RECOMMENDATION FOR SECOND READING on the Council position at first reading with a view to the adoption of a regulation of the European Parliament and of the Council amending Council Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperation
27.1.2011 - (16447/1/2010 – C7-0424/2010 – 2010/0059(COD)) - ***II
Committee on Development
Rapporteur: Charles Goerens
DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION
on the Council position at first reading with a view to the adoption of a regulation of the European Parliament and of the Council amending Council Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperation
(16447/1/2010 – C7-0424/2010 – 2010/0059(COD))
(Ordinary legislative procedure: second reading)
The European Parliament,
– having regard to the Council position at first reading (16447/1/2010 – C7-0424/2010),
– having regard to the contributions submitted by national parliaments on the draft legislative act,
– having regard to its position at first reading[1] on the Commission proposal to Parliament and the Council (COM(2010)0102),
– having regard to Article 294(7) of the Treaty on the Functioning of the European Union,
– having regard to Rule 66 of its Rules of Procedure,
– having regard to the recommendation for second reading of the Committee on Development (A7-0009/2011),
1. Adopts its position at second reading hereinafter set out;
2. Instructs its President to forward its position to the Council, the Commission and the national parliaments.
POSITION OF THE EUROPEAN PARLIAMENT
AT SECOND READING[2]*
---------------------------------------------------------
REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
amending Regulation (EC) No 1905/2006 establishing a financing instrument for development cooperation
THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the Functioning of the European Union, and in particular Article 209(1) thereof,
Having regard to the proposal from the European Commission,
After transmission of the draft legislative act to the national parliaments,
Acting in accordance with the ordinary legislative procedure[3],
Whereas:
(1) The Union's development policy aims to reduce and ultimately eradicate poverty.
(2) The Union, as a member of the World Trade Organisation (WTO), is committed to mainstreaming trade in development strategies and to promoting international trade in order to advance development and reduce – and, in the long term, eradicate – poverty worldwide.
(3) The Union supports the African, Caribbean and Pacific (ACP) Group of States on their path to poverty reduction and to sustainable economic and social development, and recognises the importance of their commodity sectors.
(4) The Union is committed to supporting the smooth and gradual integration of developing countries into the world economy with a view to sustainable development. The main ACP banana‑exporting countries may face challenges in the context of changing trade arrangements, notably liberalisation of the Most Favoured Nation (MFN) tariff in the framework of the WTO and the bilateral and regional agreements concluded, or in the process of being concluded, between the Union and Latin American countries. Therefore, an ACP Banana Accompanying Measures programme ("the programme") should be added to Regulation (EC) No 1905/2006[4].
(5) The financial assistance measures to be adopted under the programme should aim at improving the living standards and living conditions of people in banana‑growing areas and in banana value chains, specifically small farmers and small entities, as well as ensuring compliance with labour and occupational health and safety standards, and environmental standards, notably those regarding the use of and exposure to pesticides. The measures should therefore support the adaptation and include, when relevant, the reorganisation, of areas dependent upon banana exports through sector‑specific budget support or project-specific interventions. The measures should aim to provide for social resilience policies, economic diversification or investment to improve competitiveness, where this is viable, taking into account the results of and experiences gained through the Special System of Assistance to traditional ACP suppliers of bananas established in accordance with Council Regulation (EC) No 2686/94[5] and the Special Framework of Assistance (SFA) for traditional ACP suppliers of bananas established in accordance with Council Regulation (EC) No 856/1999[6] and Commission Regulation (EC) No 1609/1999[7]. The Union acknowledges the importance of promoting a more equitable distribution of banana revenues.
(6) The programme should accompany the adaptation process in ACP countries which have exported significant volumes of bananas to the Union in recent years and which will be affected by liberalisation in the framework of the Geneva Agreement on Trade in Bananas[8] and by the bilateral and regional agreements concluded, or in the process of being concluded, between the Union and Latin American countries. The programme builds on the SFA for traditional ACP suppliers of bananas. It is in conformity with the Union's international obligations in the framework of the WTO, focuses on restructuring and boosting competitiveness, and is consequently temporary in nature, with a duration of four years (2010-2013).
