member States shall adopt all the legislative, statutory and administrative provisions in accordance with Article 58(1) of Regulation (EU) No 1306/2013 in order to ensure that the Union's financial interests are protected effectively. 2. Member States shall designate, for each rural development programme, the following authorities: (a) the Managing Authority, which may be either a public or private body acting at national or regional level, or the Member State itself when it carries out that task, to be in charge of the management of the programme concerned; (b) the accredited paying agency within the meaning of Article 7 of Regulation (EU) No 1306/2013; (c) the certification body within the meaning of Article 9 of Regulation (EU) No 1306/2013. 3. Member States shall ensure, for each rural development programme, that the relevant management and control system has been set up in such a way that ensures a clear allocation and separation of functions between the Managing Authority and other bodies. Member States shall be responsible for ensuring that the systems function effectively throughout the programme period. 4. Member States shall clearly define the tasks of the Managing Authority, the Paying Agency and the local action groups under LEADER as regards to the application of eligibility and selection criteria and the project selection procedure.
Article 66 Managing Authority
1. The Managing Authority shall be responsible for managing and implementing the programme in an efficient, effective and correct way and in particular for: (a) ensuring that there is an appropriate secure electronic system to record, maintain, manage and report statistical information on the programme and its implementation required for the purposes of monitoring and evaluation and, in particular, information required to monitor progress towards the defined objectives and priorities; (b) providing the Commission, by 31 January and 31 October in each year of the programme, with relevant indicator data on operations selected for funding, including information on output and financial indicators; (c) ensuring that beneficiaries and other bodies involved in the implementation of operations: (i) are informed of their obligations resulting from the aid granted, and maintain either a separate accounting system or an adequate accounting code for all transactions relating to the operation; (ii) are aware of the requirements concerning the provision of data to the Managing Authority and the recording of outputs and results; (d) ensuring that the ex ante evaluation referred to in Article 55 of Regulation (EU) No 1303/2013 conforms to the evaluation and monitoring system and accepting and submitting it to the Commission; (e) ensuring that the evaluation plan referred to in Article 56 of Regulation (EU) No 1303/2013 is in place, that the ex post programme evaluation referred to in Article 57 of Regulation (EU) No 1303/2013 is conducted within the time limits laid down in that Regulation, ensuring that such evaluations conform to the monitoring and evaluation system and submitting them to the Monitoring Committee and the Commission; (f) providing the Monitoring Committee with the information and documents needed to monitor implementation of the programme in the light of its specific objectives and priorities; (g) drawing up the annual progress report, including aggregate monitoring tables, and, after approval by the Monitoring Committee, submitting it to the Commission; (h) ensuring that the paying agency receives all necessary information, in particular on the procedures operated and any controls carried out in relation to operations selected for funding, before payments are authorised; (i) ensuring publicity for the programme, including through the national rural network, by informing potential beneficiaries, professional organisations, the economic and social partners, bodies involved in promoting equality between men and women, and the non-governmental organisations concerned, including environmental organisations, of the possibilities offered by the programme and the rules for gaining access to programme funding as well as by informing beneficiaries of the Union contribution and the general public on the role played by the Union in the programme. 2. The Member State or the Managing Authority may designate one or more intermediate bodies including local authorities, regional development bodies or non-governmental organisations, to carry out the management and implementation of rural development operations. When a part of its tasks is delegated to another body, the Managing Authority shall retain full responsibility for the efficiency and correctness of management and implementation of those tasks. The Managing Authority shall ensure that appropriate provisions are in place to allow the other body to obtain all necessary data and information for execution of these tasks. 3. Where a thematic sub-programme, as referred to in Article 7, is included in the rural development programme, the Managing Authority may designate one or more intermediate bodies, including local authorities, local action groups or non-governmental organisations, to carry out the management and implementation of that strategy. Paragraph 2 shall apply in this case. The managing authority shall ensure that operations and outputs of this thematic sub-programme are identified separately for the purposes of the monitoring and evaluation system referred to in Article 67. 