REPORT on the proposal for a regulation of the European Parliament and of the Council on the protection of the Union's budget in case of generalised deficiencies as regards the rule of law in the Member States

17.12.2018 - (COM(2018)0324 – C8‑0178/2018 – 2018/0136(COD)) - ***I

Committee on Budgets
Committee on Budgetary Control
Co-rapporteurs : Eider Gardiazabal Rubial, Petri Sarvamaa
(Joint committee procedure – Rule 55 of the Rules of Procedure)
Rapporteur for the opinion (*):
Josep-Maria Terricabras, Committee on Civil Liberties, Justice and Home Affairs
(*) Associated committee – Rule 54 of the Rules of Procedure

Amendments

Procedure : 2018/0136(COD)

Document stages in plenary

Document selected :

A8-0469/2018

Texts tabled :

A8-0469/2018

Debates :

PV 16/01/2019 - 29
CRE 16/01/2019 - 29

Votes :

PV 17/01/2019 - 10.8
CRE 17/01/2019 - 10.8
Explanations of votes
PV 04/04/2019 - 6.17

Texts adopted :

P8_TA(2019)0038
P8_TA(2019)0349

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION
EXPLANATORY STATEMENT
OPINION of the Committee on Civil Liberties, Justice and Home Affairs
OPINION of the Committee on Regional Development
OPINION of the Committee on Constitutional Affairs
PROCEDURE – COMMITTEE RESPONSIBLE
FINAL VOTE BY ROLL CALL IN COMMITTEE RESPONSIBLE

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the proposal for a regulation of the European Parliament and of the Council on the protection of the Union's budget in case of generalised deficiencies as regards the rule of law in the Member States

(COM(2018)0324 – C8‑0178/2018/2018 – 2018/0136(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2018)0324),

– having regard to Article 294(2) and Article 322(1)(a) of the Treaty on the Functioning of the European Union and to Article 106a of the Treaty establishing the European Atomic Energy Community, pursuant to which the Commission submitted the proposal to Parliament (C8-0178/2018),

– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

– having regard to the opinion of the Court of Auditors of 17 August 2018[1],

– having regard to Rule 59 of its Rules of Procedure,

– having regard to the joint deliberations of the Committee on Budgets and the Committee on Budgetary Control under Rule 55 of the Rules of Procedure,

– having regard to the report of the Committee on Budgets and the Committee on Budgetary Control and the opinions of the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Regional Development and the Committee on Constitutional Affairs (A8-0469/2018),

1. Adopts its position at first reading hereinafter set out;

2. Calls on the Commission to refer the matter to Parliament again if it replaces, substantially amends or intends to substantially amend its proposal;

