REPORT on the proposal for a regulation of the European Parliament and of the Council establishing a Recovery and Resilience Facility

10.11.2020 - (COM(2020)0408 – C9‑0150/2020 – 2020/0104(COD))

***I
Committee on Budgets
Committee on Economic and Monetary Affairs
Rapporteurs: Eider Gardiazabal, Siegfried Muresan, Dragos Pîslaru
(Joint committee procedure – Rule 58 of the Rules of Procedure)
Rapporteurs for the opinion (*):
Dragoș Pîslaru, Committee on Employment and Social Affairs
Pascal Canfin, Committee on the Environment, Public Health and Food Safety
François‑Xavier Bellamy, Committee on Industry, Research and Energy
Roberts Zīle, Committee on Transport and Tourism
(*) Associated committees – Rule 57 of the Rules of Procedure

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the proposal for a regulation of the European Parliament and of the Council establishing a Recovery and Resilience Facility

(COM(2020)0408 – C9‑0150/2020 – 2020/0104(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

– having regard to the Commission proposal to Parliament and the Council (COM(2020)0408),

– having regard to Article 294(2) and to the third paragraph of Article 175 of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C9‑0150/2020),

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

– 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 Economic and Monetary Affairs under Rule 58 of the Rules of Procedure,

– having regard to the opinions of the Committee on Employment and Social Affairs, the Committee on the Environment, Public Health and Food Safety, the Committee on Industry, Research and Energy, the Committee on Transport and Tourism, the Committee on Budgetary Control and the Committee on Regional Development,

– having regard to the position in the form of amendments of the Committee on Women's Rights and Gender Equality,

– having regard to the letter from the Committee on Constitutional Affairs,

– having regard to the report of the Committee on Budgets and the Committee on Economic and Monetary Affairs (A9-0214/2020),

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

AMENDMENTS BY THE EUROPEAN PARLIAMENT[*]

to the Commission proposal

---------------------------------------------------------

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

establishing a Recovery and Resilience Facility

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 the third paragraph of Article 175 thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Economic and Social Committee[1],

Having regard to the opinion of the Committee of the Regions[2],

Acting in accordance with the ordinary legislative procedure,

Whereas:

(1) In accordance with Articles 120 and 121 of the Treaty on the Functioning of the European Union (TFEU), Member States are required to conduct their economic policies with a view to contributing to the achievement of the objectives of the Union and in the context of the broad guidelines that the Council formulates. Under Article 148 TFEU Member States shall implement employment policies that take into account the guidelines for employment. The coordination of the economic policies of the Member States is therefore a matter of common concern.

(2) Article 175 TFEU provides, inter alia, that Member States should coordinate their economic policies in such a way as to attain the objectives on economic, social and territorial cohesion set out in Article 174.

(2a) Article 174 TFEU provides that in order to promote its overall harmonious development, the Union shall develop and pursue its actions leading to the strengthening of its economic, social and territorial cohesion. It further provides that, in particular, the Union shall aim at reducing disparities between the levels of development of the various regions and the backwardness of the least favoured regions. Among the regions concerned, particular attention should be paid to rural areas, areas affected by industrial transition, islands, outermost regions and regions which suffer from severe and permanent natural or demographic handicaps such as the northernmost regions with very low population density and island, cross-border and mountain regions and their starting position and specificities should be taken into consideration in the implementation of Union policies.

(3) At Union level, the European Semester of economic policy coordination (European Semester), including the principles of the European Pillar of Social Rights, the United Nation’s Sustainable Development Goals, the National Climate Energy Plans adopted in the framework of the Governance of the Energy Union, and the just transition plans, are ▌frameworks to identify national reform priorities and to monitor their implementation. Reforms based on solidarity, integration, social justice and a fair distribution of wealth should also be addressed, with the aim of creating quality employment and sustainable growth, ensuring equality of, and access to, opportunities and social protection, protecting vulnerable groups and improving the living standards of all citizens. Member States develop their own national multiannual investment strategies in support of those reforms. Where relevant, those strategies should be presented alongside the yearly National Reform Programmes as a way to outline and coordinate priority investment projects to be supported by national and/or Union funding.

(3a) As the Commission outlined in the Annual Sustainable Growth Strategy 2020 and the European Semester Spring and Summer Package 2020, the European Semester should help achieve the implementation of the European Green Deal, the European Pillar of Social Rights and the United Nation’s Sustainable Development Goals.

(4) The COVID-19 outbreak in early 2020 changed the economic, social and budgetary outlook for the years to come in the Union and in the world, calling for an urgent, efficient and coordinated response both at ▌Union and national level in order to cope with the enormous economic and social consequences for all Member States. The challenges linked to the demographic context, social inclusion and cohesion have been amplified by COVID-19 leading to asymmetrical consequences for Member States. The ▌COVID-19 crisis as well as the previous economic and financial crisis have shown that developing sound, sustainable and resilient economies as well as financial and welfare systems built on strong economic and social structures helps Member States  ▌ respond more efficiently to shocks and recover more swiftly from them in a fair and inclusive way. A lack of resilience can also lead to negative spill-over effects of shocks between Member States or within the Union as a whole, thereby posing challenges to convergence and cohesion in the Union. In this regard, reduction in spending on education, culture and healthcare can prove counterproductive to achieve a swift recovery. The medium and long-term consequences of the COVID-19 crisis will critically depend on how quickly Member States’ economies and societies will recover from the crisis, which in turn depends on the fiscal space and measures that Member States have available to mitigate the social and economic impact of the crisis, and on the resilience of their economies and social structures. Sustainable and growth-enhancing reforms and investments to address structural weaknesses of the economies, ▌strengthen the resilience of Member States, increase productivity and competitiveness and reduce the dependency on carbon energy. Those will therefore be essential to set the economies back on track, ▌and to reduce inequalities and ▌divergences in the Union.

(5) The implementation of sustainable and growth enhancing reforms and investments contributing to cohesion and ▌ building a high degree of resilience of domestic economies, societies and institutions, strengthening adjustment capacity and unlocking growth potential, in a compatible way with the Paris agreement, are among the Union’s policy priorities. They are ▌ crucial to set the recovery on a sustainable, fair and inclusive path and support the process of upward economic and social convergence. This is even more necessary in the aftermath of the pandemic crisis to pave the way for a swift recovery.

(5a) Articles 2 and 8 TFEU provide that, in all its activities, the Union shall aim to eliminate inequalities and to promote equality between men and women. Gender mainstreaming, including gender budgeting, should therefore be implemented in all Union policies and legislation.

(5b) Women have been at the forefront of the COVID-19 crisis, forming the majority of healthcare workers across the Union, and balancing unpaid care work with their employment responsibilities. The situation has become increasingly difficult for single parents, 85% of whom are women. Investment in robust care infrastructure is also essential in order to ensure gender equality and women’s economic empowerment, build resilient societies, combat precarious conditions in a female dominated sector, boost job creation, prevent poverty and social exclusion, and have a positive effect on Gross Domestic Product, as it allows more women to take part in paid work.

(6) Past experiences have shown that investment is often drastically cut during crises. In light of this, it is essential to support strategic public and private investment with European added value in this particular situation, mitigate the effects of the pandemic to speed up the recovery, contribute to achieving the objectives of the European Green Deal, social inclusion and cohesion, strengthen long-term growth potential with tangible results in the real economy, as well as strengthen institutional resilience and crisis preparedness. Investing in green and digital technologies, research and innovation (R&I), including in a knowledge based economy, capacities and processes aimed at assisting clean energy and circular transition, boosting energy efficiency in housing and other key sectors of the economy are important to achieve fair, inclusive and sustainable growth and help create jobs. Such investments will also help make the Union more resilient and less dependent by diversifying key supply chains. It is equally important to invest in services of general economic interest and social services of general interest in order to promote social inclusion and social cohesion.

(6a) Recovery should be achieved and the resilience of the Union and its Member States enhanced through the financing of six European priorities, namely the just green transition, the digital transformation, economic cohesion, productivity and competitiveness, social and territorial cohesion, institutional resilience and policies to ensure the next generation of Europeans does not become a “lockdown generation".

(6b) Investing in green technologies, capacities and reforms aimed at assisting the just green transition, boosting sustainable energy transition, security and efficiency in housing and other key sectors of the economy is important in order to contribute to the long-term decarbonisation of the economy and the Union’s climate and environmental objectives, to promote biodiversity, to achieve sustainable growth, to advance the circular economy and to help create jobs.

(6c) Investing in digital technologies, infrastructure and processes will increase the Union’s competitiveness at global level and will also help make the Union more resilient, more innovative and less dependent by diversifying key supply chains. Reforms and investments should notably promote the digitalisation of services, the development of digital and data infrastructure, clusters and digital innovation hubs and open digital solutions. The digital transition should also incentivise the digitalisation of small and medium enterprises (SMEs). Public procurement should respect the principles of interoperability, energy efficiency and personal data protection, allowing for the participation of SMEs and start-ups and promoting the use of open-source solutions.

(6d) Reforms and investments aimed at increasing economic cohesion and productivity, at SMEs, at strengthening the Single Market, and at competitiveness should enable a sustainable recovery of the Union’s economy. Those reforms and investments should also promote entrepreneurship, social economy, development of sustainable infrastructure and transport and industrialisation and reindustrialisation, and mitigate the effect of the crisis on the adoption process of the single currency by non-euro area applicant Member States.

(6da) Reforms and investments should also enhance social cohesion and contribute to fighting poverty and tackling unemployment. They should lead to the creation of high-quality and stable jobs, the inclusion of disadvantaged groups and categories of citizens, enable the strengthening of the social infrastructure and services, social dialogue, and social protection and welfare. Such measures are of utmost importance for our economies to rebound while leaving nobody behind.

(6e) The Union should take actions to ensure that the next generation of Europeans is not permanently affected by the impact of the COVID-19 crisis and that the generational gap is not further deepened. Reforms and investments are essential to promote education and skills, including digital skills, the role of skills via generational targeting of priorities for upskilling, reskilling and requalification of active labour force, integration programme for the unemployed, policies of investing in access and opportunity for children and youth related to education, health, nutrition, jobs and housing, and policies that bridge the generational gap.

(6f) The COVID-19 crisis has also highlighted the importance of strengthening institutional and administrative resilience and crisis preparedness, in particular through improving business and public service continuity, and the accessibility and capacity of health and care systems, of improving the effectiveness of public administration and national systems, including minimising administrative burden, and of improving the effectiveness of judicial systems as well as fraud prevention and anti-money laundering supervision. Lessons should be learnt and Member States’ institutional resilience increased.

(6g) At least 40% of the amount of each recovery and resilience plan under the Recovery and Resilience Facility (the ‘Facility’) should contribute to climate and biodiversity mainstreaming, taking into account that at least 37% of the amount of each recovery and resilience plan should be directed to finance climate mainstreaming. Recovery and resilience plans should be consistent with the Union’s Gender Equality Strategy 2020-2025.

(6h) At least 20% of the amount of each recovery and resilience plan under the Facility should contribute to the European Digital Strategy and the achievement of a Digital Single Market with a view to increasing the Union’s competitiveness at global level and helping to make the Union more resilient, more innovative and strategically autonomous.

(6i) At least 7% of the amount of each recovery and resilience plan under the Facility should contribute to investment and reform measures falling under each of the six European priorities, while the entire financial allocation of the Facility should fall under the six European priorities.

(6j) The Facility’s general objective should contribute to addressing the challenges of the six European priorities identified under this Regulation through the promotion of economic, social and territorial cohesion, and to contribute to the objectives of Union policies, the United Nations’ Sustainable Development Goals, the European Pillar of Social Rights, the Paris Agreement, and to the strengthening of the Single Market. For that purpose, it should contribute to improving the resilience and adjustment capacity of the Member States, mitigating the social and economic impact of the crisis, and supporting the green and digital transitions ▌restoring the growth potential of the economies of the Union, fostering employment creation in the aftermath of the COVID-19 crisis and to promoting sustainable growth.

(6k) The Facility should contribute to recovery and resilience through reforms and investments which benefit society, demography, and in particular children, youth and vulnerable groups, through education and training, improve the business environment, insolvency frameworks, the fight against aggressive tax practices, modernize our economies and industry, R&I, sustainable digital, energy and transport infrastructure and connectivity. The Facility should also contribute to the development of a sustainable circular economy, support entrepreneurship including SMEs, health and care sectors, culture and media, sport, tourism and hospitality, agriculture and agrifood sectors, strengthen biodiversity and environmental protection, food supply chains, foster the green transition through climate mitigation and adaptation, and contribute to investing into sustainable and energy-efficient housing. The reforms and investments should strengthen social protection and welfare systems, the public administration and services of general interests, including justice and democracy, and contribute to address the demographic challenges.

(6l) The COVID-19 crisis has serious consequences for social activities in all Member States. Education, cultural and creative sectors, as well as hospitality and tourism which have come to a standstill. The Union and Member States should also invest in those areas of utmost importance. Member States should be encouraged to dedicate at least 2% of the overall budget to the cultural and creative sectors and 10% to investments in quality and inclusive education.

(7) Currently, no instrument foresees direct financial support linked to achievement of results and to implementation of reforms and public investments of the Member States in response to crisis of the scale of the COVID 19 crisis. The recovery of the Union’s economy as a whole could be achieved, including through the channelling of investments and gearing of reforms towards existing EU strategies and challenges, including, but not limited to, the ones identified in the European Semester, European Pillar of Social Rights, United Nations’ Sustainable Development Goals, National Climate Energy Plans adopted in the framework of the Governance of the Energy Union, and in the just transition plans, with a view to having a lasting impact on the ▌ resilience ▌ of the Member States.

(8) Against this background, it is necessary to strengthen the current framework for the provision of support to Member States and provide direct financial support to Member States through an innovative tool. To that end, ▌the Facility should be established under this Regulation to provide effective financial and significant support to step up the implementation of sustainable reforms and related public and private investments in the Member States as a dedicated instrument designed to tackle the adverse effects and consequences of the COVID-19 crisis in the Union. The Facility should be comprehensive and should also benefit from the experience gained by the Commission and the Member States from the use of the other instruments and programmes. The Facility might also include measures to incentivise private investment through support schemes, including via financial instruments, subsidies, or similar schemes, provided that State aid rules are complied with. Moreover, the Facility might also include measures to promote the development of national promotional banks.

