Article 1 Subject matter
This Regulation lays down the rules for the establishment and the implementation of the general budget of the European Union and of the European Atomic Energy Community (the ‘budget’) and the presentation and auditing of their accounts.
Article 2 Definitions
For the purposes of this Regulation, the following definitions apply: (1) ‘applicant’ means a natural person or an entity with or without legal personality who has submitted an application in a grant award procedure, in a non-financial donation award procedure or in a contest for prizes; (2) ‘application document’ means a tender, a request to participate, an application further to a call for expression of interest, a grant application, an application for a non-financial donation or an application in a contest for prizes; (3) ‘award procedure’ means a procurement procedure, a grant award procedure, a contest for prizes, an award procedure for a non-financial donation or a procedure for the selection of experts or persons or entities implementing the budget pursuant to Article 62(1), first subparagraph, point (c); (4) ‘basic act’ means a legal act, other than a recommendation or an opinion, which provides a legal basis for an action and for the implementation of the corresponding expenditure entered in the budget or of the budgetary guarantee or financial assistance backed by the budget, and which may take any of the following forms: (a) in implementation of the Treaty on the Functioning of the European Union (TFEU) and the Treaty establishing the European Atomic Energy Community (Euratom Treaty), the form of a regulation, a directive or a decision within the meaning of Article 288 TFEU; or (b) in implementation of Title V of the Treaty on European Union (TEU), one of the forms specified in Articles 28(1) and 31(2), Article 33, and Articles 42(4) and 43(2) TEU; (5) ‘beneficiary’ means a natural person or an entity with or without legal personality with whom a grant agreement has been signed; (6) ‘blending facility or platform’ means a cooperation framework established between the Commission and development or other public finance institutions with a view to combining non-repayable forms of support and/or financial instruments and/or budgetary guarantees from the budget and repayable forms of support from development or other public finance institutions, as well as from private-sector finance institutions and private-sector investors; (7) ‘budget implementation’ means the carrying out of activities relating to the management, monitoring, control and auditing of budget appropriations in accordance with the methods provided for in Article 62; (8) ‘budgetary commitment’ means the operation by which the authorising officer responsible reserves the budget appropriations necessary to cover subsequent payments to honour legal commitments; (9) ‘budgetary guarantee’ means an instrument through which the Union supports a programme of actions by taking on the budget an irrevocable and unconditional financial obligation that can be called upon should a specified event materialise during the implementation of the programme, and that remains valid for the duration of the maturity of the commitments made under the supported programme; (10) ‘building contract’ means a contract covering the purchase, exchange, long lease, usufruct, leasing, rental or hire purchase, with or without option to buy, of land, buildings or other immovable property. It covers both existing buildings and buildings before completion provided that the candidate has obtained a valid building permit for it. It does not cover buildings designed in accordance with the specifications of the contracting authority that are covered by works contracts; (11) ‘candidate’ means an economic operator that has sought an invitation or has been invited to take part in a restricted procedure, a competitive procedure with negotiation, a competitive dialogue, an innovation partnership, a design contest or a negotiated procedure; (12) ‘central purchasing body’ means a contracting authority providing centralised purchasing activities and, where applicable, ancillary purchasing activities; (13) ‘check’ means the verification of a specific aspect of a revenue or expenditure operation; (14) ‘concession contract’ means a contract for pecuniary interest concluded in writing between one or more economic operators and one or more contracting authorities within the meaning of Articles 177 and 181, in order to entrust the execution of works or the provision and management of services to an economic operator (the ‘concession’), and where: (a) the remuneration consists either solely in the right to exploit the works or services or in that right together with payment; (b) the award of the concession contract involves the transfer to the concessionaire of an operating risk in exploiting those works or services encompassing demand risk or supply risk, or both. The concessionaire shall be deemed to assume an operating risk where, under normal operating conditions, there is no guarantee of recouping the investments made or the costs incurred in operating the works or the services concerned; (15) ‘constitution phase’ means the period during which the global provisioning is paid into the common provisioning fund; (16) ‘contingent liability’ means a potential financial obligation that could be incurred depending on the outcome of a future event; (17) ‘contract’ means a public contract or a concession contract or, for Title VIII, a subcontract or purchase contract concluded by a beneficiary; (18) ‘contractor’ means an economic operator with whom a public contract has been signed; (19) ‘contribution agreement’ means an agreement concluded with persons or entities implementing Union funds pursuant to Article 62(1), first subparagraph, points (c)(ii) to (viii); (20) ‘control’ means any measure taken to provide reasonable assurance regarding the effectiveness, efficiency and economy of operations, the reliability of reporting, the safeguarding of assets and information, the prevention and detection and correction of fraud and irregularities and their follow-up, and the adequate management of the risks relating to the legality and regularity of the underlying transactions, taking into account the multiannual character of programmes as well as the nature of the payments concerned. Controls may involve various checks, as well as the implementation of any policies and procedures to achieve the objectives referred to in the first sentence; (21) ‘counterpart’ means the party that is granted a budgetary guarantee; (22) ‘crisis’ means: (a) a situation of immediate or imminent danger threatening to escalate into an armed conflict or to destabilise a country or its neighbourhood; (b) a situation caused by natural disasters, man-made crisis such as wars and other conflicts or extraordinary circumstances having comparable effects related, inter alia, to climate change, public and animal health, food security and food safety emergencies and global health threats, such as epidemics and pandemics, environmental degradation, privation of access to energy and natural resources or extreme poverty; (23) ‘decommitment’ means an operation whereby the authorising officer responsible cancels wholly or partly the reservation of appropriations previously made by means of a budgetary commitment; (24) ‘dynamic purchasing system’ means a completely electronic process for making commonly used purchases of items generally available on the market; (25) ‘economic operator’ means any natural or legal person, including a public entity, or a group of such persons, who offers to supply products, execute works or provide services or supply immovable property; (26) ‘equity investment’ means the provision of capital to a company, invested directly or indirectly in return for total or partial ownership of that company and where the equity investor may assume some management control of the company and may share the company’s profits; (27) ‘European office’ means an administrative structure set up by the Commission, or by the Commission with one or more other Union institutions, to perform specific cross-cutting tasks; (28) ‘final administrative decision’ means a decision of an administrative authority having final and binding effect in accordance with the applicable law; (29) ‘financial asset’ means any asset in the form of cash, an equity instrument of a publicly or privately held entity or a contractual right to receive cash or another financial asset from such entity; (30) ‘financial instrument’ means a Union measure of financial support provided from the budget to address one or more specific policy objectives of the Union which may take the form of equity or quasi-equity investments, loans or guarantees, or other risk-sharing instruments, and which may, where appropriate, be combined with other forms of financial support or with funds under shared management or funds of the European Development Fund (EDF); (31) ‘financial liability’ means a contractual obligation to deliver cash or another financial asset to another entity; (32) ‘foreign subsidy’ means a financial contribution within the meaning of Article 3(2) of Regulation (EU) 2022/2560 provided by a third country that falls within the description provided in Article 3(1) of that Regulation; (33) ‘framework contract’ means a public contract concluded between one or more economic operators and one or more contracting authorities, the purpose of which is to establish the terms governing specific contracts under it to be awarded during a given period, in particular with regard to price and, where appropriate, the quantity envisaged; (34) ‘global provisioning’ means the total amount of resources deemed necessary over the entire lifetime of a budgetary guarantee or financial assistance to a third country as a result of applying the provisioning rate referred to in Article 214(1) to the amount of the budgetary guarantee or financial assistance to a third country authorised by the basic act referred to in Article 213(1), points (b) and (c); (35) ‘grant’ means a financial contribution by way of donation. Where such a contribution is provided under direct management, it shall be governed by Title VIII; (36) ‘guarantee’ means a written commitment to assume responsibility for all or part of a third party’s debt or obligation or for the successful performance by that third party of its obligations if an event occurs which triggers such guarantee, such as a loan default; (37) ‘guarantee on demand’ means a guarantee that must be honoured by the guarantor upon the counterpart’s demand, notwithstanding any deficiencies in the enforceability of the underlying obligation; (38) ‘in-kind contribution’ means non-financial resources made available free of charge by third parties to a beneficiary; (39) ‘legal commitment’ means an act whereby the authorising officer responsible enters into or establishes an obligation which results in a subsequent payment and the recognition of expenditure covered by a budgetary commitment, or in an obligation to provide a non-financial donation, and which includes specific agreements and contracts concluded under financial framework partnership agreements and framework contracts; (40) ‘leverage effect’ means the amount of reimbursable financing provided to eligible final recipients divided by the amount of the Union contribution; (41) ‘liquidity risk’ means the risk that a financial asset held in the common provisioning fund might not be sold during a certain period of time without incurring a significant loss; (42) ‘loan’ means an agreement which obliges the lender to make available to the borrower an agreed amount of money for an agreed period and under which the borrower is obliged to repay that amount within the agreed period; (43) ‘low value grant’ means a grant lower than or equal to EUR 60 000; (44) ‘Member State organisation’ means an entity established in a Member State as a public law body, or as a body governed by private law entrusted with a public service mission and provided with adequate financial guarantees from the Member State; (45) ‘method of implementation’ means any of the methods of budget implementation referred to in Article 62, that is direct management, indirect management and shared management; (46) ‘multi-donor action’ means any action where Union funds are pooled with at least one other donor; (47) ‘multiple sourcing procurement’ means procurement where it is intended to award multiple contracts concluded in writing in parallel between multiple economic operators and one or more contracting authorities within the meaning of Article 177(1), in order to entrust the execution of identical or quasi-identical services, supplies or works to be performed in parallel by different contractors; (48) ‘multiplier effect’ means the investment by eligible final recipients divided by the amount of the Union contribution; (49) ‘non-governmental organisation’ means a voluntary, independent from government, non-profit organisation, which is not a political party or a trade union; (50) ‘output’ means the deliverables generated by the action determined in accordance with sector-specific rules; (51) ‘participant’ means a candidate or tenderer in a procurement procedure, an applicant in a grant award procedure or in a non-financial donation award procedure, an expert in a procedure for selection of experts, an applicant in a contest for prizes or a person or entity participating in a procedure for implementing Union funds pursuant to Article 62(1), first subparagraph, point (c); (52) ‘presumed successful tenderer’ means any tenderer in a procurement procedure that is ranked first, subject to further checks and provision of supporting documents on exclusion and/or selection criteria in order to be proposed by the evaluation committee as a successful tenderer. Where the award procedure foresees to award the contract to several tenderers, then the presumed successful tenderer shall be deemed to refer to the best ranked tenderers equal to the number of contracts to be awarded. (53) ‘prize’ means a contribution given as a reward following a contest. Where such a contribution is provided under direct management, it shall be governed by Title IX; (54) ‘procurement’ means the acquisition by means of a contract of works, supplies or services and the acquisition or rental of land, buildings or other immovable property, by one or more contracting authorities from economic operators chosen by those contracting authorities; (55) ‘procurement document’ means any document produced or referred to by the contracting authority to describe or determine elements of the procurement procedure, including: (a) the publicity measures set out in Article 166; (b) the invitation to tender; (c) the tender specifications, including the technical specifications and the relevant criteria, or the descriptive documents in the case of a competitive dialogue; (d) the draft contract; (56) ‘professional conflicting interests’ means a situation in which the previous or ongoing professional activities of an economic operator affect or risk affecting its capacity to perform a contract in an independent, impartial and objective manner; (57) ‘public contract’ means a contract for pecuniary interest concluded in writing between one or more economic operators and one or more contracting authorities within the meaning of Articles 177 and 181, in order to obtain, against payment of a price paid in whole or in part from the budget, the supply of movable or immovable assets, the execution of works or the provision of services, comprising: (a) building contracts; (b) supply contracts; (c) works contracts; (d) service contracts; (58) ‘quasi-equity investment’ means a type of financing that ranks between equity and debt, having a higher risk than senior debt and a lower risk than common equity and which can be structured as debt, typically unsecured and subordinated and in some cases convertible into equity, or into preferred equity; (59) ‘recipient’ means a beneficiary, a contractor, a remunerated external expert or a person or entity receiving prizes, non-financial donations or support from the budget under a financial instrument or a budgetary guarantee, or implementing Union funds pursuant to Article 62(1), first subparagraph, point (c); (60) ‘repurchase agreement’ means the sale of securities for cash with an agreement to repurchase them on a specified future date, or on demand; (61) ‘research and technological development appropriation’ means an appropriation entered either in one of the titles of the budget relating to the policy areas linked to ‘Indirect research’ or ‘Direct research’ or in a chapter relating to research activities in another title; (62) ‘result’ means the effects of the implementation of an action determined in accordance with sector-specific rules; (63) ‘risk-sharing instrument’ means a financial instrument which allows for the sharing of a defined risk between two or more entities, where appropriate in exchange for an agreed remuneration; (64) ‘service contract’ means a contract covering all intellectual and non-intellectual services other than those covered by supply contracts, works contracts and building contracts; (65) ‘sound financial management’ means implementation of the budget in accordance with the principles of economy, efficiency and effectiveness; (66) ‘Staff Regulations’ means the Staff Regulations of Officials of the European Union and the Conditions of Employment of Other Servants of the European Union laid down in Regulation (EEC, Euratom, ECSC) No 259/68; (67) ‘subcontractor’ means an economic operator that is proposed by a candidate or tenderer or contractor to perform part of a contract or by a beneficiary to perform part of the tasks co-financed by a grant; (68) ‘subscription’ means sums paid to bodies of which the Union is member, in accordance with the budgetary decisions and the conditions of payment established by the body concerned; (69) ‘supply contract’ means a contract covering the purchase, leasing, rental or hire purchase, with or without option to buy, of products, and which may include, as an incidental matter, siting and installation operations; (70) ‘technical assistance’ means, without prejudice to sector-specific rules, support and capacity-building activities necessary for the implementation of a programme or an action, in particular preparatory, management, monitoring, evaluation, audit and control activities; (71) ‘tenderer’ means an economic operator that has submitted a tender; (72) ‘Union’ means the European Union, the European Atomic Energy Community, or both, as the context may require; (73) ‘Union institution’ means the European Parliament, the European Council, the Council, the Commission, the Court of Justice of the European Union, the Court of Auditors, the European Economic and Social Committee, the Committee of the Regions, the European Ombudsman, the European Data Protection Supervisor or the European External Action Service (the ‘EEAS’); the European Central Bank shall not be considered to be a Union institution; (74) ‘vendor’ means an economic operator registered in a list of vendors to be invited to submit requests to participate in or submit tenders; (75) ‘very low value grant’ means a grant lower than or equal to EUR 15 000; (76) ‘volunteer’ means a person working on a non-compulsory basis for an organisation without being paid; (77) ‘a work’ means the outcome of building or civil engineering works taken as a whole that is sufficient in itself to fulfil an economic or technical function; (78) ‘works contract’ means a contract covering either: (a) the execution or both the execution and design of a work; or (b) the execution or both the execution and design of works related to one of the activities referred to in Annex II to Directive 2014/24/EU; or (c) the realisation, by whatever means, of a work corresponding to the requirements specified by the contracting authority exercising a decisive influence on the type or design of the work.
Article 3 Compliance of secondary legislation with this Regulation
1. Provisions concerning the implementation of the revenue and expenditure of the budget, and contained in a basic act, shall comply with the budgetary principles set out in Title II. 2. Without prejudice to paragraph 1, any proposal or amendment to a proposal submitted to the legislative authority containing derogations from the provisions of this Regulation other than those set out in Title II, or from delegated acts adopted pursuant to this Regulation, shall clearly indicate such derogations and shall state the specific reasons justifying them in the recitals and in the explanatory memorandum of such proposals or amendments.
Article 4 Periods, dates and time limits
Unless otherwise provided in this Regulation, Council Regulation (EEC, Euratom) No 1182/71 ( 39 ) shall apply to the deadlines set out in this Regulation.
Article 5 Protection of personal data
This Regulation is without prejudice to Regulations (EU) 2016/679 and (EU) 2018/1725.
Article 6 Respect for budgetary principles and general regime of conditionality for the protection of the Union budget
1. The budget shall be established and implemented in accordance with the principles of unity, budgetary accuracy, annuality, equilibrium, unit of account, universality, specification, sound financial management and transparency as set out in this Regulation. 2. The establishment and implementation of the budget shall also comply with the provisions of Regulation (EU, Euratom) 2020/2092. 3. In the implementation of the budget, Member States and the Commission shall ensure compliance with the Charter of Fundamental Rights of the European Union, in accordance with Article 51 of the Charter, and shall respect the Union values enshrined in Article 2 TEU relevant in the implementation of the budget.
Article 7 Scope of the budget
1. For each financial year, the budget shall forecast and authorise all revenue and expenditure considered necessary for the Union. It shall comprise: (a) the revenue and expenditure of the Union, including administrative expenditure resulting from the implementation of the provisions of the TEU relating to the common foreign and security policy (CFSP), and operational expenditure occasioned by implementation of those provisions where it is charged to the budget; (b) the revenue and expenditure of the European Atomic Energy Community. 2. The budget shall contain differentiated appropriations, which consist of commitment appropriations and payment appropriations, and non-differentiated appropriations. The appropriations authorised for the financial year shall consist of: (a) appropriations provided in the budget, including by amending budgets; (b) appropriations carried over from preceding financial years; (c) appropriations made available again in accordance with Article 15; (d) appropriations arising from pre-financing payments which have been repaid in accordance with Article 12(4), point (b); (e) appropriations provided following the receipt of assigned revenue during the financial year or carried over from preceding financial years. 3. Commitment appropriations shall cover the total cost of the legal commitments entered into during the financial year, subject to Article 114(2). 4. Payment appropriations shall cover payments made to honour the legal commitments entered into in the financial year or preceding financial years. They shall also cover the provisioning of financial liabilities referred to in Article 214. 5. Paragraphs 2 and 3 of this Article shall not prevent appropriations being committed globally or budgetary commitments being made in annual instalments as respectively provided for in Article 112(1), first subparagraph, point (b), and in Article 112(2).