3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Amendment 1 Proposal for a regulation Recital 1
Text proposed by the Commission	Amendment
(1) The rule of law is one of the essential values upon which the Union is founded. As recalled by Article 2 of the Treaty on European Union, these values are common to the Member States.	(1) The Union is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities, enshrined in Article 2 of the Treaty on European Union (TEU) and in the criteria for Union membership. As recalled by Article 2 TEU, those values are common to the Member States in a society in which pluralism, non-discrimination, tolerance, justice, solidarity and equality between women and men prevail.
Amendment 2 Proposal for a regulation Recital 1 a (new)
Text proposed by the Commission	Amendment
	(1a) Member States should uphold their obligations and set an example by genuinely fulfilling them and move towards a shared culture of the rule of law as a universal value to be applied by all concerned even-handedly. Full respect for and promotion of those principles is an essential prerequisite for the legitimacy of the European project as a whole and a basic condition for building citizens' trust in the Union and ensuring the effective implementation of its policies.
Amendment 3 Proposal for a regulation Recital 1 b (new)
Text proposed by the Commission	Amendment
	(1b) In accordance with Article 2, Article 3(1) and Article 7 TEU, the Union has the possibility to act in order to protect its constitutional core and the common values on which it was founded, including its budgetary principles. Member States, Union institutions, bodies, offices and agencies, and candidate countries are obliged to respect, protect and promote those principles and values, and they have a duty of sincere cooperation.
Amendment 4 Proposal for a regulation Recital 2
Text proposed by the Commission	Amendment
(2) The rule of law requires that all public powers act within the constraints set out by law, in accordance with the values of democracy and fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality⁷ , legal certainty⁸ , prohibition of arbitrariness of the executive powers⁹ , separation of powers¹⁰ , and effective judicial protection by independent courts¹¹ are respected¹² .	(2) The rule of law requires that all public powers act within the constraints set out by law, in accordance with the values of democracy and respect for fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality⁷, including a transparent, accountable and democratic process for enacting law, legal certainty⁸, prohibition of arbitrariness of the executive powers⁹, separation of powers¹⁰, access to justice and effective judicial protection before independent and impartial courts¹¹are respected¹². Those principles are reflected inter alia at the level of the Venice Commission of the Council of Europe and also on the basis of the relevant case law of the European Court of Human Rights^12a.
__________________	__________________
⁷ Judgment of the Court of Justice of 29 April 2004, CAS Succhi di Frutta, C-496/99 PECLI:EU:C:2004:236, paragraph 63.	⁷ Judgment of the Court of Justice of 29 April 2004, CAS Succhi di Frutta, C-496/99 PECLI:EU:C:2004:236, paragraph 63.
⁸ Judgment of the Court of Justice of 12 November 1981, Amministrazione delle finanze dello Stato v Srl Meridionale Industria Salumi and others Ditta Italo Orlandi & Figlio and Ditta Vincenzo Divella v Amministrazione delle finanze dello Stato. Joined cases 212 to 217/80, ECLI:EU:C:1981:270, paragraph 10.	⁸ Judgment of the Court of Justice of 12 November 1981, Amministrazione delle finanze dello Stato v Srl Meridionale Industria Salumi and others Ditta Italo Orlandi & Figlio and Ditta Vincenzo Divella v Amministrazione delle finanze dello Stato. Joined cases 212 to 217/80, ECLI:EU:C:1981:270, paragraph 10.
⁹ Judgment of the Court of Justice of 21 September 1989, Hoechst, Joined cases 46/87 and 227/88, ECLI:EU:C:1989:337, paragraph 19.	⁹ Judgment of the Court of Justice of 21 September 1989, Hoechst, Joined cases 46/87 and 227/88, ECLI:EU:C:1989:337, paragraph 19.
¹⁰ Judgment of the Court of Justice of 10 November 2016, Kovalkovas, C-477/16, ECLI:EU:C:2016:861, paragraph 36; Judgment of the Court of Justice of 10 November 2016, PPU Poltorak, C-452/16, ECLI:EU:C:2016:858, paragraph 35; and Judgment of the Court of Justice of 22 December 2010, DEB,C-279/09, ECLI:EU:C:2010:811, paragraph 58.	¹⁰ Judgment of the Court of Justice of 10 November 2016, Kovalkovas, C-477/16, ECLI:EU:C:2016:861, paragraph 36; Judgment of the Court of Justice of 10 November 2016, PPU Poltorak, C-452/16, ECLI:EU:C:2016:858, paragraph 35; and Judgment of the Court of Justice of 22 December 2010, DEB,C-279/09, ECLI:EU:C:2010:811, paragraph 58.
¹¹ Judgment of the Court of Justice of 27 February 2018, Associação Sindical dos Juízes Portugueses v Tribunal de Contas C-64/16, ECLI:EU:C:2018:117, paragraphs 31, 40-41.	¹¹ Judgment of the Court of Justice of 27 February 2018, Associação Sindical dos Juízes Portugueses v Tribunal de Contas C-64/16, ECLI:EU:C:2018:117, paragraphs 31, 40-41; judgment of the Court of Justice of 25 July 2018, LM, C-216/18 PPU, ECLI:EU:C:2018:586, paragraphs 63-67.
¹² Communication from the Commission "A new EU Framework to strengthen the Rule of Law", COM(2014) 158 final, Annex I.	¹² Communication from the Commission "A new EU Framework to strengthen the Rule of Law", COM(2014) 158 final, Annex I.
	^12a Report of the Venice Commission of 4 April 2011 Study No. 512/2009 (CDL-AD(2011)003rev).
Amendment 5 Proposal for a regulation Recital 2 a (new)
Text proposed by the Commission	Amendment
	(2a) The accession criteria, or Copenhagen criteria, established by the Copenhagen European Council in 1993 and strengthened by the Madrid European Council in 1995, are the essential conditions that all candidate countries must satisfy to become a Member State. Those criteria include the stability of institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities; a functioning market economy and the capacity to cope with competition and market forces; and the ability to meet the obligations of Union membership.
Amendment 6 Proposal for a regulation Recital 2 b (new)
Text proposed by the Commission	Amendment
	(2b) The failure of a candidate country to meet the required standards, values and democratic principles results in that country’s accession to the Union being delayed until it fully meets those standards. The obligations incumbent on candidate countries under the Copenhagen criteria continue to apply to Member States after joining the Union by virtue of Article 2 TEU and the principle of sincere cooperation enshrined in Article 4 TEU. Member States should therefore be assessed on a regular basis in order to verify that their laws and practices continue to comply with those criteria and the common values on which the Union is founded, thereby providing a sound legal and administrative framework for the implementation of Union policies.
Amendment 7 Proposal for a regulation Recital 3
Text proposed by the Commission	Amendment
(3) The rule of law is a prerequisite for the protection of the other fundamental values on which the Union is founded, such as freedom, democracy, equality and respect for human rights. Respect for the rule of law is intrinsically linked to respect for democracy and for fundamental rights: there can be no democracy and respect for fundamental rights without respect for the rule of law and vice versa.	(3) While there is no hierarchy among Union values, respect for the rule of law is essential for the protection of the other fundamental values on which the Union is founded, such as freedom, democracy, equality and respect for human rights. Respect for the rule of law is intrinsically linked to respect for democracy and for fundamental rights: there can be no democracy and respect for fundamental rights without respect for the rule of law and vice versa. Coherence and consistency of internal and external democracy, rule of law and fundamental rights policy is key to the credibility of the Union.
Amendment 8 Proposal for a regulation Recital 6
Text proposed by the Commission	Amendment
(6) Judicial bodies should act independently and impartially and investigation and prosecution services should be able to properly execute their function. They should be endowed with sufficient resources and procedures to act effectively and in full respect of the right to a fair trial. These conditions are required as a minimum guarantee against unlawful and arbitrary decisions by public authorities that could harm the financial interests of the Union.	(6) Independence and impartiality of the judiciary should always be guaranteed and investigation and prosecution services should be able to properly execute their function. They should be endowed with sufficient resources and procedures to act effectively and in full respect of the right to a fair trial. These conditions are required as a minimum guarantee against unlawful and arbitrary decisions by public authorities that could impair these fundamental principles and harm the financial interests of the Union.
Amendment 9 Proposal for a regulation Recital 7 a (new)
Text proposed by the Commission	Amendment
	(7a) The independence of the prosecution and the judiciary comprises both the formal (de jure) and actual (de facto) independence of the prosecution and the judiciary and the individual prosecutors and judges.
Amendment 10 Proposal for a regulation Recital 8
Text proposed by the Commission	Amendment
(8) Respect for the rule of law is not only important for citizens of the Union, but also for business initiatives, innovation, investment and the proper functioning of the internal market, which will flourish most where a solid legal and institutional framework is in place.	(8) Respect for the rule of law is not only essential for citizens of the Union, but also for business initiatives, innovation, investment, economic, social and territorial cohesion and the proper functioning of the internal market, which will flourish sustainably only where a solid legal and institutional framework is in place.
Amendment 11 Proposal for a regulation Recital 8 a (new)
Text proposed by the Commission	Amendment
	(8a) Integrating existing Union monitoring mechanisms, such as the Cooperation and Verification Mechanism, the Justice Scoreboard and the Anti-Corruption reports, into a broader rule of law monitoring framework could provide more efficient and effective control mechanisms for the protection of the financial interest of the Union.
Amendment 12 Proposal for a regulation Recital 8 b (new)
Text proposed by the Commission	Amendment
	(8b) Lack of transparency, arbitrary discrimination, distortion of competition and an uneven playing field within and outside the internal market, impact on the integrity of the single market and on the fairness, stability and legitimacy of the tax system, increased economic inequalities, unfair competition between states, social dissatisfaction, mistrust and democratic deficit are some of the negative effects of harmful tax practices.
Amendment 13 Proposal for a regulation Recital 10 a (new)
Text proposed by the Commission	Amendment
	(10a) The Union has at its disposal a multitude of instruments and processes for ensuring full and proper application of the principles and values laid down in the TEU, but there is currently no swift, effective response coming from the Union institutions, in particular to ensure sound financial management. The existing instruments should be enforced, evaluated and complemented in the framework of a rule of law mechanism to be adequate and effective.
Amendment 14 Proposal for a regulation Recital 11
Text proposed by the Commission	Amendment
(11) Generalised deficiencies in the Member States as regards the rule of law which affect in particular the proper functioning of public authorities and effective judicial review, can seriously harm the financial interests of the Union.	(11) Generalised deficiencies in the Member States as regards the rule of law which affect in particular the proper functioning of public authorities and effective judicial review, can seriously harm the financial interests of the Union. Efficient investigations into such deficiencies, and the application of effective and proportionate measures when a generalised deficiency is established, are needed not only to secure the financial interests of the Union, including the effective collection of revenue, but also to ensure public trust in the Union and its institutions. Only an independent judiciary that upholds the rule of law and legal certainty in all Member States can ultimately guarantee that money from the Union budget is sufficiently protected.
Amendment 15 Proposal for a regulation Recital 11 a (new)
Text proposed by the Commission	Amendment
	(11a) The scale of tax evasion and avoidance is estimated by the Commission to be up to EUR 1 trillion a year. The negative impacts of such practices on the Member States' and Union budgets and on citizens are evident and could undermine trust in democracy.
Amendment 16 Proposal for a regulation Recital 11 b (new)
Text proposed by the Commission	Amendment
	(11b) Corporate tax avoidance has a direct impact on Member States’ and Union budgets and on the breakdown of the tax effort between categories of tax payers as well as between economic factors.
Amendment 17 Proposal for a regulation Recital 11 c (new)
Text proposed by the Commission	Amendment
	(11c) Member States should fully apply the principle of sincere cooperation in matters of tax competition.
Amendment 18 Proposal for a regulation Recital 11 d (new)
Text proposed by the Commission	Amendment
	(11d) The Commission, as the guardian of the Treaties, should ensure that Union law and the principle of sincere cooperation between Member States are fully complied with.
Amendment 19 Proposal for a regulation Recital 11 e (new)
Text proposed by the Commission	Amendment
	(11e) Assessing and monitoring Member States' tax policies at Union level would ensure that no new harmful tax measures are implemented in Member States. Monitoring compliance of Member States, their jurisdictions, regions or other administrative structures with the common Union list of non-cooperative jurisdictions would safeguard the single market and ensure its proper and coherent functioning.
Amendment 20 Proposal for a regulation Recital 12
Text proposed by the Commission	Amendment
(12) The identification of a generalised deficiency requires a qualitative assessment by the Commission. That assessment could be based on the information from all available sources and recognized institutions, including judgments of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations and networks, such as the bodies of the Council of Europe and the European networks of supreme courts and councils for the judiciary.	(12) The identification of a generalised deficiency requires a thorough qualitative assessment by the Commission. That assessment should be objective, impartial and transparent and be based on information from all relevant sources, taking into account the criteria used in the context of Union accession negotiations, in particular the chapters of the acquis on judiciary and fundamental rights, on justice, freedom and security, on financial control and on taxation, as well as the guidelines used in the context of the Cooperation and Verification Mechanism to track the progress of a Member State, and from recognised institutions, including judgments of the Court of Justice of the European Union and the European Court of Human Rights, resolutions of the European Parliament, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations, such as the bodies of the Council of Europe, including in particular the Venice Commission’s Rule of Law Checklist, and of relevant international networks, such as the European networks of supreme courts and councils for the judiciary.
Amendment 21 Proposal for a regulation Recital 12 a (new)
Text proposed by the Commission	Amendment
	(12a) An advisory panel of independent experts in constitutional law and financial and budgetary matters should be established with the objective to assist the Commission in its assessment of generalised deficiencies. That panel should undertake an independent annual assessment of the issues as regards the rule of law in all Member States that affect or risk affecting the sound financial management or the protection of the financial interests of the Union, taking into account information from all relevant sources and recognised institutions. The Commission, when taking a decision about adopting or lifting of possible measures, should take relevant opinions expressed by that panel into account.
Amendment 22 Proposal for a regulation Recital 13
Text proposed by the Commission	Amendment
(13) The possible measures to be adopted in the event of generalised deficiencies and the procedure to be followed to adopt them should be determined. Those measures should include the suspension of payments and of commitments, a reduction of funding under existing commitments, and a prohibition to conclude new commitments with recipients.	(13) The measures to be adopted in the event of generalised deficiencies and the procedure to be followed to adopt them should be determined. Those measures should include the suspension of payments and of commitments, a reduction of funding under existing commitments, and a prohibition to conclude new commitments with recipients.
Amendment 23 Proposal for a regulation Recital 14 a (new)
Text proposed by the Commission	Amendment
	(14a) It is essential that the legitimate interests of final recipients and beneficiaries are properly safeguarded when measures are adopted in the event of generalised deficiencies. When considering the adoption of measures, the Commission should take into account their potential impact on final recipients and beneficiaries. To strengthen the protection of the final recipients or beneficiaries, the Commission should provide information and guidance via a website or internet portal, together with adequate tools to inform the Commission about any breach of the legal obligation of government entities and Member States to continue making payments after measures on the basis of this Regulation are adopted. Where necessary, in order to ensure that any amount due by government entities or Member States is effectively paid to final recipients or beneficiaries, the Commission should be able to recover payments made to those entities, or, as appropriate, to make a financial correction by reducing support to a programme, and to transfer an equivalent amount to the Union reserve to be used for the benefit of final recipients or beneficiaries.
Amendment 24 Proposal for a regulation Recital 15
Text proposed by the Commission	Amendment
(15) In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the Council which should act on the basis of a Commission proposal. To facilitate the adoption of decisions which are required to protect the financial interests of the Union, reversed qualified majority voting should be used.	(15) In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the Commission.
Amendment 25 Proposal for a regulation Recital 15 a (new)
Text proposed by the Commission	Amendment
	(15a) In view of their effect on the Union budget, measures imposed pursuant to this Regulation should only enter into force after the European Parliament and the Council have approved a transfer to a budgetary reserve of an amount equivalent to the value of the measures adopted. To facilitate the adoption of decisions which are required to protect the financial interests of the Union, such transfers should be considered to be approved unless, within a set period, the European Parliament or the Council, the latter acting by qualified majority, amend or reject them.
Amendment 26 Proposal for a regulation Recital 16
Text proposed by the Commission	Amendment
(16) Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned why it considers that a generalised deficiency regarding the rule of law might exist in that Member State. The Member State should be allowed to submit its observations. The Commission and the Council should take those observations into account.	(16) Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned why it considers that a generalised deficiency regarding the rule of law might exist in that Member State. The Commission should without delay inform the European Parliament and the Council about any such notification and its contents. The Member State concerned should be allowed to submit its observations. The Commission should take those observations into account.
Amendment 27 Proposal for a regulation Recital 17
Text proposed by the Commission	Amendment
(17) The Council should lift measures with suspensive effect on a proposal from the Commission, if the situation leading to the imposition of those measures has been sufficiently remedied.	(17) The Commission should lift measures with suspensive effect and propose to the European Parliament and the Council to lift in full or in part the budgetary reserve of the measures in question, if the situation leading to the imposition of those measures has been sufficiently remedied.
Amendment 28 Proposal for a regulation Recital 18
Text proposed by the Commission	Amendment
(18) The Commission should keep the European Parliament informed of any measures proposed and adopted pursuant to this Regulation,	deleted
Amendment 29 Proposal for a regulation Article 2 – paragraph 1 – point a
Text proposed by the Commission	Amendment
(a) 'the rule of law' refers to the Union value enshrined in Article 2 of the Treaty on European Union which includes the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting laws; legal certainty; prohibition of arbitrariness of the executive powers; effective judicial protection by independent courts, including of fundamental rights; separation of powers and equality before the law;	(a) 'the rule of law' shall be understood having regard to the Union values enshrined in Article 2 TEU and in the criteria for Union membership referred to in Article 49 TEU; it includes the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting law; legal certainty; prohibition of arbitrariness of the executive powers; access to justice and effective judicial protection before independent and impartial courts, including of fundamental rights as stipulated in the Charter of Fundamental Rights of the European Union and in international human rights treaties; separation of powers; non-discrimination and equality before the law;
Amendment 30 Proposal for a regulation Article 2 – paragraph 1 – point b
Text proposed by the Commission	Amendment
(b) 'generalised deficiency as regards the rule of law' means a widespread or recurrent practice or omission, or measure by public authorities which affects the rule of law;	(b) 'generalised deficiency as regards the rule of law' means a widespread or recurrent practice or omission, or measure by public authorities which affects the rule of law, where it affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union; a generalised deficiency as regards the rule of law may also be the consequence of a systemic threat to the Union values enshrined in Article 2 TEU that affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union;
Amendment 31 Proposal for a regulation Article 2 – paragraph 1 – point c
Text proposed by the Commission	Amendment
(c) 'government entity' means all public authorities at all levels of government, including national, regional and local authorities, as well as Member State organisations within the meaning of [point 42 of Article 2] of Regulation (EU, Euratom) No […] (the ‘Financial Regulation’).	(c) 'government entity' means any public authority at all levels of government, including national, regional and local authorities, as well as Member State organisations within the meaning of point 42 of Article 2 of Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council^1a (the ‘Financial Regulation’).
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	^1a Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council of 18 July 2018 on the financial rules applicable to the general budget of the Union, amending Regulations (EU) No 1296/2013, (EU) No 1301/2013, (EU) No 1303/2013, (EU) No 1304/2013, (EU) No 1309/2013, (EU) No 1316/2013, (EU) No 223/2014, (EU) No 283/2014, and Decision No 541/2014/EU and repealing Regulation (EU, Euratom) No 966/2012 (OJ L 193, 30.7.2018, p. 1).
Amendment 32 Proposal for a regulation Article 2 a (new)
Text proposed by the Commission	Amendment
	Article 2 a
	Generalised deficiencies
	The following shall, in particular, be considered generalised deficiencies as regards the rule of law where they affect or risk affecting the principles of sound financial management or the protection of the financial interests of the Union:
	(a) endangering the independence of judiciary, including setting any limitations on the ability to exercise judicial functions autonomously by externally intervening in guarantees of independence, by constraining judgement under external order, by arbitrarily revising rules on the appointment or terms of service of judicial personnel, by influencing judicial staff in any way that jeopardises their impartiality or by interfering with the independence of attorneyship;
	(b) failing to prevent, correct and sanction arbitrary or unlawful decisions by public authorities, including by law enforcement authorities, withholding financial and human resources affecting their proper functioning or failing to ensure the absence of conflicts of interests;
	(c) limiting the availability and effectiveness of legal remedies, including through restrictive procedural rules, lack of implementation of judgments, or limiting the effective investigation, prosecution or sanctioning of breaches of law;
	(d) endangering the administrative capacity of a Member State to respect the obligations of Union membership, including the capacity to effectively implement the rules, standards and policies that make up the body of Union law; (e) measures that weaken the protection of the confidential communication between lawyer and client.
(See amendment relating to Article 3 – paragraph 2.)
Amendment 33 Proposal for a regulation Article 3 – title
Text proposed by the Commission	Amendment
Measures	Risks for the financial interests of the Union
Amendment 34 Proposal for a regulation Article 3 – paragraph 1 – introductory part
Text proposed by the Commission	Amendment
1. Appropriate measures shall be taken where a generalised deficiency as regards the rule of law in a Member State affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union, in particular:	1. A generalised deficiency as regards the rule of law in a Member State may be established when one or more of the following, in particular, are affected or risk being affected:
Amendment 35 Proposal for a regulation Article 3 – paragraph 1 – point a
Text proposed by the Commission	Amendment
(a) the proper functioning of the authorities of that Member State implementing the Union budget, in particular in the context of public procurement or grant procedures, and when carrying out monitoring and controls;	(a) the proper functioning of the authorities of that Member State implementing the Union budget, in particular in the context of public procurement or grant procedures;
Amendment 36 Proposal for a regulation Article 3 – paragraph 1 – point a a (new)
Text proposed by the Commission	Amendment
	(aa) the proper functioning of the market economy, thereby respecting competition and market forces in the Union as well as implementing effectively the obligations of membership, including adherence to the aim of political, economic and monetary union;
Amendment 37 Proposal for a regulation Article 3 – paragraph 1 – point a b (new)
Text proposed by the Commission	Amendment
	(ab) the proper functioning of the authorities carrying out financial control, monitoring and internal and external audits, and the proper functioning of effective and transparent financial management and accountability systems;
Amendment 38 Proposal for a regulation Article 3 – paragraph 1 – point b
Text proposed by the Commission	Amendment
(b) the proper functioning of investigation and public prosecution services in relation to the prosecution of fraud, corruption or other breaches of Union law relating to the implementation of the Union budget;	(b) the proper functioning of investigation and public prosecution services in relation to the prosecution of fraud, including tax fraud, corruption or other breaches of Union law relating to the implementation of the Union budget;
Amendment 39 Proposal for a regulation Article 3 – paragraph 1 – point c
Text proposed by the Commission	Amendment
(c) the effective judicial review by independent courts of actions or omissions by the authorities referred to in points (a) and b);	(c) the effective judicial review by independent courts of actions or omissions by the authorities referred to in points (a), (a b) and (b);
Amendment 40 Proposal for a regulation Article 3 – paragraph 1 – point d
Text proposed by the Commission	Amendment
(d) the prevention and sanctioning of fraud, corruption or other breaches of Union law relating to the implementation of the Union budget, and the imposition of effective and dissuasive penalties on recipients by national courts or by administrative authorities;	(d) the prevention and sanctioning of fraud, including tax fraud, corruption or other breaches of Union law relating to the implementation of the Union budget, and the imposition of effective and dissuasive penalties on recipients by national courts or by administrative authorities;
Amendment 41 Proposal for a regulation Article 3 – paragraph 1 – point e a (new)
Text proposed by the Commission	Amendment
	(ea) the prevention and sanctioning of tax evasion and tax competition and the proper functioning of authorities contributing to administrative cooperation in tax matters;
Amendment 42 Proposal for a regulation Article 3 – paragraph 1 – point f
Text proposed by the Commission	Amendment
(f) the effective and timely cooperation with the European Anti-fraud Office and with the European Public Prosecutor’s Office in their investigations or prosecutions pursuant to their respective legal acts and to the principle of loyal cooperation.	(f) the effective and timely cooperation with the European Anti-fraud Office and, subject to the participation of the Member State concerned, with the European Public Prosecutor’s Office in their investigations or prosecutions pursuant to their respective legal acts and to the principle of loyal cooperation;
Amendment 43 Proposal for a regulation Article 3 – paragraph 1 – point f a (new)
Text proposed by the Commission	Amendment
	(fa) the proper implementation of the Union budget following a systemic violation of fundamental rights.
Amendment 44 Proposal for a regulation Article 3 – paragraph 2
Text proposed by the Commission	Amendment
2. The following may, in particular, be considered generalised deficiencies as regards the rule of law,	deleted
(a) endangering the independence of judiciary;
(b) failing to prevent, correct and sanction arbitrary or unlawful decisions by public authorities, including by law enforcement authorities, withholding financial and human resources affecting their proper functioning or failing to ensure the absence of conflicts of interests;
(c) limiting the availability and effectiveness of legal remedies, including through restrictive procedural rules, lack of implementation of judgments, or limiting the effective investigation, prosecution or sanctioning of breaches of law.
(See amendment relating to Article 2 a (new).)
Amendment 45 Proposal for a regulation Article 3 a (new)
Text proposed by the Commission	Amendment
	Article 3 a
	Panel of independent experts
	1. The Commission shall establish a panel of independent experts (‘the Panel’).
	The Panel shall be composed of independent experts in constitutional law and financial and budgetary matters. One expert shall be appointed by the national parliament of each Member State and five experts shall be appointed by the European Parliament. The composition of the Panel shall ensure gender balance.
	Whenever appropriate, representatives of relevant organisations and networks, such as the European Federation of Academies of Sciences and Humanities, the European Network of National Human Rights Institutions, the bodies of the Council of Europe, the European Commission for the efficiency of justice, the Council of Bars and Law Societies of Europe, the Tax Justice Network, the United Nations, the Organization for Security and Co-operation in Europe and the Organisation for Economic Co-operation and Development, may be invited as observers to the Panel in accordance with the rules of procedures referred to in paragraph 6.
	2. The advisory tasks of the Panel shall have as their objective to assist the Commission in identifying generalised deficiencies as regards the rule of law in a Member State that affect or risk affecting the principles of sound financial management or the protection of the financial interests of the Union.
	The Panel shall assess the situation in all Member States annually on the basis of quantitative and qualitative criteria and information, having due regard to the information and guidance referred to in Article 5(2).
	3. Each year the Panel shall make public a summary of its findings.
	4. As part of its advisory task and taking into account the outcome of the considerations under paragraph 2, the Panel may express an opinion about a generalised deficiency as regards the rule of law in a Member State.
	When expressing an opinion the Panel shall endeavour to reach a consensus. If no such consensus can be reached, the Panel shall express its opinion by a simple majority of its members.
	5. When adopting implementing acts pursuant to Article 5(6) and Article 6(2), the Commission shall take into account any relevant opinion expressed by the Panel in accordance with paragraph 4 of this Article.
	6. The Panel shall elect its chairperson from among its members. The Panel shall establish its rules of procedure.
Amendment 46 Proposal for a regulation Article 4 – title
Text proposed by the Commission	Amendment
Content of measures	Measures for the protection of the Union budget
Amendment 47 Proposal for a regulation Article 4 – paragraph 1 – introductory part
Text proposed by the Commission	Amendment
1. One or more of the following appropriate measures may be adopted	1. When the conditions of Article 3 are fulfilled, one or more of the following measures may be adopted:
Amendment 48 Proposal for a regulation Article 4 – paragraph 3
Text proposed by the Commission	Amendment
3. The measures taken shall be proportionate to the nature, gravity and scope of the generalised deficiency as regards the rule of law. They shall, insofar as possible, target the Union actions affected or potentially affected by that deficiency.	3. The measures taken shall be proportionate to the nature, gravity, duration and scope of the generalised deficiency as regards the rule of law. They shall, insofar as possible, target the Union actions affected or potentially affected by that deficiency.
Amendment 49 Proposal for a regulation Article 4 – paragraph 3 a (new)
Text proposed by the Commission	Amendment
	3a. The Commission shall provide information and guidance for the benefit of final recipients or beneficiaries on the obligations by Member States referred to in paragraph 2 via a website or internet portal.
	The Commission shall also provide, on the same website or portal, adequate tools for final recipients or beneficiaries to inform the Commission about any breach of these obligations that, in the view of these final recipients or beneficiaries, directly affects them. This paragraph shall be applied in a manner that ensures protection of persons reporting on breaches of Union law, in line with the principles set out in Directive XXX (Directive on the protection of persons reporting on breaches of Union law). Information provided by final recipients or beneficiaries in accordance with this paragraph may only be taken into account by the Commission if accompanied by a proof that the concerned final recipient or beneficiary has lodged a formal complaint to the competent authority.
Amendment 50 Proposal for a regulation Article 4 – paragraph 3 b (new)
Text proposed by the Commission	Amendment
	3b. Based on the information provided by the final recipients or beneficiaries in accordance with paragraph 3 a, the Commission shall ensure that any amount due by government entities or Member States in accordance with paragraph 2 is effectively paid to final recipients or beneficiaries. Where necessary:
	(a) with reference to funds from the Union budget managed in accordance with Article 62(1)(c) of the Financial Regulation, the Commission shall:
	(i) recover the payment made to any of the bodies referred to in points (v) to (vii) of Article 62(1)(c) of the Financial Regulation for an amount equivalent to the amount not paid to final recipients or beneficiaries, in breach of paragraph 2 of this Article;
	(ii) transfer an amount equivalent to the amount referred to in the previous point to the Union reserve referred to in Article 12 of Council Regulation XXX (MFF Regulation). Such amount shall be considered margin left available within the meaning of point (a) of Article 12(1) of Council Regulation XXX (MFF Regulation) and shall be mobilised in accordance with Article 12(2) of Council Regulation XXX (MFF Regulation), for the benefit, to the possible extent, of the final recipients or beneficiaries referred to in paragraph 2 of this Article;
	(b) with reference to funds from the Union budget managed in accordance with Article 62(1)(b) of the Financial Regulation:
	(i) the obligation of government authorities or of Member States referred to in paragraph 2 of this Article shall be considered an obligation of Member States within the meaning of [Article 63] of Regulation XXX (CPR Regulation). Any breach of such obligation shall be treated in accordance with [Article 98] of Regulation XXX (CPR Regulation);
	(ii) The amount resulting from reduced support from the Funds to a programme, in application of [Article 98] of Regulation XXX (CPR Regulation) shall be transferred by the Commission to the Union reserve referred to in Article 12 of Council Regulation XXX (MFF Regulation). Such amount shall be considered margin left available within the meaning of point a) of Article 12 of Council Regulation XXX (MFF Regulation) and shall be mobilised in accordance with paragraph 2 of Article 12 of Council Regulation XXC (MFF Regulation), for the benefit, to the possible extent, of the final recipients or beneficiaries referred to in paragraph 2 of this Article.
Amendment 51 Proposal for a regulation Article 5 – paragraph 1
Text proposed by the Commission	Amendment
1. Where the Commission finds that it has reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding	1. Where the Commission, taking into account any opinions of the Panel, finds that it has reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding. The Commission shall without delay inform the European Parliament and the Council of such notification and its contents.
Amendment 52 Proposal for a regulation Article 5 – paragraph 2
Text proposed by the Commission	Amendment
2. The Commission may take into account all relevant information, including decisions of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations.	2. When assessing whether the conditions of Article 3 are fulfilled, the Commission shall take into account all relevant information, including opinions of the Panel, decisions of the Court of Justice of the European Union, resolutions of the European Parliament, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations and networks. The Commission shall also take into account the criteria used in the context of Union accession negotiations, in particular the chapters of the acquis on judiciary and fundamental rights, justice, freedom and security, financial control and taxation, as well as the guidelines used in the context of the Cooperation and Verification Mechanism to track the progress of a Member State.
Amendment 53 Proposal for a regulation Article 5 – paragraph 4
Text proposed by the Commission	Amendment
4. The Member State concerned shall provide all required information and may make observations within a time limit specified by the Commission, which shall not be less than 1 month from the date of notification of the finding. In its observations, the Member State may propose the adoption of remedial measures.	4. The Member State concerned shall provide the required information and may make observations within a time limit specified by the Commission, which shall not be less than one month nor more than three months from the date of notification of the finding. In its observations, the Member State may propose the adoption of remedial measures.
Amendment 54 Proposal for a regulation Article 5 – paragraph 5
Text proposed by the Commission	Amendment
5. The Commission shall take into account the information received and any observations made by the Member State concerned, as well as the adequacy of any proposed remedial measures, when deciding whether or not to submit a proposal for a decision on the appropriate measures.	5. The Commission shall take into account the information received and any observations made by the Member State concerned, as well as the adequacy of any proposed remedial measures, when deciding whether or not to adopt a decision on any measures referred to in Article 4. The Commission shall decide on the follow-up to be given to the information received within an indicative time limit of one month, and in any case within a reasonable timeframe from the date of receipt of that information.
Amendment 55 Proposal for a regulation Article 5 – paragraph 5 a (new)
Text proposed by the Commission	Amendment
	5a. When assessing the proportionality of the measures to be imposed, the Commission shall have due regard to the information and guidance referred to in paragraph 2.
Amendment 56 Proposal for a regulation Article 5 – paragraph 6
Text proposed by the Commission	Amendment
6. Where the Commission considers that the generalised deficiency as regards the rule of law is established, it shall submit a proposal for an implementing act on the appropriate measures to the Council.	6. Where the Commission considers that the generalised deficiency as regards the rule of law is established, it shall adopt a decision on the measures referred to in Article 4 by means of an implementing act.
Amendment 57 Proposal for a regulation Article 5 – paragraph 6 a (new)
Text proposed by the Commission	Amendment
	6a. At the same time as it adopts its decision, the Commission shall simultaneously submit to the European Parliament and to the Council a proposal to transfer to a budgetary reserve an amount equivalent to the value of the measures adopted.
Amendment 58 Proposal for a regulation Article 5 – paragraph 6 b (new)
Text proposed by the Commission	Amendment
	6b. By way of derogation from Article 31(4) and (6) of the Financial Regulation, the European Parliament and the Council shall deliberate upon the transfer proposal within four weeks of its receipt by both institutions. The transfer proposal shall be considered to be approved unless, within the four-week period, the European Parliament, acting by majority of the votes cast, or the Council, acting by qualified majority, amend or reject it. If the European Parliament or the Council amend the transfer proposal, Article 31(8) of the Financial Regulation shall apply.
Amendment 59 Proposal for a regulation Article 5 – paragraph 6 c (new)
Text proposed by the Commission	Amendment
	6c. The decision referred to in paragraph 6 shall enter into force if neither the European Parliament nor the Council reject the transfer proposal within the period referred to in paragraph 6b.
Amendment 60 Proposal for a regulation Article 5 – paragraph 7
Text proposed by the Commission	Amendment
7. The decision shall be deemed to have been adopted by the Council, unless it decides, by qualified majority, to reject the Commission proposal within one month of its adoption by the Commission.	Deleted
Amendment 61 Proposal for a regulation Article 5 – paragraph 8
Text proposed by the Commission	Amendment
8. The Council, acting by a qualified majority, may amend the Commission’s proposal and adopt the amended text as a Council decision.	deleted
Amendment 62 Proposal for a regulation Article 6 – paragraph 1
Text proposed by the Commission	Amendment
1. The Member State concerned may, at any time, submit to the Commission evidence to show that the generalised deficiency as regards the rule of law has been remedied or has ceased to exist.	1. The Member State concerned may, at any time, submit to the Commission a formal notification including evidence to show that the generalised deficiency as regards the rule of law has been remedied or has ceased to exist.
Amendment 63 Proposal for a regulation Article 6 – paragraph 2
Text proposed by the Commission	Amendment
2. The Commission shall assess the situation in the Member State concerned. Once the generalised deficiencies as regards the rule of law which on the grounds of which the appropriate measures were adopted cease to exist in full or in part, the Commission shall submit to the Council a proposal for a decision lifting those measures in full or in part. The procedure set out in paragraphs 2, 4, 5, 6 and 7 of Article 5 shall apply.	2. At the request of the Member State concerned or on its own initiative, the Commission, taking into account any opinions of the Panel, shall assess the situation in the Member State concerned within an indicative time limit of one month, and in any case within a reasonable timeframe from the date of receipt of the formal notification. Once the generalised deficiencies as regards the rule of law which on the grounds of which the measures referred to in Article 4 were adopted cease to exist in full or in part, the Commission shall, without delay, adopt a decision lifting those measures in full or in part. At the same time as it adopts its decision, the Commission shall simultaneously submit to the European Parliament and to the Council a proposal to lift, in full or in part, the budgetary reserve referred to in Article 5(6a). The procedure set out in paragraphs 2, 4, 5, 6, 6b and 6c of Article 5 shall apply.
Amendment 64 Proposal for a regulation Article 6 – paragraph 3
Text proposed by the Commission	Amendment
3. Where measures concerning the suspension of the approval of one or more programmes or amendments thereof referred to in point (i) of Article 4(2)(b) or the suspension of commitments referred to in point (ii) of Article 4(2)(b) are lifted, amounts corresponding to the suspended commitments shall be entered in the budget subject to Article 7 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation). Suspended commitments of year n may not be entered in the budget beyond year n+2.	3. Where measures concerning the suspension of the approval of one or more programmes or amendments thereof referred to in point (i) of Article 4(2)(b) or the suspension of commitments referred to in point (ii) of Article 4(2)(b) are lifted, amounts corresponding to the suspended commitments shall be entered in the budget subject to Article 7 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation). Suspended commitments of year n may not be entered in the budget beyond year n+2. As from year n+3, an amount equivalent to the suspended commitments shall be entered in the Union Reserve for Commitments provided for in Article 12 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation).
Amendment 65 Proposal for a regulation Article 7
Text proposed by the Commission	Amendment
Article 7	deleted
Information of the European Parliament
The Commission shall immediately inform the European Parliament of any measures proposed or adopted pursuant to Articles 4 and 5
Amendment 66 Proposal for a regulation Article 7 a (new)
Text proposed by the Commission	Amendment
	Article 7a
	Reporting
	The Commission shall report to the European Parliament and the Council on the application of this Regulation, in particular on the effectiveness of the measures adopted, if any, at the latest five years after its entry into force.
	The report shall be accompanied where necessary by appropriate proposals.
Amendment 67 Proposal for a regulation Article 8 – paragraph 1
Text proposed by the Commission	Amendment
This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. It shall apply from 1 January 2021.	This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
Amendment 68 Proposal for a regulation Article 8 a (new)
Text proposed by the Commission	Amendment
	Article 8 a
	Inclusion in the Financial Regulation
	The contents of this Regulation shall be inserted into the Financial Regulation upon its next revision.