4. Subject to the role of the paying agencies and other bodies as set out in Regulation (EU) No 1306/2013, where a Member State has more than one programme, a coordinating body may be designated with the purpose of ensuring consistency in the management of the funds and of providing a link between the Commission and the national management authorities. 5. The Commission shall adopt implementing acts, laying down uniform conditions for the application of the information and publicity requirements referred to in point (i) of paragraph 1.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Financial Regulation 1 sets out the principles and procedures governing the establishment and implementation of the EU budget and the control of the EU funds. Over the last 30 years, the number of general financial rules contained in the Financial Regulation has increased sharply 2 . In addition, a number of sectoral financial rules have emerged: the rules for participation to the Framework Programme for Research and Innovation 3 , the Common Provisions to the European Structural and Investment Funds 4 and the Common Implementing Rules for the External Action 5 . Users of EU funds have repeatedly complained about the proliferation of rules both at general and at sectoral level, their heterogeneity and their complexity due to the fact that they follow the architecture of the programme and multiple layers of controls. In addition, the complexity of the financial set of rules has slowed down implementation of the EU funds, making it costly and prone to errors. A first step towards more coherent and simpler financial rules was achieved in 2012: the Commission tabled proposals for the programmes covered by the MFF 2014-2020 which reduced the number of programmes and instruments, grouped them under a single framework with common rules, simplified procedures for application and declaration of costs by final beneficiaries, facilitated the deployment of innovative financial instruments, enabled EU Trust-Funds and improved the cost-efficiency of controls. Recent revisions have aligned the Financial Regulation on the results of the negotiation to the MFF 2014-2020 (2013 revision) as well as to the new Procurement Directive (2015 revision). However, there is room for further simplification . This is confirmed by the experience gained since 2014 and by the work of the High Level Group of Independent Experts on Monitoring Simplification for Beneficiaries of the European Structural and Investment Funds 6 . The public consultation on the revision of the Financial Regulation 7 also shows stakeholders’ clear expectations in the area. Efforts must therefore continue in order to remove bottlenecks, ensure synergies and complementarities between ESI Funds and the other EU funds and improve efficiency of delivery and control requirements. Simpler and more flexible financial rules will contribute to optimising spending and impact of the MFF 2014-2020 and constitute as such one of the key elements of the Commission's initiative for a Budget Focused on Results (BFOR) which aims at making sure that resources are allocated to priorities and that every action delivers maximum performance and added value 8 . In addition, this will reduce the costs related to implementation of EU rules as well the number of errors. Simpler and more flexible EU financial rules are key in enhancing EU budget’s ability to adapt to changing circumstances and to respond to unexpected developments. The present legislative proposal forms an integral part of the mid-term review/revision of the multiannual financial framework (MFF) 2014-2020 9 . It contributes to two of its main objectives: simplification and flexibility . The Commission therefore proposes in a single act an ambitious revision of the general financial rules accompanied by corresponding changes to the sectorial financial rules set out in 15 legislative acts concerning multiannual programmes. The inclusion of sectoral changes in the same legislative proposal aims at ensuring a coherent negotiation process as well as at facilitating a speedy adoption by the legislator. The focus is put on the following key areas: 1 . Simplification for recipients of EU funds: many measures aim at simplifying life for recipients of EU funds. They relate to grants (removal of the non-cumulative award check for low-value grants and of the non-profit principle; simpler rules for "contribution in kind" valuation ; recognition of volunteer work ; grant awards without calls for proposal under specific conditions) and simplified forms of grants (Title VIII). 2 . From multi ple layers of controls to cross reliance on audit, assessment or authorisation, and harmonisation of reporting requirements: the aim of these measures is to encourage reliance as far as possible on one single audit, assessment or authorisation (conformity to State aids for instance), when the audit , assessment or authorisation meet s the necessary conditions to be taken into account in the EU system. More generally, rules for implementing partners (international organisations, EIB/EIF, national promotional banks, national agencies, NGOs) will be simplified by relying increasingly on their procedures and policies once assessed positively. Financial f ramework partnership agreements concluded with long term partners will allow progressing in the harmonisation of audit, reporting and other administrative requirements among donors (Title V Articles 122, 123 and 126). 