(9) The types of financing and the methods of implementation under this Regulation should be chosen on the basis of their ability to achieve the specific objectives of the actions and to deliver results, taking into account, ▌ the expected risk of non-compliance. This should include consideration of the use of lump sums, flat rates and unit costs, as well as financing not linked to costs as referred to in Article 125(1)(a) of the Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council[3]  (Financial Regulation).

(9a) Measures aimed at fostering the recovery from the social and economic shock of the COVID-19 crisis should be guided by the principles of resilience and ecological and social sustainability. They should also strive to combine the need for urgency with a long-term perspective. Measures that were supported by strong scientific evidence and broad political and social agreement should not be weakened or postponed, but should continue to be assigned priority.

(10) In accordance with Regulation [European Union Recovery Instrument] and within the limits of resources allocated therein, recovery and resilience measures under the ▌Facility should be carried out to address the unprecedented social and economic impact of the COVID-19 crisis. Such additional resources should be used in such a way as to ensure compliance with the time limits provided for in Regulation [EURI].

(10a) The Facility should support projects that respect the principle of additionality of Union funding and that generate a genuine European added value. The Facility should not be a substitute for recurring national expenditures and should not run counter to the strategic and economic interests of the Union, and should therefore not finance investment plans of third countries.

(10b) European added value should result from the interplay and interlinkages between the six European priorities, and should generate coherence and synergies, and provide coordination gains, legal certainty, greater effectiveness and complementarities.

(10c) One of the lessons learnt from the COVID-19 crisis is that the Union should diversify the critical supply chains and therefore one of the objectives of the Facility should be to strengthen the strategic autonomy of the Union.

(10d) The amounts of unused commitment appropriations and decommitted appropriations should be used to reinforce programmes with European added value, particularly under direct management, such as, but not limited to those in the areas of R&I, education and infrastructure.

(10e) Recovery and resilience plans under the Facility should work in synergy with the InvestEU Programme, and may allow contributions to the Member States compartment under the InvestEU Programme, in particular for the solvency of companies established in the Member States concerned. The plans might also allow contributions to Multiannual Financial Framework (MFF) programmes under direct management for children, youth, including Erasmus, culture, as well as R&I, including Horizon Europe.

(10f) Next Generation EU should not become a financial burden for the next generations and should be repaid by new Union own resources. Moreover, it is crucial that the loans incurred in the context of Next Generation EU should be repaid in due time.

(11) Reflecting the European Green Deal as Europe’s sustainable growth strategy and the translation of the Union's commitments to implement the Paris Agreement and the United Nations’ Sustainable Development Goals, the Facility established by this Regulation will contribute to mainstreaming climate actions and environmental sustainability and to the achievement of an overall target of 30% of the Union budget expenditures supporting climate objectives, of an overall target of 10% of the Union budget expenditures supporting biodiversity objectives. In their recovery and resilience plans, Member States should pay particular attention to support and empowerment of workers that may suffer from the consequence of the transitions, in particular by implementing the European Pillar of Social Rights and defending the principle of collective bargaining.

 ▌

(15) The specific objective of the Facility should be to provide financial support with a view to achieving the clear milestones and targets of reforms and investments as set out in recovery and resilience plans. That specific objective should be pursued in close cooperation with the Member States concerned.

(16) To ensure its contribution to the objectives of the Facility, the recovery and resilience plan should comprise measures for the implementation of reforms and public investment projects through a coherent, relevant, effective and efficient recovery and resilience plan. ▌

(16a) The recovery and resilience plan should have a detailed explanation on how the recovery and resilience plans and measures shall contribute to each of the six European priorities, including the respective and overall minimum budgetary allocations.

(16b) The plan should also explain how it contributes to and not run counter the Union policies, United Nations’ Sustainable Development Goals, European Pillar of Social Rights, Paris Agreement and the strengthening of the Single Market. The plan should also explain how it contributes and does not run counter to the strategic and economic interests of the Union, does not substitute national budgetary expenditure, respect the principle of additionality of Union funding and the ‘do no significant harm’ principle. It should explain how it is consistent with the principles of the Union’s Gender Equality Strategy 2020-2025.

(16c) The national recovery and resilience plan should not affect the right to conclude or enforce collective agreements or to take collective action in accordance with the Charter of Fundamental Rights of the European Union, and Union and national law and practices.

(16d) The plan should explain how it contributes to effectively address challenges identified in the relevant country-specific recommendations for the Member State concerned or in other relevant documents officially adopted by the Commission in the context of the European Semester. In case a Member State is experiencing imbalances or excessive imbalances as concluded by the Commission after an in-depth review, the plan should contain an explanation of the way the recommendations made under Article 6 of Regulation (EU) No 1176/2011 of the European Parliament and of the Council[4] are compatible with the plans. The plan should detail the envisaged clear milestones, targets and timetable for the implementation of the reforms and the investments.

(16e) The plan should represent a comprehensive reform and investment package and how they are consistent. The plan should detail the envisaged public and private investment projects, and the related investment period and references to the involvement of private partners, where relevant. The plan should detail the estimated total cost of the reforms and investments. It should contain, where relevant, information on existing or planned Union financing and the link with previous or planned reforms in the framework of the Structural Reform Support Program or Technical Support Instrument and information on the accompanying measures that may be needed, including a timetable of all policy actions.

(16f) Regional and local authorities, being the closest to their citizens, and having a first-hand experience regarding needs and problems of the local communities and economies play a crucial role in economic and social recovery. Taking this into consideration, they should be closely involved in the planning and implementation of the Facility, including the preparation of the recovery and resilience plans as well as the management of the projects under the Facility. In order to fully exploit the potential of regional and local authorities in achieving recovery and resilience, a part of the resources of the Facility should be implemented by them, while respecting the principle of subsidiarity of the Member State.

(16g) The plan should detail, where appropriate, the request for loan support and the additional milestones.

(16h) The plan should contain explanation of the Member State's plans, systems and concrete measures to prevent, detect and correct conflicts of interest, corruption and fraud when using the funds as derived from the Facility.

(16i) The plan should contain details of arrangements made by Member States to ensure that recipient undertakings are not involved in any reportable tax arrangements under the Council Directive (EU) 2018/822[5] in relation to cross-border arrangements.

(16j) Where relevant, the plans should include investments in cross-border or pan-European projects to support European cooperation.

(16k) All Member States benefitting from the Facility should respect and promote the values enshrined in Article 2 of the Treaty on European Union. The Commission should be empowered to initiate the suspension of the commitment or payment appropriations to Member States under the Facility in case of 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. The Facility should provide for clear rules and procedures on initiating the suspension mechanism or on its lifting. In this respect, the procedure to initiate the suspension of the funding under Facility and its subsequent placing into a reserve should only be blocked if a qualified majority in the Council or a majority in the European Parliament oppose it. Payments to final beneficiaries or recipients, including local and regional authorities should continue.

(16l) Measures starting from 1 February 2020 related to the economic and social consequences of the COVID-19 crisis should be eligible.

(17) Where a Member States is exempted from the monitoring and assessment of the European Semester on the basis of Article 12 of Regulation (EU) 472/2013[6], or is subject to surveillance under Council Regulation (EC) No 332/2002[7], it should be possible that the provisions of this regulation are applied to the Member State concerned in relation to the challenges and priorities identified by the measures set out under the regulations thereof.

(18) To inform the preparation and the implementation of the recovery and resilience plans by Member States, the European Parliament and Council should be able to discuss, within the European Semester, the state of recovery, resilience and adjustment capacity in the Union. To ensure appropriate evidence, this discussion should be based on the Commission’s strategic and analytical information available in the context of the European Semester and, if available, on the basis of the information on the implementation of the plans in the preceding years. All relevant information should be made available by the Commission to the European Parliament and the Council simultaneously and on equal terms. A Recovery and Resilience Dialogue modelled on the existing structured economic dialogue should be held in the relevant committees of the European Parliament in order to ensure transparency and accountability.

(19) In order to ensure a meaningful financial contribution commensurate to the actual needs of Member States to undertake and complete the reforms and investments included in the recovery and resilience plan, it is appropriate to establish a maximum financial contribution available to them under the Facility as far as the financial support (i.e. the non-repayable financial support) is concerned. In 2021 and 2022, that maximum contribution should be calculated on the basis of the population, the inverse of the per capita  ▌GDP and the relative unemployment rate of each Member State for the period 2015-2019. In 2023 and 2024, that maximum financial contribution should be calculated on the basis of the population, the inverse GDP, and the cumulative loss in real GDP observed over the period from 2020 to 2021, compared to 2019.

(20) It is necessary to establish a process for the submission of proposals for recovery and resilience plans by the Member States, and the content thereof. With a view to ensuring the expediency of procedures, a Member State should submit a recovery and resilience plan at the latest by 30 April, in the form of a separate annex of the National Reform Programme. To ensure a fast implementation, Member States should be able to submit a draft plan together with the draft budget of the forthcoming year, on 15 October of the preceding year. For the preparation of the recovery and resilience plans, Member States can make use of the Technical Support Instrument in accordance with Regulation XX/YYYY [establishing Technical Support Instrument].

(20a) In its evaluation, the Commission should take into account the synergies created between the recovery and resilience plans of different Member States and the complementarity between those plans and other investment plans at national level. The Commission should, where relevant, consult the Union wide relevant stakeholders to gather their views concerning ownership, consistency and effectiveness of the national recovery and resilience plan. The Commission should also require a gender impact assessment of the plan carried out by an independent expert or proceed to such an assessment itself.

▌

(22) The Commission should assess the recovery and resilience plan proposed by the Member States and should act in close cooperation with the Member State concerned. The Commission should fully respect the national ownership of the process and should also take into account the synergies created between the recovery and resilience plans of different Member States and the complementarity between those plans and other investment plans at national level. The Commission should assess the recovery and resilience plan based on a list of requirements and a list of criteria which should prove their effectiveness, efficiency, relevance and coherence and for that purpose, should take into account the justification and elements provided by the Member State concerned ▌.

(23) Appropriate guidelines should be set out, as an annex to this Regulation, to serve as a basis for the Commission to assess in a transparent and equitable manner the recovery and resilience plans and to determine the financial contribution in conformity with the objectives and any other relevant requirements laid down in this Regulation. In the interest of transparency and efficiency, a rating system for the assessment of the proposals for recovery and resilience plans should be established to that effect. The scores attributed to the adopted plans should be disclosed.

(24) In order to contribute to the preparation of high-quality plans and assist the Commission in the assessment of the recovery and resilience plans submitted by the Member States and in the assessment of the degree of their achievement, provision should be made for the use of expert advice and, at the Member State request, peer counselling and technical support. When such expertise concerns labour-related policies in particular, social partners should be involved.

(25) For the purpose of simplification, the determination of the financial contribution should follow simple criteria. The financial contribution should be determined on the basis of the estimated total costs of the recovery and resilience plan proposed by the Member State concerned. Financing from the Facility should not support measures which reduce government revenues for a prolonged period or permanently, such as tax cuts or levy-reductions.

(26) Provided that the recovery and resilience plan satisfactorily addresses the assessment criteria, the Member State concerned should be allocated the maximum financial contribution where the estimated total costs of the reform and investment included in the recovery and resilience plan is equal to, or higher than, the amount of the maximum financial contribution itself. The Member State concerned should instead be allocated an amount equal to the estimated total cost of the recovery and resilience plan where such estimated total cost is lower than the maximum financial contribution itself. No financial contribution should be awarded to the Member State if the recovery and resilience plan does not satisfactorily address the assessment criteria. Whenever the Commission deems that the plan does not satisfactorily address the assessment criteria it should inform the European Parliament and the Council and request the Member State concerned to submit a revised plan.

▌

(28) Financial support to a Member State’s plan should be possible in the form of a loan, subject to the conclusion of a loan agreement with the Commission, on the basis of a duly motivated request by the Member State concerned. Loans supporting the implementation of national recovery and resilience plans should be provided at maturities that reflect the longer-term nature of such spending, while having a clear and precise repayment schedule. Those maturities may diverge from the maturities of the funds the Union borrows to finance the loans on capital markets. Therefore, it is necessary to provide for the possibility to derogate from the principle set out in Article 220(2) of the Financial Regulation, according to which maturities of loans for financial assistance should not be transformed.

(29) The request for a loan should be justified by the financial needs linked to additional reforms and investments included in the recovery and resilience plan, notably relevant for the green and digital transitions, and by therefore, by a higher cost of the plan than the maximum financial contribution (to be) allocated via the non-repayable contribution. It should be possible to submit the request for a loan together with the submission of the plan. In case the request for loan is made at a different moment in time, it should be accompanied by a revised plan with additional milestones and targets. To ensure frontloading of resources, Member States should request a loan support at the latest by 31 August 2024. For the purposes of sound financial management, the total amount of all the loans granted under this Regulation should be capped. In addition, the maximum volume of the loan for each Member State should not exceed 6.8% of its Gross National Income. An increase of the capped amount should be possible in exceptional circumstances subject to available resources. For the same reasons of sound financial management, it should be possible to pay the loan in instalments against the fulfilment of results.

(30) A Member State should have the possibility to make a reasoned request to amend the recovery and resilience plan within the period of implementation, where objective circumstances justify such a course of action. The Commission should assess the reasoned request and take a new decision within two months. The Member State should be able to request, at any time throughout the year, assistance through the Technical Support Instrument in accordance with Regulation XX/YYYY [establishing Technical Support Instrument] for the purpose of amending or replacing the recovery and resilience plan.

(30a) The Member States and the Union institutions involved in the decision-making process should do their utmost to reduce processing time and to simplify procedures to ensure the smooth and rapid adoption of decisions on the mobilisation and implementation of the Facility.