[1] OJ C 291, 17.8.2018, p. 1.

EXPLANATORY STATEMENT

Background

The Commission’s communication “A new, modern, Multiannual Financial Framework for a European Union that delivers efficiently on its priorities post-2020” (COM (2018) 98), stresses that “the Union is a community of law and its values constitute the very basis of its existence. Respect for these values must therefore be ensured throughout all Union policies. This includes the EU Budget, where respect for fundamental values is an essential precondition for sound financial management and effective funding”.

Concerns about weaknesses in national checks and balances possibly undermining the respect of the fundamental values enshrined in Article 2 of the Treaty on European Union have been a matter of recent public debate. In that context, it has been suggested that the lack of respect of fundamental values should have consequences that include the suspension of disbursements from the EU budget.

In particular, in its resolution of 14 March 2018 on the next Multiannual Financial Framework (MFF), the European Parliament called on the Commission “to propose a mechanism whereby Member States that do not respect the values enshrined in Article 2 of the Treaty on European Union (TEU) can be subject to financial consequences”. However, “final beneficiaries of the Union budget”, Parliament also warned, “can in no way be affected by breaches of rules for which they are not responsible”.

On 2 May 2018, as an integral part of the 2021-20127 MFF package, the Commission published a legislative proposal to establish the rules necessary for the protection of the Union’s budget in the case of generalised deficiencies as regards the rule of law in Member States. The proposal is based on Article 322(1)(a) of the Treaty on the Functioning of the European Union, the same as the Financial Regulation.

According to the Commission proposal, in order to protect its financial interests from the risk of financial loss caused by generalised deficiencies as regards the rule of law, the EU should be able to impose appropriate measures that include suspending, reducing and restricting access to EU funding in a manner proportionate to the nature, gravity and scope of the deficiencies.

The procedure proposed by the Commission to adopt those measures is the following: when there are reasonable grounds to believe that there is a generalised deficiency, the Commission first notifies the Member State concerned and examines its observations. When the Commission considers that a generalised deficiency is established, it submits a proposal for a decision on the measures to the Council, who decides in accordance with a reversed qualified majority vote (i.e. a qualified majority is needed to reject or amend the proposal). The same procedure applies to lift the measures when the deficiency ceases to exist.

The Rapporteurs’ position

The Rapporteurs share the broad objectives put forward by the Commission and propose a number of amendments in order to strengthen the proposal and increase its effectiveness, along the following lines.

 Fundamental values and Copenhagen criteria: Articles 2 and 3 should be amended to clarify that, as suggested in Parliament’s resolution of 14 March 2018 on the new MFF, the rule of law shall be understood having regard to the fundamental values enshrined in Article 2 TEU. The Copenhagen criteria, the essential conditions all candidate countries must satisfy to become a Member State of the Union, have to be considered when assessing the risk that a generalised deficiency as regards the rule of law poses to the principles of sound financial management. Those criteria include the stability of institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities, a functioning market economy and the capacity to cope with competition and market forces, and the ability to take on the obligations of Union membership.

 Assessment of generalised deficiencies: when assessing the existence of a generalised deficiency and in order to ensure the proportionality of the measures being adopted, it is necessary that the Commission takes into account all relevant information, including information coming from the Parliament and from bodies such as the Venice Commission of the Council of Europe. The Commission must also take into account the criteria used in the context of accession negotiations, in particular the chapters on judiciary and fundamental rights (23), justice, freedom and security (24), financial control (32) and taxation (16), and the guidelines used in the context of the Cooperation and Verification Mechanism.

 Protection of final beneficiaries: while the Commission proposal specifies that the imposition of appropriate measures does not affect the obligation of government entities to implement programmes or funds, and in particular the obligation to make payments to final beneficiaries, it is not fully clear how this provision is to be enforced. The Commission should take all appropriate measures to assist final beneficiaries in enforcing their claims when legal obligations are not respected.

 Procedure to adopt/lift measures and involvement of the Parliament: the sole right conferred by the Commission proposal to the Parliament is to be informed of any measure proposed or adopted. This arrangement clearly does not respect the institutional prerogative of the Parliament as an arm of the EU budgetary authority, given the significant effect of the proposed measures on the Union’s budget. The Rapporteurs propose therefore a more balanced mechanism, which puts Parliament and Council on the same footing. According to the proposed procedure, the Commission would adopt a decision on the appropriate measures by its own implementing act, and simultaneously submit to the Parliament and the Council a proposal to transfer to a budgetary reserve an amount equivalent to the value of the measures adopted. That decision would only enter into force if the Parliament and the Council, within one month, do not reject it. The principle of reverse (qualified) majority voting included in the Commission proposal would be preserved in the proposed procedure.

 Other issues: amendments are proposed to specify more precisely what constitutes endangering the independence of the judiciary; to improve the certainty of the procedure by including indicative deadlines for the Commission to react to information received from Member States; and to ensure that if measures being imposed are not lifted after two years, the suspended funds are not lost but are entered in the Union Reserve for Commitments provided for in the 2021-2027 MFF Regulation.