3 . Allowing the application of only one set of rules to hybrid actions or in the case of combination of measures or instruments: the proposal aims at achieving further simplification for the partners of the EU by a number of measures to avoid the parallel application of different rules and procedures, notably through facilitating the combination of European Structural and Investment Funds (ESIF) funding with financial instruments and the European Fund for Strategic Investments (Title V). 4 . More effective use of financial instruments: optimise use of reflows, ensuring a level playing field among key EU implementing partners, reducing burdensome requirements related to publication of individual data of final recipients or to the exclusion criteria (Title X). 5 . More flexible budget management: the proposal sets out several ways for more budgetary flexibility, in order to allow the Union to respond to unforeseen challenges and new tasks more effectively and to achieve swifter crisis management - among which the creation of a " flexibility cushion" for unforeseen needs and new crises in the external actions geographic instruments budget , a more efficient activation of the solidarity and globalization adjustment funds, and the extension of Trust-Funds to internal policies (Articles 14 and 22 7 ) , the creation of a EU crisis reserve with the reuse of decommitted appropriations, and for the next Multiannual Financial Framework, the possibility that financial operations other than financial instruments generate a contingent liability for the Union exceeding the financial assets provided to cover the financial liability of the Union (Article 203) and the creation of a common provisioning fund holding the resources provisioned for financial operations (Article 2 05 ). R ecent initiatives (such as the European Fund for Strategic Investments (EFSI) or the European Fund for Sustainable Development (EFSD)), have indeed shown the need to fully use the leverage of the EU budget by creating non-provisioned contingent liabilities. Title X sets the framework to authorise, manage and control these financial risks. 6 . F ocus on results and streamlining of reporting: a stronger focus on results through lump sums, prizes, payment based on output and results rather than on reimbursement of costs, payment against conditions to be fulfilled (Article 121, Title X III ). This should contribute to further reducing the costs of implementing EU funds as well as the number of errors. On the reporting side, reports are regrouped around the draft budget and the integrated financial reporting package, in order to increase efficiency and transparency both towards the general public and the budgetary authority (Articles 39 and 23 9 -24 5 ). 7. Simpler and leaner EU administration: facilitating agreements or delegations between Institutions or bodies in order to pool the implementation of administrative appropriations in European Offices or within Executive Agencies (Articles 57, 58, 64, 65 and 6 8 ); merging consultative panels competent for financial irregularities (Article 73 (6)) with the EDES panel (Article 139 ) and moving from annual to multiannual financing decisions (Article 10 8 ). 8. Providing possibility for citizen engagement : t he proposal provides a possibility for citizens to be consulted on the implementation of the Union budget by the Commission, Member States and any other entity implementing the Union budget (А rticle 54 ) . In simplifying and making EU financial rules more flexible, the present proposal paves the way for the preparation of the next generation of spending programmes (post-2020).
Revised version (Article 66 Managing Authority):
1. The Managing Authority shall be responsible for managing and implementing the programme in an efficient, effective and correct way and in particular for: (a) ensuring that there is an appropriate secure electronic system to record, maintain, manage and report statistical information on the programme and its implementation required for the purposes of monitoring and evaluation and, in particular, information required to monitor progress towards the defined objectives and priorities; (c) ensuring that beneficiaries and other bodies involved in the implementation of operations: (i) are informed of their obligations resulting from the aid granted, and maintain either a separate accounting system or an adequate accounting code for all transactions relating to the operation; (ii) are aware of the requirements concerning the provision of data to the Managing Authority and the recording of outputs and results; (d) ensuring that the ex ante evaluation referred to in Article 55 of Regulation (EU) No 1303/2013 conforms to the evaluation and monitoring system and accepting and submitting it to the Commission; (e) ensuring that the evaluation plan referred to in Article 56 of Regulation (EU) No 1303/2013 is in place, that the ex post programme evaluation referred to in Article 57 of Regulation (EU) No 1303/2013 is conducted within the time limits laid down in that Regulation, ensuring that such evaluations conform to the monitoring and evaluation system and submitting them to the Monitoring Committee and the Commission; (f) providing the Monitoring Committee with the information and documents needed to monitor implementation of the programme in the light of its specific objectives and priorities; (g) drawing up the annual progress report, including aggregate monitoring tables, and, after approval by the Monitoring Committee, submitting it to the Commission; (h) ensuring that the paying agency receives all necessary information, in particular on the procedures operated and any controls carried out in relation to operations selected for funding, before payments are authorised; (i) ensuring publicity for the programme, including through the national rural network, by informing potential beneficiaries, professional organisations, the economic and social partners, bodies involved in promoting equality between men and women, and the non-governmental organisations concerned, including environmental organisations, of the possibilities offered by the programme and the rules for gaining access to programme funding as well as by informing beneficiaries of the Union contribution and the general public on the role played by the Union in the programme. 