(7) The conclusions of the Commission Communication of 17 March 2010 entitled "Biennial Report on the Special Framework of Assistance for Traditional ACP Suppliers of Bananas" indicate that past assistance programmes made substantial contributions to achieving improved capacity for successful economic diversification, although the full impact cannot be quantified, and that the sustainability of ACP banana exports remains fragile.
(8) The Commission has carried out an evaluation of the SFA programme and has not carried out an impact assessment of the banana accompanying measures.
(9) The Commission should ensure proper coordination of this programme with the regional and national indicative programmes operating in the beneficiary countries, in particular as regards the achievement of economic, agricultural, social and environmental objectives.
(10) Almost 2 % of the world's trade in bananas is endorsed by fair trade producers' organisations. The minimum fair trade prices are set on the basis of a calculation of the 'sustainable production costs', established following consultations with stakeholders, with a view to internalising the costs of meeting decent social and environmental standards and generating a reasonable profit, enabling producers to safeguard their livelihoods in the long term.
(11) To prevent the exploitation of local workers, actors in the production chain in the banana industry should agree to ensure that the revenue generated by the industry is allocated fairly.
(12) The Commission should be empowered to adopt delegated acts in accordance with Article 290 of the Treaty on the Functioning of the European Union in respect of Geographic Strategy Papers, Multi-annual Indicative Programmes and Strategy Papers for thematic programmes and the accompanying measures, as they supplement Regulation (EC) No 1905/2006 and are of general application. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level,
(13) Regulation (EC) No 1905/2006 should therefore be amended accordingly,
HAVE ADOPTED THIS REGULATION:
Article 1
Regulation (EC) No 1905/2006 is hereby amended as follows:
(1) Article 4 is replaced by the following:
"Article 4Implementation of Union assistance
Consistent with the overall purpose and scope, objectives and general principles of this Regulation, Union assistance shall be implemented through the geographic and thematic programmes set out in Articles 5 to 16 and the programmes set out in Articles 17 and 17a.";
(2) The following Article is inserted:
"Article 17aMain ACP banana-supplying countries
1. ACP banana-supplying countries listed in Annex IIIa shall benefit from banana accompanying measures. Union assistance shall aim at supporting their adjustment process following liberalisation of the Union market for bananas in the framework of the WTO. Union assistance shall in particular be used to combat poverty by improving the living standards and conditions of farmers and persons concerned, where relevant small entities, including by means of compliance with labour and safety standards, as well as with environmental standards, including the use of and exposure to pesticides. Union assistance shall take into account the countries' policies and adaptation strategies, as well as their regional environment (in terms of proximity to outermost regions of the Union and overseas countries and territories) and shall pay specific attention to the following areas of cooperation:
(a) enhancing the competitiveness of the banana export sector, where this is sustainable, taking into account the situation of different stakeholders in the chain;
(b) promoting the economic diversification of banana-dependent areas, where such a strategy is viable;
(c) addressing broader impacts generated by the adaptation process, possibly related but not restricted to employment and social services, land use and environmental restoration, and macroeconomic stability.
2. Within the amount referred to in Annex IV, the Commission shall fix the maximum amount available to each eligible ACP banana-supplying country referred to in paragraph 1 of this Article on the basis of the following objective, weighted indicators:
(a) trade in bananas with the Union;
(b) the importance of banana exports to the economy in the ACP country concerned, along with the country's level of development.
The measurement of the allocation criteria shall be based on representative data preceding 2010 and covering a period not longer than five years, and on a Commission study assessing the impact on the ACP countries of the agreement reached within the WTO and the bilateral and regional agreements concluded, or in the process of being concluded, between the Union and Latin American countries, which are the leading exporters of bananas.
3. The Commission shall adopt multi-annual support strategies by analogy to Article 19, and in accordance with Article 21. It shall ensure that such strategies complement the geographic strategy papers of the countries concerned, and the temporary nature of these banana accompanying measures.