OPINION of the Committee on Civil Liberties, Justice and Home Affairs (5.12.2018)

for the Committee on Budgets and the Committee on Budgetary Control

Rapporteur for opinion (*): Josep‑Maria Terricabras

(*) Associated committee – Rule 54 of the Rules of Procedure

AMENDMENTS

The Committee on Civil Liberties, Justice and Home Affairs calls on the Committee on Budgets and the Committee on Budgetary Control, as the committees responsible, to take into account the following amendments:

Amendment 1 Proposal for a regulation Title
Text proposed by the Commission	Amendment
Proposal for a	Proposal for a
REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL	REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
on the protection of the Union's budget in case of generalised deficiencies as regards the rule of law in the Member States	on the protection of the Union's budget in case of generalised deficiencies as regards the rule of law and fundamental rights in the Member States
	(This amendment applies throughout the text. Adopting it will necessitate corresponding changes throughout.)
Amendment 2 Proposal for a regulation Recital 1
Text proposed by the Commission	Amendment
(1) The rule of law is one of the essential values upon which the Union is founded. As recalled by Article 2 of the Treaty on European Union, these values are common to the Member States.	(1) The Union is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities. As recalled by Article 2 of the Treaty on European Union (TEU), these values are common to the Member States in a society in which pluralism, non-discrimination, tolerance, justice, solidarity and equality between women and men prevail.
Amendment 3 Proposal for a regulation Recital 1a (new)
Text proposed by the Commission	Amendment
	(1a) Democracy, the rule of law and fundamental rights are in a triangular relationship, reinforcing each other and together safeguarding the constitutional core of the Union and the Member States. There can be no hierarchy of values within the Union. The interdependence between a functioning democracy, strong and accountable institutions, transparent and inclusive decision-making and effective rule of law is essential for an effective respect for human rights and vice versa. Articles 2 and 6 TEU require the Member States to fully respect, protect and promote the principles of rule of law, fundamental rights and democracy.
Amendment 4 Proposal for a regulation Recital 2
Text proposed by the Commission	Amendment
(2) The rule of law requires that all public powers act within the constraints set out by law, in accordance with the values of democracy and fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality⁷ , legal certainty⁸ , prohibition of arbitrariness of the executive powers⁹ , separation of powers¹⁰ , and effective judicial protection by independent courts¹¹ are respected¹² .	(2) The rule of law requires that all public powers act within the constraints set out by law, in accordance with the principles of democracy and respect for fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality⁷, including a transparent, accountable and democratic process for enacting legislation, legal certainty⁸ , prohibition of arbitrariness of the executive powers⁹ , separation of powers¹⁰ , access to justice and effective judicial protection before independent and impartial courts¹¹ are respected¹².
__________________	__________________
⁷ Judgment of the Court of Justice of 29 April 2004, CAS Succhi di Frutta, C-496/99 PECLI:EU:C:2004:236, paragraph 63.	⁷ Judgment of the Court of Justice of 29 April 2004, CAS Succhi di Frutta, C-496/99 PECLI:EU:C:2004:236, paragraph 63.
⁸ Judgment of the Court of Justice of 12 November 1981, Amministrazione delle finanze dello Stato v Srl Meridionale Industria Salumi and others Ditta Italo Orlandi & Figlio and Ditta Vincenzo Divella v Amministrazione delle finanze dello Stato. Joined cases 212 to 217/80, ECLI:EU:C:1981:270, paragraph 10.	⁸ Judgment of the Court of Justice of 12 November 1981, Amministrazione delle finanze dello Stato v Srl Meridionale Industria Salumi and others Ditta Italo Orlandi & Figlio and Ditta Vincenzo Divella v Amministrazione delle finanze dello Stato. Joined cases 212 to 217/80, ECLI:EU:C:1981:270, paragraph 10.
⁹ Judgment of the Court of Justice of 21 September 1989, Hoechst, Joined cases 46/87 and 227/88, ECLI:EU:C:1989:337, paragraph 19.	⁹ Judgment of the Court of Justice of 21 September 1989, Hoechst, Joined cases 46/87 and 227/88, ECLI:EU:C:1989:337, paragraph 19.
¹⁰ Judgment of the Court of Justice of 10 November 2016, Kovalkovas, C-477/16, ECLI:EU:C:2016:861, paragraph 36; Judgment of the Court of Justice of 10 November 2016, PPU Poltorak, C-452/16, ECLI:EU:C:2016:858, paragraph 35; and Judgment of the Court of Justice of 22 December 2010, DEB,C-279/09, ECLI:EU:C:2010:811, paragraph 58.	¹⁰ Judgment of the Court of Justice of 10 November 2016, Kovalkovas, C-477/16, ECLI:EU:C:2016:861, paragraph 36; Judgment of the Court of Justice of 10 November 2016, PPU Poltorak, C-452/16, ECLI:EU:C:2016:858, paragraph 35; and Judgment of the Court of Justice of 22 December 2010, DEB,C-279/09, ECLI:EU:C:2010:811, paragraph 58.
¹¹ Judgment of the Court of Justice of 27 February 2018, Associação Sindical dos Juízes Portugueses v Tribunal de Contas C-64/16, ECLI:EU:C:2018:117, paragraphs 31, 40-41.	¹¹ Judgment of the Court of Justice of 27 February 2018, Associação Sindical dos Juízes Portugueses v Tribunal de Contas C-64/16, ECLI:EU:C:2018:117, paragraphs 31, 40-41.
¹² Communication from the Commission "A new EU Framework to strengthen the Rule of Law", COM(2014) 158 final, Annex I.	¹² Communication from the Commission "A new EU Framework to strengthen the Rule of Law", COM(2014) 158 final, Annex I.
Amendment 5 Proposal for a regulation Recital 2 a (new)
Text proposed by the Commission	Amendment
	(2 a) The Member States should uphold and cultivate the value of the rule of law and set an example by moving towards a shared culture of the rule of law, which is an essential condition for the legitimacy of the European project as a whole and the basic condition for building citizens' trust in the Union. Deterioration of the rule of law in one Member State negatively affects the rule of law in the Union as a whole.
Amendment 6 Proposal for a regulation Recital 2 b (new)
Text proposed by the Commission	Amendment
	(2 b) Fundamental rights in the Union are stipulated, in particular, in the Charter of Fundamental Rights of the European Union which in accordance with Article 6 TEU has the same legal value as Treaties and, consequently, is to be adhered to in all the Union’s legislation, including this Regulation. The obligation to respect, protect and promote fundamental rights is also set out in numerous international human rights treaties, including the European Convention for the Protection of Human Rights and Fundamental Freedoms and the European Social Charter, the Additional Protocol thereto and the revised version thereof.
Amendment 7 Proposal for a regulation Recital 3
Text proposed by the Commission	Amendment
(3) The rule of law is a prerequisite for the protection of the other fundamental values on which the Union is founded, such as freedom, democracy, equality and respect for human rights. Respect for the rule of law is intrinsically linked to respect for democracy and for fundamental rights: there can be no democracy and respect for fundamental rights without respect for the rule of law and vice versa.	deleted
Amendment 8 Proposal for a regulation Recital 4
Text proposed by the Commission	Amendment
(4) Whenever the Member States implement the Union’s budget, and whatever method of implementation they use, respect for the rule of law is an essential precondition to comply with the principles of sound financial management enshrined in Article 317 of the Treaty on the Functioning of the European Union.	(4) Whenever the Member States implement the Union’s budget, and whatever method of implementation they use, respect for the rule of law and fundamental rights is an essential precondition to comply with the principles of sound financial management enshrined in Article 317 of the Treaty on the Functioning of the European Union.
Amendment 9 Proposal for a regulation Recital 6
Text proposed by the Commission	Amendment
(6) Judicial bodies should act independently and impartially and investigation and prosecution services should be able to properly execute their function. They should be endowed with sufficient resources and procedures to act effectively and in full respect of the right to a fair trial. These conditions are required as a minimum guarantee against unlawful and arbitrary decisions by public authorities that could harm the financial interests of the Union.	(6) Independence and impartiality of the judiciary should always be guaranteed and investigation and prosecution services should be able to properly execute their function. They should be endowed with sufficient resources and procedures to act effectively and in full respect of the right to a fair trial. These conditions are required as a minimum guarantee against unlawful and arbitrary decisions by public authorities that could impair these fundamental principles.
Amendment 10 Proposal for a regulation Recital 8
Text proposed by the Commission	Amendment
(8) Respect for the rule of law is not only important for citizens of the Union, but also for business initiatives, innovation, investment and the proper functioning of the internal market, which will flourish most where a solid legal and institutional framework is in place.	(8) Respect for the rule of law and fundamental rights is essential for allowing citizens to fully participate in the democratic life of the Union. It is also important for entrepreneurship, business initiatives, innovation and investment and for the promotion of a rights-based and smooth-functioning internal market. The internal market needs a stable legal and institutional framework to ensure trust among all actors, to realise its full potential and to achieve sustainable long-term growth. In situations where a Member State no longer guarantees respect for the rule of law or fundamental rights, the Union and its Member States have a duty to protect the integrity and application of the Treaties and to protect the rights of everyone within their jurisdiction.
Amendment 11 Proposal for a regulation Recital 9
Text proposed by the Commission	Amendment
(9) Article 19 TEU, which gives concrete expression to the value of the rule of law stated in Article 2 TEU, requires the Member States to provide effective judicial protection in the fields covered by Union law, including those relating to the implementation of the Union’s budget. The very existence of effective judicial review designed to ensure compliance with Union law is the essence of the rule of law and requires independent courts¹³ . Maintaining the independence of the courts is essential, as confirmed by the second subparagraph of Article 47 of the Charter of Fundamental Rights of the European Union¹⁴ . This is true, in particular, for the judicial review of the validity of the measures, contracts or other instruments giving rise to public expenditure or debts, inter alia in the context of public procurement procedures which may also be brought before the courts.	(9) Article 19 TEU, which gives concrete expression to the value of the rule of law stated in Article 2 TEU, requires the Member States to provide effective judicial protection in the fields covered by Union law, including those relating to the implementation of the Union’s budget. The effectiveness of justice systems is a key aspect of the rule of law and is essential for ensuring equal treatment, sanctioning government abuses and preventing arbitrariness. The very existence of effective judicial review designed to ensure compliance with Union law is the essence of the rule of law and requires independent courts¹³ . Ensuring the right to an effective remedy and to a fair trial and maintaining the independence of the courts is essential, as confirmed by Article 47 of the Charter of Fundamental Rights of the European Union¹⁴ . This applies in particular to judicial review of the legality of measures, contracts or other instruments that result in public expenditure or debts, inter alia in the context of procurement procedures in respect of which the courts may also be seized.
__________________	__________________
¹³ Case C-64/16, para 32-36.	¹³ Case C-64/16, para 32-36.
¹⁴ Case C-64/16, para 40-41.	¹⁴ Case C-64/16, para 40-41.
Amendment 12 Proposal for a regulation Recital 10
Text proposed by the Commission	Amendment
(10) There is hence a clear relationship between respect for the rule of law and an efficient implementation of the Union budget in accordance with the principles of sound financial management.	(10) There is hence a clear relationship between respect for the rule of law and fundamental rights and an efficient implementation of the Union budget in accordance with the principles of sound financial management.
Amendment 13 Proposal for a regulation Recital 11
Text proposed by the Commission	Amendment
(11) Generalised deficiencies in the Member States as regards the rule of law which affect in particular the proper functioning of public authorities and effective judicial review, can seriously harm the financial interests of the Union.	(11) Generalised deficiencies in the Member States as regards the rule of law and fundamental rights can seriously harm the financial interests of the Union, in particular as regards irregularities related to the spending of the Union budget and the rights and interests of the citizens, regardless of where they live.
Amendment 14 Proposal for a regulation Recital 12
Text proposed by the Commission	Amendment
(12) The identification of a generalised deficiency requires a qualitative assessment by the Commission. That assessment could be based on the information from all available sources and recognized institutions, including judgments of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations and networks, such as the bodies of the Council of Europe and the European networks of supreme courts and councils for the judiciary.	(12) The identification of a generalised deficiency requires a qualitative, objective, transparent, non-politicised and impartial assessment, based on specific evidence, by the Commission, assisted by a representative panel of independent experts. The annual assessment of all Member States should be based on the information from all available sources and recognized institutions, including judgments of the Court of Justice of the European Union and the European Court of Human Rights, reports of the Court of Auditors, reports and opinions of other institutions, bodies, offices or agencies of the Union, such as the Economic and Social Committee, the Committee of the Regions, the Ombudsman and the European Union Agency for Fundamental Rights, conclusions and recommendations of relevant international organisations and networks, such as the bodies of the Council of Europe and the European networks of supreme courts and councils for the judiciary, as well as reporting from non-governmental and civil society organisations. This assessment should replace existing instruments and mechanisms such as the Cooperation and Verification Mechanism for Bulgaria and Romania.
Amendment 15 Proposal for a regulation Article 1 – paragraph 1
Text proposed by the Commission	Amendment
This Regulation establishes the rules necessary for the protection of the Union’s budget in the case of generalised deficiencies as regards the rule of law in the Member States.	This Regulation establishes the rules necessary for the protection of the Union’s budget in the case of generalised deficiencies as regards the rule of law and fundamental rights in the Member States.
Amendment 16 Proposal for a regulation Article 2 – paragraph 1 – point a
Text proposed by the Commission	Amendment
(a) 'the rule of law' refers to the Union value enshrined in Article 2 of the Treaty on European Union which includes the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting laws; legal certainty; prohibition of arbitrariness of the executive powers; effective judicial protection by independent courts, including of fundamental rights; separation of powers and equality before the law;	(a) 'the rule of law and fundamental rights' as enshrined in Article 2 of the Treaty on European Union include the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting law; legal certainty; prohibition of arbitrariness of the executive powers; access to justice and effective judicial protection before independent and impartial courts; separation of powers; non-discrimination and equality before the law; respect for fundamental rights as stipulated in the Charter of Fundamental Rights of the European Union and in international human rights treaties;
Amendment 17 Proposal for a regulation Article 2 – paragraph 1 – point b
Text proposed by the Commission	Amendment
(b) 'generalised deficiency as regards the rule of law' means a widespread or recurrent practice or omission, or measure by public authorities which affects the rule of law;	(b) 'generalised deficiency' means any situation where a systemic threat to the rule of law and fundamental rights may be established, or where the rule of law and fundamental rights are directly or indirectly undermined in a systemic way, either by the combined impact of practices, omissions, measures or inactions by public authorities or by widespread or recurrent practices, omissions, measures or inactions by public authorities, and where this situation affects or risks affecting the proper implementation of the Union’s budget, in particular the management and control activities, in accordance with the principles of sound financial management and the protection of the financial interests of the Union;
Amendment 18 Proposal for a regulation Article 3 – paragraph -1 (new)
Text proposed by the Commission	Amendment
	-1. Appropriate, balanced and proportionate measures shall be taken where the Commission finds that it has reasonable grounds to believe that the conditions of a generalised deficiency in a Member State are satisfied.
Amendment 19 Proposal for a regulation Article 3 – paragraph 1 – introductory part
Text proposed by the Commission	Amendment
1. Appropriate measures shall be taken where a generalised deficiency as regards the rule of law in a Member State affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union, in particular:	1. The measures shall be taken where a generalised deficiency in a Member State affects or risks affecting, in particular
Amendment 20 Proposal for a regulation Article 3 – paragraph 1 – point f a (new)
Text proposed by the Commission	Amendment
	(f a) the proper implementation of the Union budget following a systemic violation of fundamental rights.
Amendment 21 Proposal for a regulation Article 3 – paragraph 2 – introductory part
Text proposed by the Commission	Amendment
2. The following may, in particular, be considered generalised deficiencies as regards the rule of law,	2. The following shall, in particular, be considered generalised deficiencies:
Amendment 22 Proposal for a regulation Article 3 – paragraph 2 – point a
Text proposed by the Commission	Amendment
(a) endangering the independence of judiciary;	(a) endangering the independence of the judiciary, including by setting any limitations on the ability to exercise judicial functions autonomously by externally intervening in guarantees of independence, by constraining judgement under external order, by arbitrarily revising rules on the appointment or terms of service of judicial staff, or by influencing judicial staff in any way that jeopardises their impartiality;
Amendment 23 Proposal for a regulation Article 3 – paragraph 2 a (new)
Text proposed by the Commission	Amendment
	2 a. In identification of a generalised deficiency, the Commission is assisted by a representative panel of independent experts (the Rule of Law and Fundamental Rights Expert Panel), assessing the situation in all Member States annually on the basis of a quantitative and qualitative criteria and information, including decisions of the Court of Justice of the European Union and the European Court of Human Rights, reports of the Court of Auditors, reports and opinions of other institutions, bodies, offices or agencies of the Union, and conclusions and recommendations of relevant international organisations. The assessment shall be made public.
Amendment 24 Proposal for a regulation Article 3 – paragraph 2 b (new)
Text proposed by the Commission	Amendment
	2 b. The annual follow-up debate on the assessment by the Democracy, Rule of Law and Fundamental Rights Expert Panel shall be carried out by the European Parliament together with national parliaments. To this end, a specialised Joint Parliamentary Group shall be jointly established by the national parliaments and the competent committee of the European Parliament. The organisation and the rules of procedure of the Joint Parliamentary Group shall be determined jointly by the European Parliament and the national parliaments in line with Article 9 of Protocol No 1 on the role of national parliaments in the European Union, annexed to the TEU and the Treaty on the Functioning of the European Union.
Amendment 25 Proposal for a regulation Article 3 a (new)
Text proposed by the Commission	Amendment
	Article 3 a
	Democracy, Rule of Law and Fundamental Rights Expert Panel
	1. The Democracy, Rule of Law and Fundamental Rights Expert Panel shall be composed of the following members:
	(a) one independent expert designated by the parliament of each Member State, who shall be a qualified constitutional court or supreme court judge not currently in active service;
	(b) ten further experts designated by the European Parliament with a two-third majority, chosen from a list of experts nominated by:
	(i) the European Federation of Academies of Sciences and Humanities (ALLEA);
	(ii) the European Network of National Human Rights Institutions (ENNHRI);
	(iii) the Council of Europe (including the Venice Commission, the Group of States Against Corruption (GRECO) and the Council of Europe Commissioner for Human Rights);
	(iv) European Commission for the efficiency of justice (CEPEJ) and the Council of Bars and Law Societies of Europe (CCBE); and
	(v) the United Nations (UN), the Organization for Security and Co-operation in Europe (OSCE) and the Organisation for Economic Co-operation and Development (OECD).
	2. The composition of the Democracy, Rule of Law and Fundamental Rights Expert Panel shall ensure gender balance.
	3. The Democracy, Rule of Law and Fundamental Rights Expert Panel shall elect its chairperson from among its members.
	4. In order to facilitate the work of the Democracy, Rule of Law and Fundamental Rights Expert Panel, the Commission shall provide a secretariat to the Expert Panel, enabling it to function efficiently, in particular by gathering data and information sources to be reviewed and assessed, and by providing administrative support.