2. The Member State or the Managing Authority may designate one or more intermediate bodies including local authorities, regional development bodies or non-governmental organisations, to carry out the management and implementation of rural development operations. When a part of its tasks is delegated to another body, the Managing Authority shall retain full responsibility for the efficiency and correctness of management and implementation of those tasks. The Managing Authority shall ensure that appropriate provisions are in place to allow the other body to obtain all necessary data and information for execution of these tasks. 3. Where a thematic sub-programme, as referred to in Article 7, is included in the rural development programme, the Managing Authority may designate one or more intermediate bodies, including local authorities, local action groups or non-governmental organisations, to carry out the management and implementation of that strategy. Paragraph 2 shall apply in this case. The managing authority shall ensure that operations and outputs of this thematic sub-programme are identified separately for the purposes of the monitoring and evaluation system referred to in Article 67. 4. Subject to the role of the paying agencies and other bodies as set out in Regulation (EU) No 1306/2013, where a Member State has more than one programme, a coordinating body may be designated with the purpose of ensuring consistency in the management of the funds and of providing a link between the Commission and the national management authorities. 5. The Commission shall adopt implementing acts, laying down uniform conditions for the application of the information and publicity requirements referred to in point (i) of paragraph 1.
Article 67 Monitoring and evaluation system
In accordance with this Title, a common monitoring and evaluation system shall be drawn up in co-operation between the Commission and the Member States and shall be adopted by the Commission by means of implementing acts. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 84.
Article 68 Objectives
The monitoring and evaluation system shall aim to: (a) demonstrate the progress and achievements of rural development policy and assess the impact, effectiveness, efficiency and relevance of rural development policy interventions; (b) contribute to better targeted support for rural development; (c) support a common learning process related to monitoring and evaluation.
Article 69 Common indicators
1. A list of common indicators relating to the initial situation as well as to the financial execution, outputs, results and impact of the programme and applicable to each programme shall be specified in the monitoring and evaluation system provided for in Article 67 to allow for aggregation of data at Union level. 2. The common indicators shall be based on available data and linked to the structure and objectives of the rural development policy framework and shall allow assessment of the progress, efficiency and effectiveness of policy implementation against objectives and targets at Union, national and programme level. The common impact indicators shall be based on available data. 3. The evaluator shall quantify the impact of the programme measured by the impact indicators. Based on evidence in the evaluations on the CAP, including evaluations on Rural Development programmes, the Commission shall, with the help of the Member States, assess the combined impact of all CAP instruments.
Article 70 Electronic Information System
Key information on the implementation of the programme, on each operation selected for funding, as well as on completed operations, needed for monitoring and evaluation, including key information on each beneficiary and project, shall be recorded and maintained electronically.
Article 71 Provision of information
Beneficiaries of support under rural development measures and local action groups shall undertake to provide to the Managing Authority and/or to appointed evaluators or other bodies delegated to perform functions on its behalf, all the information necessary to permit monitoring and evaluation of the programme, in particular in relation to meeting specified objectives and priorities.
Article 72 Monitoring procedures
1. The Managing Authority and the Monitoring Committee referred to in Article 47 of Regulation (EU) No 1303/2013 shall monitor the quality of the implementation of the programme. 2. The Managing Authority and the Monitoring Committee shall carry out monitoring of each rural development programme by means of financial, output and target indicators.
Article 73 Monitoring Committee
Member States with regional programmes may establish a national Monitoring Committee to coordinate the implementation of these programmes in relation to the National Framework and the uptake of financial resources.