The multi‑annual support strategies for banana accompanying measures shall include:
(a) an updated environmental profile paying due attention to the country's banana sector, inter alia focusing on pesticides;
(b) information on the achievements of past banana support programmes;
(c) indicators to assess progress in relation to disbursement conditions, when budget support will be chosen as the form of financing;
(d) the expected results of the assistance;
(e) a time schedule of support activities and of expected disbursements for each recipient country;
(f) the ways in which progress will be achieved and monitored in meeting internationally agreed ILO core labour standards and appropriate occupational safety and health conventions as well as relevant internationally agreed core environmental standards.
By 18 months before the expiry date, the banana accompanying measures programme and the progress made by the countries concerned shall be the subject of an assessment, which shall include recommendations on any measures to be taken and the nature thereof.";
(3) Article 21 is replaced by the following:
"Article 21Adoption of strategy papers and multiannual indicative programmes
Strategy papers and multi-annual indicative programmes referred to in Articles 19 and 20, and any reviews thereof referred to in Article 19(2) and Article 20(1), as well as accompanying measures referred to in Articles 17 and 17a respectively, shall be adopted by the Commission by means of delegated acts in accordance with Article 35, and subject to the conditions laid down in Articles 35a and 35b.";
(4) Article 22(3) is replaced by the following:
"3. The annual action programmes shall be adopted by the Commission taking into account the opinions of the European Parliament and of the Council.";
(5) In Article 23, paragraphs 3 and 4 are replaced by the following:
"3. Where the cost of such measures exceeds EUR 10 million, the Commission shall adopt them taking into account the opinions of the European Parliament and of the Council. For special measures below EUR 10 million, the Commission shall send the measures to the European Parliament and to the Council for information within one month of adopting its decision.
4. Amendments to special measures, such as those making technical adjustments, extending the implementation period, reassigning funds within the forecast budget, or increasing or reducing the size of the budget by less than 20 % of the initial budget, provided those amendments do not affect the initial objectives set out in the Commission decision, shall be communicated within one month to the European Parliament and to the Council.";
(6) Article 25(2) is replaced by the following:
"2. Union assistance shall not in principle be used for paying taxes, duties or charges in beneficiary countries.";
(7) Article 29(1) is replaced by the following:
1. Budget commitments shall be made on the basis of decisions taken by the Commission in accordance with Articles 17a(3), 22(1), 23(1) and 26(1).";
(8) In Article 31(1), the third subparagraph is replaced by the following:
"Participation in the award of procurement or grant contracts financed under a thematic programme as defined in Articles 11 to 16, and the programmes set out in Articles 17 and 17a, shall be open to all natural persons who are nationals of, or legal persons who are established in, a developing country, as specified by the OECD/DAC and in Annex II, in addition to natural or legal persons eligible by virtue of the thematic programme or the programmes set out in Articles 17 and 17a. The Commission shall publish and update Annex II in accordance with regular reviews of the list of aid recipients of the OECD/DAC, and inform the Council thereof.";
(9) Article 33(2) is replaced by the following:
"2. The Commission shall send its evaluation reports to the European Parliament and to the Council for information. The results shall feed back into programme design and resource allocation.";
(10) Article 35 is replaced by the following:
“Article 35
Exercise of the delegation
1. The power to adopt the delegated acts referred to in Article 17(2) and Articles 17a and 21 shall be conferred on the Commission for the period of application of this Regulation.
2. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the European Parliament and to the Council.
3. The power to adopt delegated acts is conferred on the Commission subject to the conditions laid down in Articles 35a and 35b.
Article 35a
Revocation of the delegation
1. The delegation of power referred to in Article 17(2) and Articles 17a and 21 may be revoked at any time by the European Parliament or by the Council.
2. The institution which has commenced an internal procedure for deciding whether to revoke a delegation of power shall endeavour to inform the other institution and the Commission within a reasonable time before the final decision is taken, indicating the delegated power which could be subject to revocation and possible reasons for a revocation.
3. The decision of revocation shall put an end to the delegation of the power specified in that decision. It shall take effect immediately or at a later date specified therein. It shall not affect the validity of the delegated acts already in force. It shall be published in the Official Journal of the European Union.
Article 35b
Objections to delegated acts
1. The European Parliament or the Council may object to a delegated act within a period of two months from the date of notification.