PROCEDURE – COMMITTEE ASKED FOR OPINION

Title	Protection of the Union’s budget in case of generalised deficiencies as regards the rule of law in the Member States
References	COM(2018)0324 – C8-0178/2018 – 2018/0136(COD)
Committees responsible Date announced in plenary	BUDG 11.6.2018	CONT 11.6.2018
Opinion by Date announced in plenary	LIBE 11.6.2018
Associated committees - date announced in plenary	5.7.2018
Rapporteur Date appointed	Josep-Maria Terricabras 9.7.2018
Rule 55 – Joint committee procedure Date announced in plenary	5.7.2018
Discussed in committee	8.11.2018	19.11.2018	3.12.2018
Date adopted	3.12.2018
Result of final vote	+: –: 0:	33 10 3
Members present for the final vote	Heinz K. Becker, Monika Beňová, Malin Björk, Michał Boni, Caterina Chinnici, Cornelia Ernst, Raymond Finch, Romeo Franz, Kinga Gál, Sylvie Guillaume, Monika Hohlmeier, Filiz Hyusmenova, Sophia in ‘t Veld, Dietmar Köster, Barbara Kudrycka, Cécile Kashetu Kyenge, Juan Fernando López Aguilar, Roberta Metsola, Claude Moraes, József Nagy, Ivari Padar, Judith Sargentini, Birgit Sippel, Branislav Škripek, Sergei Stanishev, Helga Stevens, Traian Ungureanu, Marie-Christine Vergiat, Udo Voigt, Josef Weidenholzer, Kristina Winberg, Auke Zijlstra
Substitutes present for the final vote	Carlos Coelho, Pál Csáky, Gérard Deprez, Anna Hedh, Lívia Járóka, Sylvia-Yvonne Kaufmann, Jeroen Lenaers, Emilian Pavel, Morten Helveg Petersen, Christine Revault d’Allonnes Bonnefoy, Barbara Spinelli, Josep-Maria Terricabras
Substitutes under Rule 200(2) present for the final vote	Max Andersson, France Jamet

FINAL VOTE BY ROLL CALL IN COMMITTEE ASKED FOR OPINION

33	+
ALDE	Gérard Deprez, Filiz Hyusmenova, Sophia in 't Veld, Morten Helveg Petersen
ECR	Helga Stevens
GUE/NGL	Malin Björk, Cornelia Ernst, Barbara Spinelli, Marie-Christine Vergiat
PPE	Heinz K. Becker, Michał Boni, Carlos Coelho, Monika Hohlmeier, Barbara Kudrycka, Jeroen Lenaers, Roberta Metsola
S&D	Monika Beňová, Caterina Chinnici, Sylvie Guillaume, Anna Hedh, Sylvia-Yvonne Kaufmann, Dietmar Köster, Cécile Kashetu Kyenge, Juan Fernando López Aguilar, Claude Moraes, Ivari Padar, Christine Revault d'Allonnes Bonnefoy, Birgit Sippel, Josef Weidenholzer
VERTS/ALE	Max Andersson, Romeo Franz, Judith Sargentini, Josep-Maria Terricabras

10	-
ECR	Branislav Škripek, Kristina Winberg
EFDD	Raymond Finch
ENF	France Jamet, Auke Zijlstra
NI	Udo Voigt
PPE	Pál Csáky, Kinga Gál, Lívia Járóka, Traian Ungureanu

3	0
PPE	József Nagy
S&D	Emilian Pavel, Sergei Stanishev

Key to symbols:

+ : in favour

- : against

0 : abstention

OPINION of the Committee on Regional Development (23.11.2018)

for the Committee on Budgets and the Committee on Budgetary Control

on the proposal for a regulation of the European Parliament and of the Council on the protection of the Union’s budget in case of generalised deficiencies as regards the rule of law in the Member States
(COM(2018)0324 – C8‑0178/2018 – 2018/0136(COD))

Rapporteur for opinion: Iskra Mihaylova

AMENDMENTS

The Committee on Regional Development calls on the Committee on Budgets and the Committee on Budgetary Control, as the committees responsible, to take into account the following amendments:

Amendment 1 Proposal for a regulation Recital 3
Text proposed by the Commission	Amendment
(3) The rule of law is a prerequisite for the protection of the other fundamental values on which the Union is founded, such as freedom, democracy, equality and respect for human rights. Respect for the rule of law is intrinsically linked to respect for democracy and for fundamental rights: there can be no democracy and respect for fundamental rights without respect for the rule of law and vice versa.	(3) The rule of law is a prerequisite for the protection of the other fundamental values on which the Union is founded, such as freedom, democracy, non-discrimination, equality and respect for human rights. Respect for the rule of law is intrinsically linked to respect for democracy and for fundamental rights: there can be no democracy and respect for fundamental rights without respect for the rule of law and vice versa. Democracy, rule of law and respect for fundamental human rights are key to the credibility of the Union.
Amendment 2 Proposal for a regulation Recital 3 a (new)
Text proposed by the Commission	Amendment
	(3a) On 25 October 2016, the European Parliament adopted a resolution with recommendations to the Commission on the establishment of an EU mechanism on democracy, the rule of law and fundamental rights. Furthermore, on 11-12 March 2016, the European Commission for democracy through law (the 'Venice Commission') adopted the Rule of Law Checklist (CDL-AD(2016)007).
Amendment 3 Proposal for a regulation Recital 11
Text proposed by the Commission	Amendment
(11) Generalised deficiencies in the Member States as regards the rule of law which affect in particular the proper functioning of public authorities and effective judicial review, can seriously harm the financial interests of the Union.	(11) Generalised deficiencies in the Member States as regards the rule of law which affect in particular the proper functioning of public authorities and effective judicial review, can seriously harm the financial interests of the Union. Efficient investigations into such deficiencies, and the application of effective and proportionate measures when a generalised deficiency is established, are needed not only to secure the financial interests of the Union, including the effective collection of revenue, but also to ensure public trust in the Union and its institutions. Only an independent judiciary that upholds the rule of law and legal certainty in all Member States can ultimately guarantee that money from the Union budget is sufficiently protected.
Amendment 4 Proposal for a regulation Recital 12
Text proposed by the Commission	Amendment
(12) The identification of a generalised deficiency requires a qualitative assessment by the Commission. That assessment could be based on the information from all available sources and recognized institutions, including judgments of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations and networks, such as the bodies of the Council of Europe and the European networks of supreme courts and councils for the judiciary.	(12) The identification of a generalised deficiency requires a transparent, impartial qualitative assessment by the Commission. That assessment could be based on the information from all available sources and recognized institutions, including judgments of the Court of Justice of the European Union, reports of the Court of Auditors, expert opinions of the relevant European Union Agencies, recommendations made by any independent panel of experts as referred to in the resolution of the European Parliament of 25 October 2016, and conclusions and recommendations of relevant international organisations and networks, such as the bodies of the Council of Europe and the European networks of supreme courts and councils for the judiciary.
Amendment 5 Proposal for a regulation Recital 13
Text proposed by the Commission	Amendment
(13) The possible measures to be adopted in the event of generalised deficiencies and the procedure to be followed to adopt them should be determined. Those measures should include the suspension of payments and of commitments, a reduction of funding under existing commitments, and a prohibition to conclude new commitments with recipients.	(13) The possible measures to be adopted in the event of generalised deficiencies and the procedure to be followed to adopt them should be determined and should apply the same criteria and ensure equal treatment among all Member States. Those measures should include the suspension of payments and of commitments, a reduction of funding under existing commitments, and a prohibition to conclude new commitments with recipients. Any decision to impose these measures should provide serious guarantees, based on impact assessments, to ensure that final beneficiaries of Union funds are not adversely affected.
Amendment 6 Proposal for a regulation Recital 14
Text proposed by the Commission	Amendment
(14) The principle of proportionality should apply when determining the measures to be adopted, in particular taking into account the seriousness of the situation, the time which has elapsed since the relevant conduct started, its duration and its recurrence, the intention, and the degree of cooperation of the Member State concerned in putting an end to the generalised deficiency as regards the rule of law, and the effects of that deficiency on the respective Union funds.	(14) The principle of proportionality should apply when determining the measures to be adopted, in particular taking into account the seriousness of the situation, the time which has elapsed since the relevant conduct started, its duration and its recurrence, the intention, and the degree of cooperation of the Member State concerned in putting an end to the generalised deficiency as regards the rule of law, and the effects of that deficiency on the respective Union funds. The scope and level of the suspension of commitments to be imposed should be proportionate, should respect the equality of treatment between Member States, and should take into account the economic and social circumstances of the Member State concerned and the impact of the suspension on the economy of the Member State concerned. The impact of suspensions on programmes of critical importance to address rule-of-law conditions should be a specific factor to be taken into account.
Amendment 7 Proposal for a regulation Recital 14 a (new)
Text proposed by the Commission	Amendment
	(14a) It is essential that the legitimate interests of final recipients and beneficiaries are properly safeguarded when measures are adopted in the event of generalised deficiencies. When considering the measures to be adopted, the Commission should take into account their potential impact on final recipients and beneficiaries. To strengthen the protection of the final recipients or beneficiaries, the Commission should actively monitor the respect of the legal obligation of government entities and Member States to continue making payments after adopting measures on basis of this regulation, and inform the final recipients or beneficiaries of their rights in case any infringements occur.
Amendment 8 Proposal for a regulation Recital 14 b (new)
Text proposed by the Commission	Amendment
	(14b) It is essential that individual recipients of scholarships through programmes such as Erasmus, research grants and similar individual grants should not be affected if measures are adopted concerning a Member State in the event of generalised deficiencies.
Amendment 9 Proposal for a regulation Recital 15
Text proposed by the Commission	Amendment
(15) In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the Council which should act on the basis of a Commission proposal. To facilitate the adoption of decisions which are required to protect the financial interests of the Union, reversed qualified majority voting should be used.	(15) In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the Council which should act on the basis of a Commission proposal. To facilitate the adoption of decisions which are required to protect the financial interests of the Union, unanimous voting should be used with the non-participation of the Member State concerned.
Amendment 10 Proposal for a regulation Recital 16
Text proposed by the Commission	Amendment
(16) Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned why it considers that a generalised deficiency regarding the rule of law might exist in that Member State. The Member State should be allowed to submit its observations. The Commission and the Council should take those observations into account.	(16) Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned of the outcome of its evaluations, either undertaken by an independent panel of experts or by the Commission and why it considers that a generalised deficiency regarding the rule of law might exist in that Member State. The Commission should inform the European Parliament and the Council of the notification and its contents. The Member State concerned should be allowed to submit its observations. The Commission should take those observations into account.
Amendment 11 Proposal for a regulation Recital 17
Text proposed by the Commission	Amendment
(17) The Council should lift measures with suspensive effect on a proposal from the Commission, if the situation leading to the imposition of those measures has been sufficiently remedied.	deleted
Amendment 12 Proposal for a regulation Recital 18
Text proposed by the Commission	Amendment
(18) The Commission should keep the European Parliament informed of any measures proposed and adopted pursuant to this Regulation,	(18) The Commission should keep the European Parliament and the Council informed of any measures proposed and adopted pursuant to this Regulation,
Amendment 13 Proposal for a regulation Article 2 – paragraph 1 – point b
Text proposed by the Commission	Amendment
(b) 'generalised deficiency as regards the rule of law' means a widespread or recurrent practice or omission, or measure by public authorities which affects the rule of law;	(b) 'generalised deficiency as regards the rule of law' means a widespread or recurrent practice or omission, or measure by public authorities which affects the rule of law as described in Article 3;
Amendment 14 Proposal for a regulation Article 3 – title
Text proposed by the Commission	Amendment
Measures	Generalised deficiency as regards the rule of law
Amendment 15 Proposal for a regulation Article 3 – paragraph 1 – introductory part
Text proposed by the Commission	Amendment
1. Appropriate measures shall be taken where a generalised deficiency as regards the rule of law in a Member State affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union, in particular:	1. Generalised deficiencies as regards the rule of law in a Member State that affects or risks affecting the principles of sound financial management or the protection of the financial interests of the Union are, in particular:
Amendment 16 Proposal for a regulation Article 3 – paragraph 1 – point f a (new)
Text proposed by the Commission	Amendment
	(fa) the freedom of opinion and expression including the freedom of the press, freedom of association and academic freedom;
Amendment 17 Proposal for a regulation Article 3 – paragraph 1 – point f b (new)
Text proposed by the Commission	Amendment
	(fb) the fiscal discipline of that Member State, in particular the avoidance of excessive government deficit in line with Article 126 TFEU.
Amendment 18 Proposal for a regulation Article 3 – paragraph 2 – point c
Text proposed by the Commission	Amendment
(c) limiting the availability and effectiveness of legal remedies, including through restrictive procedural rules, lack of implementation of judgments, or limiting the effective investigation, prosecution or sanctioning of breaches of law.	(c) limiting the availability and effectiveness of legal remedies, including through restrictive procedural rules, lack of implementation of judgments with a particular focus on decisions of the Court of Justice of the European Union deriving from infringement procedures, or limiting the effective investigation, prosecution or sanctioning of breaches of law.
Amendment 19 Proposal for a regulation Article 3 – paragraph 2 – point c a (new)
Text proposed by the Commission	Amendment
	(ca) disproportionately restricting the freedom of the press, freedom of association and academic freedom;
Amendment 20 Proposal for a regulation Article 3 – paragraph 2 – point c b (new)
Text proposed by the Commission	Amendment
	(cb) failing that to ensure that the government is accountable under the law, as are private actors;
Amendment 21 Proposal for a regulation Article 3 – paragraph 2 – point c c (new)
Text proposed by the Commission	Amendment
	(cc) failing to ensure that laws are publicised and just, and protect fundamental rights, including the security of persons and property and certain core human rights;
Amendment 22 Proposal for a regulation Article 3 – paragraph 2 – point c d (new)
Text proposed by the Commission	Amendment
	(cd) failing to ensure that the processes by which the laws are enacted, administered, and enforced are accessible, fair, and efficient;
Amendment 23 Proposal for a regulation Article 3 – paragraph 2 – point c e (new)
Text proposed by the Commission	Amendment
	(ce) failing to ensure that justice is delivered timely by competent, ethical, and independent representatives and neutral parties who are accessible, have adequate resources, and reflect the make-up of the communities they serve;
Amendment 24 Proposal for a regulation Article 3 – paragraph 2 – point c f (new)
Text proposed by the Commission	Amendment
	(cf) failing to ensure that government powers are subject to non-governmental checks, and that government officials are sanctioned for misconduct.
Amendment 25 Proposal for a regulation Article 4 – title
Text proposed by the Commission	Amendment
Content of measures	Measures
Amendment 26 Proposal for a regulation Article 4 – paragraph 1 – introductory part
Text proposed by the Commission	Amendment
1. One or more of the following appropriate measures may be adopted	1. The following appropriate measures may be adopted in the case of a generalised deficiency as regards the rule of law:
Amendment 27 Proposal for a regulation Article 4 – paragraph 1 – point b – introductory part
Text proposed by the Commission	Amendment
(b) where the Commission implements the Union’s budget in shared management pursuant to [point (b) of Article 62] of the Financial Regulation:	(b) where the Commission implements the Union’s budget in shared management pursuant to [point (b) of Article 62] of the Financial Regulation, in the case of a generalised deficiency as regards the rule of law, save where point ba applies:
Amendment 28 Proposal for a regulation Article 4 – paragraph 1 – point b – point 4
Text proposed by the Commission	Amendment
(4) a reduction of pre-financing;	deleted
Amendment 29 Proposal for a regulation Article 4 – paragraph 1 – point b – point 5
Text proposed by the Commission	Amendment
(5) an interruption of payment deadlines;	deleted
Amendment 30 Proposal for a regulation Article 4 – paragraph 1 – point b – point 6
Text proposed by the Commission	Amendment
(6) a suspension of payments.	deleted
Amendment 31 Proposal for a regulation Article 4 – paragraph 1 – point b a (new)
Text proposed by the Commission	Amendment
	(ba) as far as ESI Funds are concerned, where the Commission implements the Union’s budget in shared management pursuant to [point (b) of Article 62] of the Financial Regulation, the measures defined in the Common Provisions Regulation should apply in the case of a generalised deficiency as regards the rule of law.
Amendment 32 Proposal for a regulation Article 4 – paragraph 2
Text proposed by the Commission	Amendment
2. Unless the decision adopting the measures provides otherwise, the imposition of appropriate measures shall not affect the obligation of government entities referred to in point (a) of paragraph 1 or of Member States referred to in point (b) of paragraph 1 to implement the programme or fund affected by the measure, and in particular the obligation to make payments to final recipients or beneficiaries.	2. The imposition of appropriate measures shall not affect the obligation of government entities referred to in point (a) of paragraph 1 or of Member States referred to in point (b) of paragraph 1 to implement the programme or fund affected by the measure, and in particular the obligation to make payments to final recipients or beneficiaries. Any decision to impose appropriate measures should provide serious guarantees, based on impact assessments, to ensure that final beneficiaries of EU funds are not adversely affected.
Amendment 33 Proposal for a regulation Article 4 – paragraph 3 a (new)
Text proposed by the Commission	Amendment
	3a. The scope and level of the suspension of commitments to be imposed shall be proportionate, shall respect the equality of treatment between Member States and shall take into account the economic and social circumstances of the Member State concerned and the impact of the suspension on the economy of the Member State concerned. The impact of suspensions on programmes of critical importance to address rule-of-law conditions shall be a specific factor to be taken into account.
Amendment 34 Proposal for a regulation Article 5 – paragraph 1
Text proposed by the Commission	Amendment
1. Where the Commission finds that it has reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding	1. Where the Commission finds that it has clear and reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding. The Commission shall promptly inform the Parliament and the Council of the notification and its contents.
Amendment 35 Proposal for a regulation Article 5 – paragraph 1 a (new)
Text proposed by the Commission	Amendment
	1a. The Commission shall provide necessary guarantees to ensure that the same criteria are applied to all Member States, in line with the principles of equal treatment and non-discrimination, in assessing the rule-of-law situation, by adopting similar and non-discriminatory measures in comparable cases for all Member States.
Amendment 36 Proposal for a regulation Article 5 – paragraph 2
Text proposed by the Commission	Amendment
2. The Commission may take into account all relevant information, including decisions of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations.	2. When assessing whether the conditions of Article 3 are fulfilled, the Commission may take into account all relevant information, including decisions of the Court of Justice of the European Union, resolutions of the European Parliament, recommandations made by any independent panel of experts as referred to in the resolution of the European Parliament of 25 October 2016, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations, non-governmental organisations and networks, such as the bodies of the Council of Europe and the European networks of supreme courts and councils for the judiciary and expert opinions of the relevant European Union Agencies.
Amendment 37 Proposal for a regulation Article 5 – paragraph 6
Text proposed by the Commission	Amendment
6. Where the Commission considers that the generalised deficiency as regards the rule of law is established, it shall submit a proposal for an implementing act on the appropriate measures to the Council.	6. Where the Commission considers that the generalised deficiency as regards the rule of law as defined in Article 3(2) is established, it shall submit a proposal for an implementing act on the appropriate measures to the European Parliament for opinion and to the Council for decision.
	After taking into account the European Parliament’s opinion, the decision shall be deemed to have been adopted by the Council, unless it decides, by qualified majority, to reject the Commission proposal within one month of its adoption by the Commission.
	The Council, acting by a qualified majority, may amend the Commission’s proposal and adopt the amended text as a Council decision.
Amendment 38 Proposal for a regulation Article 5 – paragraph 7
Text proposed by the Commission	Amendment
7. The decision shall be deemed to have been adopted by the Council, unless it decides, by qualified majority, to reject the Commission proposal within one month of its adoption by the Commission.	7. Where the Commission considers that the generalised deficiency as regards the rule of law as defined in Article 3(1) is established, it shall submit a proposal for a decision on the appropriate measures to the European Parliament and to the Council for opinion. Taking into account the European Parliament and Council opinions, the Commission shall take a decision on the appropriate measures, or a decision not to enforce the rule-of-law conditionality.
Amendment 39 Proposal for a regulation Article 5 – paragraph 7 a (new)
Text proposed by the Commission	Amendment
	7a. Before adopting a decision on the appropriate measures, the Commission shall carry out an assessment of the potential impact of those measures on final recipients or beneficiaries of the payments related to the affected programmes or funds. The Commission shall take into due account the information and guidance referred to in paragraph 2 when assessing the proportionality of the measures.
Amendment 40 Proposal for a regulation Article 5 – paragraph 8
Text proposed by the Commission	Amendment
8. The Council, acting by a qualified majority, may amend the Commission’s proposal and adopt the amended text as a Council decision.	8. The Council, acting by unanimity with the non-participation of the Member State concerned, may amend the Commission’s proposal and adopt the amended text as a Council decision.
Amendment 41 Proposal for a regulation Article 5 – paragraph 8 a (new)
Text proposed by the Commission	Amendment
	8a. When a decision is adopted, the Commission shall simultaneously submit to the European Parliament and the Council a proposal to transfer to a budgetary reserve an amount equivalent to the value of the measures adopted.
Amendment 42 Proposal for a regulation Article 5 – paragraph 8 b (new)
Text proposed by the Commission	Amendment
	8b. By way of derogation from paragraphs 4 and 6 of Article 31 of the Financial Regulation, the European Parliament and the Council shall deliberate upon the transfer proposal within four weeks of its receipt by both institutions. The transfer proposal shall be considered to be approved unless, within the four-week period, the European Parliament, acting by majority of the votes cast, or the Council, acting by qualified majority, amend or reject it. If the European Parliament or the Council amend the transfer proposal, paragraph 8 of Article 31 of the Financial Regulation shall apply.
Amendment 43 Proposal for a regulation Article 5 – paragraph 8 c (new)
Text proposed by the Commission	Amendment
	8c. The decision shall enter into force if neither the European Parliament nor the Council reject the transfer proposal within the period referred to in paragraph 8b.
Amendment 44 Proposal for a regulation Article 5 – paragraph 8 d (new)
Text proposed by the Commission	Amendment
	8d. Throughout the period of application of the measures, the Commission shall actively monitor whether the legal entitlements of final recipients or beneficiaries are being respected. The Commission shall also facilitate the submission to it of complaints from final recipients or beneficiaries where they consider their legal entitlements are not being respected. Where the Commission finds that the Member State or the government entity concerned fails to fulfil its legal obligation to make payments, and the legitimate interests of final recipients or beneficiaries are not being respected, it shall take any appropriate measures to assist those final recipients or beneficiaries in enforcing their claims.
Amendment 45 Proposal for a regulation Article 6 – paragraph 3
Text proposed by the Commission	Amendment
3. Where measures concerning the suspension of the approval of one or more programmes or amendments thereof referred to in point (i) of Article 4(2)(b) or the suspension of commitments referred to in point (ii) of Article 4(2)(b) are lifted, amounts corresponding to the suspended commitments shall be entered in the budget subject to Article 7 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation). Suspended commitments of year n may not be entered in the budget beyond year n+2.	3. Where measures concerning the suspension of the approval of one or more programmes or amendments thereof referred to in point (1) of Article 4(1)(b) or the suspension of commitments referred to in point (2) of Article 4(1)(b) are lifted, amounts corresponding to the suspended commitments shall be entered in the budget subject to Article 7 of Council Regulation (EU, Euratom) No XXXX (MFF Regulation).
Amendment 46 Proposal for a regulation Article 7 – paragraph 1
Text proposed by the Commission	Amendment
The Commission shall immediately inform the European Parliament of any measures proposed or adopted pursuant to Articles 4 and 5	The Commission shall immediately inform the European Parliament and the Council of any measures proposed or adopted pursuant to Articles 4 and 5.

PROCEDURE – COMMITTEE ASKED FOR OPINION

Title	Protection of the Union’s budget in case of generalised deficiencies as regards the rule of law in the Member States
References	COM(2018)0324 – C8-0178/2018 – 2018/0136(COD)
Committees responsible Date announced in plenary	BUDG 11.6.2018	CONT 11.6.2018
Opinion by Date announced in plenary	REGI 11.6.2018
Rapporteur Date appointed	Iskra Mihaylova 22.9.2018
Previous rapporteur	Matthijs van Miltenburg
Rule 55 – Joint committee procedure Date announced in plenary	5.7.2018
Discussed in committee	9.10.2018
Date adopted	22.11.2018
Result of final vote	+: –: 0:	17 6 4
Members present for the final vote	Pascal Arimont, Franc Bogovič, Victor Boştinaru, John Flack, Krzysztof Hetman, Marc Joulaud, Constanze Krehl, Iskra Mihaylova, Andrey Novakov, Mirosław Piotrowski, Stanislav Polčák, Fernando Ruas, Monika Smolková, Maria Spyraki, Ruža Tomašić, Monika Vana, Matthijs van Miltenburg, Lambert van Nistelrooij, Kerstin Westphal, Joachim Zeller
Substitutes present for the final vote	Martina Anderson, Petras Auštrevičius, John Howarth, Ivana Maletić, Dimitrios Papadimoulis, Bronis Ropė, Milan Zver

FINAL VOTE BY ROLL CALL IN COMMITTEE ASKED FOR OPINION

17	+
PPE	Pascal Arimont, Franc Bogovič, Krzysztof Hetman, Marc Joulaud, Ivana Maletić, Lambert van Nistelrooij, Andrey Novakov, Stanislav Polčák, Fernando Ruas, Maria Spyraki, Joachim Zeller, Milan Zver
S&D	Victor Boştinaru, John Howarth, Constanze Krehl, Monika Smolková, Kerstin Westphal

6	-
ALDE	Petras Auštrevičius, Iskra Mihaylova, Matthijs van Miltenburg
ECR	John Flack, Mirosław Piotrowski, Ruža Tomašić

4	0
GUE/NGL	Martina Anderson, Dimitrios Papadimoulis
VERTS/ALE	Bronis Ropė, Monika Vana

Key to symbols:

+ : in favour

- : against

0 : abstention

OPINION of the Committee on Constitutional Affairs (22.11.2018)

for the Committee on Budgets and the Committee on Budgetary Control

Rapporteur for opinion: Helmut Scholz

SHORT JUSTIFICATION

Your rapporteur welcomes the aim of the proposed regulation to protect the Union budget against generalised deficiencies as regards the rule of law in a Member State, which affect or risk affecting the sound financial management or the protection of the financial interests of the Union. He shares the Commission’s view that there is a clear relationship between respect for the rule of law and an efficient implementation of the Union budget in accordance with the principles of sound financial management. He also acknowledges that the independence and impartiality of the judiciary are essential to ensure the respect of the rule of law. At the same time, he considers that the proposed mechanism confers too much discretionary power on the Commission. In particular, the criteria for launching the procedure and for the qualitative assessment are not clearly defined, nor are the criteria for the choice and extent of measures, and the Commission would ultimately be free to decide whether to apply a measure, which measure should be applied and whether such measure could be lifted later on. This is all the more possible since the Commission’s proposal would be deemed to have been approved unless the Council, acting by qualified majority within one month, rejects it (‘reversed qualified majority voting’). What is more, the proposed mechanism seems to be devoid of legal basis (Article 322 TFEU, on which the proposal is based, would not suffice). It also seems to be disproportionate, especially compared to Article 7 TEU, which may cover similar cases of deficiencies as regards the rule of law and which requires, depending on the circumstances, a four-fifth majority of the Council and unanimity of the European Council. Your rapporteur therefore suggests a different mechanism. Your rapporteur is also critical of the fact that no specific stakeholder consultation and no impact assessment were conducted in preparation of the proposed regulation. In particular, the proposal foresees that in direct and indirect management pursuant to Article 62(a) and (c) of the Financial Regulation, measures can only be applied where a government entity is the recipient. If this condition is not met, the Union funding in question cannot be the subject of any of the measures referred to in the proposed regulation. Without an impact assessment clarifying how much of the Union budget would remain outside the protection of the proposed mechanism, it is difficult to establish its potential benefits. Your rapporteur also wonders why the proposal does not establish any obligation for the Commission to assess the possibility to lift measures on its own initiative and to report on the application of the proposed regulation. In light of the foregoing, your rapporteur suggests that the proposal be amended as shown hereinafter.