Article 74 Responsibilities of the Monitoring Committee
The Monitoring Committee shall satisfy itself as to the performance of the rural development programme and the effectiveness of its implementation. To that end, in addition to the functions referred to in Article 49 of Regulation (EU) No 1303/2013 the Monitoring Committee shall: (a) be consulted and shall issue an opinion, within four months of the decision approving the programme, on the selection criteria for financed operations, which shall be revised according to programming needs; (b) examine the activities and outputs related to the progress in the implementation of the evaluation plan of the programme; (c) examine, in particular, actions in the programme relating to the fulfilment of ex ante conditionalities, which fall within the responsibilities of the Managing Authority, and be informed of actions relating to the fulfilment of other ex ante conditionalities; (d) participate in the national rural network to exchange information on programme implementation; and (e) consider and approve the annual implementation reports before they are sent to the Commission.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Financial Regulation 1 sets out the principles and procedures governing the establishment and implementation of the EU budget and the control of the EU funds. Over the last 30 years, the number of general financial rules contained in the Financial Regulation has increased sharply 2 . In addition, a number of sectoral financial rules have emerged: the rules for participation to the Framework Programme for Research and Innovation 3 , the Common Provisions to the European Structural and Investment Funds 4 and the Common Implementing Rules for the External Action 5 . Users of EU funds have repeatedly complained about the proliferation of rules both at general and at sectoral level, their heterogeneity and their complexity due to the fact that they follow the architecture of the programme and multiple layers of controls. In addition, the complexity of the financial set of rules has slowed down implementation of the EU funds, making it costly and prone to errors. A first step towards more coherent and simpler financial rules was achieved in 2012: the Commission tabled proposals for the programmes covered by the MFF 2014-2020 which reduced the number of programmes and instruments, grouped them under a single framework with common rules, simplified procedures for application and declaration of costs by final beneficiaries, facilitated the deployment of innovative financial instruments, enabled EU Trust-Funds and improved the cost-efficiency of controls. Recent revisions have aligned the Financial Regulation on the results of the negotiation to the MFF 2014-2020 (2013 revision) as well as to the new Procurement Directive (2015 revision). However, there is room for further simplification . This is confirmed by the experience gained since 2014 and by the work of the High Level Group of Independent Experts on Monitoring Simplification for Beneficiaries of the European Structural and Investment Funds 6 . The public consultation on the revision of the Financial Regulation 7 also shows stakeholders’ clear expectations in the area. Efforts must therefore continue in order to remove bottlenecks, ensure synergies and complementarities between ESI Funds and the other EU funds and improve efficiency of delivery and control requirements. Simpler and more flexible financial rules will contribute to optimising spending and impact of the MFF 2014-2020 and constitute as such one of the key elements of the Commission's initiative for a Budget Focused on Results (BFOR) which aims at making sure that resources are allocated to priorities and that every action delivers maximum performance and added value 8 . In addition, this will reduce the costs related to implementation of EU rules as well the number of errors. Simpler and more flexible EU financial rules are key in enhancing EU budget’s ability to adapt to changing circumstances and to respond to unexpected developments. The present legislative proposal forms an integral part of the mid-term review/revision of the multiannual financial framework (MFF) 2014-2020 9 . It contributes to two of its main objectives: simplification and flexibility . The Commission therefore proposes in a single act an ambitious revision of the general financial rules accompanied by corresponding changes to the sectorial financial rules set out in 15 legislative acts concerning multiannual programmes. The inclusion of sectoral changes in the same legislative proposal aims at ensuring a coherent negotiation process as well as at facilitating a speedy adoption by the legislator. The focus is put on the following key areas: 1 . Simplification for recipients of EU funds: many measures aim at simplifying life for recipients of EU funds. They relate to grants (removal of the non-cumulative award check for low-value grants and of the non-profit principle; simpler rules for "contribution in kind" valuation ; recognition of volunteer work ; grant awards without calls for proposal under specific conditions) and simplified forms of grants (Title VIII). 