Article 8 Specific rules on the principles of unity and budgetary accuracy
1. All revenue and expenditure shall be booked to a budget line. 2. Without prejudice to authorised expenditure arising from contingent liabilities as provided for in Article 213(2), no expenditure may be committed or authorised in excess of the authorised appropriations. 3. An appropriation shall be entered in the budget only if it is for an item of expenditure considered necessary. 4. Interest generated by pre-financing payments made from the budget shall not be due to the Union except as otherwise provided in the contribution agreements or the financing agreements concerned.
Article 9 Definition
The appropriations entered in the budget shall be authorised for a financial year which shall run from 1 January to 31 December.
Article 10 Budgetary accounting for revenue and appropriations
1. The revenue of a financial year shall be entered in the accounts for that year on the basis of the amounts collected during it. However, the own resources for the month of January of the following financial year may be made available in advance pursuant to Regulation (EU, Euratom) No 609/2014. 2. The entries in respect of the Value Added Tax (VAT) and Gross National Income-based own resources may be adjusted in accordance with Regulation (EU, Euratom) No 609/2014. 3. The entries in respect of the own resources referred to in Article 2(1), point (c), of Decision (EU, Euratom) 2020/2053 may be adjusted in accordance with Regulation (EU, Euratom) 2021/770. 4. Commitments shall be entered in the accounts for a financial year on the basis of the legal commitments entered into and of the provisioning of financial liabilities referred to in Article 214 made up to 31 December of that year. However, the global budgetary commitments referred to in Article 112(4) shall be entered in the accounts for a financial year on the basis of the budgetary commitments up to 31 December of that year. 5. Payments shall be entered in the accounts for a financial year on the basis of the payments made by the accounting officer by 31 December of that year. 6. By way of derogation from paragraphs 4 and 5: (a) the expenditure of the European Agricultural Guarantee Fund (EAGF) shall be entered in the accounts for a financial year on the basis of the repayments made by the Commission to Member States by 31 December of that year, provided that the payment order has reached the accounting officer by 31 January of the following financial year; (b) expenditure implemented under shared management with the exception of the EAGF shall be entered in the accounts for a financial year on the basis of the reimbursements made by the Commission to Member States by 31 December of that year, including the expenditure charged by 31 January of the following financial year as laid down in Articles 30 and 31.
Article 11 Commitment of appropriations
1. The appropriations entered in the budget may be committed with effect from 1 January, once the budget has been definitively adopted. 2. As of 15 October of the financial year, the following expenditure may be committed in advance against the appropriations provided for the following financial year: (a) routine administrative expenditure, provided that such expenditure has been approved in the last budget duly adopted, and only up to a maximum of one quarter of the total corresponding appropriations decided upon by the European Parliament and by the Council for the current financial year; (b) routine management expenditure for the EAGF, provided that the basis for such expenditure is laid down in an existing basic act, and only up to a maximum of three quarters of the total corresponding appropriations decided upon by the European Parliament and by the Council for the current financial year.
Article 12 Cancellation and carry-over of appropriations
1. Appropriations which have not been used by the end of the financial year for which they were entered shall be cancelled, unless they are carried over in accordance with paragraphs 2 to 8. 2. The following appropriations may be carried over by a decision taken pursuant to paragraph 3, but only to the following financial year: (a) commitment appropriations and non-differentiated appropriations, for which most of the preparatory stages of the commitment procedure have been completed by 31 December of the financial year. Such appropriations may be committed up to 31 March of the following financial year, with the exception of non-differentiated appropriations related to building projects which may be committed up to 31 December of the following financial year; (b) appropriations which are necessary when the legislative authority has adopted a basic act in the final quarter of the financial year and the Commission has been unable to commit the appropriations provided for that purpose by 31 December of that year. Such appropriations may be committed up to 31 December of the following financial year; (c) payment appropriations which are needed to cover existing commitments or commitments linked to commitment appropriations carried over, where the payment appropriations provided for in the relevant budget lines for the following financial year are insufficient; (d) non-committed appropriations relating to the actions referred to in Article 5(2) of Regulation (EU) 2021/2116. By way of derogation from the first subparagraph, point (d), of this paragraph, non-committed appropriations of the agricultural reserve referred to in Article 16 of Regulation (EU) 2021/2116 shall be carried over to finance the agricultural reserve in the following financial years for the period referred to in Article 16(2), third subparagraph, of that Regulation and for any period beyond 2027 provided for in the applicable sector-specific rules. With regard to the first subparagraph, point (c), of this paragraph, the Union institution concerned shall first use the appropriations authorised for the current financial year and shall not use the appropriations carried over until the former are exhausted. Carry-overs of non-committed appropriations as referred to in the first subparagraph, point (d), of this paragraph shall not exceed, within a limit of 2 % of the initial appropriations voted by the European Parliament and by the Council, the amount of the adjustment of direct payments applied in accordance with Article 17 of Regulation (EU) 2021/2116 during the preceding financial year. Appropriations which are carried over shall be returned to the budget lines which cover the actions referred to in Article 5(2), point (d), of Regulation (EU) 2021/2116. 3. The Union institution concerned shall take its decision on carry-overs as referred to in paragraph 2 by 15 February of the following financial year. It shall inform the European Parliament and the Council by 15 March of that year of the carry-over decision it has taken. It shall also state, for each budget line, how the criteria in paragraph 2, first subparagraph, points (a), (b) and (c), have been applied to each carry-over. 4. Appropriations shall be automatically carried over in respect of: (a) appropriations for the Solidarity and Emergency Aid Reserve and for the European Union Solidarity Fund. Such appropriations may be carried over only to the following financial year and may be used up to 31 December of that year; (b) appropriations corresponding to internal assigned revenue. Such appropriations may be carried over only to the following financial year and may be committed up to 31 December of that year, with the exception of the internal assigned revenue from lettings and the sale of buildings and land which may be carried over until it is fully used. Commitment appropriations, as referred to in Regulation (EU) No 1303/2013 of the European Parliament and of the Council ( 40 ) Regulation (EU) No 514/2014 of the European Parliament and of the Council ( 41 ) and Regulation (EU) 2021/1060, which are available on 31 December arising from repayments of pre-financing payments may be carried over until the closure of the programme and used when necessary, provided that other commitment appropriations are no longer available; (c) appropriations corresponding to external assigned revenue. Such appropriations shall be fully used by the time all the operations relating to the programme or action to which they are assigned have been carried out or they may be carried over and used for the succeeding programme or action. This shall not apply to the revenue referred to in Article 21(2), point (g)(iii), for which appropriations not committed within five years shall be cancelled; (d) payment appropriations related to the EAGF resulting from suspensions in accordance with Articles 40, 41 and 42 of Regulation (EU) 2021/2116. 5. The treatment of external assigned revenue as referred to in paragraph 4, point (c), of this Article resulting from the participation of European Free Trade Association (EFTA) States in certain Union programmes in accordance with Article 21(2), point (e), shall be in line with Protocol No 32 annexed to the Agreement on the European Economic Area (EEA Agreement). 6. In addition to the information provided for in paragraph 3, the Union institution concerned shall submit to the European Parliament and to the Council information on appropriations which were automatically carried over, including the amounts involved and the provision of this Article under which the appropriations were carried over. 7. Non-differentiated appropriations legally committed at the end of the financial year shall be paid until the end of the following financial year. 8. Without prejudice to paragraph 4, appropriations placed in reserve and appropriations for staff expenditure shall not be carried over. For the purposes of this Article, staff expenditure comprises remuneration and allowances for members and for staff of Union institutions who are subject to the Staff Regulations.
Article 13 Detailed provisions on cancellation and carry-over of appropriations
1. The commitment appropriations and the non-differentiated appropriations referred to in Article 12(2), first subparagraph, point (a), may be carried over only if the commitments could not be made before 31 December of the financial year for reasons not attributable to the authorising officer and if the preparatory stages are sufficiently advanced to make it reasonable to expect that the commitment will be made by 31 March of the following financial year, or, in relation to building projects, by 31 December of the following financial year. 2. The preparatory stages referred to in Article 12(2), first subparagraph, point (a), which shall be completed by 31 December of the financial year in order to allow a carry-over to the following financial year, are in particular: (a) for individual budgetary commitments within the meaning of Article 112(1), first subparagraph, point (a), the completion of the selection of potential contractors, beneficiaries, prize winners or delegates; (b) for global budgetary commitments within the meaning of Article 112(1), first subparagraph, point (b), the adoption of a financing decision or the closing of the consultation of the departments concerned within each Union institution on the adoption of the financing decision. 3. Appropriations carried over in accordance with Article 12(2) first subparagraph, point (a), which have not been committed by 31 March of the following financial year, or by 31 December of the following financial year for amounts relating to building projects, shall be automatically cancelled. The Commission shall inform the European Parliament and the Council of the appropriations cancelled in accordance with the first subparagraph within one month following the cancellation.
Article 14 Decommitments
1. Where budgetary commitments are decommitted in any financial year after the year in which they were made as a result of the total or partial non-implementation of the actions for which they were earmarked, the appropriations corresponding to such decommitments shall be cancelled, unless otherwise provided in Regulation (EU) No 1303/2013, Regulation (EU) No 223/2014 of the European Parliament and of the Council ( 42 ) and Regulations (EU) No 514/2014, (EU) 2021/1060 and (EU) 2021/2116 and notwithstanding Article 15 of this Regulation. 2. Commitment appropriations referred to in Regulations (EU) No 1303/2013, (EU) No 223/2014, (EU) No 514/2014, (EU) 2021/1060 and (EU) 2021/2116 shall be decommitted automatically in accordance with those Regulations. 3. This Article does not apply to external assigned revenue referred to in Article 21(2).
Article 15 Making appropriations corresponding to decommitments available again
1. The appropriations corresponding to decommitments referred to in Regulations (EU) No 1303/2013, (EU) No 223/2014, (EU) No 514/2014, (EU) 2021/1060 and (EU) 2021/2116 may be made available again in the event of a manifest error attributable solely to the Commission. To that end, the Commission shall examine decommitments made during the preceding financial year and shall decide, by 15 February of the current financial year, on the basis of requirements, whether it is necessary to make the corresponding appropriations available again. 2. In addition to the case referred to in paragraph 1 of this Article, the appropriations corresponding to decommitments shall be made available again in the event of a decommitment of resources transferred back to the fund from which they have been initially transferred in line with Article 26 of Regulation (EU) 2021/1060. 3. Commitment appropriations corresponding to the amount of decommitments made as a result of total or partial non-implementation of corresponding research projects may also be made available again to the benefit of the research programme the projects belong to or its successor in the context of the budgetary procedure.
Article 16 Rules applicable in the event of late adoption of the budget
1. If the budget has not been definitively adopted at the beginning of the financial year, the procedure set out in the first paragraph of Article 315 TFEU (the provisional twelfths regime) shall apply. Commitments and payments may be made within the limits laid down in paragraph 2 of this Article. 2. Commitments may be made per chapter up to a maximum of one quarter of the total appropriations authorised in the relevant chapter of the budget for the preceding financial year plus one twelfth for each month which has elapsed. The limit of the appropriations provided for in the draft budget shall not be exceeded. Payments may be made monthly per chapter up to a maximum of one twelfth of the appropriations authorised in the relevant chapter of the budget for the preceding financial year. That sum shall not, however, exceed one twelfth of the appropriations provided for in the same chapter of the draft budget. 3. The appropriations authorised in the relevant chapter of the budget for the preceding financial year, as referred to in paragraphs 1 and 2, shall be understood as referring to the appropriations voted in the budget, including by amending budgets, and after adjustment for the transfers made during that financial year. 4. If the continuity of Union action and management needs so require, the Council, acting by qualified majority on a proposal from the Commission, may authorise expenditure in excess of one provisional twelfth but not exceeding a total of four provisional twelfths, except in duly justified cases, both for commitments and for payments over and above those automatically made available in accordance with paragraphs 1 and 2. The Council shall without delay forward its decision on authorisation to the European Parliament. The decision referred to in the first subparagraph shall enter into force 30 days after its adoption unless the European Parliament takes any of the following actions: (a) acting by a majority of its component members, decides to reduce the expenditure before the expiry of the 30 days, in which case the Commission shall submit a new proposal; (b) informs the Council and the Commission that it does not wish to reduce the expenditure, in which case the decision shall enter into force before the expiry of the 30 days. The additional twelfths shall be authorised in full and shall not be divisible. 5. If, for a given chapter, the authorisation of four provisional twelfths granted in accordance with paragraph 4 is not sufficient to cover the expenditure necessary to avoid a break in continuity of Union action in the area covered by the chapter in question, authorisation may exceptionally be given to exceed the amount of the appropriations entered in the corresponding chapter of the budget for the preceding financial year. The European Parliament and the Council shall act in accordance with the procedures provided for in paragraph 4. However, the overall total of the appropriations available in the budget of the preceding financial year or in the draft budget, as proposed, shall in no circumstances be exceeded.
Article 17 Definition and scope
1. Revenue and payment appropriations shall be in balance. 2. The Union and the Union bodies referred to in Articles 70 and 71 shall not raise loans within the framework of the budget.
Article 18 Balance from financial year
1. The balance from each financial year shall be entered in the budget for the following financial year as revenue in the event of a surplus or as a payment appropriation in the event of a deficit. 2. The estimates of the revenue or payment appropriations referred to in paragraph 1 of this Article shall be entered in the budget during the budgetary procedure and in a letter of amendment submitted pursuant to Article 42 of this Regulation. The estimates shall be drawn up in accordance with Article 1 of Regulation (EU, Euratom) 2021/768. 3. After the presentation of the provisional accounts for each financial year, any discrepancy between those accounts and the estimates shall be entered in the budget for the following financial year through an amending budget devoted solely to that discrepancy. In such a case, the Commission shall submit the draft amending budget simultaneously to the European Parliament and to the Council within 15 days of submission of the provisional accounts.
Article 19 Use of euro
1. The multiannual financial framework and the budget shall be drawn up and implemented in euro and the accounts shall be presented in euro. However, for the cash-flow purposes referred to in Article 77, the accounting officer and, in the case of imprest accounts, the imprest administrators, and, for the needs of the administrative management of the Commission and the EEAS, the authorising officer responsible, shall be authorised to carry out operations in other currencies. 2. Without prejudice to specific provisions laid down in sector-specific rules, or in specific contracts, grant agreements, contribution agreements and financing agreements, conversion by the authorising officer responsible shall be made using the daily euro exchange rate published in the C series of the Official Journal of the European Union of the day on which the payment order or recovery order is drawn up by the authorising department. If no such daily rate is published, the authorising officer responsible shall use the one referred to in paragraph 3. 3. For the purposes of the accounts provided for in Articles 82, 83 and 84, conversion between the euro and another currency shall be made using the monthly accounting exchange rate of the euro. That accounting exchange rate shall be established by the accounting officer of the Commission by means of any source of information regarded as reliable, on the basis of the exchange rate on the penultimate working day of the month preceding that for which the rate is established. 4. Currency conversion operations shall be carried out in such a way as to avoid having a significant impact on the level of the Union co-financing or a detrimental impact on the budget. Where appropriate, the rate of conversion between the euro and other currencies may be calculated using the average of the daily exchange rate in a given period.
Article 20 Scope
Without prejudice to Article 21, total revenue shall cover total payment appropriations. Without prejudice to Article 27, all revenue and expenditure shall be entered in the budget in full without any adjustment against each other.
Article 21 Assigned revenue
1. External assigned revenue and internal assigned revenue shall be used to finance specific items of expenditure. 2. The following shall constitute external assigned revenue: (a) specific additional financial contributions from Member States including voluntary contributions to Union programmes, instruments and activities; (b) appropriations relating to the revenue generated by the Research Fund for Coal and Steel established by Protocol No 37 on the financial consequences of the expiry of the ECSC Treaty and on the Research Fund for Coal and Steel, annexed to the TEU and to the TFEU. (c) the interest on deposits and the fines provided for in Council Regulation (EC) No 1467/97 ( 43 ) ; (d) revenue earmarked for a specific purpose, such as income from foundations, subsidies, gifts and bequests, including the earmarked revenue specific to each Union institution; (e) financial contributions to Union activities from third countries or from bodies other than those set up under the TFEU or the Euratom Treaty; (f) internal assigned revenue referred to in paragraph 3, to the extent that it is ancillary to external assigned revenue referred to in this paragraph; (g) revenue from the activities of a competitive nature conducted by the Joint Research Centre (JRC) which consist of any of the following: (i) grant and procurement procedures in which the JRC participates; (ii) activities of the JRC on behalf of third parties; (iii) activities undertaken under an administrative agreement with other Union institutions or other Commission departments, in accordance with Article 59, for the provision of technical-scientific services. 3. The following shall constitute internal assigned revenue: (a) revenue from third parties in respect of goods, services or work supplied at their request; (b) revenue arising from the repayment, in accordance with Article 101, of amounts wrongly paid; (c) proceeds from the supply of goods, services and works to other departments within an Union institution, or to other Union institutions or bodies, including refunds by other Union institutions or bodies of mission allowances paid on their behalf; (d) insurance payments received; (e) revenue from lettings and from the sale of buildings and land; (f) repayments to financial instruments or budgetary guarantees pursuant to Article 212(3), second subparagraph; (g) revenue arising from subsequent reimbursement of taxes pursuant to Article 27(3), first subparagraph, point (b). 4. Assigned revenue shall be carried over and transferred in accordance with Article 12(4), points (b) and (c), and with Article 32. 5. A basic act may assign the revenue for which it provides to specific items of expenditure. Unless otherwise specified in the basic act, such revenue shall constitute internal assigned revenue. 6. The budget shall include lines to accommodate external assigned revenue and internal assigned revenue and shall, wherever possible, indicate the amount.