AMENDMENTS

The Committee on Constitutional Affairs calls on the Committee on Budgets and the Committee on Budgetary Control, as the committees responsible, to take into account the following amendments:

Amendment 1 Proposal for a regulation Recital 1
Text proposed by the Commission	Amendment
(1) The rule of law is one of the essential values upon which the Union is founded. As recalled by Article 2 of the Treaty on European Union, these values are common to the Member States.	(1) The Union is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities. In accordance with Articles 2 and 7 of the Treaty on European Union (TEU), the Member States and the institutions of the Union are obliged to respect, protect and promote these values, common to all the Member States, in a society in which pluralism, non-discrimination, tolerance, justice, solidarity and equality between women and men prevail. Among those values, Article 2 TEU does not foresee any hierarchy.
Justification
This amendment seeks to align the recital with the actual wording of Article 2 TEU.
Amendment 2 Proposal for a regulation Recital 1 a (new)
Text proposed by the Commission	Amendment
	(1a) Member States shall duly and sincerely cooperate to take on the obligations of Union membership as recalled in the Treaty on the European Union.
Amendment 3 Proposal for a regulation Recital 2
Text proposed by the Commission	Amendment
(2) The rule of law requires that all public powers act within the constraints set out by law, in accordance with the values of democracy and fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality⁷, legal certainty⁸, prohibition of arbitrariness of the executive powers⁹, separation of powers¹⁰, and effective judicial protection by independent courts¹¹ are respected¹².	(2) The rule of law requires that all public powers act within the constraints set out by law, in accordance with the values of democracy and fundamental rights, and under the control of independent and impartial courts. It requires, in particular, that the principles of legality⁷, legal certainty⁸, prohibition of arbitrariness of the executive powers⁹, separation of powers¹⁰, and effective judicial protection by independent courts¹¹ are respected¹².
_____________________________	_____________________________
⁷ Judgment of the Court of Justice of 29 April 2004, CAS Succhi di Frutta, C-496/99 PECLI:EU:C:2004:236, paragraph 63.	⁷ Judgment of the Court of Justice of 29 April 2004, CAS Succhi di Frutta, C-496/99 PECLI:EU:C:2004:236, paragraph 63.
⁸ Judgment of the Court of Justice of 12 November 1981, Amministrazione delle finanze dello Stato v Srl Meridionale Industria Salumi and others Ditta Italo Orlandi & Figlio and Ditta Vincenzo Divella v Amministrazione delle finanze dello Stato. Joined cases 212 to 217/80, ECLI:EU:C:1981:270, paragraph 10.	⁸ Judgment of the Court of Justice of 12 November 1981, Amministrazione delle finanze dello Stato v Srl Meridionale Industria Salumi and others Ditta Italo Orlandi & Figlio and Ditta Vincenzo Divella v Amministrazione delle finanze dello Stato. Joined cases 212 to 217/80, ECLI:EU:C:1981:270, paragraph 10.
⁹ Judgment of the Court of Justice of 21 September 1989, Hoechst, Joined cases 46/87 and 227/88, ECLI:EU:C:1989:337, paragraph 19.	⁹ Judgment of the Court of Justice of 21 September 1989, Hoechst, Joined cases 46/87 and 227/88, ECLI:EU:C:1989:337, paragraph 19.
¹⁰ Judgment of the Court of Justice of 10 November 2016, Kovalkovas, C‑477/16, ECLI:EU:C:2016:861, paragraph 36; Judgment of the Court of Justice of 10 November 2016, PPU Poltorak, C‑452/16, ECLI:EU:C:2016:858, paragraph 35; and Judgment of the Court of Justice of 22 December 2010, DEB,C-279/09, ECLI:EU:C:2010:811, paragraph 58.	¹⁰ Judgment of the Court of Justice of 10 November 2016, Kovalkovas, C‑477/16, ECLI:EU:C:2016:861, paragraph 36; Judgment of the Court of Justice of 10 November 2016, PPU Poltorak, C‑452/16, ECLI:EU:C:2016:858, paragraph 35; and Judgment of the Court of Justice of 22 December 2010, DEB,C-279/09, ECLI:EU:C:2010:811, paragraph 58.
¹¹ Judgment of the Court of Justice of 27 February 2018, Associação Sindical dos Juízes Portugueses v Tribunal de Contas C‑64/16, ECLI:EU:C:2018:117, paragraphs 31, 40-41.	¹¹ Judgment of the Court of Justice of 27 February 2018, Associação Sindical dos Juízes Portugueses v Tribunal de Contas C‑64/16, ECLI:EU:C:2018:117, paragraphs 31, 40-41; judgment of the Court of Justice of 25 July 2018, LM, C-216/18 PPU, ECLI:EU:C:2018:586, paragraphs 63-67.
¹² Communication from the Commission "A new EU Framework to strengthen the Rule of Law", COM(2014) 158 final, Annex I.	¹² Communication from the Commission "A new EU Framework to strengthen the Rule of Law", COM(2014) 158 final, Annex I.
Justification
The amendment seeks to align the recital with the most recent case law of the Court of Justice.
Amendment 4 Proposal for a regulation Recital 7
Text proposed by the Commission	Amendment
(7) The independence of the judiciary presupposes, in particular, that the body concerned is able to exercise its judicial functions wholly autonomously, without being subject to any hierarchical constraint or subordinated to any other body, and without taking orders or instructions from any source whatsoever, and that it is thus protected against external interventions or pressure liable to impair the independent judgment of its members and to influence their decisions. The guarantees of independence and impartiality require rules, particularly as regards the composition of the body and the appointment, length of service and the grounds for rejection and dismissal of its members, in order to dismiss any reasonable doubt in the minds of individuals as to the imperviousness of that body to external factors and its neutrality with respect to the interests before it.	(7) The independence of the judiciary presupposes, in particular, that the body concerned is able to exercise its judicial functions wholly autonomously, without being subject to any hierarchical constraint or subordinated to any other body, and without taking orders or instructions from any source whatsoever, and that it is thus protected against external interventions or pressure liable to impair the independent judgment of its members and to influence their decisions. The independence of the judiciary also presupposes that an equal distance is maintained from the parties to the proceedings and their respective interests with regard to the subject matter of those proceedings. That aspect requires objectivity and the absence of any interest in the outcome of the proceedings apart from the strict application of the rule of law. The guarantees of independence and impartiality require rules, particularly as regards the composition of the body and the appointment, length of service and the grounds for abstention, rejection and dismissal of its members, in order to dismiss any reasonable doubt in the minds of individuals as to the imperviousness of that body to external factors and its neutrality with respect to the interests before it.
(See amendment to Recital 7a new of the proposal)
Justification
The amendment seeks to align the recital with the most recent case law of the Court of Justice (see notably Case C-216/18, paragraphs 63-67).
Amendment 5 Proposal for a regulation Recital 7 a (new)
Text proposed by the Commission	Amendment
	(7a) The requirement of an independent judiciary also means that the disciplinary regime governing those who have the task of adjudicating in a dispute must display the necessary guarantees in order to prevent any risk of it being used as a system of political control of the content of judicial decisions. Rules which define, in particular, both conduct amounting to disciplinary offences and the penalties actually applicable, which provide for the involvement of an independent body in accordance with a procedure which fully safeguards the rights enshrined in Articles 47 and 48 of the Charter, in particular the rights of the defence, and which lay down the possibility of bringing legal proceedings challenging the disciplinary bodies’ decisions constitute a set of guarantees that are essential for safeguarding the independence of the judiciary.
(See amendment to Recital 7 of the proposal)
Justification
The amendment seeks to align the recital to the most recent case law of the Court of Justice (see notably Case C-216/18, paragraphs 63-67).
Amendment 6 Proposal for a regulation Recital 11 a (new)
Text proposed by the Commission	Amendment
	(11 a) The Commission should be able continuously to monitor the state of the rule of law in the Member States and an EU mechanism on democracy; the rule of law and fundamental rights could be set up as requested by the European Parliament in its resolution of 25 October 2016^1a.
	_________
	^1aEuropean Parliament resolution of 25 October 2016 with recommendations to the Commission on the establishment of an EU mechanism on democracy, the rule of law and fundamental rights (2015/2254(INL)), OJ C 215,19.6.2018, p. 162–177
Amendment 7 Proposal for a regulation Recital 12
Text proposed by the Commission	Amendment
(12) The identification of a generalised deficiency requires a qualitative assessment by the Commission. That assessment could be based on the information from all available sources and recognized institutions, including judgments of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations and networks, such as the bodies of the Council of Europe and the European networks of supreme courts and councils for the judiciary.	(12) The identification of a generalised deficiency requires an impartial, transparent and qualitative assessment by the Commission. That assessment should be based on the information from all available sources and recognized institutions, including conditions and timing of the Member State’s adoption, implementation and enforcement of the relevant chapters of the acquis, judgments of the Court of Justice of the European Union, reports of the Court of Auditors, resolutions of the European Parliament and conclusions and recommendations of relevant international organisations and networks, such as the bodies of the Council of Europe and the European networks of supreme courts and councils for the judiciary.
(See amendments to Article 5(2) of the proposal)
Amendment 8 Proposal for a regulation Recital 14 a (new)
Text proposed by the Commission	Amendment
	(14 a) It is essential that the legitimate interests of the final recipients and beneficiaries of the programme or fund targeted by measures in the event of generalised deficiencies as regards the rule of law in the Member States are fully safeguarded and should not be affected by the breaches of rules for which they are not responsible. The Commission should take into account the potential impact on final recipients and beneficiaries when proposing such measures and should actively monitor the respect of the legal obligation of the Member States to continue making payments after the adoption of measures by the Commission in accordance with this Regulation. In case of any infringement by a Member State, the Commission should inform the final recipients or beneficiaries of their rights.
Amendment 9 Proposal for a regulation Recital 14 b (new)
Text proposed by the Commission	Amendment
	(14 b) Before proposing concrete measures, the Commission should be required to assess the possible budgetary implications of such measures for the national budget of the Member State concerned with due regard to the principles of proportionality and non-discrimination.
Amendment 10 Proposal for a regulation Recital 15
Text proposed by the Commission	Amendment
(15) In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the Council which should act on the basis of a Commission proposal. To facilitate the adoption of decisions which are required to protect the financial interests of the Union, reversed qualified majority voting should be used.	(15) In order to ensure uniform implementation of this Regulation and in view of the importance of the financial effects of measures being imposed pursuant to this Regulation, implementing powers should be conferred on the Commission.
Amendment 11 Proposal for a regulation Recital 15 a (new)
Text proposed by the Commission	Amendment
	(15a) In view of their effect on the Union's budget, measures imposed pursuant to this Regulation should only enter into force after the European Parliament and the Council have approved a transfer to a budgetary reserve of an amount equivalent to the value of the measures adopted. In order to ensure a swift decision on the measures required to protect the financial interests of the Union, such transfers should be considered to be approved unless, within a set period, the European Parliament or the Council, the latter acting by qualified majority, amend or reject it.
Amendment 12 Proposal for a regulation Recital 16
Text proposed by the Commission	Amendment
(16) Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned why it considers that a generalised deficiency regarding the rule of law might exist in that Member State. The Member State should be allowed to submit its observations. The Commission and the Council should take those observations into account.	(16) Before proposing the adoption of any measure pursuant to this Regulation, the Commission should inform the Member State concerned why it considers that a generalised deficiency regarding the rule of law might exist in that Member State. The Commission should immediately inform the European Parliament and the Council about the notification and its content. The Member State concerned should be allowed to submit its observations. The Commission should take those observations into account.
Amendment 13 Proposal for a regulation Recital 17
Text proposed by the Commission	Amendment
(17) The Council should lift measures with suspensive effect on a proposal from the Commission, if the situation leading to the imposition of those measures has been sufficiently remedied.	(17) The Commission should lift measures with suspensive effect and send a proposal to the European Parliament and the Council to lift in full or in part the budgetary reserve of the measures in question, if the situation leading to the imposition of those measures has been sufficiently remedied.
Amendment 14 Proposal for a regulation Recital 18
Text proposed by the Commission	Amendment
(18) The Commission should keep the European Parliament informed of any measures proposed and adopted pursuant to this Regulation,	deleted
Amendment 15 Proposal for a regulation Article 2 – paragraph 1 – point a
Text proposed by the Commission	Amendment
(a) 'the rule of law' refers to the Union value enshrined in Article 2 of the Treaty on European Union which includes the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting laws; legal certainty; prohibition of arbitrariness of the executive powers; effective judicial protection by independent courts, including of fundamental rights; separation of powers and equality before the law;	(a) 'the rule of law' shall be understood having regard to the Union values enshrined in Article 2 of the Treaty on European Union and in the criteria for Union membership as recalled by Article 49 of the Treaty; it includes the principles of legality, implying a transparent, accountable, democratic and pluralistic process for enacting laws; legal certainty; prohibition of arbitrariness of the executive powers; effective judicial protection by independent and impartial courts, including of fundamental rights; separation of powers and equality before the law;
Amendment 16 Proposal for a regulation Article 2 a (new)
Text proposed by the Commission	Amendment
	Article 2 a
	Monitoring
	The Commission shall continuously monitor and assess the correct implementation of the Union law and the respect for the rule of law.
Amendment 17 Proposal for a regulation Article 3 – title
Text proposed by the Commission	Amendment
Measures	Conditions for the protection of the Union’s budget
(See amendments to Articles 3, 4 and 5 of the proposal)
Justification
The title of this article should be aligned with its actual content.
Amendment 18 Proposal for a regulation Article 3 – paragraph 1 – point f
Text proposed by the Commission	Amendment
(f) the effective and timely cooperation with the European Anti-fraud Office and with the European Public Prosecutor’s Office in their investigations or prosecutions pursuant to their respective legal acts and to the principle of loyal cooperation.	(f) the effective and timely cooperation with the European Anti-fraud Office and, subject to the participation of the Member State concerned, with the European Public Prosecutor’s Office in their investigations or prosecutions pursuant to their respective legal acts and to the principle of loyal cooperation.
Justification
Not all Member States are part of the European Public Prosecutor’s Office cooperation.
Amendment 19 Proposal for a regulation Article 3 – paragraph 2 – point c a (new)
Text proposed by the Commission	Amendment
	(c a) endangering the ability of a Member State to respect the obligations of Union membership, including the capacity effectively to implement the rules, standards and policies that constitute the body of Union law;
Amendment 20 Proposal for a regulation Article 4 – title
Text proposed by the Commission	Amendment
Content of measures	Measures for the protection of the Union’s budget
(See amendments to Articles 3, 4 and 5 of the proposal)
Justification
The title of this article should be aligned with its actual content.
Amendment 21 Proposal for a regulation Article 4 – paragraph 1 – introductory part
Text proposed by the Commission	Amendment
1. One or more of the following appropriate measures may be adopted	1. Where the conditions of Article 3 are fulfilled, one or more of the following measures may be adopted
(See amendments to Articles 3 and 5 of the proposal)
Justification
A more precise wording is suggested.
Amendment 22 Proposal for a regulation Article 4 – paragraph 1 – point a – point 2 a (new)
Text proposed by the Commission	Amendment
	(2 a) where applicable, a suspension of indirect management and implementation in direct management in its stead;
Justification
This amendment proposes an additional measure to protect the Union’s budget.
Amendment 23 Proposal for a regulation Article 4 – paragraph 2
Text proposed by the Commission	Amendment
2. Unless the decision adopting the measures provides otherwise, the imposition of appropriate measures shall not affect the obligation of government entities referred to in point (a) of paragraph 1 or of Member States referred to in point (b) of paragraph 1 to implement the programme or fund affected by the measure, and in particular the obligation to make payments to final recipients or beneficiaries.	2. The imposition of the measures referred to in paragraph 1 shall not affect the obligation of government entities referred to in point (a) of paragraph 1 or of Member States referred to in point (b) of paragraph 1 to implement the programme or fund affected by the measure, and in particular the obligation to make payments to final recipients or beneficiaries. The Commission shall actively monitor whether the legal entitlements of final recipients or beneficiaries are respected. If the Commission finds evidence that the Member State is not fulfilling its obligation to secure the payments and legitimate interests of final recipients or beneficiaries, it shall take all appropriate measures to assist those recipients or beneficiaries in enforcing their claims. Article 68, paragraph 1, point b of Regulation (EU, Euratom) No XXXX (Common Provisions Regulation) shall not apply.
(See amendments to Articles 3 and 5 of the proposal)
Justification
In its resolution of 14 March 2018 on the next MFF, Parliament considered that “final beneficiaries of the Union budget can in no way be affected by breaches of rules for which they are not responsible” (see paragraph 119). Article 68(1)(b) of the proposed Common Provisions Regulation (COM(2018 375) – which makes the obligation of the national authority to ensure payment to the beneficiary subject to the availability of funding – should therefore not apply to the case in point.
Amendment 24 Proposal for a regulation Article 4 – paragraph 3
Text proposed by the Commission	Amendment
3. The measures taken shall be proportionate to the nature, gravity and scope of the generalised deficiency as regards the rule of law. They shall, insofar as possible, target the Union actions affected or potentially affected by that deficiency.	3. The measures taken shall be proportionate to the nature, gravity, duration and scope of the generalised deficiency as regards the rule of law. They shall, insofar as possible, target the Union actions affected or potentially affected by that deficiency.
Amendment 25 Proposal for a regulation Article 5 – paragraph 1
Text proposed by the Commission	Amendment
1. Where the Commission finds that it has reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding	1. Where the Commission has reasonable grounds to believe that the conditions of Article 3 are fulfilled, it shall send a written notification to that Member State, setting out the grounds on which it based its finding. The Commission shall, without delay, inform the European Parliament and the Council of such notification and its content.
Amendment 26 Proposal for a regulation Article 5 – paragraph 2
Text proposed by the Commission	Amendment
2. The Commission may take into account all relevant information, including decisions of the Court of Justice of the European Union, reports of the Court of Auditors, and conclusions and recommendations of relevant international organisations.	2. Before resorting to a written notification pursuant to paragraph 1, the Commission shall take into account all relevant information, including conditions and timing of the Member State’s adoption, implementation and enforcement of the relevant chapters of the acquis, where available decisions of the Court of Justice of the European Union, reports of the Court of Auditors and resolutions of the European Parliament. It shall also take into account conclusions and recommendations of relevant international organisations, and in particular:
	(i) the Venice Commission’s Rule of Law Checklist,
	(ii) the Council of Europe Recommendation CM/Rec (2010)12 ‘Judges: independence, efficiency and responsibilities’,
	(iii) the Venice Commission Report on the Independence of the Judicial System Part I: the Independence of Judges (CDL-AD(2010)004),
	(iv) the Venice Commission Report on Part II: the Prosecution Service (CDL-AD(2010)040), and
	(v) the relevant evaluation and compliance reports of the Group of States against Corruption (GRECO).
Justification
Clearer specification of the possible guidance sources could improve transparency, traceability and auditability of the proposed mechanism as well as legal certainty and non-arbitrariness of the powers to be conferred on the Commission.
Amendment 27 Proposal for a regulation Article 5 – paragraph 4
Text proposed by the Commission	Amendment
4. The Member State concerned shall provide all required information and may make observations within a time limit specified by the Commission, which shall not be less than 1 month from the date of notification of the finding. In its observations, the Member State may propose the adoption of remedial measures.	4. The Member State concerned shall provide all required information and may make observations within a time limit specified by the Commission, which shall not be less than 1 month or more than 3 months from the date of notification of the finding. In its observations, the Member State may propose the adoption of remedial measures.
Amendment 28 Proposal for a regulation Article 5 – paragraph 5
Text proposed by the Commission	Amendment
5. The Commission shall take into account the information received and any observations made by the Member State concerned, as well as the adequacy of any proposed remedial measures, when deciding whether or not to submit a proposal for a decision on the appropriate measures.	5. The Commission shall take into account the information received and any observations made by the Member State concerned, as well as the adequacy of any proposed remedial measures, when deciding whether or not to adopt a decision on the appropriate measures.
Amendment 29 Proposal for a regulation Article 5 – paragraph 6
Text proposed by the Commission	Amendment
6. Where the Commission considers that the generalised deficiency as regards the rule of law is established, it shall submit a proposal for an implementing act on the appropriate measures to the Council.	6. Where the Commission considers that the generalised deficiency as regards the rule of law is established, it shall adopt a decision on the measures referred to in Article 4 by means of an implementing act.
Amendment 30 Proposal for a regulation Article 5 – paragraph 6 a (new)
Text proposed by the Commission	Amendment
	6 a. At the same time as it adopts its decision, the Commission shall submit to the European Parliament and the Council a proposal to transfer the amount equivalent to the value of the measures adopted to a budgetary reserve. By way of derogation from Article 31 (4) and (6) of the Financial Regulation, the European Parliament and the Council shall deliberate upon the transfer proposal within four weeks of its receipt by both institutions. The transfer proposal shall be considered to be approved unless the Parliament acting by a majority of the votes cast, or the Council acting by qualified majority, amend or reject it. The decision shall enter into force if neither the European Parliament nor the Council reject the transfer proposal within this period. If the European Parliament or the Council amend the transfer proposal, Article 31(8) of the Financial Regulation shall apply.
Amendment 31 Proposal for a regulation Article 5 – paragraph 6 b (new)
Text proposed by the Commission	Amendment
	6b. In the proposal submitted pursuant to paragraph 6, the Commission shall ensure that the legitimate interests of the final recipients or beneficiaries of the programme or fund affected by the measure are fully safeguarded. The Commission shall also assess the possible budgetary implications of a reduction in the Union funding for the national budget of the Member State concerned with due regard to the principles of proportionality and non-discrimination.
(See amendments to Articles 3 and 4 of the proposal)
Justification
In its resolution of 14 March 2018 on the next MFF, Parliament considered that “final beneficiaries of the Union budget can in no way be affected by breaches of rules for which they are not responsible”, that “the Union budget is not the right instrument for addressing the failure to observe Article 2 TEU”, and that “any possible financial consequence should be borne by the Member State independently of budget implementation” (see paragraph 119).
Amendment 32 Proposal for a regulation Article 5 – paragraph 7
Text proposed by the Commission	Amendment
7. The decision shall be deemed to have been adopted by the Council, unless it decides, by qualified majority, to reject the Commission proposal within one month of its adoption by the Commission.	deleted
(See amendment to Recital 15 of the proposal)
Amendment 33 Proposal for a regulation Article 5 – paragraph 8
Text proposed by the Commission	Amendment
8. The Council, acting by a qualified majority, may amend the Commission’s proposal and adopt the amended text as a Council decision.	deleted
Amendment 34 Proposal for a regulation Article 6 – paragraph 1
Text proposed by the Commission	Amendment
1. The Member State concerned may, at any time, submit to the Commission evidence to show that the generalised deficiency as regards the rule of law has been remedied or has ceased to exist.	1. The Member State concerned may, at any time, submit to the Commission evidence to show that the generalised deficiency as regards the rule of law has sufficiently been remedied or has ceased to exist.
Amendment 35 Proposal for a regulation Article 6 – paragraph 2
Text proposed by the Commission	Amendment
The Commission shall assess the situation in the Member State concerned. Once the generalised deficiencies as regards the rule of law which on the grounds of which the appropriate measures were adopted cease to exist in full or in part, the Commission shall submit to the Council a proposal for a decision lifting those measures in full or in part. The procedure set out in paragraphs 2, 4, 5, 6 and 7 of Article 5 shall apply.	At the request of the Member State concerned or on its own initiative, the Commission shall assess the situation in that Member State. Once the generalised deficiencies as regards the rule of law which on the grounds of which the measures in question were adopted cease to exist in full or in part, the Commission shall adopt a decision lifting those measures in full or in part. At the same time, the Commission shall submit to the European Parliament and the Council a proposal to lift in full or in part, the budgetary reserve referred to the measures adopted. The procedure set out in paragraphs 2, 4, 5, 6, 6 a and 6 b of Article 5 shall apply.
Justification
This Commission should be enabled to act on its own initiative, and not only at the request of the Member State concerned. A more precise wording is also suggested.
Amendment 36 Proposal for a regulation Article 7
Text proposed by the Commission	Amendment
Article 7	deleted
Information of the European Parliament
The Commission shall immediately inform the European Parliament of any measures proposed or adopted pursuant to Articles 4 and 5
Amendment 37 Proposal for a regulation Article 7 a (new)
Text proposed by the Commission	Amendment
	Article 7a
	Reporting
	The Commission shall report to the European Parliament and the Council on the application of this Regulation, in particular on the effectiveness of the measures adopted, if any, at the latest five years after its entry into force.
	The report shall be accompanied where necessary by appropriate proposals.
Amendment 38 Proposal for a regulation Article 8 – paragraph 1
Text proposed by the Commission	Amendment
This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. It shall apply from 1 January 2021.	This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