At the initiative of the European Parliament or the Council that period shall be extended by two months.
2. If, on the expiry of the period referred to in paragraph 1, neither the European Parliament nor the Council has objected to the delegated act, it shall be published in the Official Journal of the European Union and shall enter into force on the date stated therein.
The delegated act may be published in the Official Journal of the European Union and enter into force before the expiry of that period if the European Parliament and the Council have both informed the Commission of their intention not to raise objections.
3. If either the European Parliament or the Council objects to the delegated act within the period referred to in paragraph 1, it shall not enter into force. The institution which objects shall state the reasons for objecting to the delegated act.”;
(11) In Article 38, paragraphs 1 and 2 are replaced by the following:
"1. The financial reference amount for the implementation of this Regulation over the period 2007‑2013 is EUR 17 087 million.
2. The indicative amounts allocated to each programme referred to in Articles 5 to 10, 11 to 16 and 17 to 17a are laid down in Annex IV. These amounts are established for the period 2007-2013.";
(12) Annex IIIa, as contained in Annex I to this Regulation, is inserted;
(13) Annex IV is replaced by the contents of Annex II to this Regulation.
Article 2
This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Union.
This Regulation shall be binding in its entirety and directly applicable in all Member States.
Done at
For the European Parliament For the Council
The President The President
ANNEX I
"ANNEX IIIaMain ACP banana-supplying countries
1. Belize
2. Cameroon
3. Côte d'Ivoire
4. Dominica
5. Dominican Republic
6. Ghana
7. Jamaica
8. Saint Lucia
9. Saint Vincent and the Grenadines
10. Suriname".
ANNEX II
"ANNEX IVIndicative financial allocations for the period 2007-2013 (in EUR million)
|
Total |
17 087 |
|
|
Geographic programmes: |
10 057 |
|
|
Latin America |
2 690 |
|
|
Asia |
5 187 |
|
|
Central Asia |
719 |
|
|
Middle East |
481 |
|
|
South Africa |
980 |
|
|
Thematic programmes: |
5 596 |
|
|
Investing in people |
1 060 |
|
|
Environment and sustainable management of natural resources |
804 |
|
|
Non-State actors and local authorities in development |
1 639 |
|
|
Food security |
1 709 |
|
|
Migration and asylum |
384 |
|
|
ACP Sugar Protocol countries |
1 244 |
|
|
Main ACP banana-supplying countries |
190 |
|
- [1] Texts adopted of 21.10.2010, P7_TA(2010)0382.
- [2] * Amendments: new or amended text is highlighted in bold italics; deletions are indicated by the symbol ▌.
- [3] Position of the European Parliament of 21 October 2010 (not yet published in the Official Journal) and position of the Council at first reading of 10 December 2010 (not yet published in the Official Journal).
- [4] OJ L 378, 27.12.2006, p. 41.
- [5] OJ L 286, 5.11.1994, p. 1.
- [6] OJ L 108, 27.4.1999, p. 2.
- [7] OJ L 190, 23.7.1999, p. 14.
- [8] OJ L 141, 9.6.2010, p. 3.
EXPLANATORY STATEMENT
Substantial issues concerning the banana accompanying measures
The aim of the draft regulation amending the DCI is to support the main banana-exporting countries in Africa, the Caribbean and the Pacific (ACP) via banana accompanying measures (BAMs), which are intended to last for four years (2010-2013).
Parliament, through its Committee on Development, raised a series of concerns regarding the Commission proposal at an early stage. Our committee highlighted in particular the need for ensuring that the banana accompanying measures are geared to the key objectives of development and poverty eradication, that environmental, health and labour standards are taken into account, and that specific criteria for allocation of funds are formulated.
On all substantial issues Parliament entered into rapid and constructive negotiations with the Council, facilitated by the European Commission, and a speedy agreement was reached between the co-legislators.
The Common Position of Council at first reading, in line with the political agreement found, accepts all fifteen substantial amendments contained in Parliament 's first reading position: These are amendments 1, 2, 3, 4 (with a technical adaptation), 25, 6, 7, 8, 9, 10, 12, 13, 14, 26, and 17. In the view of your rapporteur, Parliament can be satisfied with the content of the draft regulation as proposed by the Council, as far as substantial issues are concerned.