Article 22 Structure to accommodate assigned revenue and provision of corresponding appropriations
1. Without prejudice to paragraph 2, first subparagraph, point (c), of this Article and to Article 24, the structure to accommodate assigned revenue in the budget shall comprise: (a) in the statement of revenue of each Union institution’s section, a budget line to receive the revenue; (b) in the statement of expenditure, the remarks, including general remarks, showing which budget lines may receive the appropriations corresponding to the assigned revenue which are made available; (c) in the statement of expenditure, an annex, forming an integral part of the budget, setting out all the budget lines for which internal or external assigned revenue is foreseen and providing information on the estimated amount of such revenue to be received and the estimated amount of such revenue to be carried over from preceding years for each budget line. In the case referred to in the first subparagraph, point (a), a token entry pro memoria shall be made and the estimated revenue shall be shown for information in the remarks. 2. The appropriations corresponding to assigned revenue shall be made available automatically, both as commitment appropriations and as payment appropriations, when the revenue has been received by the Union institution, save in any of the following cases: (a) in the case provided for in Article 21(2), point (a), for financial contributions from Member States and where the contribution agreement is expressed in euro, commitment appropriations may be made available upon signature of the contribution agreement by the Member State; (b) in the cases provided for in Article 21(2), point (b), and in Article 21(2), point (g)(i) and (iii), the commitment appropriations shall be made available as soon as the amount receivable has been estimated; (c) in the case provided for in Article 21(2), point (c), the entry of the amounts in the statement of revenue shall give rise to the provision, in the statement of expenditure, of commitment and payment appropriations. Appropriations referred to in the first subparagraph, point (c), of this paragraph shall be implemented in accordance with Article 20. 3. The estimates of amounts receivable referred to in Article 21(2), points (b) and (g), shall be sent to the accounting officer for registration.
Article 23 Contributions from Member States to research programmes
1. The contributions from Member States to the financing of certain supplementary research programmes, referred to in Article 5 of Regulation (EU, Euratom) No 609/2014, shall be paid as follows: (a) seven twelfths of the sum entered in the budget shall be paid by 31 January of the current financial year; (b) the remaining five twelfths shall be paid by 15 July of the current financial year. 2. Where the budget has not been definitively adopted before the start of a financial year, the contributions provided for in paragraph 1 shall be based on the sum entered in the budget for the preceding financial year. 3. Any contribution or additional payment owed by Member States to the budget shall be entered in the Commission’s account or accounts within thirty calendar days of the call for funds. 4. Payments made shall be entered in the account provided for in Regulation (EU, Euratom) No 609/2014 and shall be subject to the conditions laid down by that Regulation.
Article 24 Assigned revenue resulting from the participation of EFTA States in certain Union programmes
1. The budget structure to accommodate the revenue from the participation of EFTA States in certain Union programmes shall be as follows: (a) in the statement of revenue, a budget line with a token entry pro memoria shall be entered to accommodate the full amount of each EFTA State’s contribution for the financial year; (b) in the statement of expenditure, an annex, forming an integral part of the budget, shall set out all the budget lines covering the Union activities in which EFTA States participate, and shall include information on the estimated amount of the participation of each EFTA State. 2. Under Article 82 of the EEA Agreement, the amounts of the annual participation of EFTA States, as confirmed to the Commission by the Joint Committee of the European Economic Area in accordance with Article 1(5) of Protocol No 32 annexed to the EEA Agreement, shall give rise to the provision, at the start of the financial year, of the full amounts of the corresponding commitment appropriations and payment appropriations. 3. The use of the revenue arising from the financial contribution of EFTA States shall be monitored separately.
Article 25 Donations
1. Union institutions may accept any donation made to the Union, such as income from foundations, subsidies, gifts and bequests. 2. Acceptance of a donation of a value of EUR 50 000 or more which involves a financial charge, including follow-up costs, exceeding 10 % of the value of the donation made, shall be subject to the authorisation of the European Parliament and of the Council. The European Parliament and the Council shall act on the matter within two months of receiving a request for such an authorisation from the Union institutions concerned. If no objection is made within that period, the Union institutions concerned shall take a final decision regarding the acceptance of the donation. The Union institutions concerned shall in their request to the European Parliament and to the Council explain the financial charges entailed by the acceptance of donations made to the Union. 3. Notwithstanding paragraph 2, in exceptional circumstances, the Commission may accept any in-kind donation made to the Union, irrespective of its value, where such a donation is made for the purposes of humanitarian aid, emergency support, civil protection or crisis management aid. The Commission may accept such a donation provided that: (a) the acceptance is in accordance with the principles of sound financial management and transparency; (b) it does not give rise to a conflict of interests; (c) it does not harm the image of the Union; (d) it does not harm or risk harming the security or public order of the Union or Member States; (e) the donor is not, at the time of the acceptance, in one of the situations referred to in Articles 138(1) and 143(1) and is not registered as excluded in the database referred to in Article 144(1). The donor shall submit the declaration referred to in Article 139. The authorising officer responsible shall provide information in the annual activity report referred to in Article 74(9) on all cases where the Commission accepted a donation pursuant to the first subparagraph of this paragraph.
Article 26 Corporate sponsorship
1. ‘Corporate sponsorship’ means an agreement by which a legal person supports in-kind an event or an activity for promotional or corporate social responsibility purposes. 2. On the basis of specific internal rules, which shall be published on their respective websites, Union institutions and bodies may exceptionally accept corporate sponsorship provided that: (a) there is due regard to the principles of non-discrimination, proportionality, equal treatment and transparency at all stages of the procedure for accepting corporate sponsorship; (b) it contributes to the positive image of the Union and is directly linked to the core objective of an event or of an activity; (c) it does neither generate a conflict of interest nor concern exclusively social events; (d) the event or activity is not exclusively financed through corporate sponsorship; (e) the service in return for the corporate sponsorship is limited to the public visibility of the trademark or name of the sponsor; (f) the sponsor is not, at the time of the sponsorship procedure, in one of the situations referred to in Articles 138(1) and 143(1) and is not registered as excluded in the database referred to in Article 144(1). 3. Where the value of the corporate sponsorship exceeds EUR 5 000, the sponsor shall be listed in a public register that includes information on the type of event or activity being sponsored.
Article 27 Rules on deductions and exchange rate adjustments
1. The following deductions may be made from payment requests which shall then be passed for payment of the net amount: (a) penalties imposed on parties to contracts or beneficiaries; (b) discounts, refunds and rebates on individual invoices and cost statements; (c) interest generated by pre-financing payments; (d) adjustments for amounts unduly paid. The adjustments referred to in the first subparagraph, point (d), may be made, by means of direct deduction, against a new interim payment or payment of a balance to the same payee under the chapter, article and financial year in respect of which the excess payment was made. Union accounting rules shall apply to the deductions referred to in the first subparagraph, points (c) and (d). 2. The cost of products or services, provided to the Union, incorporating taxes refunded by Member States pursuant to Protocol No 7 on the privileges and immunities of the European Union, annexed to the TEU and to the TFEU, shall be charged to the budget for the ex-tax amount. 3. The cost of products or services, provided to the Union, incorporating taxes refunded by third countries on the basis of relevant agreements, may be charged to the budget for any of the following amounts: (a) the ex-tax amount; (b) the tax-inclusive amount. In the case referred to in the first subparagraph, point (b), subsequently reimbursed taxes shall be treated as internal assigned revenue. 4. Adjustments may be made in respect of exchange differences occurring in budget implementation. The final gain or loss shall be included in the balance for the financial year.
Article 28 General provisions
1. Appropriations shall be earmarked for specific purposes by title and chapter. The chapters shall be further subdivided into articles and items. 2. The Commission and the other Union institutions may transfer appropriations within the budget subject to the specific conditions laid down in Articles 29 to 32. Appropriations may only be transferred to budget lines for which the budget has authorised appropriations or which carry a token entry pro memoria. The limits referred to in Articles 29, 30 and 31 shall be calculated at the time the request for transfer is made and with reference to the appropriations provided in the budget, including amending budgets. The amount to be taken into consideration for the purposes of calculating the limits referred to in Articles 29, 30 and 31 shall be the sum of the transfers to be made on the budget line from which transfers are being made, after adjustment for earlier transfers made. The amount corresponding to the transfers which are carried out autonomously by the Commission, or by any other Union institution concerned without a decision of the European Parliament and of the Council, shall not be taken into consideration. Proposals for transfers and all information for the European Parliament and for the Council concerning transfers made under Articles 29, 30 and 31 shall be accompanied by appropriate and detailed supporting documents showing the most recent information available for the implementation of appropriations and estimates of requirements up to the end of the financial year, both for the budget lines to which the appropriations are to be transferred and for those from which they are to be taken.
Article 29 Transfers by Union institutions other than the Commission
1. Any Union institution other than the Commission may, within its own section of the budget, transfer appropriations: (a) from one title to another up to a maximum of 10 % of the appropriations for the financial year shown on the budget line from which the transfer is made; (b) from one chapter to another without limit. 2. Without prejudice to paragraph 4 of this Article, three weeks before making a transfer, as referred to in paragraph 1, the Union institution shall inform the European Parliament and the Council of its intention to do so. In the event that duly justified objections are raised within that period by either the European Parliament or the Council, the procedure laid down in Article 31 shall apply. 3. Any Union institution other than the Commission may propose to the European Parliament and to the Council, within its own section of the budget, transfers from one title to another exceeding the limit referred to in paragraph 1, point (a), of this Article. Those transfers shall be subject to the procedure laid down in Article 31. 4. Any Union institution other than the Commission may, within its own section of the budget, make transfers within articles without informing the European Parliament and the Council beforehand.
Article 30 Transfers by the Commission
1. The Commission may, within its own section of the budget, autonomously: (a) transfer appropriations within each chapter; (b) with regard to expenditure on staff and administration which is common to several titles, transfer appropriations from one title to another up to a maximum of 10 % of the appropriations for the financial year shown on the budget line from which the transfer is made, and up to a maximum of 30 % of the appropriations for the financial year shown on the budget line to which the transfer is made; (c) with regard to operational expenditure, transfer appropriations between chapters within the same title up to a maximum of 10 % of the appropriations for the financial year shown on the budget line from which the transfer is made; (d) with regard to research and technological development appropriations implemented by the JRC, within the title of the budget relating to the ‘Direct research’ policy area, transfer appropriations between chapters of up to a maximum of 15 % of the appropriations on the budget line from which the transfer is made; (e) with regard to research and technological development, transfer operational appropriations from one title to another, provided that the appropriations are used for the same purpose; (f) with regard to operational expenditure of the funds implemented under shared management, with the exception of the EAGF, transfer appropriations from one title to another, provided that the appropriations concerned are for the same objective within the meaning of the Regulation establishing the fund concerned or constitute technical assistance expenditure; (g) transfer appropriations from the budgetary item of a budgetary guarantee to the budgetary item of another budgetary guarantee, in the exceptional cases when the provisioned resources in the common provisioning fund of the latter are insufficient to pay a guarantee call and subject to the subsequent restoring of the amount transferred in accordance with the procedure set out in Article 215(4). The expenditure referred to in the first subparagraph, point (b), of this paragraph shall cover, for each policy area, the items referred to in Article 47(4). Where the Commission transfers EAGF appropriations pursuant to the first subparagraph after 31 December, it shall take its decision by 31 January of the following financial year. The Commission shall inform the European Parliament and the Council within two weeks after its decision on those transfers. Three weeks before making the transfers referred to in the first subparagraph, point (b), of this paragraph, the Commission shall inform the European Parliament and the Council of its intention to do so. In the event that duly justified objections are raised within that period by the European Parliament or by the Council, the procedure laid down in Article 31 shall apply. By way of derogation from the fourth subparagraph, the Commission may, during the last two months of the financial year, autonomously transfer appropriations concerning expenditure on staff, external personnel and other agents from one title to another within the total limit of 5 % of the appropriations for that year. The Commission shall inform the European Parliament and the Council within two weeks after its decision on those transfers. 2. The Commission may, within its own section of the budget, decide on the following transfers of appropriations from one title to another, provided it immediately informs the European Parliament and the Council of its decision: (a) transfer of appropriations from the ‘provisions’ title referred to in Article 49 of this Regulation, where the only condition for lifting the reserve is the adoption of a basic act pursuant to Article 294 TFEU; (b) in duly justified exceptional cases such as international humanitarian disasters and crises occurring after 1 December of the financial year, transfer of unused appropriations for that year still available in the titles falling under the heading of the multiannual financial framework dedicated to Union external action to the titles concerning crisis management aid and humanitarian aid operations.
Article 31 Transfer proposals submitted to the European Parliament and to the Council by Union institutions
1. Each Union institution shall submit its transfer proposals simultaneously to the European Parliament and to the Council. 2. The Commission may submit proposals for transfers of payment appropriations to the funds implemented under shared management with the exception of the EAGF to the European Parliament and to the Council by 10 January of the following financial year. The transfer of the payment appropriations may be made from any budgetary item. In such cases, the six-week period referred to in paragraph 4 shall be reduced to three weeks. If the transfer is not approved or only partially approved by the European Parliament and by the Council, the corresponding part of the expenditure referred to in Article 10(7), point (b), shall be charged to the payment appropriations of the following financial year. 3. The European Parliament and the Council shall take decisions on transfers of appropriations in accordance with paragraphs 4 to 8. 4. Except in urgent circumstances, the European Parliament and the Council, the latter acting by qualified majority, shall deliberate upon each transfer proposal within six weeks of its receipt by both institutions. In urgent circumstances, the European Parliament and the Council shall deliberate within three weeks of receipt of the proposal. 5. Where the Commission intends to transfer EAGF appropriations in accordance with this Article, it shall submit transfer proposals to the European Parliament and to the Council by 10 January of the following financial year. In such cases, the six-week period referred to in paragraph 4 shall be reduced to three weeks. 6. A transfer proposal shall be approved or considered to be approved, if, within the six-week period, any of the following occurs: (a) the European Parliament and the Council approve it; (b) either the European Parliament or the Council approves it and the other institution refrains from acting; (c) neither the European Parliament nor the Council takes a decision to amend or refuse the transfer proposal. 7. Unless either the European Parliament or the Council requests otherwise, the six-week period referred to in paragraph 4 shall be reduced to three weeks in the following cases: (a) the transfer represents less than 10 % of the appropriations of the budget line from which the transfer is made and does not exceed EUR 5 000 000; (b) the transfer concerns only payment appropriations and the overall amount of the transfer does not exceed EUR 100 000 000. 8. If either the European Parliament or the Council has amended the amount of the transfer while the other institution has approved it or refrains from acting, or if the European Parliament and the Council have both amended the amount of the transfer, the lesser of the two amounts shall be deemed approved, unless the Union institution concerned withdraws its transfer proposal.
Article 32 Transfers subject to special provisions
1. Appropriations corresponding to assigned revenue may be transferred only if such revenue is used for the purpose for which it is assigned. 2. Decisions on transfers to allow the use of the Solidarity and Emergency Aid Reserve under Article 9(1), point (b), of Regulation (EU, Euratom) 2020/2093 shall be taken by the European Parliament and by the Council on a proposal from the Commission. For the purposes of this paragraph, the procedure set out in Article 31(3) and (4) shall apply. If the European Parliament and the Council do not agree to the Commission proposal and cannot reach a common position, they shall refrain from acting on that proposal. Proposals for transfers from the Solidarity and Emergency Aid Reserve for assistance under Article 9(1), point (b), of Regulation (EU, Euratom) 2020/2093 shall be accompanied by appropriate and detailed supporting documents demonstrating: (a) the most recent information available for the implementation of appropriations and the estimate of requirements up to the end of the financial year for the budget line to which the transfer is to be made; (b) an analysis of the possibilities of reallocating appropriations.
Article 33 Performance and principles of economy, efficiency and effectiveness
1. Appropriations shall be used in accordance with the principle of sound financial management, and thus be implemented respecting the following principles: (a) the principle of economy which requires that the resources used by the Union institution concerned in the pursuit of its activities shall be made available in due time, in appropriate quantity and quality, and at the best price; (b) the principle of efficiency which concerns the best relationship between the resources employed, the activities undertaken and the achievement of objectives; (c) the principle of effectiveness which concerns the extent to which the objectives pursued are achieved through the activities undertaken. 2. In line with the principle of sound financial management, the use of appropriations shall focus on performance and for that purpose: (a) objectives for programmes and activities shall be established ex ante ; (b) progress in the achievement of objectives, including mainstreamed ones, where relevant, shall be monitored with performance indicators; (c) progress in, and problems with, the achievement of objectives shall be reported to the European Parliament and to the Council in accordance with Article 41(3), first subparagraph, point (h), and with Article 253(1), point (e); (d) programmes and activities shall, where feasible and appropriate in accordance with the relevant sector-specific rules, be implemented to achieve their set objectives without doing significant harm to the environmental objectives of climate change mitigation, climate change adaptation, the sustainable use and protection of water and marine resources, the transition to a circular economy, pollution prevention and control and the protection and restoration of biodiversity and ecosystems, as set out in Article 9 of Regulation (EU) 2020/852 of the European Parliament and of the Council ( 44 ) ; (e) programmes and activities shall, where feasible and appropriate in accordance with the relevant sector-specific rules, be implemented to achieve their set objectives respecting working and employment conditions under applicable national law, Union law, ILO conventions and collective agreements; (f) programmes and activities shall, where feasible and appropriate in accordance with the relevant sector-specific rules, be implemented taking into account the principle of gender equality and in accordance with an appropriate gender mainstreaming methodology. 3. Specific, measurable, attainable, relevant and time-bound objectives as referred to in paragraphs 1 and 2 and indicators that are relevant, accepted, credible, easy, robust and based on widely recognised scientific evidence and an effective, transparent and comprehensive methodology shall be defined where relevant. Where appropriate, the data collected in relation to such indicators shall be broken down by gender and shall be collected in a way allowing for aggregation of such data across all relevant programmes.