PROCEDURE – COMMITTEE ASKED FOR OPINION

Title	Protection of the Union’s budget in case of generalised deficiencies as regards the rule of law in the Member States
References	COM(2018)0324 – C8-0178/2018 – 2018/0136(COD)
Committees responsible Date announced in plenary	BUDG 11.6.2018	CONT 11.6.2018
Opinion by Date announced in plenary	AFCO 11.6.2018
Rapporteur Date appointed	Helmut Scholz 20.6.2018
Rule 55 – Joint committee procedure Date announced in plenary	5.7.2018
Discussed in committee	1.10.2018	12.11.2018
Date adopted	21.11.2018
Result of final vote	+: –: 0:	19 2 1
Members present for the final vote	Mercedes Bresso, Elmar Brok, Richard Corbett, Pascal Durand, Danuta Maria Hübner, Ramón Jáuregui Atondo, Jo Leinen, Morten Messerschmidt, Maite Pagazaurtundúa Ruiz, Markus Pieper, Paulo Rangel, Helmut Scholz, György Schöpflin, Pedro Silva Pereira, Barbara Spinelli, Kazimierz Michał Ujazdowski
Substitutes present for the final vote	Enrique Guerrero Salom, Jérôme Lavrilleux, Georg Mayer, Jasenko Selimovic, Rainer Wieland
Substitutes under Rule 200(2) present for the final vote	Pavel Svoboda

FINAL VOTE BY ROLL CALL IN COMMITTEE ASKED FOR OPINION

19	+
ALDE	Maite Pagazaurtundúa Ruiz, Jasenko Selimovic
GUE/NGL	Helmut Scholz, Barbara Spinelli
PPE	Elmar Brok, Danuta Maria Hübner, Jérôme Lavrilleux, Markus Pieper, Paulo Rangel, György Schöpflin, Pavel Svoboda, Rainer Wieland
S&D	Mercedes Bresso, Richard Corbett, Enrique Guerrero Salom, Ramón Jáuregui Atondo, Jo Leinen, Pedro Silva Pereira
VERTS/ALE	Pascal Durand

2	-
ECR	Morten Messerschmidt
ENF	Georg Mayer

1	0
NI	Kazimierz Michał Ujazdowski

Key to symbols:

+ : in favour

- : against

0 : abstention

PROCEDURE – COMMITTEE RESPONSIBLE

Title	Protection of the Union’s budget in case of generalised deficiencies as regards the rule of law in the Member States
References	COM(2018)0324 – C8-0178/2018 – 2018/0136(COD)
Date submitted to Parliament	3.5.2018
Committees responsible Date announced in plenary	BUDG 11.6.2018	CONT 11.6.2018
Committees asked for opinions Date announced in plenary	REGI 11.6.2018	LIBE 11.6.2018	AFCO 11.6.2018
Associated committees Date announced in plenary	LIBE 5.7.2018
Rapporteurs Date appointed	Eider Gardiazabal Rubial 30.8.2018	Petri Sarvamaa 30.8.2018
Rule 55 – Joint committee procedure Date announced in plenary	5.7.2018
Discussed in committee	27.11.2018
Date adopted	13.12.2018
Result of final vote	+: –: 0:	43 9 3
Members present for the final vote	Nedzhmi Ali, Inés Ayala Sender, Jonathan Bullock, Ryszard Czarnecki, Dennis de Jong, Tamás Deutsch, Martina Dlabajová, Manuel dos Santos, André Elissen, José Manuel Fernandes, Luke Ming Flanagan, Eider Gardiazabal Rubial, Esteban González Pons, Ingeborg Gräßle, John Howarth, Arndt Kohn, Bernd Kölmel, Zbigniew Kuźmiuk, Vladimír Maňka, Georgi Pirinski, Răzvan Popa, Paul Rübig, José Ignacio Salafranca Sánchez-Neyra, Petri Sarvamaa, Claudia Schmidt, Indrek Tarand, Isabelle Thomas, Marco Valli, Derek Vaughan, Marco Zanni
Substitutes present for the final vote	Xabier Benito Ziluaga, José Blanco López, Caterina Chinnici, Sven Giegold, Karine Gloanec Maurin, Brian Hayes, Anneli Jäätteenmäki, Benedek Jávor, Georgios Kyrtsos, Giovanni La Via, Marian-Jean Marinescu, Péter Niedermüller, Nils Torvalds, Wim van de Camp, Marie-Pierre Vieu
Substitutes under Rule 200(2) present for the final vote	Asim Ademov, Gunnar Hökmark, Danuta Maria Hübner, Ramón Jáuregui Atondo, Susanne Melior, Luděk Niedermayer, Joachim Schuster, Bart Staes, Henna Virkkunen, Kerstin Westphal
Date tabled	18.12.2018

FINAL VOTE BY ROLL CALL IN COMMITTEE RESPONSIBLE

43	+
ALDE	Nedzhmi Ali, Martina Dlabajová, Anneli Jäätteenmäki, Nils Torvalds
ECR	Bernd Kölmel
GUE/NGL	Dennis de Jong
PPE	Wim van de Camp, José Manuel Fernandes, Esteban González Pons, Ingeborg Gräßle, Brian Hayes, Gunnar Hökmark, Danuta Maria Hübner, Georgios Kyrtsos, Giovanni La Via, Luděk Niedermayer, Paul Rübig, José Ignacio Salafranca Sánchez-Neyra, Petri Sarvamaa, Claudia Schmidt, Henna Virkkunen
S&D	Inés Ayala Sender, José Blanco López, Caterina Chinnici, Eider Gardiazabal Rubial, Karine Gloanec Maurin, John Howarth, Ramón Jáuregui Atondo, Arndt Kohn, Vladimír Maňka, Susanne Melior, Péter Niedermüller, Georgi Pirinski, Răzvan Popa, Manuel dos Santos, Joachim Schuster, Isabelle Thomas, Derek Vaughan, Kerstin Westphal
VERTS/ALE	Sven Giegold, Benedek Jávor, Bart Staes, Indrek Tarand

9	-
ECR	Ryszard Czarnecki, Zbigniew Kuźmiuk
EFDD	Jonathan Bullock, Marco Valli
ENF	André Elissen, Marco Zanni
GUE/NGL	Marie-Pierre Vieu
PPE	Tamás Deutsch, Marian-Jean Marinescu

3	0
GUE/NGL	Xabier Benito Ziluaga, Luke Ming Flanagan
PPE	Asim Ademov

Key to symbols:

+ : in favour

- : against

0 : abstention

Last updated: 7 January 2019

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