2 . From multi ple layers of controls to cross reliance on audit, assessment or authorisation, and harmonisation of reporting requirements: the aim of these measures is to encourage reliance as far as possible on one single audit, assessment or authorisation (conformity to State aids for instance), when the audit , assessment or authorisation meet s the necessary conditions to be taken into account in the EU system. More generally, rules for implementing partners (international organisations, EIB/EIF, national promotional banks, national agencies, NGOs) will be simplified by relying increasingly on their procedures and policies once assessed positively. Financial f ramework partnership agreements concluded with long term partners will allow progressing in the harmonisation of audit, reporting and other administrative requirements among donors (Title V Articles 122, 123 and 126). 3 . Allowing the application of only one set of rules to hybrid actions or in the case of combination of measures or instruments: the proposal aims at achieving further simplification for the partners of the EU by a number of measures to avoid the parallel application of different rules and procedures, notably through facilitating the combination of European Structural and Investment Funds (ESIF) funding with financial instruments and the European Fund for Strategic Investments (Title V). 4 . More effective use of financial instruments: optimise use of reflows, ensuring a level playing field among key EU implementing partners, reducing burdensome requirements related to publication of individual data of final recipients or to the exclusion criteria (Title X). 5 . More flexible budget management: the proposal sets out several ways for more budgetary flexibility, in order to allow the Union to respond to unforeseen challenges and new tasks more effectively and to achieve swifter crisis management - among which the creation of a " flexibility cushion" for unforeseen needs and new crises in the external actions geographic instruments budget , a more efficient activation of the solidarity and globalization adjustment funds, and the extension of Trust-Funds to internal policies (Articles 14 and 22 7 ) , the creation of a EU crisis reserve with the reuse of decommitted appropriations, and for the next Multiannual Financial Framework, the possibility that financial operations other than financial instruments generate a contingent liability for the Union exceeding the financial assets provided to cover the financial liability of the Union (Article 203) and the creation of a common provisioning fund holding the resources provisioned for financial operations (Article 2 05 ). R ecent initiatives (such as the European Fund for Strategic Investments (EFSI) or the European Fund for Sustainable Development (EFSD)), have indeed shown the need to fully use the leverage of the EU budget by creating non-provisioned contingent liabilities. Title X sets the framework to authorise, manage and control these financial risks. 6 . F ocus on results and streamlining of reporting: a stronger focus on results through lump sums, prizes, payment based on output and results rather than on reimbursement of costs, payment against conditions to be fulfilled (Article 121, Title X III ). This should contribute to further reducing the costs of implementing EU funds as well as the number of errors. On the reporting side, reports are regrouped around the draft budget and the integrated financial reporting package, in order to increase efficiency and transparency both towards the general public and the budgetary authority (Articles 39 and 23 9 -24 5 ). 7. Simpler and leaner EU administration: facilitating agreements or delegations between Institutions or bodies in order to pool the implementation of administrative appropriations in European Offices or within Executive Agencies (Articles 57, 58, 64, 65 and 6 8 ); merging consultative panels competent for financial irregularities (Article 73 (6)) with the EDES panel (Article 139 ) and moving from annual to multiannual financing decisions (Article 10 8 ). 8. Providing possibility for citizen engagement : t he proposal provides a possibility for citizens to be consulted on the implementation of the Union budget by the Commission, Member States and any other entity implementing the Union budget (А rticle 54 ) . In simplifying and making EU financial rules more flexible, the present proposal paves the way for the preparation of the next generation of spending programmes (post-2020).
Revised version (Article 74 Responsibilities of the Monitoring Committee):
The Monitoring Committee shall satisfy itself as to the performance of the rural development programme and the effectiveness of its implementation. To that end, in addition to the functions referred to in Article 49 of Regulation (EU) No 1303/2013 the Monitoring Committee shall: (a) be consulted and shall issue an opinion, before publication of the relevant call for proposals, on the selection criteria for financed operations, which shall be revised according to programming needs; (b) examine the activities and outputs related to the progress in the implementation of the evaluation plan of the programme; (c) examine, in particular, actions in the programme relating to the fulfilment of ex ante conditionalities, which fall within the responsibilities of the Managing Authority, and be informed of actions relating to the fulfilment of other ex ante conditionalities; (d) participate in the national rural network to exchange information on programme implementation; and (e) consider and approve the annual implementation reports before they are sent to the Commission.