Article 34 Evaluations
1. Programmes and activities which entail significant spending shall be subject to ex ante and retrospective evaluations, which shall be proportionate to the objectives and expenditure. 2. Ex ante evaluations supporting the preparation of programmes and activities shall be based on evidence on the performance of related programmes or activities and shall identify and analyse the issues to be addressed, the added value of Union involvement, objectives, expected effects of different options and monitoring and evaluation arrangements. For major programmes or activities that are expected to have significant economic, environmental or social impacts, the ex ante evaluation may take the form of an impact assessment that, in addition to meeting the requirements set out in the first subparagraph, analyses the various options concerning the methods of implementation. 3. Retrospective evaluations shall assess the performance of the programme or activity, including aspects such as effectiveness, efficiency, coherence, relevance and EU added value. Retrospective evaluations shall be based on the information generated by the monitoring arrangements and indicators established for the action concerned. They shall be undertaken at least once during the term of every multiannual financial framework and where possible in sufficient time for the findings to be taken into account in ex ante evaluations or impact assessments which support the preparation of related programmes and activities.
Article 35 Compulsory financial statement
1. Any proposal or initiative submitted to the legislative authority by the Commission, the High Representative of the Union for Foreign Affairs and Security Policy (the ‘High Representative’) or by a Member State, which may have an impact on the budget, including changes in the number of posts, shall be accompanied by a financial statement showing the estimates in terms of payment and commitment appropriations, by an assessment of the different financing options available, and by an ex ante evaluation or impact assessment as provided for in Article 34. Any amendment to a proposal or initiative submitted to the legislative authority which may have an appreciable impact on the budget, including changes in the number of posts, shall be accompanied by a financial statement prepared by the Union institution proposing the amendment. The financial statement shall contain the financial and economic data necessary for the assessment by the legislative authority of the need for Union action. It shall provide appropriate information as regards coherence with other activities of the Union and any possible synergy. In the case of multiannual operations, the financial statement shall contain the foreseeable schedule of annual requirements in terms of commitment and payment appropriations and posts, including for external personnel, and an evaluation of their medium-term and, where possible, long-term financial impact. 2. During the budgetary procedure, the Commission shall provide the necessary information for a comparison between changes in the appropriations required and the initial forecasts made in the financial statement in the light of the progress of deliberations on the proposal or initiative submitted to the legislative authority. 3. In order to reduce the risk of fraud, irregularities and non-achievement of objectives, the financial statement shall provide information on the internal control system set up, an estimate of the costs and benefits of the controls implied by such a system and an assessment of the expected level of risk of error, as well as information on existing and planned fraud prevention and protection measures. Such assessment shall take into account the likely scale and type of errors, as well as the specific conditions of the policy area concerned and the rules applicable thereto. 4. When presenting revised or new spending proposals, the Commission shall estimate the costs and benefits of control systems, as well as the expected level of risk of error as referred to in paragraph 3.
Article 36 Internal control of budget implementation
1. Pursuant to the principle of sound financial management, the budget shall be implemented in compliance with the effective and efficient internal control appropriate to each method of implementation, and in accordance with the relevant sector-specific rules. 2. For the purposes of budget implementation, internal control shall be applied at all levels of management and shall be designed to provide reasonable assurance of achieving the following objectives: (a) effectiveness, efficiency and economy of operations; (b) reliability of reporting; (c) safeguarding of assets and information; (d) prevention, detection, correction and follow-up of irregularities including fraud, corruption, conflicts of interest and double funding, also through the voluntary use of a single integrated and interoperable information and monitoring system, including a single data-mining and risk-scoring tool, provided by the Commission, and allowing for the access to and the electronic automatic retrieval, recording, storage and analysis of data on the recipients of Union funds including their beneficial owners, as defined in Article 3, point (6), of Directive (EU) 2015/849, in accordance with sector-specific rules; (e) adequate management of the risks relating to the legality and regularity of the underlying transactions, taking into account the multiannual character of programmes as well as the nature of the payments concerned. 3. Effective internal control shall be based on best international practices and include, in particular, the following elements: (a) segregation of tasks; (b) an appropriate risk management and control strategy that includes control at recipient level; (c) adequate audit trails and data integrity in data systems, including electronic ones; (d) procedures for monitoring effectiveness and efficiency; (e) procedures for follow-up of identified internal control weaknesses and exceptions; (f) periodic assessment of the sound functioning of the internal control system. 4. Efficient internal control shall be based on the following elements: (a) the implementation of an appropriate risk management and control strategy coordinated among appropriate actors involved in the control chain; (b) the accessibility for all appropriate actors in the control chain of the results of controls carried out; (c) reliance, where appropriate, on management declarations of implementation partners and on independent audit opinions, provided that the quality of the underlying work is adequate and acceptable and that it was performed in accordance with agreed standards; (d) the timely application of corrective measures including, where appropriate, dissuasive penalties; (e) clear and unambiguous legislation underlying the policies concerned, including basic acts on the elements of the internal control; (f) the elimination of multiple controls; (g) the improvement of the cost benefit ratio of controls. 5. If, during implementation, the level of error is persistently high, the Commission shall identify the weaknesses in the control systems, analyse the costs and benefits of possible corrective measures and take or propose appropriate action, such as simplification of the applicable provisions, improvement of the control systems and redesign of the programme or delivery systems. 6. For the purposes of paragraph 2, point (d), of this Article, and without prejudice to the second subparagraph of this paragraph, Union institutions and bodies and persons or entities implementing the budget pursuant to Article 62(1) shall make the following information available to the Commission electronically, in an interoperable and machine-readable format: (a) on the recipient: all the information listed in Article 38(2), points (a), (b) and (c), and Article 38(6), second subparagraph, and, in the case of a natural person, also the date of birth; (b) on the operation: all the information listed in Article 38(2), points (d) and (e), as well as the unique identifier of the operation; (c) on the beneficial owner(s) of the recipient, where the recipient is not a natural person: the first name(s), last name(s), date of birth, and VAT identification number(s) or tax identification number(s) where available or another unique identifier at country level. For the purpose of this Article, where the Member States receive and implement the budget pursuant to Article 62(1), they shall provide the Commission with access to the information set out in the first subparagraph only where they have an obligation to record and store such information in accordance with sector-specific rules. In the absence of such an obligation under sector-specific rules, Member States may provide the Commission with access to the information in their possession as referred to in the first subparagraph, on a voluntary basis. The Commission shall present by the end of 2027 an assessment of the readiness of the system referred to in paragraph 2, point (d), of this Article, with respect to the following criteria: (a) interoperability is ensured with relevant IT systems and databases, including those of Member States, allowing for an automatic transfer of the relevant information in real time where feasible, and avoiding duplication of reporting; (b) the risk indicators used by the system referred to in paragraph 2, point (d), of this Article are sufficiently uniform, objective, proportionate, and necessary for risk assessment, and are based on reliable sources of information; (c) the system referred to in paragraph 2, point (d), of this Article permits using artificial intelligence for analysing and interpreting data; (d) the system referred to in paragraph 2, point (d), of this Article complies with general data protection principles. For the purposes of this Article, ‘interoperability’ means the minimum necessary collection of data from and communication between various sources in order to have the data assessed and potential risks evaluated effectively. Union institutions and bodies, Member States and persons or entities implementing the budget pursuant to Article 62(1) may use the system referred to in paragraph 2, point (d), of this Article on a voluntary basis. 7. The system referred to in paragraph 2, point (d), of this Article shall be designed to facilitate risk assessment for the purposes of selection, award, financial management, monitoring, investigation, control and audit and contribute to effective prevention, detection, correction and follow-up of irregularities, including fraud, corruption, conflicts of interest and double funding and shall: (a) only use risk indicators that are objective, proportionate, necessary for risk assessment, as well as based on reliable sources of data and information; (b) be designed for its use in line with general data protection principles, including data minimisation and storage limitation, applicable to the processing of personal data. Access to the data processed by the system referred to in paragraph 2, point (d), of this Article shall comply with applicable data protection rules, respect the principles of necessity and proportionality and shall be limited to the Union institutions and bodies implementing the budget, the Member States implementing the budget pursuant to Article 62(1), first subparagraph, point (b), the Member States that receive and implement Union funds under Article 62(1), first subparagraph, point (a), persons or entities implementing the budget pursuant to Article 62(1), first subparagraph, point (c), Union investigative, control and audit bodies including OLAF, the Court of Auditors, and the EPPO, within the exercise of their respective competences. Data available through the system referred to in paragraph 2, point (d), of this Article shall be made available to the European Parliament and the Council on a case-by-case basis to the extent necessary and proportionate within the exercise of their respective competences, in the context of the discharge procedure for the Commission. The Commission shall be the controller within the meaning of Article 3(8) of Regulation (EU) 2018/1725 and shall be responsible for the development, management and supervision of the system referred to in paragraph 2, point (d), of this Article, for ensuring the security, integrity and confidentiality of data, the authentication of the users and for protecting the IT system against mismanagement and misuse. Data shall be stored for the period necessary and proportionate to fulfil the purpose determined in paragraph 2, point (d). The maximum possible storage period shall not exceed 10 years from the last payment claim for the period submitted to the Commission. 8. For the purposes of paragraph 2, point (d), of this Article, Article 144(2) and Article 147, and in addition to any applicable sector-specific rule, persons and entities implementing the budget under Article 62(1), first subparagraph, point (b), and persons and entities implementing funds, where the budget is implemented under Article 62(1), first subparagraph, point (a), with Member States, shall transmit to the Commission through any official channel, such as the automated information system established by the Commission currently in use for reporting of fraud and irregularities (the ‘Irregularity Management System’), information on facts and findings established only in the context of final judgments or final administrative decisions with reference to the grounds set out in Article 138(1), point (c)(iv) and point (d), when they become aware of such information. For the same purposes, Member States shall transmit other necessary information requested by the Commission, in particular information related to the administrative follow-up. 9. Member States that receive and implement Union funds under Article 62(1), first subparagraph, point (a), shall apply paragraphs 1 to 7 of this Article. 10. For the purposes of the application of the requirements of paragraphs 2, 3 and 6 of this Article by Member States implementing the budget under Article 62(1), first subparagraph, point (b), references to recipients shall be understood as referred to in Article 38(1), second subparagraph. 11. As part of its control strategy, the Commission shall, where appropriate, design and perform controls and audits that use automated IT tools and emerging technologies.
Article 37 Publication of accounts and budgets
1. The budget shall be established and implemented and the accounts presented in accordance with the principle of transparency. 2. The President of the European Parliament shall have the budget and any amending budget, as definitively adopted, published in the Official Journal of the European Union . The budgets shall be published within three months of the date on which they are declared definitively adopted. Pending official publication in the Official Journal of the European Union , the final detailed budget figures shall be published in all languages on the website of Union institutions, on the Commission’s initiative, as soon as possible and no later than four weeks after the definitive adoption of the budget. The consolidated annual accounts shall be published in the Official Journal of the European Union and on the website of Union institutions.
Article 38 Publication of information on recipients and other information
1. The Commission shall make available on a centralised website information on recipients of funds financed from the budget no later than 30 June of the year following the financial year in which the funds were legally committed, where the budget is implemented by it in accordance with Article 62(1), first subparagraph, point (a), by Union institutions in accordance with Article 59(1), and by the Union bodies referred to in Articles 70 and 71. Where the budget is implemented in accordance with Article 62(1), first subparagraph, points (b) and (c), and with Member States in accordance to Article 62(1), first subparagraph, point (a), the Commission shall make available on its centralised website, as referred to in the first subparagraph of this paragraph, information on recipients no later than 30 June of the year following the financial year in which the contract or agreement setting out the conditions of support was established. Where the budget is implemented in accordance with Article 62(1), first subparagraph, point (b), references in this Article to recipients shall be understood as references to recipients, contractors, subcontractors and beneficiaries as referred to in sector-specific rules. Information listed under paragraph 2 of this Article for such recipients shall be published provided sector-specific rules require their collection and storage. 2. Save in the cases referred to in paragraph 3, the following information shall be published in an open, interoperable and machine-readable format, which allows data to be sorted, searched, extracted, compared and reused, having due regard for the requirements of confidentiality and security, in particular the protection of personal data: (a) whether the recipient is a natural or a legal person; (b) the recipient’s full legal name in the case of a legal person and their VAT identification number or tax identification number where available or another unique identifier established at country level, the first and last name of the recipient in the case of a natural person; (c) the locality of the recipient, namely: (i) the address of the recipient when the recipient is a legal person; (ii) the region on NUTS 2 level when the recipient is a natural person and is domiciled in the Union or the country when the recipient is a natural person and is not domiciled in the Union; (d) the amount committed and, in case of a commitment with multiple recipients, the breakdown of this amount per recipient where available; (e) the nature and purpose of the measure. 3. The information referred to in paragraph 2 of this Article shall not be published and shall not be submitted for publication in accordance with paragraph 6 of this Article for: (a) education supports paid to natural persons and other direct support paid to natural persons most in need as referred to in Article 194(4), point (b); (b) very low value contracts awarded to experts selected pursuant to Article 242(2) as well as very low value contracts below the amount referred to in point 14.4 of Annex I; (c) financial support provided through financial instruments or budgetary guarantees for an amount lower than EUR 500 000; (d) where disclosure risks threatening the rights and freedoms of the persons or entities concerned as protected by the Charter of Fundamental Rights of the European Union or harming the commercial interests of the recipients; (e) where it is not required for publication in sector-specific rules where the budget is implemented in accordance with Article 62(1), first subparagraph, point (b). In the cases referred to in the first subparagraph, point (c), the information made available shall be limited to statistical data, aggregated in accordance with relevant criteria, such as geographical situation, economic typology of recipients, type of support received and the Union policy area under which such support was provided. Where natural persons are concerned, the disclosure of the information referred to in paragraph 2 shall be based on relevant criteria such as the frequency or the type of the measure and the amounts involved. 4. Persons or entities implementing Union funds pursuant to Article 62(1), first subparagraph, point (c), shall publish information on recipients in accordance with rules and procedures of those persons or entities, to the extent that those rules are deemed equivalent following the assessment carried out by the Commission pursuant to Article 157(3) and (4), first subparagraph, point (e), and provided that any publication of personal data is subject to safeguards equivalent to those set out in this Article. Bodies designated pursuant to Article 63(3) shall publish information in accordance with sector-specific rules. Those sector-specific rules may, in accordance with the relevant legal basis, derogate from paragraphs 2 and 3 of this Article and taking into account the specificities of the sector concerned. Member States that receive and implement Union funds under Article 62(1), first subparagraph, point (a), shall ensure ex post publication of information on their recipients, on a centralised website referred to in paragraph 1 of this Article, in accordance with paragraphs 2 and 3 of this Article. 5. The websites of Union institutions shall contain a reference to the centralised website referred to in paragraph 1 where the information referred to in that paragraph can be found. The Commission shall make available, in an appropriate and timely manner, information about the centralised website referred to in paragraph 1, including a reference to its address, where the information as provided by the Member States, persons, entities or bodies referred to in paragraph 4 can be found. 6. For the purposes of the first and second subparagraphs of paragraph 1 of this Article and without prejudice to paragraphs 3 and 4 of this Article and to sector-specific rules, the Commission shall use the relevant data stored in the system referred to in Article 36(2), point (d), to feed the centralised website referred to in paragraph 1 of this Article with the information referred to in paragraph 2 of this Article. In addition, the data shall also include the VAT identification number or tax identification number of natural persons where available or another unique identifier established at country level with a view to improve the quality of the data transmitted without it being used for publication. 7. Where personal data are published, the information shall be removed two years after the end of the financial year in which the funds were legally committed. Where the budget is implemented in accordance with Article 62(1), first subparagraph, points (b) and (c), the personal data shall be removed two years after the end of the financial year in which the contract or agreement setting out the conditions of support was established.
Article 39 Estimates of revenue and expenditure
1. Each Union institution other than the Commission shall draw up an estimate of its revenue and expenditure, which it shall send to the Commission, and in parallel, for information, to the European Parliament and to the Council, before 1 July each year. 2. The High Representative shall hold consultations with the members of the Commission responsible for development policy, neighbourhood policy, international cooperation, humanitarian aid and crisis response, regarding their respective responsibilities. 3. The Commission shall draw up its own estimates, which it shall send, directly after their adoption, to the European Parliament and to the Council. In preparing its estimates, the Commission shall use the information referred to in Article 40.
Article 40 Estimated budget of the Union bodies referred to in Article 70
By 31 January each year, each Union body referred to in Article 70 shall, in accordance with the instrument establishing it, send the Commission, the European Parliament and the Council its draft single programming document containing its annual and multi-annual programming with the corresponding planning for human and financial resources.