(31) For reasons of efficiency and simplification in the financial management of the instrument, the Union financial support to recovery and resilience plans should take the form of a financing based on the achievement of results measured by reference to milestones and targets indicated in the approved recovery and resilience plans. To this effect, the additional loan support should be linked to the additional milestones and targets compared to those relevant for the financial support (i.e. the non-repayable support). Disbursements should be made upon implementation of the relevant milestones.

(32) For the purpose of sound financial management, specific rules should be laid down for budget commitments, payments, suspension, cancellation and recovery of funds. To ensure predictability, it should be possible for Member States to submit requests for payments on a biannual basis. Payments should be made in instalments and be based on a positive assessment by the Commission of the implementation of the recovery and resilience plan by the Member State. Pre-financing up to 20% of the total support from the Funds set out in the decision approving a recovery and resilience plan should be made available by the Commission. Suspension and cancellation as well as a reduction and a recovery of the financial contribution should be possible when the recovery and resilience plan has not been implemented in a satisfactory manner by the Member State or in case of serious irregularities, including fraud, corruption and conflict of interest. Recovery should, where possible, be ensured by way of offsetting against outstanding disbursements under the Facility. Appropriate contradictory procedures should be established to ensure that the decision by the Commission in relation to suspension, cancellation and recovery of amounts paid respects the right of Member States to provide observations.

(32a) To protect the financial interests of the Union in implementing the Facility, the Member States should ensure the functioning of an effective and efficient internal control systems and recover amounts unduly paid or misused. The Member States should collect data and information allowing to prevent, detect and correct serious irregularities, including fraud, corruption and conflict of interests in relation to the measures supported by the Facility.

(33) For effective monitoring of implementation, the Member States should report on a bi-annual basis within the European Semester process on the progress made in the achievement of the recovery and resilience plan. Such reports prepared by the Member States concerned should be appropriately reflected in the National Reform Programmes, which should be used as a tool for reporting on progress towards completion of recovery and resilience plans. The competent committees of the European Parliament may, at any stage, hear Member States representatives responsible of the recovery and resilience plans and any other relevant institutions and stakeholders to discuss the measures provided for in, and to be taken pursuant to, this Regulation.

(34) For the purposes of transparency, the recovery and resilience plans adopted by the Commission should be communicated to the European Parliament and the Council simultaneously and communication activities should be carried out by the Commission as appropriate. The Commission should ensure the visibility of spending under the Facility by clearly indicating that the projects supported should be clearly labelled as “European Union Recovery Initiative”.

(35) Spending under the Facility should be efficient and will have a double positive impact on Europe's recovery from the crisis and on Europe’s transition towards a sustainable economy. In order to ensure an efficient and coherent allocation of funds from the Union budget, respect the principle of sound financial management and avoid conflicts of interest, actions under this Regulation should be consistent with, and be complementary to, ongoing Union programmes, whilst avoiding double funding for the same expenditure. In particular, the Commission and the Member State should ensure, in all stages of the process, effective coordination in order to safeguard the consistency, coherence, complementarity and synergy among sources of funding, and technical support received through the Technical Support Instrument. To that effect, Member States should be required to present the relevant, information on existing or planned Union financing when submitting their plans to the Commission. Financial support under Facility should be additional to the support provided under other Union funds and programmes, and reform and investment projects financed under the Facility should be able to receive funding from other Union programmes and instruments provided that such support does not cover the same cost.

(36) Pursuant to paragraphs 22 and 23 of the Interinstitutional Agreement of 13 April 2016 for Better Law-Making, there is a need to evaluate the ▌Facility ▌on the basis of information through specific monitoring requirements, while avoiding overregulation and administrative burdens, in particular on Member States. Those requirements, where appropriate, should include measurable indicators, as a basis for evaluating the effects of the instruments on the ground. A dedicated scoreboard that should complement the existing Social Scoreboard and the existing Macroeconomic imbalance procedure Scoreboard should be set up to that effect. Spending under the Facility should be subject to a dedicated discharge procedure in a separate chapter of the discharge evaluation report of the Commission under Article 318 TFEU. Data collected for monitoring purposes should be collected disaggregated by gender.

(36a) The Commission should be accountable as regards the implementation of the Facility and should appear before the European Parliament to provide explanations where necessary, including in cases of gross negligence or misconduct. In this respect, the European Parliament may provide recommendations to address the identified shortcomings.

(37) It is opportune that the Commission provides a biannual report to the European Parliament and the Council on the implementation of the Facility set out in this Regulation. This report should include detailed information on the progress made by Member States, including the status of implementation of the targets and milestones, under the recovery and resilience plans approved; it should also include information on the volume of the proceeds assigned to the Facility under the European Union Recovery Instrument in the previous year, broken down by budget line, and the contribution of the amounts raised through the European Union Recovery Instrument to the achievements of the objectives of the Facility.

(38) An independent evaluation, looking at the achievement of the objectives of the Facility established by this Regulation, the efficiency of the use of its resources and its added value should be carried out. Where appropriate, the evaluation should be accompanied by a proposal for amendments to this Regulation. An independent ex-post evaluation should, in addition, deal with the long-term impact of the instruments.

(38a) The Commission should present reviews of the implementation of the Facility and propose, if appropriate, modifications of the Regulation in order to ensure full commitment of the appropriations.

(39) The recovery and resilience plans to be implemented by the Member States and the corresponding financial contribution allocated to them should be established by way of delegated acts. The power to adopt acts in accordance with Article 290 TFEU relating to the adoption of the recovery and resilience plans and to the payment of the financial support upon fulfilment of the relevant milestones and targets should be delegated to the Commission. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making. In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States’ experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated actions. After the adoption of a delegated act, it should be possible for the Member State concerned and the Commission to agree on certain operational arrangements of a technical nature, detailing aspects of the implementation with respect to timelines, indicators for the milestones and targets, and access to underlying data. To allow the continuous relevance of the operational arrangements in respect of the prevailing circumstances during the implementation of the recovery and resilience plan, it should be possible that the elements of such technical arrangements may be modified by mutual consent. Horizontal financial rules adopted by the European Parliament and the Council on the basis of Article 322 TFEU apply to this Regulation. Those rules are laid down in the Financial Regulation and determine in particular the procedure for establishing and implementing the budget through grants, procurement, prizes, indirect implementation, and provide for checks on the responsibility of financial actors. Rules adopted on the basis of Article 322 TFEU also concern the protection of the Union's budget in case of generalised deficiencies as regards the rule of law in the Member States, as the respect for the rule of law is an essential precondition for sound financial management and effective Union funding.

(40) In accordance with the Financial Regulation, Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council[8], Council Regulation (Euratom, EC) No 2988/95[9],Council Regulation (Euratom, EC) No 2185/96[10] and Council Regulation (EU) 2017/1939[11], the financial interests of the Union are to be protected through proportionate measures, including the prevention, detection, correction and investigation of irregularities and fraud, the recovery of funds lost, wrongly paid or incorrectly used and, where appropriate, the imposition of administrative sanctions. In particular, in accordance with Regulation (EU, Euratom) No 883/2013 and Regulation (Euratom, EC) No 2185/96, the European Anti-Fraud Office (OLAF) may carry out administrative investigations, including on-the-spot checks and inspections, with a view to establishing whether there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union. In accordance with Regulation (EU) 2017/1939, the European Public Prosecutor's Office (EPPO) may investigate and prosecute fraud and other criminal offences affecting the financial interests of the Union as provided for in Directive (EU) 2017/1371 of the European Parliament and of the Council[12]. In accordance with the Financial Regulation, any person or entity receiving Union funds is to fully cooperate in the protection of the Union’s financial interests, to grant the necessary rights and access to the Commission, OLAF, the EPPO and the European Court of Auditors and to ensure that any third parties involved in the implementation of Union funds grant equivalent rights to the Commission, OLAF, the EPPO and the European Court of Auditors. To ensure full transparency, final recipients or beneficiaries of funding from the Facility should be disclosed. For the purpose of audit and control of the use of funds, the Member States should provide information in an electronic format into a single database, without adding unnecessary administrative burden.

(41) Since the objectives of this Regulation cannot be sufficiently achieved by the Member States alone, but can rather be better achieved at Union level, the Union may adopt measures in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond that which is necessary to achieve that objective. Reviews and regular updates on the functioning of the programme should be provided to the European Parliament in order to inform discussions, for example at the Conference on the Future of Europe.

(42) In order to allow for the prompt application of the measures provided for in this Regulation, this Regulation should enter into force on the day following that of its publication in the Official Journal of the European Union.

HAVE ADOPTED THIS REGULATION:

CHAPTER I

General provisions and financial envelope

Article 1
Subject matter

This Regulation establishes a Recovery and Resilience Facility (the ‘Facility’).

It lays down its objectives, the financing, the forms of Union funding and the rules for providing such funding.

Article 2
Definitions

For the purposes of this Regulation, the following definitions apply:

1. ‘Union Funds’ means the funds covered by Regulation (EU) YYY/XX of the European Parliament and of the Council [CPR successor][13];

2. ‘financial contribution’ means non-repayable financial support available for allocation or allocated to the Member States under the Facility; ▌

2a. 'non-revolving loan' means a loan made to a Member State with a fixed schedule in time for the repayments by regular instalments;

3. ‘European Semester of ▌policy coordination’ or ‘European Semester’ means the process set out by Article 2-a of Council Regulation (EC) No 1466/97 ▌[14];

3a. ‘national authority’ means one or more public authorities at the level of government, including those at regional and local levels, as well as Member State organisations within the meaning of Article 2(42) of the Financial Regulation, cooperating in a spirit of partnership in accordance with the Member States' institutional and legal framework;

3b. ‘additionality’ for the purpose of this Regulation means compliance with the requirement set out in [point (b)of Article 209(2)] of [the Financial Regulation] and, if applicable, maximising private investment in accordance with [point (d) of Article 209(2)] of the [Financial Regulation];

3c. ‘milestones’ mean clear, qualitative and quantitative, measurable and verifiable commitments that a Member State undertook in the context of the recovery and resilience plans;

3d. ‘resilience’ means the ability to face economic, social and environmental shocks and persistent structural changes deriving from any kind of crisis in a fair, sustainable and inclusive way, and promoting well-being for all;

3e. ‘do no significant harm’ means not supporting or carrying out economic activities that significantly harm any environmental objective, as referred to, where relevant, in Regulation (EU) 2020/852 of the European Parliament and Council[15] (EU Taxonomy Regulation). The Commission shall develop a technical guidance notes on the practical application of the ‘do no significant harm’ principle, taking into account that Regulation.

3f. ‘Union climate and environment objectives’ mean the Union climate objectives and targets set out in Regulation (EU) …/…[European Climate Law].

Article 3
Scope

The scope of application of the ▌Facility established by this Regulation shall refer to six European priorities structured in pillars as follows:

- just green transition, taking into account the objectives of the Green Deal;

- digital transformation, taking into account the objectives of the European Digital Strategy;

- economic cohesion, productivity and competitiveness taking into account the objectives of the Industrial and SME Strategies;

- social and territorial cohesion, taking into account the objectives of the European Pillar of Social Rights;

- institutional resilience, in view of increasing crisis-reaction and crisis-preparedness; and

- policies for the Next Generation, taking into account the objectives of the European Skills Agenda, the Youth Guarantee and Child Guarantee.

Recovery and resilience plans eligible for financing under this instrument shall allocate 100% of its allocation, measured in aggregate cost, to investment and reform measures that fall under the six European priorities. Each national recovery and resilience plan shall allocate at least 7% of its allocation, measured in aggregate cost, to investment and reform measures falling under each of the six European priorities.

The Commission shall develop technical guidance notes on the practical application of the allocation.

To contribute to, and be fully consistent with, the climate and environment objectives of the Union, notably the transition towards achieving the Union’s updated 2030 climate targets and complying with the objective of Union climate neutrality by 2050 in accordance with [Regulation 2020/XXX establishing the framework for achieving climate neutrality and amending Regulation (EU) 2018/199 (European Climate Law)], at least 40% of the amount of each recovery and resilience plan shall contribute to climate and biodiversity mainstreaming across the six European priorities.

Reflecting the priorities of the European Digital Strategy and the necessity to accomplish a Digital Single Market which will increase the Union’s competitiveness at global level and also help make the Union more resilient, more innovative and strategically autonomous, at least 20% of the amount of each recovery and resilience plan shall contribute to finance digital expenditure across the six European priorities.

Article 4
General and specific objectives

1. The general objective of the ▌Facility shall be to focus on the six European priorities referred in Article 3. Particular attention should be given to the interplay and interlinkages between the six European priorities in order to provide coherence and synergies, thereby generating European added value. The Facility shall  promote the Union’s economic, social and territorial cohesion and convergence as well as strategic autonomy by improving the resilience, crisis preparedness and adjustment capacity of the Member States, mitigating the social and economic and gender-related impact of the crisis, ▌ supporting the just green and digital transitions, ▌ contributing to restoring the growth potential of the economies of the Union, fostering high quality employment creation in the aftermath of the COVID-19 crisis, ▌ promoting sustainable growth and enhancement of the euro area.

1b. The Facility shall contribute to the objectives of Union policies, the United Nations’ Sustainable Development Goals, the European Pillar of Social Rights, the Paris Agreement and the strengthening of the Single Market.

2. To achieve that general objective, the specific objective of the Recovery and Resilience Facility shall be to provide Member States with financial support with a view to achieving the clear milestones and targets of sustainable growth enhancing reforms and investments as set out in their recovery and resilience plans. That specific objective shall be pursued in close and transparent cooperation with the Member States concerned.

Article 4a
Horizontal principles

1. The Facility shall not run counter to the strategic and economic interests of the Union. In this respect, support shall not be provided to projects that are part of the strategic investment plans of third countries, falling within the scope of the factors likely to affect security or public order to be taken into account by Member States and the Commission under Article 4 Regulation (EU) 2019/452 of the European Parliament and of the Council[16].

2. Support from the Facility shall not substitute recurring national budgetary expenditure and shall respect the principle of additionality of the Union funding.