Article 75 Annual implementation report
1. By 30 June 2016 and by 30 June of each subsequent year until and including 2024, the Member State shall submit to the Commission an annual implementation report on implementation of the rural development programme in the previous calendar year. The report submitted in 2016 shall cover the calendar years 2014 and 2015. 2. In addition to complying with the requirements of Article 50 of Regulation (EU) No 1303/2013 annual implementation reports shall include information inter alia on financial commitments and expenditure by measure, and a summary of the activities undertaken in relation to the evaluation plan. 3. In addition to complying with the requirements of Article 50 of Regulation (EU) No 1303/2013, the annual implementation report submitted in 2017 shall also cover a description of the implementation of any sub-programmes included within the programme. 4. In addition to complying with the requirements of Article 50 of Regulation (EU) No 1303/2013, the annual implementation report submitted in 2019 shall also cover, a description of the implementation of any sub-programmes included within the programme and an assessment of progress made in ensuring an integrated approach to use of the EAFRD and other EU financial instruments to support the territorial development of rural areas, including through local development strategies. 5. The Commission shall adopt implementing acts, laying down rules concerning the presentation of the annual implementation reports. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 84.
Article 76 General provisions
1. The Commission may adopt implementing acts, specifying the elements to be contained in the ex ante and ex post evaluations referred to in Articles 55 and 57 of Regulation (EU) No 1303/2013 and establishing the minimum requirements for the evaluation plan referred to in Article 56 of Regulation (EU) No 1303/2013. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 84. 2. Member States shall ensure that the evaluations are in accordance with the common evaluation approach agreed in accordance with Article 67, shall organise the production and gathering of the requisite data, and shall supply the various pieces of information provided by the monitoring system to the evaluators. 3. The evaluation reports shall be made available by the Member States on the internet and by the Commission on its website.
Article 77 Ex ante evaluation
Member States shall ensure that the ex ante evaluator is involved from an early stage in the process of development of the rural development programme, including in the development of the analysis referred to in Article 8(1)(b), in the design of the programme's intervention logic and in the establishment of the programme's targets.
Article 78 Ex post evaluation
In 2024, an ex post evaluation report shall be prepared by the Member States for each of their rural development programmes. That report shall be submitted to the Commission by 31 December 2024.
Article 79 Syntheses of evaluations
Syntheses at Union level of the ex ante and ex post evaluation reports shall be undertaken under the responsibility of the Commission. The syntheses of the evaluation reports shall be completed at the latest by 31 December of the year following the submission of the relevant evaluations.
Article 80 Rules applying to undertakings
Where support under this Regulation is granted to forms of co-operation between undertakings, it may be granted only to such forms of co-operation which comply with the competition rules as they apply by virtue of Articles 206 to 210 of the Regulation of the European Parliament and the Council (EU) No 1308/2013.
Article 81 State aid
1. Save as otherwise provided for in this Title, Articles 107, 108 and 109 TFEU shall apply to support for rural development by Member States. 2. Articles 107, 108 and 109 TFEU shall not apply to payments made by Member States pursuant to, and in conformity with, this Regulation, or to additional national financing referred to in Article 82, within the scope of Article 42 TFEU.
Article 82 Additional national financing
Payments made by Member States in relation to operations falling within the scope of Article 42 TFEU and intended to provide additional financing for rural development for which Union support is granted at any time during the programming period, shall be included by Member States in the rural development programme as provided for in paragraph 1(j) of Article 8 and, where they comply with the criteria under this Regulation, shall be approved by the Commission.