Article 41 Draft budget
1. The Commission shall submit a proposal containing the draft budget to the European Parliament and to the Council by 1 September of the year preceding that in which the budget is to be implemented. It shall transmit that proposal, for information, to the national parliaments. The draft budget shall contain a summary general statement of the revenue and expenditure of the Union and shall consolidate the estimates referred to in Article 39. It may also contain different estimates from those drawn up by Union institutions. The draft budget shall follow the structure and presentation set out in Articles 47 to 52. Each section of the draft budget shall be preceded by an introduction drawn up by the Union institution concerned. The Commission shall draw up the general introduction to the draft budget. The general introduction shall comprise financial tables covering the main data by titles and justifications for the changes in the appropriations from one financial year to the next by categories of expenditure of the multiannual financial framework. 2. In order to provide more precise and reliable forecasts of the budgetary implications of legislation in force and of pending legislative proposals, the Commission shall attach to the draft budget an indicative financial programming for the following years, structured by category of expenditure, policy area and budget line. The complete financial programming shall cover the categories of expenditure covered by point 26 of the Interinstitutional Agreement of 16 December 2020. Summary data shall be provided for the categories of expenditure not covered by point 26 of that Interinstitutional Agreement. The indicative financial programming shall be updated after the adoption of the budget to incorporate the results of the budgetary procedure and any other relevant decisions. 3. The Commission shall attach to the draft budget: (a) a comparative table including the draft budget for other Union institutions and the original estimates of other Union institutions as sent to the Commission and, where applicable, setting out the reasons for which the draft budget contains estimates different from those drawn up by other Union institutions; (b) any working document it considers useful in connection with the establishment plans of Union institutions, showing the latest authorised establishment plan and presenting: (i) all staff employed by the Union, displayed by type of employment contract; (ii) a statement of the policy on posts and external personnel and on gender balance; (iii) the number of posts actually filled on the last day of the year preceding the year in which the draft budget is presented and the annual average of full-time equivalents actually in place for that preceding year, indicating their distribution by grade, by gender and by administrative unit; (iv) a list of posts broken down per policy area; (v) for each category of external personnel, the initial estimated number of full-time equivalents on the basis of the authorised appropriations, as well as the number of persons actually in place at the beginning of the year in which the draft budget is presented, indicating their distribution by function group and, as appropriate, by grade; (c) for the Union bodies referred to in Articles 70 and 71, a working document presenting the revenue and expenditure, as well as all information on staff as referred to in point (b) of this subparagraph; (d) a working document on the planned implementation of appropriations for the financial year, information on the implementation of the assigned revenue in the preceding year, including information on the amounts carried over to the financial year and on commitments outstanding; (e) as regards appropriations for administration, a working document presenting administrative expenditure to be implemented by the Commission under its section of the budget and a working document on the Commission’s building policy as referred to in Article 272(1); (f) a working document on pilot projects and preparatory actions which also contain an assessment of the results and the follow-up envisaged; (g) as regards funding to international organisations, a working document containing: (i) a summary of all contributions, with a breakdown per Union programme or fund and per international organisation; (ii) a statement of reasons explaining why it is more efficient for the Union to fund those international organisations rather than to act directly; (h) programme statements or any other relevant document containing the following: (i) an indication of which Union policies and objectives the programme is to contribute to; (ii) a clear rationale for intervention at Union level in accordance, inter alia, with the principle of subsidiarity; (iii) progress in achieving programme objectives, as specified in Article 33; (iv) a full justification, including a cost-benefit analysis for proposed changes in the level of appropriations; (v) information on the implementation rates of the programme for the current and preceding financial year; (i) a summary statement of the schedule of payments summarising per programme and per heading payments due in subsequent financial years to meet budgetary commitments proposed in the draft budget entered into in preceding financial years. Where public-private partnerships make use of financial instruments, the information relating to those instruments shall be included in the working document referred to in paragraph 4. 4. Where the Commission makes use of financial instruments, it shall attach to the draft budget a working document presenting for each financial instrument the following: (a) a reference to the financial instrument and its basic act, together with a general description of the instrument, its impact on the budget, its duration and the added value of the Union contribution; (b) the financial institutions involved in implementation, including any issues relating to the application of Article 158(2); (c) the contribution of the financial instrument to the achievement of the objectives of the programme concerned as measured by the indicators established including, where applicable, the geographical diversification; (d) the envisaged operations, including target volumes based on the target leverage and expected private capital to be mobilised or, when unavailable, on the leverage effect arising from the existing financial instruments; (e) budget lines corresponding to the relevant operations and the aggregate budgetary commitments and payments from the budget; (f) the average duration between the budgetary commitment to the financial instruments and the legal commitments for individual projects in the form of equity or debt, where that duration exceeds three years; (g) revenue and repayments under Article 212(3), presented separately, including an evaluation of their use; (h) the value of equity investments, with respect to preceding years; (i) the total amount of provisions for risks and liabilities, as well as any information on the financial risk exposure of the Union, including any contingent liability; (j) realised losses from assets and called guarantees both for the preceding year and the respective accumulated figures; (k) the performance of the financial instrument, including the investments realised, the target and the achieved leverage and multiplier effects, and also the amount of private capital mobilised; (l) the provisioned resources in the common provisioning fund and, when applicable, the balance on the fiduciary account. The working document referred to in the first subparagraph shall also include an overview of the administrative expenditure arising from management fees and other financial and operating charges paid for the management of financial instruments in total and per managing party and per financial instrument managed. The Commission shall explain the reasons for the duration referred to in the first subparagraph, point (f), and shall, where appropriate, provide an action plan for the reduction of the duration in the framework of the annual discharge procedure. The working document referred to in the first subparagraph shall summarise in a clear and concise table information per financial instrument. 5. Where the Union has granted a budgetary guarantee, the Commission shall attach to the draft budget a working document presenting for each budgetary guarantee and for the common provisioning fund the following: (a) a reference to the budgetary guarantee and its basic act, together with a general description of the budgetary guarantee, its impact on the financial liabilities of the budget, its duration and the added value of the Union support; (b) the counterparts for the budgetary guarantee, including any issues relating to the application of Article 158(2); (c) the budgetary guarantee’s contribution to the achievement of the objectives of the budgetary guarantee as measured by the indicators established, including, where applicable, the geographical diversification and the mobilisation of private sector resources; (d) information on operations covered by the budgetary guarantee on an aggregated basis by sectors, countries and instruments, including, where applicable, portfolios and support combined with other Union actions; (e) the amount transferred to recipients as well as an assessment of the leverage effect achieved by the projects supported under the budgetary guarantee; (f) information aggregated on the same basis as referred to in point (d) on calls on the budgetary guarantee, losses, returns, amounts recovered and any other payments received; (g) amount of provisioning for liabilities arising from each budgetary guarantee, and an assessment of the adequacy of its provisioning rate and of the need for its replenishment; (h) the effective provisioning rate of the common provisioning fund and, where applicable, the subsequent operations in accordance with Article 216(4). 6. Where the Commission makes use of Union trust funds for external actions, it shall attach to the draft budget a detailed working document on the activities supported by those trust funds, including: (a) on their implementation, containing, inter alia, information on the monitoring arrangements with the entities implementing the trust funds; (b) their management costs; (c) the contributions from other donors than the Union; (d) a preliminary assessment of their performance based on the conditions set out in Article 238(3); (e) a description on how their activities have contributed to the objectives laid down in the basic act of the instrument from which the Union contribution to the trust funds were provided. 7. The Commission shall attach to the draft budget a list of its decisions imposing fines in the area of competition law and the amount of each fine imposed, together with information on whether the fines have become definitive or whether they are or could still become subject to an appeal before the Court of Justice of the European Union, as well as, where possible, information on when each fine is expected to become definitive. The Commission shall also attach to the draft budget a list of its decisions and the amounts that have been entered or may be entered as negative revenue to the budget pursuant to Article 48(2), point (b). 8. The Commission shall also attach to the draft budget any further working document it considers useful for the European Parliament and for the Council to assess the budget requests. 9. In accordance with Article 8(5) of Council Decision 2010/427/EU ( 45 ) , the Commission shall transmit to the European Parliament and to the Council, together with the draft budget, a working document presenting, in a comprehensive way: (a) all administrative and operational expenditure relating to the external actions of the Union, including CFSP and common security and defence policy tasks, and financed from the budget; (b) the EEAS’ overall administrative expenditure for the preceding year, broken down into expenditure per Union delegation and expenditure for the central administration of the EEAS, together with operational expenditure, broken down by geographic area (regions, countries), thematic areas, Union delegations and missions. 10. The working document referred to in paragraph 9 shall also: (a) show the number of posts for each grade in each category and the number of permanent and temporary posts, including contractual and local staff authorised within the limits of the appropriations in each Union delegation, as well as in the central administration of the EEAS; (b) show any increase or reduction, compared to the preceding financial year, of posts by grade and category in the central administration of the EEAS, and in all Union delegations; (c) show the number of posts authorised for the financial year and for the preceding financial year, as well as the number of posts occupied by diplomats seconded from Member States, and by Union officials; (d) provide a detailed picture of all personnel in place in Union delegations at the time of presenting the draft budget, including a breakdown by geographic area, gender, individual country and mission, distinguishing between establishment plan posts, contract agents, local agents and seconded national experts, and of appropriations requested in the draft budget for such types of personnel with corresponding estimates of the number of full-time equivalents on the basis of the appropriations requested.
Article 42 Letter of amendment to the draft budget
On the basis of any new information which was not available at the time the draft budget was established, the Commission may, on its own initiative or if requested by another Union institutions in respect of its respective section, submit simultaneously to the European Parliament and to the Council one or more letters of amendment to the draft budget before the Conciliation Committee referred to in Article 314 TFEU is convened. Such letters may include a letter of amendment updating, in particular, expenditure estimates for agriculture.
Article 43 Obligations of Member States as a result of the adoption of the budget
1. The President of the European Parliament shall declare the budget definitively adopted in accordance with the procedure provided for in Article 314(9) TFEU and Article 106a of the Euratom Treaty. 2. Once the budget has been declared definitively adopted, each Member State shall, from 1 January of the following financial year or from the date of the declaration of definitive adoption of the budget if that occurs after 1 January, be bound to make the payments due to the Union, as specified in Regulations (EU, Euratom) No 609/2014 and (EU, Euratom) 2021/770.
Article 44 Draft amending budgets
1. The Commission may present draft amending budgets which are primarily revenue-driven in the following circumstances: (a) to enter in the budget the balance of the preceding financial year, in accordance with the procedure laid down in Article 18; (b) to revise the forecast of own resources on the basis of updated economic forecasts; (c) to update the revised forecast of own resources and other revenue, as well as to review the availability of, and need for, payment appropriations. If there are unavoidable, exceptional and unforeseen circumstances, the Commission may present draft amending budgets which are primarily expenditure- driven. 2. Requests for amending budgets, in the same circumstances as referred to in paragraph 1, from Union institutions other than the Commission shall be sent to the Commission. Before presenting a draft amending budget, the Commission and the other Union institutions concerned shall examine the scope for reallocation of the relevant appropriations, with particular reference to any expected under-implementation of appropriations. Article 43 shall apply to amending budgets. Amending budgets shall be substantiated by reference to the budget the estimates of which they are amending. 3. The Commission shall, except in duly justified exceptional circumstances, submit its draft amending budgets simultaneously to the European Parliament and to the Council by 1 September of each financial year. It may attach an opinion to the requests for amending budgets from other Union institutions. 4. Draft amending budgets shall be accompanied by statements of reasons and information on budget implementation for the preceding and current financial years available at the time of their establishment.
Article 45 Early transmission of estimates and draft budgets
The Commission, the European Parliament and the Council may agree to bring forward certain dates for the transmission of the estimates, and for the adoption and transmission of the draft budget. Such an arrangement shall not, however, have the effect of shortening or extending the periods for which provision is made for consideration of those texts under Article 314 TFEU and Article 106a of the Euratom Treaty.
Article 46 Structure of the budget
The budget shall consist of the following: (a) a general statement of revenue and expenditure; (b) separate sections for each Union institution, with the exception of the European Council and of the Council which shall share the same section, subdivided into statements of revenue and expenditure.
Article 47 Budget nomenclature
1. Commission revenue and the revenue and expenditure of the other Union institutions shall be classified by the European Parliament and by the Council according to their type or the use to which they are assigned under titles, chapters, articles and items. 2. The statement of expenditure for the section of the budget relating to the Commission shall be set out on the basis of a nomenclature adopted by the European Parliament and by the Council and classified according to the purpose of the expenditure. Each title shall correspond to a policy area and each chapter shall, as a rule, correspond to a programme or an activity. Each title may include operational appropriations and administrative appropriations. The administrative appropriations for a title shall be grouped in a single chapter. The budget nomenclature shall comply with the principles of specification, sound financial management and transparency. It shall provide the clarity and transparency necessary for the budgetary process, facilitating the identification of the main objectives as reflected in the relevant legal bases, making choices on political priorities possible and enabling efficient and effective implementation. 3. The Commission may request the addition of a token entry pro memoria on an entry without authorised appropriations. Such a request shall be approved in accordance with the procedure laid down in Article 31. 4. When presented by purpose, administrative appropriations for individual titles shall be classified as follows: (a) expenditure on staff authorised in the establishment plan, which shall include an amount of appropriations and a number of establishment plan posts corresponding to that expenditure; (b) expenditure on external personnel and other expenditure referred to in Article 30(1), first subparagraph, point (b), and financed under the ‘administration’ heading of the multiannual financial framework; (c) expenditure on buildings and other related expenditure, including cleaning and maintenance, rental and hiring, telecommunications, water, gas and electricity; (d) expenditure on external personnel and technical assistance directly linked to the implementation of programmes. Any administrative expenditure of the Commission of a type which is common to several titles shall be set out in a separate summary statement classified by type.
Article 48 Negative revenue
1. The budget shall not contain negative revenue. 2. By way of derogation from paragraph 1 of this Article, the following shall be deducted from the revenue of the budget: (a) negative remuneration of deposits in total; (b) where the amounts of the fines, other penalties or sanctions under the TFEU or the Euratom Treaty referred to in Article 108(1) are cancelled or reduced by the Court of Justice of the European Union, any interest or other charge due to the parties concerned, including any negative return related to those amounts. With regard to the first subparagraph, point (b), the interest or other charge shall be reflected in the draft budget within a specific budget line, and the Commission shall update the information referred to in the second sentence of Article 41(7) together with the amending budget referred to in Article 18(3). 3. The own resources paid under Decision (EU, Euratom) 2020/2053 shall be net amounts and shall be shown as such in the summary statement of revenue in the budget.
Article 49 Provisions
1. Each section of the budget may include a ‘provisions’ title. Appropriations shall be entered in that title in any of the following cases: (a) no basic act exists for the action concerned when the budget is established; (b) there are serious grounds for doubting the adequacy of the appropriations or the possibility of implementing, under conditions in accordance with the principle of sound financial management, the appropriations entered on the budget lines concerned. The appropriations in that title may be used only after transfers in accordance with the procedure laid down in Article 30(2), point (a), of this Regulation, where the adoption of the basic act is subject to the procedure laid down in Article 294 TFEU, and in accordance with the procedure laid down in Article 31 of this Regulation, for all other cases. 2. In the event of serious implementation difficulties, the Commission may, in the course of a financial year, propose that appropriations be transferred to the ‘provisions’ title. The European Parliament and the Council shall take a decision on such transfers as provided for in Article 31.
Article 50 Negative reserve
The section of the budget relating to the Commission may include a ‘negative reserve’ limited to a maximum amount of EUR 200 000 000. Such a reserve, which shall be entered in a separate title, shall comprise payment appropriations only. That negative reserve shall be drawn upon before the end of the financial year by means of transfers in accordance with the procedure laid down in Articles 30 and 31.
Article 51 Emergency Aid Reserve
1. The section of the budget relating to the Commission shall include a reserve for emergency aid for third countries. 2. The reserve referred to in paragraph 1 shall be drawn upon before the end of the financial year by means of transfers in accordance with the procedure laid down in Articles 30 and 32.
Article 52 Presentation of the budget
1. The budget shall show: (a) in the general statement of revenue and expenditure: (i) the estimated revenue of the Union for the current financial year concerned (year n); (ii) the estimated revenue for the preceding financial year and the revenue for year n-2; (iii) the commitment and payment appropriations for year n; (iv) the commitment and payment appropriations for the preceding financial year; (v) the expenditure committed and the expenditure paid in year n-2, the latter also expressed as a percentage of the budget of year n; (vi) appropriate remarks on each subdivision, as set out in Article 47(1), including the references of the basic act, where one exists, as well as all appropriate explanations concerning the nature and purpose of the appropriations; (b) in each section, the revenue and expenditure following the same structure as set out in point (a); (c) with regard to staff: (i) for each section, an establishment plan setting the number of posts for each grade in each category and in each service and the number of permanent and temporary posts authorised within the limits of the appropriations; (ii) an establishment plan for staff paid from the research and technological development appropriations for direct action and an establishment plan for staff paid from the same appropriations for indirect action; the establishment plans shall be classified by category and grade and shall distinguish between permanent and temporary posts, authorised within the limits of the appropriations; (iii) an establishment plan setting the number of posts by grade and by category for each Union body referred to in Article 70 which receives a contribution charged to the budget. The establishment plans shall show, next to the number of posts authorised for the financial year, the number authorised for the preceding year. The staff of the Euratom Supply Agency shall appear separately in the Commission establishment plan; (d) with regard to financial assistance and budgetary guarantees: (i) in the general statement of revenue, the budget lines corresponding to the relevant operations and intended to record any reimbursements received from recipients who initially defaulted. Those lines shall carry a token entry pro memoria and be accompanied by appropriate remarks; (ii) in the section of the budget relating to the Commission: — the budget lines containing the budgetary guarantees in respect of the operations concerned. Those lines shall carry a token entry pro memoria, provided that no effective charge which has to be covered by definitive resources has arisen; — remarks giving the reference to the basic act and the volume of the operations envisaged, the duration and the financial guarantee provided by the Union in respect of such operations; (iii) in a document annexed to the section of the budget relating to the Commission, as an indication, also of the corresponding risks: — ongoing capital operations and debt management; — the capital operations and debt management for year n; — a comprehensive overview of borrowing and lending operations; that overview shall provide inter alia detailed information on maturities, schedule of payments, interest due on aggregate level, the investor base on the primary market, and, where applicable, the dimension and costs of the common liquidity pool underpinning the diversified funding strategy, as well as the borrowing plan; (e) with regard to financial instruments to be established without a basic act: (i) budget lines corresponding to the relevant operations; (ii) a general description of the financial instruments, including their duration and their impact on the budget; (iii) the envisaged operations, including target volumes based on the expected multiplier and leverage effect; (f) with regard to the funds implemented by persons or entities pursuant to Article 62(1), first subparagraph, point (c): (i) a reference to the basic act of the relevant programme; (ii) corresponding budget lines; (iii) a general description of the action, including its duration and its impact on the budget; (g) the total amount of CFSP expenditure entered in a chapter, entitled ‘CFSP’, with specific articles covering CFSP expenditure and containing specific budget lines identifying at least the single major missions. 2. In addition to the documents referred to in paragraph 1, the European Parliament and the Council may attach any other relevant documents to the budget.