3. The Facility shall only support projects respecting the “do no significant harm” principle.

Article 5
Resources from the European Union Recovery Instrument

1. Measures referred to in Article 2 of Regulation [EURI] shall be implemented under the Facility:

(a) through amount of EUR 337 968 000 000 referred to in point (ii) of Article 3(2)(a) of Regulation [EURI] in current prices [EUR 312 500 000 000, in 2018 prices], available for non-repayable support, subject to Article 4(4) and (8) of Regulation [EURI].

Those amounts shall constitute external assigned revenues in accordance with Article 21(5) of the Financial Regulation.

(b) through amount of EUR 385 856 000 000 referred to in Article 3(2)(b) of Regulation [EURI] in current prices, [EUR 360 000 000 000, in 2018 prices] available for non-revolving loan support to Members States pursuant to Article 12 and 13, subject to Article 4(5) of Regulation [EURI].

2. The amounts referred to in paragraph 1(a) may also cover expenses pertaining to preparatory, monitoring, control, audit and evaluation activities, which are required for the management of the Facility and the achievement of its objectives, in particular studies, meetings of experts, information and communication actions, including corporate communication of the political priorities of the Union, in so far as they are related to the objectives of this Regulation, consultation of national authorities, social partners, civil society, in particular youth organisations and other relevant stakeholders expenses linked to IT networks focusing on information processing and exchange, corporate information technology tools, and all other technical and administrative assistance expenses incurred by the Commission for the management of the Facility. Expenses may also cover the costs of other supporting activities such as quality control and monitoring of projects on the ground and the costs of peer counselling and experts for the assessment and implementation of sustainable growth enhancing reforms and investments. In view of such activities, Member States may also request technical support in accordance with Regulation XX/YYYY [establishing Technical Support Instrument].

2a. By 31 December [2024], the Commission shall assess the expected amount of unused commitment appropriations and decommitment appropriations available for non-repayable support referred to in paragraph 1, point a of this Article that may be entered into the Union budget to reinforce programmes with the European added value as external assigned revenues in accordance with Article 21(5) of the Financial Regulation in the 2025 Draft Budget of the EU.

The Commission shall propose, on an individual basis, to reinforce the programmes identified in first sub-paragraph only after an assessment, which shall conclude that the programmes concerned need an increase of financing in order to reach the objectives set out in the respective legislation.

The assessment of Commission shall be presented to the budgetary authority. The Parliament and the Council shall have the possibility to amend, approve or reject individually the proposals of the Commission to reinforce specific programmes identified in the first sub-paragraph of this paragraph.

The amounts not used to reinforce the programmes identified in the first sub-paragraph of this paragraph shall be used in their entirety for repayment of the financing drawn by the Commission for the purpose of the financing of the Facility.

Article 6
Resources from shared management programmes

1. Resources allocated to Member States under shared management may, at their request, be transferred to the Facility. The Commission shall implement those resources directly in accordance with point (a) of Article 62(1) of the Financial Regulation. Those resources shall be used for the benefit of the Member State concerned with a maximum limit of 5% of the budgetary envelope of the Member State.

2. Member States may propose to allocate up to 5% of their reform and resilience plan to the Technical Support Instrument and to the InvestEU Programme, in particular for solvency support measures, as well as MFF programmes under direct management for children, youth, including Erasmus, culture, as well as R&I, including Horizon Europe - if, and only if, the amount allocated shall contribute to the achievement of the objectives and respect the requirements of this Regulation in accordance with Articles 3, 4 and 4a and follow the assessment procedure of Article 17. The amount allocated shall be implemented in accordance with the rules of the Funds to which the resources are transferred and for the benefit of the Member State concerned. No co-financing is required for the amount transferred. The Commission shall implement those resources in accordance with point (a) of Article 62(1) of the Financial Regulation.

Article 7
Implementation

The ▌Facility shall be implemented by the Commission in direct management in accordance with the Financial Regulation.

Article 8
Additionality and complementary funding

Support under the ▌Facility shall be additional to the support provided under other Union funds and programmes and financing provided by the European Investment Bank Group or other international financial institutions in which a Member State is a shareholder. Reform and investment projects may receive support from other Union programmes and instruments provided that such support does not cover the same cost.

Article 9
Measures linking the Facility to sound economic governance

When the general escape clause of the Stability and Growth Pact is deactivated, the Commission shall propose, in 3 months, an amending proposal of this Regulation to link the Facility to sound economic governance as laid down in Article 15(7) of the Regulation laying down common provisions on the […)][CPR]. ▌

Article 9a
Measures linking the Facility to the protection of the Union budget in the case of generalised deficiencies as regards the rule of law

1. The Facility shall only be available to Member States committed to respecting the rule of law and Union’s fundamental values.

2. The Commission shall be empowered to initiate the suspension of the commitment or payment appropriations to Member States under the Facility in case of 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.

3. 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 a lawyer and a client.

4. A generalised deficiency as regards the rule of law in a Member State may be established, in particular, when one or more of the following are affected or risk being affected:

(a) the proper functioning of the authorities of the Member State implementing the Facility, in particular in the context of public procurement or grant procedures;

(b) 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;

(c) 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;

(d) 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 Facility;

(e) the effective judicial review by independent courts of actions or omissions by the authorities referred to in points a), c) and d);

(f) the prevention and sanctioning of fraud, including tax fraud, corruption or other breaches of Union law relating to the implementation of the Facility, and the imposition of effective and dissuasive penalties on recipients by national courts or by administrative authorities;

(g) the recovery of funds unduly paid;

(h) the prevention and sanctioning of tax evasion and tax competition and the proper functioning of authorities contributing to administrative cooperation in tax matters;

(i) the effective and timely cooperation with OLAF and, subject to the participation of the Member State concerned, with EPPO in their investigations or prosecutions pursuant to respective legal acts and to the principle of loyal cooperation;

(j) the proper implementation of the Facility following a systemic violation of fundamental rights.

5. When the conditions of paragraph 4 are fulfilled, one or more of the following measures may be adopted:

(a) a prohibition to enter into new legal commitments;

(b) a suspension of commitments;

(c) a reduction of commitments, including through financial corrections;

(d) a reduction of pre-financing;

(e) an interruption of payment deadlines;

(f) a suspension of payments.

Unless the decision adopting the measures provides otherwise, the imposition of appropriate measures shall not affect the obligation of a Member State to make payments to final recipients or beneficiaries. Regional and local actions that are eligible for support shall continue to benefit from the Facility. In case of any deficiencies by a Member State, regional and local actions that are eligible for support shall continue to benefit from the Facility.

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.

The Commission shall provide information and guidance for the benefit of final recipients or beneficiaries on the obligations by Member States 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. 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.

Based on the information provided by the final recipients or beneficiaries, the Commission shall ensure that any amount due by Member States is effectively paid to final recipients or beneficiaries.

6. Where the Commission finds that it has reasonable grounds to believe that the conditions of paragraph 4 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.

When assessing whether the conditions of paragraph 4 are fulfilled, the Commission shall take into account all relevant information, 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.

The Commission shall be assisted by a Panel of independent experts, which shall be established by means of a delegated act.

The Commission may request any additional information required for its assessment, both before and after having made a finding.

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.

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 paragraph 5. 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.

When assessing the proportionality of the measures to be imposed, the Commission shall have due regard to the information and guidance referred to in this paragraph.

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 paragraph 5 by means of an implementing act.

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.

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.

The decision referred to in the eighth sub-paragraph shall enter into force if neither the European Parliament nor the Council reject the transfer proposal within the period referred to in the tenth sub-paragraph.

7. 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.

At the request of the Member State concerned or on its own initiative, the Commission 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 on the grounds of which the measures referred to in paragraph 5 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 paragraph 6. The procedure set out in paragraph 5 shall apply.

CHAPTER II

Financial contribution, allocation process and loans

Article 10
Maximum financial contribution

A maximum financial contribution shall be calculated for each Member State for the allocation of the amount referred to in Article 5(1)(a), using the methodology set out in Annex I, based on the population, the inverse of the per capita Gross Domestic Product (GDP), ▌ the relative unemployment rate of each Member State and the cumulative loss in real GDP observed over the period 2020-2021 compared to 2019.

For the period 2021-2022 the maximum financial contribution shall be calculated using the methodology set out in Annex I, based on the population, the inverse of the per capita GDP and the relative unemployment rate of each Member State for the period 2015-2019.

For the period 2023-2024, the maximum financial contribution shall be calculated using the methodology set out in Annex I, based on the population, the inverse of the per capita GDP, and the cumulative loss in real GDP observed over the period 2020-2021 compared to 2019 and shall be calculated by 30 June 2022.

Article 11
Allocation of financial contribution

1. For a period until 31 December 2022, the Commission shall make available for allocation EUR 337 968 000 000, referred to in point (a) of Article 5(1). Each Member State may submit requests up to their maximum financial contribution, referred to in Article 10, to implement their recovery and resilience plans.

2. For a period starting after 31 December 2022 until 31 December 2024, where financial resources are available, the Commission may organise calls in line with the calendar of the European Semester. To that effect, it shall publish an indicative calendar of the calls to be organised in that period, and shall indicate, at each call, the amount available for allocation. Each Member State may propose to receive up to a maximum amount corresponding to its allocation share of the available amount for allocation, as referred to in Annex I, to implement the recovery and resilience plan.

Article 12
Loans

1. Until 31 December 2024, upon request from a Member State, the Commission may grant to the Member State concerned a loan support for the implementation of its recovery and resilience plans.

2. A Member State may request a loan at the same time of the submission of a recovery and resilience plan referred to in Article 15, or at a different moment in time until 31 August 2024. In the latter case, the request shall be accompanied by a revised plan, including additional milestones and targets.

3. The request for a loan by a Member State shall set out:

(a) the reasons for the loan support, justified by the higher financial needs linked to additional reforms and investments;

(b) the additional reforms and investments in line with Article 15;

(c) the higher cost of the recovery and resilience plan concerned compared to the amount of the maximum financial contribution referred to in Article 10, or to the financial contribution allocated to the recovery and resilience plan on the basis of Article 17(3)(b);

(ca) information about how the loan request fits into the overall financial planning of the Member State and the general objective of sound fiscal policies.

4. The loan support to the recovery and resilience plan of the Member State concerned shall not be higher than the difference between the total cost of the recovery and resilience plan, as revised where relevant, and the maximum financial contribution referred to in Article 10. The maximum volume of the loan for each Member State shall not exceed 6.8% of its Gross National Income.

5. By derogation from paragraph 4, subject to availability of resources, in exceptional circumstances the amount of the loan support may be increased.

6. The loan support shall be disbursed in instalments subject to the fulfilment of milestones and targets in line with Article 17(4)(g).

7. The Commission shall take a decision on the request for a loan support in accordance with Article 17. Where appropriate, the recovery and resilience plan shall be amended accordingly.

Article 13
Loan agreement

1. Prior to entering into a loan agreement with the Member State concerned, the Commission shall assess whether:

(a) the justification for requesting the loan and its amount is considered reasonable and plausible in relation to the additional reforms and investments; and

(b) the additional reforms and investments comply with the criteria set out in Article 16(3).

2. Where the request for a loan fulfils the criteria referred to in paragraph 1, and upon adoption of the decision referred to in Article 17(2), the Commission shall enter into a loan agreement with the Member State concerned. The loan agreement, in addition to the elements laid down in Article 220(5) of the Financial Regulation, shall contain the following elements:

(a) the amount of the loan in euro, including, where applicable, the amount of pre-financed loan support in accordance with Article XX;

(b) the average maturity; Article 220(2) of the Financial Regulation shall not apply with regard to this maturity;

(c) the pricing formula, and the availability period of the loan;

(d) the maximum number of instalments and a clear and precise  repayment schedule;

(e) the other elements needed for the implementation of the loan support in relation to the reforms and the investment projects concerned in line with the decision referred to in Article 17(2).

3. In accordance with Article 220(5)(e) of the Financial Regulation, costs related to the borrowing of funds for the loans referred to in this Article shall be borne by the beneficiary Member States.

4. The Commission shall establish the necessary arrangements for the administration of the lending operations related to loans granted in accordance with this Article.

5. A Member State benefitting from a loan granted in accordance with this Article shall open a dedicated account for the management of the loan received. It shall also transfer the principal and the interest due under any related loan to an account indicated by the Commission in line with the arrangements put in place in accordance with the previous paragraph twenty TARGET2 business days prior to the corresponding due date.

Article 13a
Reviews and revisions

1. By the end of 2022 at the latest, the Commission shall present a review of the implementation of the resources referred to in Chapter II of this Regulation. This compulsory review shall, as appropriate, be accompanied by a legislative proposal for the revision of this Regulation to ensure the full use of the resources.

2. By the end of 2024 at the latest, the Commission shall present a review of the implementation of the resources referred to in Chapter II of this Regulation. This compulsory review shall be accompanied by necessary measures for the revision of this Regulation to ensure the full use of commitment appropriations.

CHAPTER III

Recovery and resilience plans

Article 14
Eligibility

1. In pursuance of the European priorities referred to in Article 3 and the objectives set out in Article 4, Member States shall prepare national recovery and resilience plans. These plans shall set out the reform and investment agenda of the Member State concerned for the subsequent four years. Recovery and resilience plans eligible for financing under this instrument shall comprise measures for the implementation of reforms and public and private investment projects through a comprehensive and coherent package. For the preparation of the recovery and resilience plans, Member States can make use of the Technical Support Instrument in accordance with Regulation XX/YYYY [establishing Technical Support Instrument].

Measures started from 1 February 2020 onwards related to the economic and social consequences of the COVID-19 crisis shall be eligible for support by the recovery and resilience facility, provided they adhere to the requirements set out in this Regulation.

2. The recovery and resilience plans shall contribute to the six European priorities as defined in Article 3, including the minimum spending shares identified in Article 3, the general and specific objectives as defined in Article 4 and shall respect the horizontal principles established under Article 4a.

2a. In line with the scope of the Facility, the recovery and resilience plans shall contribute to effectively address challenges identified in the relevant country-specific recommendations for the Member State concerned or in other relevant documents officially adopted by the Commission in the context of the European Semester, including the relevant recommendations for the euro area as endorsed by the Council.