Article 83 Exercise of the delegation
1. The power to adopt delegated acts referred to in Articles 2(3), Article 14(5), Article 16(5), Article 19(8), Article 22(3), Article 28(10) and (11), Article 29(6), Article 30(8), Article 33(4), Article 34(5), Article 35(10), Article 36(5), Article 45(6), Article 47(6), Article 58(7) and Article 89 is conferred on the Commission subject to the conditions laid down in this Article. 2. The power to adopt delegated acts referred to in in Articles 2(3), Article 14(5), Article 16(5), Article 19(8), Article 22(3), Article 28(10) and (11), Article 29(6), Article 30(8), Article 33(4), Article 34(5), Article 35(10), Article 36(5), Article 45(6), Article 47(6), Article 58(7) and Article 89 shall be conferred on the Commission for a period of seven years from the date of entry into force of this Regulation. e Commission shall draw up a report in respect of the delegation of power not later than nine months before the end of the seven-year period. The delegation of power shall be tacitly extended for periods of an identical duration, unless the European Parliament or the Council opposes such extension not later than three months before the end of each period. 3. The power to adopt delegated acts referred to in Articles 2(3), Article 14(5), Article 16(5), Article 19(8), Article 22(3), Article 28(10) and (11), Article 29(6), Article 30(8), Article 33(4), Article 34(5), Article 35(10), Article 36(5), Article 45(6), Article 47(6), Article 58(7) and Article 89 may be revoked at any time by the European Parliament or by the Council. decision to revoke shall put an end to the delegation of the powers specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified therein. It shall not affect the validity of any delegated acts already in force. 4. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the European Parliament and to the Council. 5. A delegated act adopted pursuant to Articles 2(3), Article 14(5), Article 16(5), Article 19(8), Article 22(3), Article 28(10) and (11), Article 29(6), Article 30(8), Article 33(4), Article 34(5), Article 35(10), Article 36(5), Article 45(6), Article 47(6), Article 58(7) and Article 89 shall enter into force only if no objection has been expressed either by the European Parliament or the Council within a period of two months of notification of that act to the European Parliament and the Council or if, before the expiry of that period, the European Parliament and the Council have both informed the Commission that they will not object. That period shall be extended by two months at the initiative of the European Parliament or of the Council.
Article 84 Committee procedure
1. The Commission shall be assisted by a committee called "Rural Development Committee". That Committee shall be a committee within the meaning of Regulation (EU) No 182/2011. 2. Where reference is made to this paragraph, Article 5 of Regulation (EU) No 182/2011 shall apply.
Article 85 Exchange of information and documents
1. The Commission, in collaboration with the Member States, shall establish an information system to enable the secure exchange of data of common interest between the Commission and each Member State. The Commission shall adopt implementing acts, laying down rules for the operation of that system. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 84. 2. The Commission shall ensure that there is an appropriate secure electronic system in which key information and report on monitoring and evaluation can be recorded, maintained and managed.
Article 86 Processing and protection of personal data
1. Member States and the Commission shall collect personal data for the purpose of carrying out their respective management control, monitoring and evaluation obligations under this Regulation, and in particular those laid down in Titles VI and VII, and shall not process this data in a way which is incompatible with this purpose. 2. Where personal data are processed for monitoring and evaluation purposes under Title VII using the secure electronic system referred to in Article 85, they shall be made anonymous, and processed in aggregated form only. 3. Personal data shall be processed in accordance with the rules of Directive 95/46/EC and Regulation (EC) No 45/2001. In particular, such data shall not be stored in a form which permits identification of data subjects for longer than is necessary for the purposes for which they were collected or for which they are further processed, taking into account the minimum retention periods laid down in the applicable national and Union law. 4. Member States shall inform the data subjects that their personal data may be processed by national and Union bodies in accordance with paragraph 1 and that in this respect they enjoy the rights set out in the data protection rules of, respectively, Directive 95/46/EC and Regulation (EC) No 45/2001. 5. Articles 111 to 114 in Regulation(EU) 1306/2013 shall apply to this Article.
Article 87 General CAP provisions
Regulation (EU) No 1306/2013 and the provisions adopted pursuant to it shall apply in relation to the measures set out in this Regulation.
Article 88 Regulation (EC) No 1698/2005
Regulation (EC) No 1698/2005 is repealed. Regulation (EC) No 1698/2005 shall continue to apply to operations implemented pursuant to programmes approved by the Commission under that Regulation before 1 January 2014.
Article 89 Transitional provisions
In order to facilitate the transition from the system established by Regulation (EC) No 1698/2005 to the system established by this Regulation, the Commission shall be empowered to adopt delegated acts in accordance with Article 83, laying down the conditions under which support approved by the Commission under Regulation (EC) No 1698/2005 may be integrated into support provided for under this Regulation, including for technical assistance and for the ex-post evaluations. Those delegated acts may also provide conditions for the transition from rural development support for Croatia under Regulation (EC) No 1085/2006 to support provided for under this Regulation.
Article 90 Entry into force and application
This Regulation shall enter into force on the day of its publication in the Official Journal of the European Union . It shall apply from 1 January 2014. This Regulation shall be binding in its entirety and directly applicable in all Member States.