Article 53 Rules on the establishment plans for staff
1. The establishment plans referred to in Article 52(1), point (c), shall constitute an absolute limit for each Union institution or body. No appointment shall be made in excess of the limit set. However, save in the case of grades AD 14, AD 15 and AD 16, each Union institution or body may modify its establishment plans by up to 10 % of posts authorised, subject to the following conditions: (a) the volume of staff appropriations corresponding to a full financial year is not affected; (b) the limit of the total number of posts authorised by each establishment plan is not exceeded; (c) the Union institution or body has taken part in a benchmarking exercise with other Union institutions and bodies as initiated by the Commission’s staff screening exercise. At least three weeks before making a modification as referred to in the second subparagraph, the Union institution concerned shall inform the European Parliament and the Council of its intention to do so. In the event that duly justified objections are raised within this period by the European Parliament or the Council, the Union institution shall refrain from making the modifications and the procedure laid down in Article 44 shall apply. 2. By way of derogation from the first subparagraph of paragraph 1, the effects of part-time work authorised by the appointing authority in accordance with the Staff Regulations may be offset by other appointments.
Article 54 Compliance with the Multiannual Financial Framework and the decision on the system of own resources of the European Union
The budget shall comply with the Multiannual Financial Framework and Decision (EU, Euratom) 2020/2053.
Article 55 Compliance of Union acts with the budget
Where the implementation of a Union act exceeds the appropriations available in the budget, such an act shall not be implemented in financial terms until the budget has been amended accordingly.
Article 56 Budget implementation in accordance with the principle of sound financial management
1. The Commission shall implement the revenue and expenditure of the budget in accordance with this Regulation, under its own responsibility and within the limits of the appropriations authorised. 2. The Member States shall cooperate with the Commission so that the appropriations are used in accordance with the principle of sound financial management.
Article 57 Information on transfers of personal data for audit purposes
In award procedures, including in any call made in the context of grants, non-financial donations, procurement or prizes implemented under direct management, potential beneficiaries, candidates, tenderers and participants shall, in accordance with Regulation (EU) 2018/1725 be informed that, for the purposes of safeguarding the financial interests of the Union, their personal data may be transferred to internal audit services, to the Court of Auditors, to the EPPO or to OLAF and between authorising officers of the Commission, and the executive agencies referred to in Article 69 of this Regulation and the Union bodies referred to in Articles 70 and 71 of this Regulation.
Article 58 Basic act and exceptions
1. Appropriations entered in the budget for any Union action shall only be used if a basic act has been adopted. 2. By way of derogation from paragraph 1, and subject to the conditions set out in paragraphs 3, 4 and 5, the following appropriations may be implemented without a basic act provided the actions which they are intended to finance fall within the competences of the Union: (a) appropriations for pilot projects of an experimental nature designed to test the feasibility of an action and its usefulness; (b) appropriations for preparatory actions in the field of application of the TFEU and the Euratom Treaty, designed to prepare proposals with a view to the adoption of future actions; (c) appropriations for preparatory measures in the field of Title V of the TEU; (d) appropriations for one-off actions, or for actions for an indefinite duration, carried out by the Commission by virtue of tasks resulting from its prerogatives at institutional level pursuant to the TFEU and to the Euratom Treaty, other than its right of legislative initiative to submit proposals as referred to in point (b) of this paragraph, and under specific powers directly conferred on it by Articles 154, 156, 159 and 160 TFEU, Articles 168(2), 171(2) and 173(2) TFEU, the second paragraph of Article 175 TFEU, Article 181(2) TFEU, Article 190 TFEU and Articles 210(2) and 214(6) TFEU and Articles 70 and 77 to 85 of the Euratom Treaty; (e) appropriations for the operation of each Union institution under its administrative autonomy. 3. With regard to appropriations referred to in paragraph 2, point (a), the relevant commitment appropriations may be entered in the budget for not more than two consecutive financial years. The total amount of appropriations for pilot projects shall not exceed EUR 40 000 000 in any financial year. 4. With regard to appropriations referred to in paragraph 2, point (b), preparatory actions shall follow a coherent approach and may take various forms. The relevant commitment appropriations may be entered in the budget for not more than three consecutive financial years. The procedure for the adoption of the relevant basic act shall be concluded before the end of the third financial year. In the course of that procedure, the commitment of appropriations shall correspond to the particular features of the preparatory action with regard to the activities envisaged, the aims pursued and the recipients. As a result, the amount of the appropriations committed shall not correspond to the amount of those envisaged for financing the definitive action itself. The total amount of appropriations for new preparatory actions referred to in paragraph 2, point (b), shall not exceed EUR 50 000 000 in any financial year, and the total amount of appropriations actually committed for preparatory actions shall not exceed EUR 100 000 000. 5. With regard to the appropriations referred to in paragraph 2, point (c), preparatory measures shall be limited to a short period of time and shall be designed to establish the conditions for Union action in fulfilment of the objectives of the CFSP and for the adoption of the necessary legal instruments. For the purpose of Union crisis management operations, preparatory measures shall be designed, inter alia, to assess the operational requirements, to provide for a rapid initial deployment of resources, or to establish the conditions on the ground for the launching of the operation. Preparatory measures shall be agreed by the Council, on a proposal by the High Representative. In order to ensure the rapid implementation of preparatory measures, the High Representative shall inform the European Parliament and the Commission as early as possible of the Council’s intention to launch a preparatory measure and, in particular, of the estimated resources required for that purpose. The Commission shall take all the measures necessary to ensure a rapid disbursement of the funds. The financing of measures agreed by the Council for the preparation of Union crisis management operations under Title V TEU shall cover incremental costs directly arising from a specific field deployment of a mission or team involving, inter alia, personnel from Union institutions, including high-risk insurance, travel and accommodation costs and per diem payments.
Article 59 Budget implementation by Union institutions other than the Commission
1. The Commission shall confer on the other Union institutions the requisite powers for the implementation of the sections of the budget relating to them. 2. In order to facilitate the implementation of their appropriations, Union institutions may conclude service-level agreements with each other laying down the conditions governing the provision of services, supply of products, execution of works or of building contracts. Those agreements shall enable the transfer of appropriations or the recovery of costs, which result from their implementation. 3. Service-level agreements referred to in paragraph 2 may also be agreed upon between departments of Union institutions, Union bodies, European offices, bodies or persons entrusted with implementation of specific actions in the CFSP pursuant to Title V of the TEU and the Office of the Secretary-General of the Board of Governors of the European schools. The Commission and other Union institutions shall report regularly to the European Parliament and to the Council on the service-level agreements they conclude with other Union institutions.
Article 60 Delegation of budget implementation powers
1. The Commission and each of the other Union institutions may, within their departments, delegate their powers of budget implementation in accordance with the conditions laid down in this Regulation and their internal rules and within the limits laid down in the instrument of delegation. Those so empowered shall act within the limits of the powers expressly conferred upon them. 2. In addition to paragraph 1, the Commission may delegate its powers of budget implementation concerning the operational appropriations of its own section of the budget to Heads of Union delegations and, in order to ensure business continuity during their absence, to deputy Heads of Union delegations. Such delegation shall be without prejudice to the responsibility of Heads of Union delegations for budget implementation. Where the absence of a Head of Union delegation exceeds four weeks, the Commission shall revise its decision to delegate powers of budget implementation. When Heads of Union delegations, and their deputies in the absence of the former, act as authorising officers by subdelegation of the Commission, they shall apply the Commission rules for budget implementation and shall be subject to the same duties, obligations and accountability as any other authorising officer by subdelegation of the Commission. The Commission may withdraw the delegation of powers referred to in the first subparagraph in accordance with its own rules. For the purposes of the first subparagraph, the High Representative shall take the measures necessary to facilitate cooperation between Union delegations and Commission departments. 3. The EEAS may exceptionally delegate its powers of budget implementation concerning the administrative appropriations of its own section of the budget to Commission staff of Union delegations where this is necessary in order to ensure the continuity in the administration of such delegations in the absence of the EEAS competent authorising officer from the country where his or her delegation is based. In the exceptional cases where Commission staff of Union delegations act as authorising officers by subdelegation of the EEAS, they shall apply the EEAS internal rules for budget implementation and shall be subject to the same duties, obligations and accountability as any other authorising officer by subdelegation of the EEAS. The EEAS may withdraw the delegation of powers referred to in the first subparagraph in accordance with its own rules.
Article 61 Conflict of interests
1. Financial actors within the meaning of Chapter 4 of this Title and other persons, including national authorities at any level, involved in budget implementation under direct, indirect and shared management, including acts preparatory thereto, audit or control, shall not take any action which may bring their own interests into conflict with those of the Union. They shall also take appropriate measures to prevent a conflict of interests from arising in the functions under their responsibility and to address situations which may objectively be perceived as a conflict of interests. 2. Where there is a risk of a conflict of interests involving a member of staff of a national authority, the person in question shall refer the matter to his or her hierarchical superior. Where such a risk exists for staff covered by the Staff Regulations, the person in question shall refer the matter to the relevant authorising officer by delegation. The relevant hierarchical superior or the authorising officer by delegation shall confirm in writing whether a conflict of interests is found to exist. Where a conflict of interests is found to exist, the appointing authority or the relevant national authority shall ensure that the person in question ceases all activity in the matter. The relevant authorising officer by delegation or the relevant national authority shall ensure that any further appropriate action is taken in accordance with the applicable law, including, in the cases involving a member of staff of a national authority, with the national law relating to conflict of interests. 3. For the purposes of paragraph 1, a conflict of interests exists where the impartial and objective exercise of the functions of a financial actor or other person, as referred to in paragraph 1, is compromised for reasons involving family, emotional life, political or national affinity, economic interest or any other direct or indirect personal interest.
Article 62 Methods of budget implementation
1. The Commission shall implement the budget in any of the following ways: (a) directly (direct management) as set out in Articles 125 to 156, by its departments, including its staff in the Union delegations under the authority of their respective Head of delegation, in accordance with Article 60(2), or through executive agencies as referred to in Article 69; (b) under shared management with Member States (shared management) as set out in Articles 63 and 125 to 129; (c) indirectly (indirect management) as set out in Articles 125 to 152 and 157 to 162, where this is provided for in the basic act or in the cases referred to in Article 58(2), points (a) to (d), by entrusting budget implementation tasks to: (i) third countries or the bodies they have designated, as referred to in Article 161; (ii) international organisations or their agencies, within the meaning of Article 159; (iii) the European Investment Bank (the ‘EIB’) or the European Investment Fund (the ‘EIF’) or both of them acting as a group (the ‘EIB group’); (iv) Union bodies referred to in Articles 70 and 71; (v) public law bodies, including Member State organisations; (vi) bodies governed by private law with a public service mission, including Member State organisations, to the extent that they are provided with adequate financial guarantees; (vii) bodies governed by the private law of a Member State that are entrusted with the implementation of a public- private partnership and that are provided with adequate financial guarantees; (viii) bodies or persons entrusted with the implementation of specific actions in the CFSP pursuant to Title V of the TEU, and identified in the relevant basic act; (ix) bodies established in a Member State, governed by the private law of a Member State or Union law and eligible to be entrusted, in accordance with sector-specific rules, with the implementation of Union funds or budgetary guarantees, to the extent that such bodies are controlled by bodies as set out in point (v) or (vi) and are provided with adequate financial guarantees in the form of joint and several liability by the controlling bodies or equivalent financial guarantees and which may be, for each action, limited to the maximum amount of the Union support. With regard to points (c)(vi) and (vii) of the first subparagraph, the amount of the financial guarantees required may be set out in the relevant basic act and be limited to the maximum amount of the Union contribution to the body concerned. In the case of multiple guarantors, the repartition of the amount of the total liability to be covered by the guarantees shall be specified in the contribution agreement, which may provide for the liability of each guarantor to be proportionate to the share of their respective contribution to the body. 2. For the purposes of direct management, the Commission may use the instruments referred to in Titles VII, VIII, IX, X and XII. For the purposes of shared management, the instruments for budget implementation shall be the ones provided for in sector-specific rules. For the purposes of indirect management, the Commission shall apply Title VI and, in the case of financial instruments and budgetary guarantees, Titles VI and X. The implementing entities shall apply the instruments for budget implementation set out in the contribution agreement concerned. 3. The Commission is responsible for budget implementation in accordance with Article 317 TFEU and shall not delegate those tasks to third parties, where such tasks involve a large measure of discretion implying political choices. The Commission shall not, through contracts in accordance with Title VII of this Regulation, outsource tasks involving the exercise of public authority and discretionary powers of judgement.
Article 63 Shared management with Member States
1. Where the Commission implements the budget under shared management, tasks relating to budget implementation shall be delegated to Member States. The Commission and Member States shall respect the principles of sound financial management, transparency and non-discrimination and shall ensure the visibility of the Union action when they manage Union funds. To that end, the Commission and Member States shall fulfil their respective control and audit obligations and assume the resulting responsibilities laid down in this Regulation. Complementary provisions shall be laid down in sector-specific rules. 2. When executing tasks relating to budget implementation, Member States shall take all the necessary measures, including legislative, regulatory and administrative measures, to protect the financial interests of the Union, namely by: (a) ensuring that actions financed from the budget are implemented correctly and effectively and in accordance with the applicable sector-specific rules; (b) designating bodies responsible for the management and control of Union funds in accordance with paragraph 3, and supervising such bodies; (c) preventing, detecting and correcting irregularities and fraud; (d) cooperating, in accordance with this Regulation and sector-specific rules, with the Commission, OLAF, the Court of Auditors and, for those Member States participating in enhanced cooperation pursuant to Regulation (EU) 2017/1939, with the EPPO. In order to protect the financial interests of the Union, Member States shall, while respecting the principle of proportionality, and in compliance with this Article and the relevant sector-specific rules, carry out ex ante and ex post controls including, where appropriate, on-the-spot checks on representative and/or risk-based samples of transactions. They shall also recover funds unduly paid and bring legal proceedings where necessary in that regard. Member States shall impose effective, dissuasive and proportionate penalties on recipients where provided for in sector- specific rules or in specific provisions in national law. As part of its risk assessment and in accordance with sector-specific rules, the Commission shall monitor the management and control systems established in Member States. The Commission shall, in its audit work, respect the principle of proportionality and shall take into account the level of risk assessed in accordance with sector-specific rules. 3. In accordance with the criteria and procedures laid down in sector-specific rules, Member States shall, at the appropriate level, designate bodies to be responsible for the management and control of Union funds. Such bodies may also carry out tasks not related to the management of Union funds and may entrust certain of their tasks to other bodies. When deciding on the designation of bodies, Member States may base their decision on whether the management and control systems are essentially the same as those already in place for the previous period and whether they have functioned effectively. If audit and control results show that the designated bodies no longer comply with the criteria set out in sector-specific rules, Member States shall take the measures necessary to ensure that deficiencies in the implementation of the tasks of those bodies are remedied, including by ending the designation in accordance with sector-specific rules. Sector-specific rules shall define the role of the Commission in the process set out in this paragraph. 4. Bodies designated pursuant to paragraph 3 shall: (a) set up and ensure the functioning of an effective and efficient internal control system, which, where appropriate, may rely on digital controls as referred to in Article 36(11); (b) use an accounting system that provides accurate, complete and reliable information in a timely manner; (c) provide the information required under paragraphs 5, 6 and 7; (d) ensure ex post publication in accordance with Article 38(2) to (7). Any processing of personal data shall comply with Regulation (EU) 2016/679. 5. Bodies designated pursuant to paragraph 3 shall, by 15 February of the following financial year, provide the Commission with: (a) their accounts on the expenditure that was incurred, during the relevant reference period as defined in sector-specific rules, in the execution of their tasks and that was presented to the Commission for reimbursement; (b) an annual summary of the final audit reports and of controls carried out, including an analysis of the nature and extent of errors and weaknesses identified in systems, as well as corrective action taken or planned. 6. The accounts referred to in paragraph 5, point (a), shall include pre-financing and sums for which recovery procedures are ongoing or have been completed. They shall be accompanied by a management declaration confirming that, in the opinion of those in charge of the management of the funds: (a) the information is properly presented, complete and accurate; (b) the expenditure was used for its intended purpose, as defined in sector-specific rules; (c) the control systems put in place ensure the legality and regularity of the underlying transactions. 7. The accounts referred to in paragraph 5, point (a), and the summary referred to in point (b) of that paragraph shall be accompanied by an opinion of an independent audit body, drawn up in accordance with internationally accepted audit standards. That opinion shall establish whether the accounts give a true and fair view, whether expenditure for which reimbursement has been requested from the Commission is legal and regular, and whether the control systems put in place function properly. The opinion shall also state whether the audit work puts in doubt the assertions made in the management declaration referred to in paragraph 6. The deadline of 15 February set out in paragraph 5 may exceptionally be extended by the Commission to 1 March, upon communication by the Member State concerned. Member States may, at the appropriate level, publish the information referred to in paragraphs 5 and 6 and in this paragraph. In addition, Member States may provide to the European Parliament, to the Council and to the Commission declarations signed at the appropriate level based on the information referred to in paragraphs 5 and 6 and in this paragraph. 8. In order to ensure that Union funds are used in accordance with the applicable rules, the Commission shall: (a) apply procedures for the examination and acceptance of the accounts of the designated bodies, ensuring that the accounts are complete, accurate and true; (b) exclude from Union financing expenditure for which disbursements have been made in breach of applicable law; (c) interrupt payment deadlines or suspend payments where provided for in sector-specific rules. The Commission shall end all or part of the interruption of payment deadlines or suspension of payments after a Member State has presented its observations and as soon as it has taken any necessary measures. The annual activity report referred to in Article 74(9) shall cover all the obligations under this paragraph. 9. Sector-specific rules shall take account of the needs of European Territorial Cooperation programmes as regards, in particular, the content of the management declaration, the process set out in paragraph 3 and the audit function. 10. The Commission shall compile a register of bodies responsible for management, certification and audit activities under sector-specific rules. 11. Member States may use resources allocated to them under shared management in combination with operations and instruments carried out under Regulation (EU) 2015/1017 in accordance with the conditions set out in the relevant sector-specific rules.