2b. The recovery and resilience plans shall also be consistent with the information included by the Member States in the National Reform Programmes under the European Semester, in their national energy and climate plans and updates thereof under the Regulation (EU)2018/1999[17], in the territorial just transition plans under the Just Transition Fund[18], in the Youth Guarantee implementation plans and in the partnership agreements and operational programmes under the Union funds and in actions related to the implementation of Union law and policies.

2c. The recovery and resilience plans shall be consistent with the Union’s Gender Equality Strategy 2020-2025, shall be based on a gender impact assessment of the planned measures and shall comprise key actions to effectively address the negative impact of the crisis on gender equality combined with measures for gender mainstreaming. The recovery and resilience plans shall also be consistent with the national gender equality strategies.

2d. Recovery and resilience plans shall not be detrimental to the Single Market.

3. Where a Member State is exempted from the monitoring and assessment of the European Semester on the basis of Article 12 of Regulation (EU) 472/2013, or is subject to surveillance under Council Regulation (EC) No 332/2002, the provisions set out in this regulation shall be applied to the Member State concerned in relation to the challenges and priorities identified by the measures set out under the regulations thereof.

3a. The national recovery and resilience shall not affect the right to conclude or enforce collective agreements or to take collective action in accordance with national law and practices in accordance with the Charter of Fundamental Rights of the European Union and national and Union law and practices.

Article 15
Recovery and resilience plan

1. A Member State wishing to receive a financial contribution as made available for allocation in accordance with Article 11(1) shall submit to the Commission a recovery and resilience plan as defined in Article 14(1).

After the Commission makes available for allocation the amount referred to in Article 11(2) a Member State shall, when relevant, update and submit to the Commission, the recovery and resilience plan referred to in paragraph 1 to take into account the updated maximum financial contribution calculated in accordance with Article 10(2).

2. The recovery and resilience plan presented by the Member State concerned shall be submitted together with the National Reform Programme in a single integrated document and shall as a rule be officially submitted at the latest by 30 April. A draft plan may be submitted by Member State starting from 15 October of the preceding year, together with the draft budget of the subsequent year.

A Member State wishing to receive support under the Facility shall establish a multilevel dialogue, in which local and regional authorities, social partners, civil society organisations, in particular youth organisations, and other relevant stakeholders and the general public are able to actively engage and discuss the preparation and the implementation of the recovery and resilience plan. The draft plan shall be submitted to the attention of local and regional authorities, social partners, civil society organisations, in particular youth organisations, and other relevant stakeholders and the general public for consultation before the date of submission to the Commission and social partners shall have at least 30 days to react in writing, in accordance with the principle of partnership.

3. The recovery and resilience plan shall be duly reasoned and substantiated. It shall in particular set out the following elements:

(a) a detailed explanation on how the recovery and resilience plans and measures shall contribute to each of the six European priorities as defined in Article 3 and shall contribute and not run counter the objectives of Article 4, paragraph 1, point b;

(ab) in line with the scope of the Facility, a justification on how the plan contributes to effectively address challenges identified in the relevant country-specific recommendations for the Member State concerned or in other relevant documents officially adopted by the Commission in the context of the European Semester, including the relevant recommendations for the euro area as endorsed by the Council;

(ac) in case a Member State is experiencing imbalances or excessive imbalances as concluded by the Commission after an in-depth review, an explanation of the way the recommendations made under Article 6 of Regulation (EU) No 1176/2011 are compatible with the plans;

(ad)  a detailed explanation of how the plan complies with the minimum allocation shares for each of the six European priorities established under Article 3;

(ae) a detailed explanation of how at least 40% of the amount requested for the recovery and resilience plan contribute to climate and biodiversity mainstreaming using the tracking methodology provided by the Commission. Before the entry into force of the Regulation, the Commission shall adopt by means of a delegated act the corresponding methodology using, as appropriate, the criteria established by the EU taxonomy;

(af) an explanation of how the measures in the plan are expected to contribute to digital actions and whether they account for an amount which represents at least 20% of the plan’s total allocation, based on the methodology for digital tagging set out in Annex...; the methodology shall be used accordingly for measures that cannot be directly assigned to an intervention field listed in the table; the coefficients for support to the digital objectives may be increased for individual investments to take account of accompanying reform measures that increase their impact on the digital objectives;

(ag) an explanation on how the measures do not run counter the strategic and economic interests of the Union, do not substitute recurring national budgetary expenditure and respect the principle of additionality and the do no significantly harm principle in accordance with Article 4a;

(ah) a justification of how the recovery and resilience plan is consistent with the principles of Union’s Gender Equality Strategy 2020-2025, the national Gender equality strategy, a gender impact assessment and an explanation of how the measures in the plan are expected to contribute to the promotion of gender equality and the principle of gender mainstreaming and elimination of gender discrimination or to the challenges resulting from it;

▌

(d) envisaged clear milestones, targets and an indicative timetable for the implementation of the reforms over a maximum period of four years, and of the investments over a maximum period of seven years;

(da) a justification of how the recovery and resilience plans represent a comprehensive reform and investment package and how they are consistent and the expected synergies with plans, strategies and programmes laid down in documents referred to in Article 14(2b);

(e) the envisaged public and private investment projects, and the related investment period and references to the involvement of private partners, where relevant;

(ea) in case the measures provided for in the recovery and resilience plan are not exempted from the obligation to notify State aid referred to in Article 108, paragraph 3, TFEU in accordance with the Commission Regulation (EU) No 651/2014[19], the recovery and resilience plan shall be analysed with priority by the Commission for the purposes of compliance with State aid and competition rules;

(f) the estimated total cost of the reforms and investments covered by the recovery and resilience plan submitted (also referred as ‘estimated total cost of the recovery and resilience plan’) backed up by a clear justification validated by an independent public body and how the cost is commensurate to the expected social and economic impacts ▌in line with the principle of cost-efficiency;

(g) where relevant, information on existing or planned Union financing and the link with previous or planned reforms in the framework of the Structural Reform Support Program or Technical Support Instrument;

(h) the accompanying measures that may be needed, including a timetable of all policy actions;

(i) a summary of the multilevel dialogue as referred to in of paragraph 2, subparagraph 2, how the inputs of the stakeholders were taken into account and, at the request of the stakeholders, their opinions may be attached to the national recovery and resilience plans as well as the details, including the relevant milestones and targets, of the consultations and dialogues planned in relation to the implementation of the recovery and resilience plan;

(j) the arrangements for the effective monitoring and implementation of the recovery and resilience plan by the Member State concerned, including the proposed qualitative and quantitative clear milestones and targets, and the related indicators including how the plan improves the country-based performance under the Social Scoreboard and the Macroeconomic imbalance procedure scoreboard;

(k) where appropriate, the request for loan support and the additional milestones as referred to in Article 12(2) and (3) and the elements thereof; and

(ka) an explanation of the Member State's plans, systems and concrete measures to prevent, detect and correct conflicts of interest, corruption and fraud when using the funds as derived from the Facility, including those aiming to avoid double funding from other Union programmes and to recover funds lost, wrongly paid or incorrectly used and, where appropriate, the imposition of sanctions;

(kb) arrangements made by Member States to ensure that recipient undertakings are not involved in any reportable tax arrangements under the Directive (EU) 2018/822 in relation to cross-border arrangements;

(l) any other relevant information.

4. In the preparation of proposals for their recovery and resilience plan, Member States may request the Commission to organise an exchange of good practices in order to allow the requesting Member States to benefit from the experience of other Member States. Member States may also request at any time throughout the year technical support under the Technical Support Instrument in accordance with the regulation thereof. Technical support shall fully respect national rules and practices concerning collective bargaining. Technical support activities cannot undermine the role of social partners or threaten the autonomy of collective bargaining.

4a. In order to ensure greater transparency and accountability, Member States representatives responsible of the recovery and resilience plan and, where appropriate, Independent Fiscal Institutions, once invited, shall appear before the competent committees of the European Parliament to present the recovery and resilience plan. Relevant information shall be made available by the Commission to the European Parliament and the Council simultaneously and on equal terms.

Article 16
Commission assessment

1. When assessing the recovery and resilience plan and where relevant its update, as submitted by the Member State in accordance with Article 15(1), the Commission shall act in close cooperation with the Member State concerned. The Commission may make observations or seek additional information. The Member State concerned shall provide the requested additional information and may revise the plan if needed, prior to or after its official submission. The Member State concerned and the Commission may agree to extend the deadline set out in Article 17(1) by a reasonable time period if necessary.

1a. In its evaluation, the Commission shall take into account the synergies created between the recovery and resilience plans of different Member States and the complementarity between those plans and other investment plans at national level.

2. When assessing the recovery and resilience plan and in the determination of the amount to be allocated to the Member State concerned, the Commission shall take into account the analytical information on the Member State concerned available in the context of the European Semester as well as the justification and the elements provided by the Member State concerned, as referred to in Article 15(3), and any other relevant information including, in particular, the one contained in the National Reform Programme and the National Energy and Climate Plan of the Member State concerned and, in the territorial just transition plans under the Just Transition Fund,  in the Youth Guarantee implementation plans and, if relevant, information from technical support received via the Technical Support Instrument.

It shall also take into account information contained in the Annual Rule of Law Report, the EU Justice Scoreboard, the Macroeconomic Imbalances Procedure Scoreboard and the Social Scoreboard. The Commission shall also require a gender impact assessment of the plan carried out by an independent expert or proceed to such an assessment itself.

The Commission shall, where relevant, consult Union wide relevant stakeholders to gather their views concerning ownership, consistency and effectiveness of the national recovery and resilience plan.

3. The Commission shall assess the effectiveness, efficiency, relevance and coherence of the recovery and resilience plan and ▌for that purpose, shall take into account the following elements:

The Commission shall assess whether all recovery and resilience plans shall fulfil the following requirements:

(a) whether the plan contributes with at least 40% of its amount to climate and biodiversity mainstreaming and whether the tracking methodology referred in Article 15(3)(ae)  is correctly applied;

(b) whether the plan contributes with at least 20% of its amount to digital actions and whether the tracking methodology referred in Article 15(3)(af) is correctly applied;

(c) whether each measure does not run counter the strategic and economic interests of the Union, does not substitute recurring national budgetary expenditure and respects the principle of additionality and the do not significantly harm principle in accordance with Article 4a;

(d) whether the plan complies with the minimum allocation shares for each of the European priorities established under Article 3;

(e) whether the arrangements made by Member States ensure that recipient undertakings are not involved in any reportable tax arrangements under the Directive (EU) 2018/822 in relation to cross-border arrangements;

▌

Effectiveness:

(f) whether the recovery and resilience plan contributes to each of the six European priorities as defined in Article 3 and whether it contributes and does not run counter the objectives of Article 4, paragraph 1, point b;

(g) whether the multilevel dialogue as referred to in Article 15, paragraph 2, subparagraph 2, has taken place and whether the respective stakeholders are given effective opportunities to participate in the preparation and the implementation of the recovery and resilience plan;

(h) whether the arrangements proposed by the Member States concerned are expected to ensure an effective monitoring and implementation of the recovery and resilience plan, including the proposed qualitative and quantitative, clear milestones and targets, and the related indicators and whether the plan improves the country-based performance under the Social Scoreboard and the Macroeconomic imbalance procedure scoreboard;

(i) whether the recovery and resilience plan is expected to have a lasting impact on the Member State concerned;

(j) whether the recovery and resilience plan includes investments in cross-border or pan-European projects generating European value added where relevant, taking into account Member States` constraints derived from their geographical position;

Efficiency:

(k) whether the justification provided by the Member State on the amount of the estimated total costs of the recovery and resilience plan submitted is reasonable and plausible and is commensurate to the expected social and economic impacts ▌in line with the principle of cost-efficiency;

(l) whether the arrangement proposed by the  Member States concerned  are expected to prevent, detect and correct conflicts of interest, corruption and fraud when using the funds as derived from the Facility, including those aiming to avoid double funding from other Union programmes;

Relevance:

(m) whether the plan contains measures that, in line with the scope of the Facility, effectively contribute to address challenges identified in the relevant country-specific recommendations addressed to the Member State concernedor in other relevant documents officially adopted by the Commission in the context of the European Semester, including the relevant recommendations for the euro area as endorsed by the Council;

(n) whether the plan, in case a Member State is experiencing imbalances or excessive imbalances as concluded by the Commission after an in-depth review, is compatible with the recommendations made under Article 6 of Regulation (EU) No 1176/2011;

(o) whether the plan contains accurate information referred to in Article 15;

Coherence:

(p) whether the plan represents a comprehensive reform and investment package and whether the arrangements provide consistency and synergies as referred to in Article 14(2b);

(q) whether the plan is consistent with the principles of Union’s Gender Equality Strategy 2020-2025, the national Gender equality strategy, whether a gender impact assessment has been carried out and whether the measures in the plan are expected to contribute to the promotion of gender equality and the principle of gender mainstreaming and elimination of gender discrimination or to the challenges resulting from it.

Those assessment criteria shall be applied in accordance with Annex II.

4. In case the Member State concerned has requested a loan support as referred to in Article 12, the Commission shall assess whether the request for loan support fulfils the criteria set out in Article 13(1), notably whether the additional reforms and investments concerned by the loan request fulfil the assessment criteria under paragraph 3.

4a. Where the Commission gives a negative assessment to a recovery and resilience plan, it shall communicate a duly justified assessment within the deadline set out in Article 17(1).

5. For the purpose of the assessment of the recovery and resilience plans submitted by Member States, the Commission may be assisted by experts, including those appointed by the European Parliament.

Article 17
Commission decision

1. The Commission shall adopt a decision within two months of the official submission of the recovery and resilience plan by the Member State, by means of a delegated act in accordance with Article 25a. In the event that the Commission gives a positive assessment to a recovery and resilience plan, that decision shall set out the reforms and investment projects to be implemented by the Member State, including the milestones and targets required for the disbursal of the instalment of the financial contribution allocated in accordance with Article 11.