Your rapporteur recommends only one small change to the Council version of recital 5 (based on Parliament's first reading amendment No. 4), in order to improve the technical adaptation made by the Council and bring it closer to the original wording agreed upon.
No agreement among the co-legislators was found, however, on the horizontal issue of the application of the delegated acts procedure (Article 290 TFEU) to the DCI, which would also concern the strategic programming documents relating to the BAM. It is only for this controversial but very important issue, further outlined below, that a first-reading conclusion of the legislative procedure on the BAM was not possible.
Financial issues
Your rapporteur notes that Parliament and Council have found an agreement on financing the Banana Accompanying Measures (BAM) for 2010 and 2011.
However, your rapporteur wishes to underline that the concerns about the financing modalities of the BAM expressed during the first reading are still valid, and that no financing agreement has been reached for 2012 and 2013.
The proposal for a regulation drastically reduces the margin under the ceiling of heading 4 of the multiannual financial framework (MFF) for 2007-2013, not leaving sufficient room for manoeuvre to face and to react adequately to potential upcoming crises. As a matter of principle, any new instrument should not be financed through redeployment as this would jeopardise the existing priorities, but should on the contrary be financed through the mobilisation of additional funds.
Therefore, Parliament has called for the revision of the MFF by all means provided for in points 21 and 23 of the Interinstitutional Agreement of 17 May 2006 on budgetary discipline and sound financial management, or by other means such as those included in points 25 and 27 thereof.
These concerns should be taken into account when the financing of the banana accompanying measures for the subsequent years is decided upon.
The remaining issue for second reading: procedures for democratic scrutiny
Context: what is at stake?
The main objective of the legislative recommendation your Rapporteur is proposing for second reading is to protect the democratic prerogatives of Parliament as foreseen by the Lisbon Treaty: As co-legislator, Parliament must be able to control, on an equal footing with the Council, the adoption of strategic decisions on where and how development aid is spent.
In technical terms, a number of decisions, which are normally taken by the Commission for the execution of the basic act, fulfil the criteria of "delegated acts" (Article 290 of the TFEU). The introduction of the delegated act procedure would give the two branches of the legislative authority the possibility to effectively object to certain draft decisions proposed by the Commission, or even to revoke the delegation. Your rapporteur is convinced that this would constitute a strong incentive for the Commission to take duly into account Parliament's suggestions when programming EU aid in terms of funding allocation and sectoral priorities. Giving the European Parliament real scrutiny and oversight powers, as the Lisbon Treaty clearly intends to do, would constitute a major contribution to shrinking the democratic deficit in the decision-making process of the European Union.
That is why several procedural amendments proposed for the first reading aim to ensure that the delegated acts procedure is appropriately included in the DCI regulation, in line with the letter and spirit of the Lisbon Treaty. The same amendments have also been proposed in the report by colleague Gay Mitchell on the mid-term review of the DCI (A7- 0078/2009).
As the delegated acts procedure also applies to the programming of the other financing instruments in the area of external action which are currently under review - the Instrument for Stability, the Instrument for Democracy and Human Rights, and the Instrument for Cooperation with Industrialised Countries -, the parliamentary committees responsible for these instruments (AFET and INTA) tabled identical amendments for the first reading in Parliament.
Our committees' position on delegated acts is consistent with the analysis of Parliament's legal service, and is fully in line with Parliament's political position, expressed by the Conference of Presidents on 9 September 2010: "Parliament's negotiators should always insist on the inclusion of delegated acts in all decisions fulfilling the criteria of Article 290 TFEU – in particular concerning objectives, choice of priorities, expected results and financial allocations in broad terms – in order to preserve the Parliament's prerogatives in these areas".
Your rapporteur notes that the criteria of Article 290 are compulsory, which means that if they are fulfilled (as is the case in the external financial instruments), they cannot be the matter of political bargains or any "special arrangements", as this would be contrary to the Treaty.