Article 64 Scope of competences of European offices
1. Before setting up a new European office, the Commission shall make a cost-benefit study and an assessment of the associated risks, inform the European Parliament and the Council of the results thereof and propose to enter the necessary appropriations in an annex to the section of the budget relating to the Commission. 2. Within the scope of their competences, European offices: (a) shall perform obligatory tasks provided for in their act of establishment or in other legal acts of the Union; (b) may, in accordance with Article 66, perform non-obligatory tasks authorised by their Management Committees having considered the costs, benefits and associated risks for the parties involved. 3. This Section shall apply to the operation of OLAF, with the exception of paragraph 4 of this Article, Article 66 and Article 67(1), (2) and (3). 4. The internal auditor of the Commission shall exercise all responsibilities laid down in Chapter 8 of this Title.
Article 65 Appropriations regarding European offices
1. The appropriations authorised to implement obligatory tasks of each European office shall be entered in a specific budget line within the section of the budget relating to the Commission and shall be set out in detail in an annex to that section. The annex referred to in the first subparagraph shall take the form of a statement of revenue and expenditure, subdivided in the same way as the sections of the budget. The appropriations entered in that annex: (a) shall cover all the financial requirements of each European office in the performance of the obligatory tasks provided for in its act of establishment or in other legal acts of the Union; (b) may cover financial requirements of a European office in the performance of tasks requested by Union institutions, Union bodies, other European offices and agencies established by or under the Treaties and authorised in accordance with the act of establishment of the office. 2. The Commission shall, in respect of the appropriations entered in the annex for each European office, delegate the powers of authorising officer to the Director of the European office concerned, in accordance with Article 73. 3. The establishment plan of each European office shall be annexed to that of the Commission. 4. The Director of each European office shall take decisions on transfers within the annex referred to in paragraph 1. The Commission shall inform the European Parliament and the Council of such transfers.
Article 66 Non-obligatory tasks
1. For the non-obligatory tasks referred to in Article 64(2), point (b), a European office may: (a) receive delegation to its Director from Union institutions, Union bodies and other European offices, together with a delegation of the powers of the authorising officer concerning appropriations entered in the section of the budget relating to the Union institution, Union body or other European office; (b) conclude ad-hoc service-level agreements with Union institutions, Union bodies, other European offices or third parties. 2. In the cases referred to in paragraph 1, point (a), Union institutions, Union bodies and other European offices concerned shall set the limits and conditions for the delegation of powers. Such delegation shall be agreed in accordance with the act of establishment of the European office, in particular as regards the conditions and modalities of the delegation. 3. In the cases referred to in paragraph 1, point (b), the Director of the European office shall, in accordance with its act of establishment, adopt the specific provisions governing the implementation of the tasks, the recovery of costs incurred, and the keeping of the corresponding accounting records. The European office shall report the result of such accounting records to the Union institutions, Union bodies or other European offices concerned.
Article 67 Accounting records of European offices
1. Each European office shall draw up accounting records of its expenditure, enabling the proportion of its services supplied to each of Union institutions, Union bodies or other European offices to be determined. The Director of the European office concerned shall, after approval by its Management Committee, adopt the criteria upon which the accounting records shall be based. 2. The remarks concerning the specific budget line, in which the total appropriations for each European office to which the powers of authorising officer have been delegated in accordance with Article 66(1), point (a), are entered, shall show an estimate of the costs of services supplied by that office to each of the Union institutions, Union bodies and other European offices concerned. This shall be based on the accounting records provided for in paragraph 1 of this Article. 3. Each European office to which authorising officer powers have been delegated in accordance with Article 66(1), point (a), shall notify the Union institutions, Union bodies and other European offices concerned of the results of the accounting records provided for in paragraph 1 of this Article. 4. Each European office’s accounting records shall form an integral part of the Union’s accounts in accordance with Article 247. 5. The accounting officer of the Commission, acting on a proposal from the Management Committee of the European office concerned, may delegate to a member of staff of the European office some of the officer’s tasks relating to the collection of revenue and the payment of expenditure made directly by the European office concerned. 6. To meet the cash requirements of the European office, bank accounts or post office giro accounts may be opened in its name by the Commission, acting on a proposal from the Management Committee. The final cash position for each year shall be reconciled and adjusted between the European office concerned and the Commission at the end of the financial year.
Article 68 Applicability to the Euratom Supply Agency
This Regulation shall apply to the implementation of the budget for the Euratom Supply Agency.
Article 69 Executive agencies
1. The Commission may delegate powers to executive agencies to implement all or part of a Union programme or project, including pilot projects and preparatory actions and the implementation of administrative expenditure, on its behalf and under its responsibility, in accordance with Council Regulation (EC) No 58/2003 ( 46 ) . Executive agencies shall be created by means of a Commission decision and shall have legal personality under Union law. They shall receive an annual contribution. 2. The directors of executive agencies shall act as authorising officers by delegation as regards the implementation of the operational appropriations relating to the Union programmes which they manage in whole or in part. 3. The steering committee of an executive agency may agree with the Commission that the accounting officer of the Commission shall also act as the accounting officer of the executive agency concerned. The steering committee may also entrust the accounting officer of the Commission with part of the tasks of the accounting officer of the executive agency concerned, taking into account cost-benefit considerations. In both cases, the arrangements necessary to avoid any conflict of interests shall be made.
Article 70 Bodies set up under the TFEU and the Euratom Treaty
1. The Commission is empowered to adopt delegated acts in accordance with Article 275 of this Regulation to supplement this Regulation with a framework financial regulation for bodies which are set up under the TFEU and the Euratom Treaty and which have legal personality and receive contributions charged to the budget. 2. The framework financial regulation shall be based on the principles and rules set out in this Regulation, taking into account the specificities of the bodies referred to in paragraph 1. 3. The financial rules of the bodies referred to in paragraph 1 shall not depart from the framework financial regulation except where their specific needs so require and subject to the Commission’s prior consent. 4. Discharge for the implementation of the budgets of the bodies referred to in paragraph 1 shall be given by the European Parliament on the recommendation of the Council. The bodies referred to in paragraph 1 shall fully cooperate with the Union institutions involved in the discharge procedure and provide, as appropriate, any additional necessary information, including through attendance at meetings of the relevant bodies. 5. The internal auditor of the Commission shall exercise the same powers over the bodies referred to in paragraph 1 as those exercised in respect of the Commission. 6. An independent external auditor shall verify that the annual accounts of each of the bodies referred to in paragraph 1 of this Article properly present the income, expenditure and financial position of the relevant body prior to the consolidation in the Commission’s final accounts. Unless otherwise provided in the relevant basic act, the Court of Auditors shall prepare a specific annual report on each body in line with the requirements of Article 287(1) TFEU. In preparing that report, the Court of Auditors shall consider the audit work performed by the independent external auditor and the action taken in response to the auditor’s findings. 7. All aspects of the independent external audits referred to in paragraph 6, including the reported findings, shall remain under the full responsibility of the Court of Auditors.
Article 71 Public-private partnership bodies
Bodies having legal personality that are set up by a basic act and entrusted with the implementation of a public-private partnership shall adopt their own financial rules. Those rules shall include a set of principles necessary to ensure sound financial management of Union funds. The Commission is empowered to adopt delegated acts in accordance with Article 275 to supplement this Regulation with a model financial regulation for public-private partnership bodies laying down the principles necessary to ensure sound financial management of Union funds and which shall be based on Article 157. The financial rules of the public-private partnership bodies shall not depart from the model financial regulation except where their specific needs so require and subject to the Commission’s prior consent. Article 70(4) to (7) shall apply to public-private partnership bodies.
Article 72 Segregation of duties
1. The duties of authorising officer and accounting officer shall be segregated and mutually exclusive. 2. Each Union institution shall provide each financial actor with the resources required to perform his or her duties and a charter describing in detail his or her tasks, rights and obligations.
Article 73 Authorising officer
1. Each Union institution shall perform the duties of authorising officer. 2. For the purposes of this Title, ‘staff’ means persons covered by the Staff Regulations. 3. Each Union institution shall, in compliance with the conditions in its rules of procedure, delegate the duties of authorising officer to staff at an appropriate level. It shall, in its internal administrative rules, indicate the staff to whom it delegates those duties, the scope of the powers delegated and whether the persons to whom those powers are delegated may subdelegate them. 4. The powers of authorising officer shall be delegated or subdelegated only to staff. 5. The authorising officer responsible shall act within the limits set by the instrument of delegation or subdelegation. The authorising officer responsible may be assisted by one or more members of staff entrusted, under his or her responsibility, with the carrying out of certain operations necessary for budget implementation and the production of the financial and management information. 6. Each Union institution and each Union body referred to in Article 70 shall inform the European Parliament, the Council, the Court of Auditors and the accounting officer of the Commission within two weeks of the appointment and the termination of the duties of authorising officers by delegation, internal auditors and accounting officers, and of any internal rules it adopts in respect of financial matters. 7. Each Union institution shall inform the Court of Auditors of delegation decisions and of the appointment of imprest administrators under Articles 79 and 88.
Article 74 Powers and duties of the authorising officer
1. The authorising officer shall be responsible in the Union institution concerned for implementing revenue and expenditure in accordance with the principle of sound financial management, including through ensuring reporting on performance, and for ensuring compliance with the requirements of legality and regularity and equal treatment of recipients. 2. For the purposes of paragraph 1 of this Article, the authorising officer by delegation shall, in accordance with Article 36 and the minimum standards adopted by each Union institution and having due regard to the risks associated with the management environment and the nature of the actions financed, put in place the organisational structure and the internal control systems suited to the performance of his or her duties. The establishment of such structure and systems shall be supported by a comprehensive risk analysis, which takes into account their cost effectiveness and performance considerations. 3. To implement expenditure, the authorising officer responsible shall make budgetary and legal commitments, shall validate expenditure and authorise payments and shall undertake the preliminary steps for the implementation of appropriations. 4. To implement revenue, the authorising officer responsible shall draw up estimates of amounts receivable, establish entitlements to be recovered and issue recovery orders. Where appropriate, the authorising officer responsible shall waive established entitlements. 5. In order to prevent errors and irregularities before the authorisation of operations and to mitigate risks of non- achievement of objectives, each operation shall be subject at least to an ex ante control relating to the operational and financial aspects of the operation, on the basis of a multiannual control strategy which takes risk into account. As referred to in Article 36(11), ex ante controls shall use, where appropriate, automated IT tools and emerging technologies. The extent in terms of frequency and intensity of the ex ante controls shall be determined by the authorising officer responsible taking into account the results of prior controls as well as risk-based and cost-effectiveness considerations, on the basis of the authorising officer’s own risk analysis. In case of doubt, the authorising officer responsible for validating the relevant operations shall, as part of the ex ante control, request complementary information or perform an on-the-spot control in order to obtain reasonable assurance. For a given operation, the verification shall be carried out by staff other than those who initiated the operation. The staff who carry out the verification shall not be subordinate to the members of staff who initiated the operation. 6. The authorising officer by delegation may put in place ex post controls to detect and correct errors and irregularities of operations after they have been authorised. Such controls may be organised on a sample basis according to risk and shall take account of the results of prior controls as well as cost-effectiveness and performance considerations. As referred to in Article 36(11), ex post controls shall use, where appropriate, automated IT tools and emerging technologies. The ex post controls shall be carried out by staff other than those responsible for the ex ante controls. The staff responsible for the ex post controls shall not be subordinate to the members of staff responsible for the ex ante controls. The rules and modalities, including timeframes, for carrying out audits of the beneficiaries shall be clear, consistent and transparent, and shall be made available to the beneficiaries when signing the grant agreement. 7. Authorising officers responsible and staff responsible for budget implementation shall have the necessary professional skills. In each Union institution, the authorising officer by delegation shall ensure the following: (a) that the authorising officers by subdelegation and their staff receive regularly updated and appropriate information and training concerning the control standards and the methods and techniques available for that purpose; (b) that measures are taken, where needed, to ensure the effective and efficient functioning of the control systems in accordance with paragraph 2. 8. If a member of staff, involved in the financial management and control of transactions, considers that a decision he or she is required by his or her superior to apply or to agree to is irregular or contrary to the principle of sound financial management or the professional rules which that member of staff is required to observe, he or she shall inform his or her hierarchical superior accordingly. If the member of staff does so in writing, the hierarchical superior shall reply in writing. If the hierarchical superior fails to take action or confirms the initial decision or instruction and the member of staff believes that such confirmation does not constitute a reasonable response to his or her concern, the member of staff shall inform the authorising officer by delegation in writing. If that officer does not reply within a reasonable time given the circumstances of the case and in any event within a month, the member of staff shall inform the relevant panel referred to in Article 145. In the event of any illegal activity, fraud or corruption which may harm the interests of the Union, the member of staff shall inform the authorities and bodies designated in the Staff Regulations and in the decisions of Union institutions concerning the terms and conditions for internal investigations in relation to the prevention of fraud, corruption and any other illegal activity detrimental to the interests of the Union. Contracts with external auditors carrying out audits of the financial management of the Union shall provide for an obligation of the external auditor to inform the authorising officer by delegation of any suspected illegal activity, fraud or corruption which may harm the interests of the Union. 9. The authorising officer by delegation shall report to his or her Union institution on the performance of his or her duties in the form of an annual activity report containing financial and management information, including the results of controls, declaring that, except as otherwise specified in any reservations related to defined areas of revenue and expenditure, he or she has reasonable assurance that: (a) the information contained in the report presents a true and fair view; (b) the resources assigned to the activities described in the report have been used for their intended purpose and in accordance with the principle of sound financial management; and (c) the control procedures put in place give the necessary guarantees concerning the legality and regularity of the underlying transactions. The annual activity report shall include information on the operations carried out, by reference to the objectives and performance considerations set in the strategic plans, the risks associated with those operations, the use made of the resources provided and the efficiency and effectiveness of internal control systems. The report shall include an overall assessment of the costs and benefits of controls and information on the extent to which the operational expenditure authorised contributes to the achievement of strategic objectives of the Union and generates EU added value. The Commission shall prepare a summary of the annual activity reports for the preceding year. The annual activity reports for the financial year of the authorising officers and, where applicable, authorising officers by delegation of Union institutions, Union bodies, European offices and agencies shall be published by 1 July of the following financial year on the website of the respective Union institution, Union body, European office or agency in an easily accessible way, subject to duly justified confidentiality and security considerations. 10. The authorising officer by delegation shall, for each financial year, record contracts concluded by negotiated procedures in accordance with point 11.1, points (a) to (f), and point 39 of Annex I. If the proportion of negotiated procedures in relation to the number of procedures awarded by the same authorising officer by delegation increases significantly in relation to earlier years or if that proportion is distinctly higher than the average recorded for the Union institution, the authorising officer responsible shall report to the Union institution setting out any measures taken to reverse that trend. Each Union institution shall send a report on negotiated procedures to the European Parliament and to the Council. In the case of the Commission, that report shall be annexed to the summary of the annual activity reports referred to in paragraph 9 of this Article.
Article 75 Keeping of supporting documents by authorising officers
The authorising officer shall set up paper-based or electronic systems for the keeping of original supporting documents relating to budget implementation. Such documents shall be kept for at least five years from the date on which the European Parliament gives discharge for the financial year to which the documents relate. Without prejudice to the first paragraph, documents relating to operations shall in any case be kept until the end of the year following that in which those operations are definitively closed. Personal data contained in supporting documents shall, where possible, be deleted when those data are not necessary for budgetary discharge, control and audit purposes. Article 4 of Regulation (EU) 2018/1725 shall apply to the conservation of traffic data.
Article 76 Powers and duties of Heads of Union Delegations
1. Where Heads of Union delegations act as authorising officers by subdelegation in accordance with Article 60(2), they shall be subject to the Commission as the Union institution responsible for the definition, exercise, monitoring and appraisal of their duties and responsibilities as authorising officers by subdelegation and shall cooperate closely with the Commission with regard to the proper implementation of the funds, in order to ensure, in particular, the legality and regularity of financial transactions, respect for the principle of sound financial management in the management of the funds and the effective protection of the financial interests of the Union. They shall be subject to the internal rules of the Commission and to the Commission Charter for the implementation of the financial management tasks subdelegated to them. They may be assisted in their duties by Commission staff of Union delegations. To this effect, Heads of Union delegations shall take the measures necessary to prevent any situation likely to put at risk the Commission’s capacity to fulfil its responsibility for budget implementation subdelegated to them, as well as any conflict of priorities which is likely to have an impact on the implementation of the financial management tasks subdelegated to them. Where a situation or conflict referred to in the second subparagraph arises, Heads of Union delegations shall without delay inform the Directors-General responsible of the Commission and of the EEAS thereof. Those Directors-General shall take appropriate steps to remedy the situation. 2. If Heads of Union delegations find themselves in a situation as referred to in Article 74(8), they shall refer the matter to the panel referred to in Article 145. In the event of any illegal activity, fraud or corruption which may harm the interests of the Union, they shall inform the authorities and bodies designated by the applicable legislation. 3. Heads of Union delegations acting as authorising officers by subdelegation in accordance with Article 60(2) shall report to their authorising officer by delegation so that the latter can integrate their reports in his or her annual activity report referred to in Article 74(9). The reports of Heads of Union delegations shall include information on the efficiency and effectiveness of internal control systems put in place in their delegation, as well as on the management of operations subdelegated to them, and provide the assurance referred to in Article 92(5), third subparagraph. Those reports shall be annexed to the annual activity report of the authorising officer by delegation, and shall be made available to the European Parliament and to the Council having due regard, where appropriate, to their confidentiality. Heads of Union delegations shall fully cooperate with Union institutions involved in the discharge procedure and provide, as appropriate, any necessary additional information. In this context, they may be requested to attend meetings of the relevant bodies and assist the authorising officer by delegation responsible. Heads of Union delegations acting as authorising officers by subdelegation in accordance with Article 60(2) shall reply to any request by the authorising officer by delegation of the Commission at the Commission’s own request or, in the context of discharge, at the request of the European Parliament. The Commission shall ensure that the subdelegating of powers to Heads of Union delegations is not detrimental to the discharge procedure under Article 319 TFEU. 4. Paragraphs 1, 2 and 3 shall also apply to deputy Heads of Union delegations when they act as authorising officers by subdelegation in the absence of Heads of Union delegations.