2. In case the Member State concerned requests a loan support, the decision shall also set out the amount of the loan support as referred to in Article 12(4) and (5) and the additional reforms and investment projects to be implemented by the Member State covered by that loan support, including the additional milestones and targets.

3. The amount of the financial contribution for recovery and resilience plans that comply with the criteria set out in Article 16(3) ▌shall be set as follows:

(a) where the recovery and resilience plan complies satisfactorily with the criteria set out in Article 16(3), and the amount of the estimated total costs of the recovery and resilience plan is equal to, or higher than, the maximum financial contribution for that Member State referred to in Article 10, the financial contribution allocated to the Member State concerned shall be equal to the total amount of the maximum financial contribution referred to in Article 10;

(b) where the recovery and resilience plan complies satisfactorily with the criteria set out in Article 16(3), and the amount of the estimated total costs of the recovery and resilience plan is lower than the maximum financial contribution for that Member State referred to in Article 10, the financial contribution allocated to the Member State shall be equal to the amount of the estimated total costs of the recovery and resilience plan;

(ba) where the recovery and resilience plan complies satisfactorily with the criteria set out in Article 16(3), and the plan receives each B in excess of two Bs for the criteria in points h, i, l, m, p set out in Article 16(3) the financial allocation shall be reduced by 2 % per criterion and the overall reduction shall not exceed 6 % of the total financial allocation;

(c) where the recovery and resilience plan does not comply satisfactorily with the criteria set out in Article 16(3), no financial contribution shall be allocated to the Member State concerned. The Member State concerned may make a request for technical support as part of the Technical Support Instrument, in order to allow for a better preparation of the proposal in the subsequent cycles.

4. The decision referred to in paragraph 1 shall also lay down:

(a) the financial contribution to be paid only in instalments once the Member State has satisfactorily implemented the relevant milestones and targets identified in relation to the implementation of the recovery and resilience plan;

(aa) the financial contribution and, where applicable, the amount of loan support to be paid in the form of a prefinancing in accordance with Article 11a after the approval of the recovery and resilience plan;

(b) the description of the reforms and of the investment projects and the amount of the estimated total cost of the recovery and resilience plan;

(c) the period for implementation of the recovery and resilience plan as follows:

(1) as regards completion of the investment, the investment period by which the investment project must be implemented shall end no later than seven years after the adoption of the decision;

(2) as regards completion of reforms, the period by which the reforms must be implemented shall end no later than four years after the adoption of the decision.

(d) the arrangements and timetable for monitoring and implementation of the recovery and resilience plan including qualitative and quantitative clear milestones and where relevant measures necessary for complying with Article - 19;

(e) the relevant indicators relating to the fulfilment of the envisaged milestones and targets, including the methodology to measure the compliance with the climate and environmental spending targets, referred to in Article 15; and

(f) the arrangements for providing full access by the Commission to the underlying relevant data and reports;

(g) where appropriate, the amount of the loan to be paid in instalments and the additional milestones and targets related to the disbursement of the loan support.

5. Where the Commission gives a negative assessment to a recovery and resilience plan, it shall communicate a duly justified assessment within two months of the submission of the proposal by the Member State. That communication shall also include a recommendation for the Member State to use the Technical Support Instrument in accordance with Regulation XX/YYY [establishing Technical Support Instrument] in order to amend or replace the recovery and resilience plan in line with Article 18 of this Regulation. Following an invitation from the European Parliament, the Commission shall appear in front of the competent committees to present explanations for the negative assessment of the recovery and resilience plan. Relevant information shall be made available by the Commission to the European Parliament and the Council simultaneously and on equal terms.

6. The arrangements and timetable for implementation as referred to in point (d), the relevant indicators relating to the fulfilment of the envisaged milestones and targets referred to in point (e), the arrangements for providing access by the Commission to the underlying data referred to in point (f), and, where appropriate, the additional milestones and targets related to the disbursement of the loan support referred to in point (g) of paragraph 4 of this Article shall be further illustrated in an operational arrangement to be agreed by the Member State concerned and the Commission after the adoption of the decision referred to in paragraph 1 of this Article. The plan adopted and all other relevant information, including the operational agreement referred to in paragraph 6 shall be made available by the Commission to the European Parliament and the Council, simultaneously and on equal terms, immediately following the decision and publication on the Commission website. The Commission shall, by means of the delegated act referred to in paragraph 1 of this Article, specify the content of the operational arrangements with a view to fostering coherence and comparability of Member States’ national recovery and resilience plans and providing standardised data for the Recovery and Resilience Scoreboard, referred to in Article 21a.

7. The delegated acts referred to in paragraphs 1 and 2 shall be adopted in accordance with the ▌Article 25(a).

Article 18
Amendment of the Member State’s recovery and resilience plan

1. Where a Member State’s recovery and resilience plan including relevant milestones and targets, is no longer achievable, either partially or totally, by the Member State concerned because of objective circumstances, or where the Member State concerned has identified important additional investment and reform measures, eligible for support under this Regulation or when the Members State concerned intends to substantially improve the result of the assessment pursuant to Article 16 and 17, the Member State concerned may make a reasoned request to the Commission to amend or replace the decisions referred to in Article 17(1) and 17(2). To that effect, the Member State may propose a modified or a new recovery and resilience plan. The Member State may request at any time throughout the year to use the Technical Support Instrument in accordance with Regulation XX/YYYY [establishing Technical Support Instrument] for the purpose of amending or replacing the recovery and resilience plan.

2. Where the Commission considers that the reasons put forward by the Member State concerned justify an amendment of the relevant recovery and resilience plan, the Commission shall assess the new plan in accordance with the provisions of Article 16 and shall take a new decision in accordance with Article 17 within two months of the official submission of the request.

3. Where the Commission considers that the reasons put forward by the Member State concerned do not justify an amendment of the relevant recovery and resilience plan, it shall reject the request within two months of its official submission, after having given the Member State concerned the possibility to present its observations within a period of one month of the communication of the Commission's conclusions. Following an invitation from the European Parliament, the Commission shall appear before the competent committees to present explanations for the negative assessment of the recovery and resilience plan.

3a. Member States shall align where relevant, through an update, their recovery and resilience plans in accordance with the updated 2030 climate target of the Regulation establishing the framework for achieving climate neutrality and amending Regulation (EU) 2018/1999 (European Climate Law) within six month after the publication of this Regulation in the Official Journal. The Commission shall assess the updated recovery and resilience plans consistently with the requirements set in Article 16 and shall take a new decision in accordance with Article 17 within two months of the official submission of the request.

CHAPTER IV

Financial provisions

Article -19
Protection of the financial interests of the Union

1. In implementing the Facility, the Member States, as beneficiaries or borrowers of funds under the Facility, shall take all the necessary measures to protect the financial interests of the Union, and in particular to ensure that any measure for the implementation of reforms and investments projects under the recovery and resilience plan complies with the applicable Union and national law.

2. The agreements referred to in Articles 13(2) and 19(1) shall provide for the obligations of the Member States:

(a) to regularly check that the financing provided has been properly used in accordance with all applicable rules and that any measure for the implementation of reforms and investment projects under the recovery and resilience plan has been properly implemented in accordance with all applicable rules, including Union law and national law;

(b) to take appropriate measures to prevent, detect and correct fraud, corruption, and conflict of interest as defined in Article 61(2) and (3) of the Financial Regulation affecting the financial interests of the Union and to take legal actions to recover funds that have been misappropriated, including in relation to any measure for the implementation of reforms and investment projects under the recovery and resilience plan;

(c) to accompany a request for payment by:

(i) a management declaration that the funds were used for its intended purpose, that the information submitted with the request for payment is complete, accurate and reliable and that the control systems put in place give the necessary assurances that the funds were managed in accordance with all applicable rules, in particular rules on avoidance of conflict of interest, fraud prevention, corruption and double funding in accordance with the principle of sound financial management; and

(ii) a detailed account of the audits, appropriate justification of the cost estimates as validated by an independent public body, impact assessments, financial statements, and other relevant information, as well as the controls carried out, particularly with regards to investment projects, including weaknesses identified and any corrective actions taken;

(d) to collect for the purposes of audit and control of the use of funds in relation to measures for the implementation of reforms and investment projects under the recovery and resilience plan, in an electronic format into a single database that allows, without adding unnecessary administrative burden, for a comparable level of access by Union investigative and audit bodies, the following categories of data:

(i) name of the final recipient of funds;

(ii) name of the contractor and sub-contractor, where the final recipient of funds is a contracting authority in accordance with the Union or national provision on public procurement;

(iii) first name(s), last name(s) and date of birth of beneficial owner(s) of the recipient of funds or contractor, as defined by Article 3, paragraph 6 of Directive (EU) 2015/849 of the European Parliament and of the Council[20];

(iv) list of any measures for the implementation of reforms and investment projects under the recovery and resilience plan, the total amount of public funding, by indicating the amount of funds disbursed under the Facility and under other Union funds;

(e) to expressly authorise the Commission, OLAF, EPPO and the Court of Auditors to exert their rights as foreseen by Article 129(1) of the Financial Regulation and to impose similar obligations to all final recipients of funds disbursed for the measures for the implementation of reforms and investment projects included in the recovery and resilience plan, or to all other persons or entities involved in their implementation;

(f) to keep records in line with Article 132 of the Financial Regulation;

(fa) to keep records in line with Article 75 of the Financial Regulation. As a result, documents relating to budget implementation shall be kept for at least five years from the date on which the European Parliament gives discharge. Documents relating to operations shall in any case be kept until the end of the year following the year in which those operations are definitely closed. In case of legal proceedings, the time period shall be suspended until the last possibility of judicial appeal has expired;

(g) personal data contained in supporting documents shall, where possible, be deleted when those data are not necessary for budgetary discharge, control and audit purposes. Regulation (EU) 2018/1725 of the European Parliament and of the Council[21] shall apply to the conservation of traffic data.

3. Member States are the implementing partners and shall trace, collect and store information on the recipients of funding for projects that are covered by the Facility.

The Commission remains accountable towards the budgetary authority in the context of the annual discharge procedure, and presents the Facility as dedicated discharge procedure in a separate chapter of the discharge evaluation report of the Commission under Art 318 TFEU.

4. Union funds disbursed under the Facility are subject to the external audit of the European Court of Auditors in accordance with Article 287 TFEU.

5. The Commission, OLAF, EPPO and the Court of Auditors shall be expressly authorised by Member States, under this Regulation to exert their rights as foreseen by Article 129(1) of the Financial Regulation.

OLAF may carry out administrative investigations, including on-the-spot checks and inspections, in accordance with the provisions and procedures laid down in Regulation (EU, Euratom) No 883/2013 and Council Regulation (Euratom, EC) No 2185/96, with a view to establishing whether there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union in connection with support under the Facility.

The Commission shall put in place effective and proportionate anti-fraud measures taking into account the risks identified. The Commission shall, for this purpose develop or adapt existing IT systems to create a digital performance reporting system that allows monitoring, detection and reporting of irregularities or fraud.

6. The agreements referred to in Article 13(2) and in Article 19(1) shall also provide for the right of the Commission to proportionately reduce the support under the Facility and recover any amount due to the Union budget or to ask early repayment of the loan, in cases of fraud, corruption, and conflict of interests affecting the financial interests of the Union, or breach of obligations resulting from the said agreements.

When deciding on the amount of the recovery, the reduction or on the amount to be early repaid the Commission shall respect the principle of proportionality and shall take into account the seriousness of the fraud, corruption, and conflict of interest affecting the financial interests of the Union, or breach of obligations. The Member State shall be given the opportunity to present its observations before the reduction is made or early repayment is requested.

Article 19
Commitment of the financial contribution

1. The ▌decision referred to in Article 17(1) shall constitute an individual legal commitment within the meaning of the Financial Regulation, which may be based on global commitments. Where appropriate, budgetary commitments may be broken down into annual instalments spread over several years.

1a. Budgetary commitments may be based on global commitments and, where appropriate, be broken down into annual instalments spread over several years.

Article 19a
Rules on payments, suspension and cancellation of financial contributions

2. Payment of financial contributions to the Member State concerned under this Article shall be made in accordance with the budget appropriations and subject to the available funding. The ▌decisions referred to in this Article shall be adopted in accordance with ▌Article 25(a).

2a. In 2021, subject to the adoption by the Commission of the legal commitment referred to in Article 19(1) of this Regulation, and when requested by a Member State together with the submission of the recovery and resilience plan, the Commission shall make a pre-financing payment of an amount of up to 20% of the legal commitment in the form of non-repayable support, and, where applicable, of up to 20% of the loan support in the form of a loan asset out in accordance with Article 19 of this Regulation. By derogation from Article 116(1) of the Financial Regulation, the Commission shall make the corresponding payment within two months after the adoption by the Commission of the legal commitment referred to in Article 19 of this Regulation.

In cases of pre-financing under paragraph 2a, the financial contributions and, where applicable, the loan support to be paid as referred to in Article 17(4)(a) shall be adjusted proportionally.

If the amount of pre-financing of the financial contribution in the form of non-repayable support paid in 2021 under paragraph 1 exceeds 20% of the maximum financial contribution calculated in accordance with Article 10(2) by 30 June 2022, the next disbursement authorised in accordance with Article 19a(3), and if needed the following disbursements, shall be reduced until the excess amount is offset. In case the remaining disbursements are insufficient, the excess amount shall be returned.

2b. The agreements and decisions referred to in Article 13(2) and in Article 19(1) shall also provide for the right of the Commission to proportionately reduce the support under the Facility and recover any amount due to the Union budget or to ask early repayment of the loan, in cases of fraud, corruption, and conflict of interests affecting the financial interests of the Union that have not been corrected by the Member State, or serious breach of obligations resulting from those agreements and decisions.

When deciding on the amount of the recovery, the reduction or the amount to be early repaid the Commission shall respect the principle of proportionality and shall take into account the seriousness of the fraud, corruption, and conflict of interest affecting the financial interests of the Union, or of the breach of obligations. The Member State shall be given the opportunity to present its observations before the reduction is made or early repayment is requested.