For Parliament, the interinstitutional negotiations on the external financing instruments are therefore not only about ensuring effective parliamentary control, and hence democratic control, over the implementation of EU legislation. They also fundamentally concern the respect by all institutions of the Treaty. And it is also worth considering that the outcome of the negotiations on the use of delegated acts for the implementation of the financing instruments in the area of external relations will establish a strong precedent for future legislative negotiations on all financing instruments. If we lose this battle, we may have to wait for a new Treaty in order to finally obtain the powers that the Lisbon Treaty is giving us now.
The procedure
After formal adoption of the first reading position in DEVE, interinstitutional negotiations started in February 2010 on the horizontal issue of delegated acts in the external financing instruments. Because of Council's outright refusal to grant Parliament its proper role in the operation of the financing instruments as foreseen in Article 290 TFEU, without making any alternative proposals to accommodate Parliament's legitimate aspiration for proper democratic scrutiny of the implementation of the instruments, no compromise was reached.
On 21 October 2010, Parliament concluded its first reading by adopting legislative resolutions on all the external financing instruments, with a large majority supporting the introduction of the delegated acts procedure.
On 10 December 2010, Council formally adopted its position on three of the four instruments, including the DCI. In its position Council rejects all first reading amendments which attempt to introduce delegated acts into the instruments, without proposing any alternative procedure.
Council calls for Parliament to adopt before the end of 2010 (i.e. without any negotiation) Council's Common Position, which - as Council very well knows - would not be possible without completely disregarding Parliament's internal procedures. Council also did not consult Parliament to determine jointly the most suitable moment to transmit its position, as would have been required in accordance with Article 20 of the agreement on good interinstitutional cooperation in the field of codecision.
-o0o-
As all attempts to move forward on the dossiers during trilogues and technical level contacts have failed, your rapporteur is of the opinion that Parliament should adopt and reiterate as quickly as possible its position regarding the delegated acts in second reading. Given the lack of any alternative proposal from the co-legislator, and the need to act fast in the interest of the beneficiaries, Parliament should reconfirm its position of first reading as regards the appropriate procedure for democratic scrutiny and the application of delegated acts without at this stage entering into a new debate about individual amendments.
At the same time, Council should be called on to react as quickly as possible to Parliament's second reading position in order to ensure that a solution can be found and that funds can be unblocked as soon as possible.
In conclusion, and in light of the legal and political arguments outlined above, your rapporteur recommends reinstating all the amendments concerning delegated acts and democratic scrutiny from the first reading which were not accepted by the Council.
PROCEDURE
|
Title |
Financing instrument for development cooperation |
|||||||
|
References |
16447/1/2010 – C7-0424/2010 – 2010/0059(COD) |
|||||||
|
Date of Parliament’s first reading – P number |
21.10.2010 T7-0382/2010 |
|||||||
|
Commission proposal |
COM(2010)0102 - C7-0079/2010 |
|||||||
|
Receipt of Council position at first reading announced in plenary |
16.12.2010 |
|||||||
|
Committee responsible Date announced in plenary |
DEVE 16.12.2010 |
|||||||
|
Rapporteur(s) Date appointed |
Charles Goerens 25.1.2011 |
|
|
|||||
|
Discussed in committee |
25.1.2011 |
|
|
|
||||
|
Date adopted |
26.1.2011 |
|
|
|
||||
|
Result of final vote |
+: –: 0: |
28 0 0 |
||||||
|
Members present for the final vote |
Thijs Berman, Michael Cashman, Ricardo Cortés Lastra, Corina Creţu, Véronique De Keyser, Nirj Deva, Leonidas Donskis, Charles Goerens, Catherine Grèze, András Gyürk, Eva Joly, Filip Kaczmarek, Franziska Keller, Miguel Angel Martínez Martínez, Gay Mitchell, Norbert Neuser, Bill Newton Dunn, Maurice Ponga, Birgit Schnieber-Jastram, Michèle Striffler, Alf Svensson, Eleni Theocharous, Patrice Tirolien, Ivo Vajgl, Iva Zanicchi, Gabriele Zimmer |
|||||||
|
Substitute(s) present for the final vote |
Martin Kastler, Csaba Őry |
|||||||
|
Date tabled |
28.1.2011 |
|||||||