Article 77 Powers and duties of the accounting officer
1. Each Union institution shall appoint an accounting officer who shall be responsible in that institution for the following: (a) properly implementing payments, collecting revenue and recovering amounts established as being receivable; (b) preparing and presenting the accounts in accordance with Title XIII; (c) keeping the accounts in accordance with Articles 82 and 84; (d) laying down the accounting rules, procedures and the chart of accounts, in accordance with Articles 80 to 84; (e) laying down and validating the accounting systems and, where appropriate, validating systems laid down by the authorising officer to supply or justify accounting information; (f) treasury management. With respect to the tasks referred to in the first subparagraph, point (e), the accounting officer shall be empowered to verify at any time compliance with the validation criteria. 2. The responsibilities of the accounting officer of the EEAS shall concern only the section of the budget relating to the EEAS as implemented by the EEAS. The accounting officer of the Commission shall remain responsible for the entire section of the budget relating to the Commission, including accounting operations relating to appropriations subdelegated to Heads of Union delegations. The accounting officer of the Commission shall also act as the accounting officer of the EEAS in respect of the implementation of the section of the budget relating to the EEAS.
Article 78 Appointment and termination of duties of the accounting officer
1. Each Union institution shall appoint an accounting officer from officials subject to the Staff Regulations. The accounting officer shall be chosen by the Union institution on the grounds of his or her particular competence as evidenced by diplomas or by equivalent professional experience. 2. Two or more Union institutions or bodies may appoint the same accounting officer. In such case, they shall make the necessary arrangements in order to avoid any conflict of interests. 3. A trial balance shall be drawn up without delay in the event of termination of the duties of the accounting officer. 4. The trial balance accompanied by a hand-over report shall be transmitted to the new accounting officer by the accounting officer who is terminating his or her duties or, if it is not possible, by an official in his or her department. The new accounting officer shall sign the trial balance in acceptance within one month from the date of transmission and may make reservations. The hand-over report shall contain the result of the trial balance and any reservations made.
Article 79 Powers which may be delegated by the accounting officer
The accounting officer may, in the performance of his or her duties, delegate certain tasks to subordinate staff and to imprest administrators appointed in accordance with Article 89(1). The instrument of delegation shall set out those tasks.
Article 80 Accounting rules
1. The accounting rules to be applied by Union institutions, European offices and the agencies and Union bodies referred to in Section 2 of Chapter 3 of this Title shall be based on internationally accepted accounting standards for the public sector. Those rules shall be adopted by the accounting officer of the Commission following consultation with the accounting officers of other Union institutions, European offices and Union bodies. 2. The accounting officer may deviate from the standards referred to in paragraph 1 if he or she considers this necessary in order to give a fair presentation of the assets and liabilities, charges, income and cash flow. Where an accounting rule diverges materially from those standards, the notes to the financial statements shall disclose that fact and the reasons for it. 3. The accounting rules referred to in paragraph 1 shall lay down the structure and content of the financial statements, as well as the accounting principles underlying the accounts. 4. The budget implementation reports referred to in Article 247 shall respect the budgetary principles laid down in this Regulation. They shall provide a detailed record of budget implementation. They shall record all revenue and expenditure operations provided for in this Title and give a fair presentation thereon.
Article 81 Organisation of the accounts
1. The accounting officer of each Union institution or body shall draw up and keep updated documents describing the organisation of the accounts and the accounting procedures of his or her Union institution or body. 2. Revenue and expenditure shall be recorded in a computerised system according to the economic nature of the operation, as current revenue or expenditure or as capital.
Article 82 Keeping the accounts
1. The accounting officer of the Commission shall be responsible for laying down the harmonised charts of accounts to be applied by Union institutions, by European offices and by the agencies and Union bodies referred to in Section 2 of Chapter 3 of this Title. 2. The accounting officers shall obtain from authorising officers all the information necessary for the production of accounts which give a fair presentation of the financial situation of Union institutions and of budget implementation. The authorising officers shall guarantee the reliability of that information. 3. Before the adoption of the accounts by the Union institution or the Union body referred to in Article 70, the accounting officer shall sign them off, thereby certifying that he or she has reasonable assurance that the accounts give a fair presentation of the financial situation of the Union institution or the Union body referred to in Article 70. For that purpose, the accounting officer shall verify that the accounts have been prepared in accordance with the accounting rules referred to in Article 80, and the accounting procedures referred to in Article 77(1), first subparagraph, point (d), and that all revenue and expenditure is entered in the accounts. 4. The authorising officer by delegation shall, in accordance with the rules adopted by the accounting officer, send the accounting officer any financial and management information required for the performance of the accounting officer’s duties. The accounting officer shall be informed, regularly and at least for the closure of the accounts, by the authorising officer of the relevant financial data of the fiduciary bank accounts in order to allow the use of Union funds to be reflected in the accounts of the Union. The authorising officers shall remain fully responsible for the proper use of the funds they manage, the legality and regularity of the expenditure under their control and the completeness and accuracy of the information sent to the accounting officer. 5. The authorising officer responsible shall notify the accounting officer of all developments or significant modifications of a financial management system, an inventory system or a system for the valuation of assets and liabilities, if it provides data for the accounts of the Union institution or is used to substantiate data thereof, so that the accounting officer can verify compliance with the validation criteria. At any time, the accounting officer may re-examine a financial management system already validated and may request that the authorising officer responsible establishes an action plan in order to correct, in due time, possible weaknesses. The authorising officer shall be responsible for the completeness of information sent to the accounting officer. 6. The accounting officer shall be empowered to check the information received as well as to carry out any further checks he or she deems necessary in order to sign off the accounts. The accounting officer shall, if necessary, make reservations, explaining exactly the nature and scope of such reservations. 7. A Union institution’s accounting system shall serve to organise the budgetary and financial information in such a way that figures can be entered, filed and registered. 8. The accounting system shall consist of general accounts and budget accounts. The accounts shall be kept in euro and on the basis of the calendar year. 9. The authorising officer by delegation may also keep detailed management accounts. 10. Supporting documents for the accounting system and for the preparation of the accounts referred to in Article 247 shall be kept for at least five years from the date on which the European Parliament gives discharge for the financial year to which the documents relate. However, documents relating to operations not definitively closed shall be kept until the end of the year following that in which the operations are closed. Article 4 of Regulation (EU) 2018/1725 shall apply to the conservation of traffic data. Each Union institution shall decide in which department the supporting documents are to be kept.
Article 83 Content and keeping of budget accounts
1. The budget accounts shall for each subdivision of the budget show: (a) in the case of expenditure: (i) the appropriations authorised in the budget, including the appropriations entered in amending budgets, the appropriations carried over, the appropriations available following collection of assigned revenue, transfers of appropriations and the total appropriations available; (ii) the commitment appropriations and payment appropriations in respect of the financial year; (b) in the case of revenue: (i) the estimates entered in the budget, including the estimates entered in amending budgets, assigned revenue and the total amount of estimated revenue; (ii) the entitlements established and the amounts recovered in respect of the financial year; (c) the commitments still to be paid and the revenue still to be recovered, carried forward from preceding financial years. The commitment appropriations and payment appropriations referred to in the first subparagraph, point (a), shall be entered and shown separately. 2. The budget accounts shall show separately: (a) the use of appropriations carried over and the appropriations for the financial year; (b) the clearance of outstanding commitments. On the revenue side, amounts still to be recovered from preceding financial years shall be shown separately.
Article 84 General accounts
1. The general accounts shall, in chronological order using the double-entry method, record all events and operations which affect the economic and financial situation and the assets and liabilities of Union institutions and of the agencies and Union bodies referred to in Section 2 of Chapter 3 of this Title. 2. Balances and movements in the general accounts shall be entered in the accounting ledgers. 3. All accounting entries, including adjustments to the accounts, shall be based on supporting documents, to which the entries shall refer. 4. The accounting system shall be such as to leave a clear audit trail for all accounting entries.
Article 85 Bank accounts
1. For the requirements of treasury management, the accounting officer may, in the name of his or her Union institution, open accounts with financial institutions or national central banks or request for such accounts to be opened. The accounting officer shall also be responsible for closing those accounts or for ensuring that they are closed. 2. The terms governing the opening, operation and use of bank accounts shall, depending on internal control requirements, provide that cheques, bank credit transfer orders or any other banking operations must be signed by one or more duly authorised members of staff. Manual instructions shall be signed by at least two duly authorised members of staff, or by the accounting officer. 3. Within the implementation of a programme or an action, fiduciary accounts may be opened on behalf of the Commission in order to allow for their management by an entity pursuant to Article 62(1), first subparagraph, point (c)(ii), (iii), (v) or (vi). Such accounts shall be opened under the responsibility of the authorising officer in charge of the implementation of the programme or action in agreement with the accounting officer of the Commission. Such accounts shall be managed under the responsibility of the authorising officer. 4. The accounting officer of the Commission shall lay down rules for the opening, management and closure of fiduciary accounts and their use.
Article 86 Treasury management
1. Unless otherwise provided in this Regulation, only the accounting officer shall be empowered to manage cash and cash equivalents. The accounting officer shall be responsible for their safekeeping. 2. The accounting officer shall ensure that his or her Union institution has at its disposal sufficient funds to cover the cash requirements arising from budget implementation within the applicable regulatory framework and shall set up procedures to ensure that none of the accounts opened in accordance with Article 85(1) is in debit. 3. Payments shall be made by bank credit transfer, by cheque, or if specifically authorised by the accounting officer, by credit card, debit card, electronic wallets, direct debit or other means of payment, in accordance with the rules laid down by the accounting officer. Before entering into a commitment towards a third party, the authorising officer shall confirm the payee’s identity, establish the legal entity and payment details of the payee and enter them in the common file by the Union institution for which the accounting officer is responsible. The accounting officer may only make payments if the payee’s legal entity and payment details have first been entered in a common file by the Union institution for which the accounting officer is responsible. Authorising officers shall inform the accounting officer of any change in the legal entity and payment details communicated to them by the payee and shall check that those details are valid before they authorise any payment.
Article 87 The inventory of assets
1. Union institutions and agencies or Union bodies referred to in Section 2 of Chapter 3 of this Title shall keep inventories showing the quantity and value of all their tangible, intangible and financial assets in accordance with a model drawn up by the accounting officer of the Commission. They shall also check that entries in their respective inventories correspond to the actual situation. All items acquired with a period of use greater than one year, which are not consumables, and whose purchase price or production cost is higher than that indicated by the accounting procedures referred to in Article 77 shall be entered in the inventory and recorded in the fixed assets accounts. 2. The sale of the Union’s tangible assets shall be suitably advertised. 3. Union institutions and agencies or Union bodies referred to in Section 2 of Chapter 3 of this Title shall adopt provisions on safeguarding the assets included in their respective inventories and decide which administrative departments are responsible for the inventory system.
Article 88 Creation of imprest accounts
1. The creation of an imprest account and the appointment of an imprest administrator shall be the subject of a decision by the accounting officer of the Union institution specifying the operating terms and the conditions for use of the imprest account. 2. Imprest accounts may be set up for the payment of expenditure where, owing to the limited amounts involved, it is materially impossible or inefficient to carry out payment operations in line with general rules for expenditure operations. The maximum amount which may be paid by the imprest administrator in such cases shall be established by the accounting officer for each type of expenditure in the decision referred to in paragraph 1. Imprest accounts may also be set up for the collection of revenue. In the field of crisis management aid and humanitarian aid operations, imprest accounts may be used without any limitation on the amount for a set timeframe after being duly justified, while respecting the level of payment appropriations decided by the European Parliament and by the Council on the corresponding budget line for the current financial year and in accordance with the internal rules of the Commission. In Union delegations, imprest accounts may also be used to execute payments in line with general rules for expenditure operations of amounts limited to EUR 60 000 for each item of expenditure, if such use is efficient and effective due to local requirements. Where they are needed for the payment of expenditure from both the sections of the budget relating to the Commission and to the EEAS, they shall be set up as separate imprest accounts.
Article 89 Administration of imprest accounts
1. Imprest administrators shall be chosen from officials or, should the need arise and only in duly substantiated cases, from other members of staff or in accordance with the conditions established in the internal rules of the Commission from personnel employed by the Commission in the field of crisis management aid and humanitarian aid operations provided that their employment contracts guarantee equivalent level of protection in terms of liability as applicable to staff pursuant to Article 95. 2. Imprest accounts shall be endowed under supervision of the accounting officer of the Union institution concerned and shall be placed under the responsibility of imprest administrators. 3. Payments made shall be followed by formal final validation decisions or payment orders signed by the authorising officer responsible. The imprest transactions carried out outside general rules for expenditure operations shall be settled by the authorising officer by the end of the following month, so that the accounting balance and the bank balance can be reconciled. 4. The accounting officer shall supervise the existence of the funds allocated to the imprest administrators and the bookkeeping and check that imprest transactions are settled within the time limit set.
Article 90 Withdrawal of delegation of powers to and suspension of duties of financial actors
1. Authorising officers responsible may at any time have their delegation or subdelegation withdrawn temporarily or definitively by the authority which appointed them. 2. Accounting officers or imprest administrators, or both, may at any time be suspended temporarily or definitively from their duties by the authority which appointed them. 3. Paragraphs 1 and 2 shall be without prejudice to any disciplinary action taken in respect of the financial actors referred to in those paragraphs.
Article 91 Liability of financial actors for illegal activity, fraud or corruption
1. This Chapter is without prejudice to any liability under criminal law which the financial actors referred to in Article 90 may incur as provided for in applicable national law and in the provisions in force concerning the protection of the financial interests of the Union and the fight against corruption involving Union officials or officials of Member States. 2. Without prejudice to Articles 92, 94 and 95 of this Regulation, each authorising officer responsible, accounting officer or imprest administrator shall be liable to disciplinary action and payment of compensation in accordance with the conditions laid down in the Staff Regulations or, in the case of personnel employed by the Commission in the field of crisis management aid and humanitarian aid operations as referred to in Article 89(1) of this Regulation, in accordance with the conditions laid down in their employment contracts. In the event of illegal activity, fraud or corruption which may harm the interests of the Union, the matter shall be referred to the authorities and bodies designated by the applicable legislation, in particular to OLAF.
Article 92 Rules applicable to authorising officers
1. The authorising officer responsible shall be liable for payment of compensation as laid down in the Staff Regulations. 2. The obligation to pay compensation shall apply in particular if the authorising officer responsible, whether intentionally or through gross negligence on his or her part: (a) determines entitlements to be recovered or issues recovery orders, commits expenditure or signs a payment order without complying with this Regulation; (b) omits to draw up a document establishing an amount receivable, neglects to issue a recovery order or is late in issuing it or is late in issuing a payment order, thereby rendering the Union institution liable to civil action by third parties. 3. An authorising officer by delegation or sub-delegation who receives a binding instruction which he or she considers to be irregular or contrary to the principle of sound financial management, in particular because the instruction cannot be carried out with the resources allocated to him or her, shall inform the authority from which he or she received the delegation or subdelegation about that fact in writing. If the instruction is confirmed in writing and that confirmation is received in good time and is sufficiently clear, in that it refers explicitly to the points which the authorising officer by delegation or subdelegation has challenged, the authorising officer by delegation or subdelegation shall not be held liable. He or she shall carry out the instruction, unless it is manifestly illegal or constitutes a breach of the relevant safety standards. The same procedure shall apply in cases where an authorising officer considers that a decision, which is his or her responsibility to take, is irregular or contrary to the principle of sound financial management or where an authorising officer learns, in the course of acting on a binding instruction, that the circumstances of the case could give rise to such a situation. Any instructions confirmed in the circumstances referred to in this paragraph shall be recorded by the authorising officer by delegation responsible and mentioned in his or her annual activity report. 4. In the event of subdelegation within his or her service, the authorising officer by delegation shall continue to be responsible for the efficiency and effectiveness of the internal management and control systems put in place and for the choice of the authorising officer by subdelegation. 5. In the event of subdelegation to Heads of Union delegations and their deputies, the authorising officer by delegation shall be responsible for the definition of the internal management and control systems put in place, as well as their efficiency and effectiveness. Heads of Union delegations shall be responsible for the adequate setting up and functioning of those systems, in accordance with the instructions of the authorising officer by delegation, and for the management of the funds and the operations they carry out within the Union delegation under their responsibility. Before taking up their duties, they shall complete specific training courses on the tasks and responsibilities of authorising officers and budget implementation. Heads of Union delegations shall in accordance with Article 76(3) report on their responsibilities pursuant to the first subparagraph of this paragraph. Each year, Heads of Union delegations shall provide to the authorising officer by delegation of the Commission assurance on the internal management and control systems put in place in their delegation, as well as on the management of operations subdelegated to them, and the results thereof, in order to allow the authorising officer to make the statement of assurance provided for in Article 74(9). This paragraph shall also apply to deputy Heads of Union delegations when they act as authorising officers by subdelegation in the absence of Heads of Union delegations.