3. Taking into account the pre-financing under Article 19(2a), upon completion of the relevant agreed milestones and targets indicated in the recovery and resilience plan as approved in the delegated act of the Commission, the Member State concerned shall submit to the Commission a duly justified request for payment share of the financial contribution corresponding to the implementation of the targets and milestones and, where relevant, of the loan tranche. Such requests for payment shall, where relevant  be submitted by the Member States to the Commission on a biannual basis. The Commission shall assess, within two months of receiving the request, whether the relevant milestones and targets set out in the decision referred to in Article 17(1) have been satisfactorily implemented. For the purpose of the assessment, the operational arrangement referred to in Article 17(6) shall also be taken into account. The disbursement of funds shall correspond to the level of implementation of the agreed milestones and targets. The Commission may be assisted by experts, including appointed by the European Parliament.

Where the Commission makes a positive assessment, it shall adopt a decision authorising the disbursement of the financial contribution in accordance with the Financial Regulation. Each payment decision should be disbursed only if relevant milestones and targets have been implemented which shows measurable progress.

4. Where, as a result of the assessment referred to in paragraph 3, the Commission establishes that the milestones and targets set out in the decision referred to in Article 17(1) have not been satisfactorily implemented, the relevant part of the payment ▌ application shall be suspended. The Member State concerned may present its observations within one month of the communication of the Commission's assessment.

The suspension shall only be lifted where the Member State has taken the necessary measures to ensure a satisfactory implementation of the milestones and targets referred to in Article 17(1).

5. By derogation from Article 116(2) of the Financial Regulation, the payment deadline shall start running from the date of the communication of the positive outcome to the Member State concerned pursuant to the second subparagraph of paragraph 3, or from the date of the communication of the lifting of a suspension pursuant to the second subparagraph of paragraph 4.

6. Where the Member State concerned has not taken the necessary measures within a period of six months from the suspension, the Commission shall proportionately reduce the amount of the financial contribution pursuant to Article 14(1) of the Financial Regulation after having given the Member State concerned the possibility to present its observations within two months from the communication of its conclusions.

7. Where, within eighteen months of the date of the adoption the decision referred to in Article 17(1), no tangible progress has been made in respect of any relevant milestones and targets by the Member State concerned, the Commission shall terminate the agreements or decisions referred to in Article 13(2) and Article 19(1) of this Regulation and shall decommit the amount of the financial contribution without prejudice to Article 14(3) of the Financial Regulation. Any pre-financing pursuant to paragraph 2a of this Article shall be recovered in full.

The Commission shall take a decision on the cancellation of the financial contribution and, where applicable, of the recovery of the pre-financing after having given the Member State concerned the possibility to present its observations within a period of two months of the communication of its assessment as to whether no tangible progress has been made.

7a. If exceptional circumstances arise, the adoption of the decision authorising the disbursement of the financial contribution according to Article 19a(3) may be postponed for up to three months.

8. The provisions of this Article apply mutatis mutandis to the additional loan support in line with the provisions of the loan agreement referred to in Article 13, and of the decision referred to in Article 17(2).

CHAPTER V

Reporting and Information

Article 20
Reporting by the Member State in the European Semester

The Member State concerned shall report on a quarterly basis within the European Semester process on the progress made in the achievement of the recovery and resilience plans, including the operational arrangement referred to in Article 17(6), the implementation of individual proposed milestones, targets, and the related indicators and the recommendations by the Commission as part of the technical support instrument if the Member State requested it. To that effect, the quarterly reports of the Member States shall be appropriately reflected in the National Reform Programmes, which shall be used as a tool for reporting on progress towards completion of the recovery and resilience plans. In order to ensure greater transparency and accountability, Member States representatives responsible of the recovery and resilience plans and the relevant institutions and stakeholders shall, at the request of the European Parliament, appear before the competent committees to discuss the measures provided for and to be taken pursuant to this Regulation. Relevant information shall be made available by Member States, at any stage during the process, to the European Parliament and the Council simultaneously.

Independent fiscal institutions, as defined by Council Directive 2011/85/EU[22], are invited to, on a biannual basis, complement and assess such reports focusing on the reliability of the information, data and forecasts provided, as well as the performance and the general progress made in the achievement of the recovery and resilience plans.

Article 20a
Recovery and Resilience Dialogue

1. In order to enhance the dialogue between the Union institutions, in particular the European Parliament, the Council and the Commission, and to ensure greater transparency and accountability, the competent committees of the European Parliament may invite representatives of the Council and its preparatory bodies, of the Commission, and, where appropriate, of the Eurogroup, to appear before it to discuss all measures taken pursuant to this Regulation and those adopted under Council Regulation XXX[EURI].

2. In order to ensure greater transparency and accountability, the competent committee or committees of the European Parliament may invite Member State representatives responsible of the recovery and resilience plan and, where appropriate, the national independent fiscal institutions, to appear before the committees to present the recovery and resilience plan and the measures provided for and to be taken pursuant to this Regulation.

3. The Commission shall make available to the European Parliament and to the Council, simultaneously, all information provided by the Member States that is relevant for the institutions to perform their mandates under this Regulation. Sensitive or confidential information may be transmitted subject to specific confidentiality obligations.

4. Information transmitted by the Commission to  the Council or any of its preparatory bodies in the context of this Regulation or its implementation shall simultaneously be made available to the European Parliament, subject to confidentiality arrangements if necessary. Relevant outcomes of discussions held in Council preparatory bodies shall be shared with the relevant committees of the European Parliament.

Article 21
Information to the European Parliament and the Council and communication on the Member States’ recovery and resilience plans

1. The Commission shall transmit the recovery and resilience plans as approved in the delegated act of the Commission in accordance with Article 17, and any other relevant information, simultaneously and on equal terms to the European Parliament and the Council without undue delay. In such a case, the Commission shall liaise with the Parliament and Council how the redacted information can be made available to them in a confidential manner. In order to ensure greater transparency and accountability, Member States representatives responsible of the recovery and resilience plans and the relevant institutions and stakeholders shall, at the request of the European Parliament, appear before the competent committees to discuss the measures provided for and to be taken pursuant to this Regulation. Relevant information shall be made available by Member States, at any stage during the process, to the European Parliament and the Council simultaneously.

2. The Commission may engage in communication activities to ensure the visibility of the Union funding for the financial support envisaged in the relevant recovery and resilience plan by displaying a visible label of the Union, including through joint communication activities with the national authorities concerned. The Commission shall ensure the visibility of spending under the Facility by clearly indicating that the supported projects shall be clearly labelled as “European Union Recovery Initiative”.

2a. The Commission shall report biannually to the European Parliament on the progress in the implementation of the milestones and targets of the recovery and resilience plans as well on the complementarity of the plans with existing Union programmes.

2b. The Commission shall transmit a detailed report regarding the financial obligations it has entered in with third parties for the purpose of the financing the of Facility to the European Parliament and the Council on a biannual basis. The report shall contain a clear and credible repayment plan, without recourse to the MFF in accordance with Article 7. The sensitive or confidential information shall be available to the Members of the European Parliament under pre-agreed strict confidentiality.

Article 21a
Recovery and resilience scoreboard

1. The Commission shall establish a recovery and resilience scoreboard (the ‘Scoreboard’) which shall complement, without modifying, the existing Social Scoreboard with indicators framed by the United Nations’ Sustainable Development Goals and the existing Macroeconomic imbalance procedure Scoreboard. The Scoreboard shall display the status of implementation of the agreed reforms and investments through the recovery and resilience plans of each Member State, and the status of the disbursal of instalments to Member States linked to the satisfactorily implementation of the clear milestones and targets.

2. The Scoreboard shall display the progress registered by the recovery and resilience plans in each of the six priorities that define the scope of this Regulation.

3. The Scoreboard shall include key indicators relating to the European priorities referred to in Article 3 and the specific objectives of Article 4 and horizontal principles of Article 4a such as social, economic and environmental indicators, that evaluate the progress registered by the recovery and resilience plans in each of the six European priorities of Article 3 that define the scope of this Regulation as well as a summary of the monitoring process regarding the compliance with the minimum shares of expenditure on climate and other environmental objectives.

4. The Scoreboard shall indicate the degree of fulfilment of the relevant milestones of the recovery and resilience plans and the identified shortcomings in their implementation, as well as the recommendations of the Commission to address the respective shortcomings.

5. The Scoreboard shall indicate arrangements and timetable for implementation of the recovery and resilience plan, and for the disbursal of instalments linked to the satisfactory implementation of the clear milestones and targets.

6. The Scoreboard shall serve as a basis for a permanent exchange of best practices between Member States which shall materialise in the form of a structured dialogue organised on a regular basis.

7. The Scoreboard shall be constantly updated and shall be made publicly available on the Commission’s website. It shall indicate the status of payment claims, payments, suspensions and cancellations of financial contributions.

8. The Commission shall present the Scoreboard at a hearing organised by the competent committees of the European Parliament.

9. In establishing the scoreboard, the Commission should rely as much as possible on dashboards based on multiple indicators for monitoring the social and economic dimension of resilience and dashboards for monitoring the green and digital dimension of resilience as annexed to its 2020 strategic foresight report “Charting the course towards a more resilient Europe”.

CHAPTER VI

Complementarity, monitoring and evaluation

Article 22
Coordination and complementarity

The Commission and the Member States concerned shall, in a measure commensurate to their respective responsibilities, foster synergies and ensure effective coordination between the Facility  established by this Regulation and other Union programmes and instruments, including the Technical support Instrument and in particular with measures financed by the Union funds and financing provided by the European Investment Bank Group or other international financial institutions in which a Member State is a shareholder. For that purpose, they shall:

(a) ensure complementarity, synergy, coherence and consistency among different instruments at Union, national and, where appropriate, regional levels, in particular in relation to measures financed by Union funds, both in the planning phase and during implementation;

(b) optimise mechanisms for coordination to avoid duplication of effort; and

(c) ensure close cooperation between those responsible for implementation  control and supervision at Union, national and, where appropriate, regional levels to achieve the objectives of the instruments established under this Regulation.

Article 23
Monitoring of implementation

1. The Commission shall monitor the implementation of the Facility and measure the achievement of the objectives set out in Articles 4. Indicators to be used for reporting on progress and for the purpose of monitoring and evaluation of the Facility towards the achievement of the general and specific objectives are set in Annex III. The monitoring of implementation shall be targeted and proportionate to the activities carried out under the Facility.

2. The performance reporting system shall ensure that data for monitoring the implementation of the activities and results are collected efficiently, effectively, and in a timely manner and disaggregated by gender and income levels. To that end, proportionate reporting requirements shall be imposed on final beneficiaries and recipients of Union funding.

2a. The European Parliament shall have the right to fully scrutinise the spending decisions of the Commission. The Commission shall provide full access to the relevant body of the European Parliament and to the Members of the European Parliament. The Commission shall inform the European Parliament on a quarterly basis of the status of approved plans, modifications approved to those plans, payment applications made, payment decisions taken, the suspension of payments, the cancellation of payments and the recovery of funds. On a quarterly basis, the Commission shall present an overview of this information at a hearing organised by the competent committees of the European Parliament.

2ab. The Commission shall inform the European Parliament on a quarterly basis by establishing an open-data, publicly-accessible database of the ultimate beneficiaries of the funds from the Facility. The sensitive or confidential information shall be available to the Members of the European Parliament under pre-agreed strict confidentiality.

2ac. The Commission shall report to the European Parliament on a quarterly basis, through public hearings, on the implementation of the Facility in Member States. That report shall contain detailed information on the amounts committed and paid to Member States, the status of implementation of the milestones agreed, as well as all relevant information to ensure full transparency and disclosure on the Facility. 

2ad. The Commission shall establish an effective monitoring framework for the completed projects.

Article 24
Biannual report

1. The Commission shall provide biannual reports to the European Parliament and the Council on the implementation of the Facility set out in this Regulation.

2. The biannual report shall include information on the progress made with the recovery and resilience plans of the Member States concerned under the Facility.

3. The biannual report shall also include the following information:

(a) the volume of the proceeds assigned to the Facility under the European Union Recovery Instrument in the previous year, broken down by budget line; ▌

(b) the contribution of the amounts raised through the European Union Recovery Instrument to the achievements of the objectives of the Facility;

(ba) details on the requests made for the technical support instrument with respect to the drafting, revision, implementation and improvement of the recovery and resilience plan;

(bb) the status of implementation of the targets and milestones for each Member State, the amounts committed for and paid to each Member State and in total, the payment applications made, the payment decisions adopted, the suspension or cancellation of payments, the recovery of funds, the recipients of the funds and all other relevant information that ensure full transparency and accountability as well on the complementarity of the plans with existing Union programmes;

(bc) a section for each Member State, detailing how the respect of the principle of sound financial management is implemented in accordance with Article 61 of the Financial Regulation;

(bd) the share of the Facility that contributes to the Union’s climate and environment;

(be) a list of recipients and ultimate beneficiaries of the funds from the Facility.

4. The report shall be transmitted to the European Parliament and the European Council as part of the Integrated Financial Accountability Reporting and shall be part of the dedicated discharge procedure in a separate chapter of the discharge evaluation report of the Commission under Article 318 TFEU.

Article 25
Evaluation and ex-post evaluation of the Facility

1. Four years after the entry into force of this Regulation, the Commission shall provide the European Parliament, and the Council, the European Economic and Social Committee and the Committee of the Regions with an independent evaluation report on its implementation and with an independent ex post evaluation report no later than 12 months after the end of 2027.

2. The evaluation report shall, in particular, assess to which extent the objectives have been achieved, the efficiency of the use of resources and the European added value. It shall also consider the continued relevance of all objectives and actions.

3. Where appropriate, the evaluation shall be accompanied by a proposal for an amendments to this Regulation.

4. The ex-post evaluation report shall consist of a global assessment of the instruments established by this Regulation and shall include information on its impact in the long-term.

Article 25a
Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the conditions laid down in this Article.

2. The power to adopt delegated acts referred to in Article 17 and Article 19 shall be conferred on the Commission until 31 December 2027.

3. The delegation of power referred to in Article 17 and Article 19 may be revoked at any time by the European Parliament or by the Council. A decision to revoke shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified therein. It shall not affect the validity of any delegated acts already in force.

4. Before adopting a delegated act, the Commission shall consult experts designated by each Member State in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making.

5. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the European Parliament and to the Council.

6. A delegated act adopted pursuant to Article 17 and Article 19 shall enter into force if no objection has been expressed either by the European Parliament or by the Council within a period of three months of notification of that act to the European Parliament and the Council or if, before the expiry of that period, the European Parliament and the Council have both informed the Commission that they will not object. That period shall be extended by three months at the initiative of the European Parliament or of the Council.

CHAPTER VII

Communication and final provisions

Article 26
Information, communication and publicity

1. The recipients of Union funding shall acknowledge the origin and ensure the visibility of the Union funding by displaying a visible label of the Union, in particular when promoting the actions and their results, by providing coherent, effective and proportionate targeted information to multiple audiences, including the media, the social media and the public. Recipients shall ensure the visibility of spending under the Facility by clearly labelling the supported projects as “European Union Recovery Initiative”.

2. The Commission shall implement information and communication actions relating to the Facility established by this Regulation, its actions and its results. Financial resources allocated to the instruments established by this Regulation shall also contribute to the corporate communication of the political priorities of the Union, as far as they are related to the objectives referred to in Articles 4.

2a. When promoting actions and their results, the recipients of Union funding and the Commission shall regularly inform and involve the representation offices of the European Parliament and of the Commission about projects in the Member States concerned.

▌Article 28
Entry into force

This Regulation shall enter into force on the following 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 Brussels,

For the European Parliament For the Council

The President The President

ANNEX I

Methodology for the calculation of the maximum financial contribution (namely the non-repayable financial support) per Member State under the Facility

 

This annex sets out the methodology for calculating the maximum financial contribution available for each Member State in accordance with Article 10. The method takes into account:

• Population;

• The inverse of GDP per capita;

• The average unemployment rate over the past 5 years compared to the EU average (2015-2019);

• The cumulative drop in real GDP over the period from 2020 to 2021, namely real GDP change by 2021 as compared to 2019.

To avoid excessive concentration of resources:

• the inverse GDP per capita is capped at 150% of EU average

• the deviation of individual country’s unemployment rate from the EU average is capped to 150% of EU average

• to account for the generally more stable labour markets of wealthier Member States (with GNI per capita above EU average) the deviation of their unemployment rate from the EU average is capped to 75%.

For 2021 and 2022, the maximum financial contribution of a Member State under the Facility () is defined as follows:

MFCi(2021-2022) = αi × 0,6 × (FS)

For 2023 and 2024, the maximum financial contribution of a Member State under the Facility (MFCi) is defined as follows:

MFCi(2023-2024) = betai × [ 0,4(FS) + uncommitted amount (2021-2022)

where:

FS (Financial Support) is the available financial envelope under the facility as referred to

Article 5(1)(a); and  is the allocation key of Member State i, defined as:

,

with 1.

and with  1.  and 0.75 for Member States with

With:

  is the allocation key of country i is the 2019 Gross domestic product per capita of country i, the 2019 weighted Average Gross Domestic product per capita of the EU-27

Member States,

𝑝𝑜𝑝𝑖 is the 2019 total population in country i,

𝑝𝑜𝑝𝐸𝑈 is the 2019 total population in EU-27 Member States

𝑈𝑖 is the average unemployment rate over the period 2015-2019 of country i

𝑈𝐸𝑈 is the average unemployment rate over the period 2015-2019 in the EU-27

FS (Financial Support) is the available financial envelope under the Facility as referred to Article 5(1)(a); and

betai is the allocation key of Member State i, defined as:

with 1.

and with    and 0.75 for Member States with

With:

  is the allocation key of country i

is the 2019 GDP per capita of country i,

the 2019 weighted Average GDP per capita of the EU-27 Member States,

is the 2019 total population in country i,

is the 2019 total population in EU-27 Member States

is the cumulative loss in real GDP of country i over the period 2020-2021

is the cumulative loss in real GDP of EU 27 Member States over the period 2020-2021

The allocation key for the period from 2023 to 2024 shall be calculated by 30 June 2022 based on the Eurostat data.

The application of the methodology will result in the following share and amount for the maximum financial contribution per Member State.

 

Maximum financial contribution per EU Member State
	Share as % of total	Amount (million, 2018 prices)
BE	1,55	4821
BG	1,98	6131
CZ	1,51	4678
DK	0,56	1723
DE	6,95	21545
EE	0,32	1004
IE	0,39	1209
EL	5,77	17874
ES	19,88	61618
FR	10,38	32167
HR	1,98	6125
IT	20,45	63380
CY	0,35	1082
LV	0,70	2170
LT	0,89	2766
LU	0,03	101
HU	1,98	6136
MT	0,07	226
NL	1,68	5197
AT	0,95	2950
PL	8,65	26808
PT	4,16	12905
RO	4,36	13505
SI	0,55	1693
SK	1,98	6140
FI	0,71	2196
SE	1,24	3849
Total	100,00	310000

 

ANNEX II

Assessment guidance for the Facility

1. Scope

The purpose of these assessment guidelines is to serve together with this Regulation as a basis for the Commission to assess - in a transparent and equitable manner - the proposals for recovery and resilience plans put forward by Member States and to determine the financial contribution in conformity with the objectives and any other relevant requirements laid down in this Regulation. These guidelines notably represent the basis for the application of the assessment criteria and the determination of the financial contribution as referred to, respectively, in Articles 16(3) and 17(3).

The assessment guidelines are designed to:

(a) give further guidance on the assessment process of the proposals for recovery and resilience plans submitted by Member States;

(b) provide further details on the assessment criteria and provide for a rating system, to be established with a view to ensuring an equitable and transparent process; and

(c) define the link between the assessment to be made by the Commission under the assessment criteria and the determination of the financial contribution to be set out in the Commission decision in relation to the  recovery and resilience plans selected.

The guidelines are a tool to facilitate assessment by the Commission of the proposals for recovery and resilience plans as submitted by Member States, and to ensure that the recovery and resilience plans support reforms and public investment that are relevant and respect the principle of additionality of Union funding and generate a genuine European added value, while ensuring equal treatment among the Member States.

2. Assessment criteria

In accordance with Article 16(3), the Commission shall assess effectiveness, efficiency, relevance and coherence of the recovery and resilience plan, ▌and for that purpose, it shall take into account the following elements:

The Commission shall assess whether all recovery and resilience plans shall fulfil the following requirements:

(a) whether the plan contributes with at least 40 % of its amount to climate and biodiversity mainstreaming and whether the tracking methodology referred in Article 15(3)(ae)  is correctly applied;

(b) whether the plan contributes with at least 20% of its amount to digital actions and whether the tracking methodology referred in Article 15(3)(af) is correctly applied;

(c) whether each measure does not run counter the strategic and economic interests of the Union, does not substitute recurring national budgetary expenditure and respects the principle of additionality and the do not significantly harm principle in accordance with Article 4a new;

(d) whether the plan complies with the minimum allocation shares for each of the European priorities established under Article 3;

(e) whether the arrangements taken by Member States ensure that recipient undertakings are not involved in any reportable tax arrangements under the Directive (EU) 2018/822 in relation to cross-border arrangements;

Effectiveness:

(f) whether the recovery and resilience plan contributes to each of the six European priorities as defined in Article 3 and whether it contributes and not run counter the objectives of Article 4, paragraph 1, point b;

(g) whether the multilevel dialogue as referred to in the second subparagraph of Article 15(2), has taken place and whether the respective stakeholders are given effective opportunities to participate in the preparation and the implementation of the recovery and resilience plan;

(h) whether the arrangements proposed by the Member States concerned are expected to ensure an effective monitoring and implementation of the  recovery and resilience plan, proposed qualitative and quantitative milestones and targets, and the related indicators and whether the plan improves the country-based performance under the Social Scoreboard and the Macroeconomic imbalance procedure scoreboard;

(i) whether the recovery and resilience plan is expected to have a lasting impact on the Member State concerned;

(j) whether the recovery and resilience plan includes investments in cross-border or pan-European projects generating European value added, where relevant, taking into account Member States` constraints derived from their geographical position;

Efficiency:

(k) whether the justification provided by the Member State on the amount of the estimated total costs of the recovery and resilience plan submitted is reasonable and plausible and is commensurate to the social and economic impacts in line with the principle of cost-efficiency;

(l) whether the arrangement proposed by the Member States concerned  are expected to prevent, detect and correct conflicts of interest, corruption and fraud when using the funds as derived from this Facility, including those aiming to avoid double funding from other Union programmes;

Relevance:

(m) whether the plan contains measures that, in line with the scope of the Facility, effectively contribute to address challenges identified in the relevant country-specific recommendations addressed to the Member State concerned or in other relevant documents officially adopted by the Commission in the context of  the European Semester, including the relevant recommendations for the euro area as endorsed by the Council;

(n) whether the plan, in case a Member State is experiencing imbalances or excessive imbalances as concluded by the Commission after an in-depth review, is compatible with the recommendations made under Article 6 of Regulation (EU) No 1176/2011;

(o) whether the plan contains accurate information referred to in Article 15;

Coherence:

(p) whether the plan represents a comprehensive reform and investment package and whether the arrangements provides consistency and synergies as referred to in Article 14(2b);

(q) whether the plan is consistent with the principles of Union’s Gender Equality Strategy 2020-2025, the national Gender equality strategy, whether a gender impact assessment has been carried out and whether the measures in the plan are expected to contribute to the promotion of gender equality and the principle of gender mainstreaming and elimination of gender discrimination or to the challenges resulting from it.

▌As a result of the assessment process, the Commission shall give ratings to the recovery and resilience plans submitted by the Member States, under each of the assessment criteria referred to in Article 16(3), in order to assess effectiveness, efficiency, relevance and coherence of the plans and with a view to establishing the financial allocation in accordance with Article 17(3).

For the sake of simplification and efficiency, the rating system shall range from A to C, as set out in the following:

▌

Rating for points (a) to (e)

A - Criteria fulfilled

C - Criteria not fulfilled

Rating for points (f), (g), (h), (i), (j), (k), (l), (m), (n), (o), (p), (q)

A - Criteria fulfilled to a large extent / Adequate arrangements for effective implementation for (h)

B - Criteria fulfilled to a moderate extent / Minimum arrangements for effective implementation for (h)

C - Criteria fulfilled to a small extent / Insufficient arrangements for effective implementation for (h)

For criteria (j) only the rating of A or B applies and no rating is given for Member States that have objective constraints derived from their geographical position.

▌3. Determination of the financial contribution under the budgetary instrument for recovery and resilience

In accordance with Article 17(3), the Commission shall determine the financial contribution taking into account the importance and coherence of the recovery and resilience plan proposed by the Member State concerned, as assessed under the criteria set out in Article 17(3). For that purpose, it shall apply the following criteria:

(a) where the recovery and resilience plan complies satisfactorily with the criteria set out in Article 16(3), and the amount of the estimated total costs of the  recovery and resilience plan is equal to, or higher than the maximum financial contribution for that Member State referred to in Article 10, the financial contribution allocated to the Member State concerned shall be equal to the total amount of the maximum financial contribution referred to in Article 10;

(b) where the recovery and resilience plan complies satisfactorily with the criteria set out in Article 16(3), and the amount of the estimated total costs of the recovery and resilience plan is lower than the maximum financial contribution for that Member State referred to in Article 10, the financial contribution allocated to the Member State shall be equal to the amount of the estimated total costs of the  recovery and resilience plan;

(ba) where the recovery and resilience plan complies satisfactorily with the criteria set out in Article 16(3), and the plan receives each B in excess of two Bs for the criteria in points h, i, l, m, p set out in Article 16(3) the financial allocation shall be reduced by 2% per criterion and the overall reduction shall not exceed 6% of the total financial allocation;

(c) where the recovery and resilience plan does not comply satisfactorily with the criteria set out in Article 16(3), no financial contribution shall be allocated to the Member State concerned.

For the purpose of the implementation of this subparagraph, the following formulas shall apply:

– for (a) above:  𝐼𝑓 𝐶𝑖 ≥ 𝑀𝐹𝐶𝑖  the Member State 𝑖 receives 𝑀𝐹𝐶𝑖

– for (b) above:  𝐼𝑓 𝐶𝑖 < 𝑀𝐹𝐶𝑖  the Member State 𝑖 receives 𝐶𝑖

– where: 

– i  refers to the Member State concerned

– MFC  is the maximum financial contribution for the Member State concerned 

– C  is the amount of the estimated total costs of the  recovery and resilience plan

 

As a result of the assessment process in accordance with Article 16(3), and taking into account the ratings:

The recovery and resilience plan complies satisfactorily with the assessment criteria:

 

If the final rating for criteria (a) to (q) includes scores with:

 

- an A for criteria (a) to (f);

 

and for the other criteria:

 

- all A's,

 

or

 

- a majority of A's over B's and no C's,

The plan receives each B in excess of two Bs for the criteria in points h, i, l, m, p set out in Article 16(3) the financial allocation shall be reduced by 2 % per criterion and the overall reduction shall not exceed 6% of the total financial allocation.

The recovery and resilience plan does not comply satisfactorily with the assessment criteria:

 

If the final rating for criteria (a) to (q) includes scores with:

 

- not an A in criteria (a) to (f);

 

and for the other criteria:

 

- a majority of B's over A's

 

or

 

- at least one C

 

 

 

ANNEX III

Indicators

The achievement of the objectives referred to in Articles 4 shall be measured on the basis of the following indicators, broken down by Member State and by area of intervention.

Indicators shall be used in accordance with data and information available, including quantitative and/or qualitative data.

  Output indicators:

(a) number of approved recovery and resilience plans ▌;

(b) overall financial contribution allocated to the  recovery and resilience plan;

  Result indicators:

(c) number of recovery and resilience plans implemented; Impact indicators established by this Regulation

(d) The objectives set in the recovery and resilience plan, which have been achieved due, inter alia, to the overall financial support (including, where appropriate, the loan support) received under the Recovery and Resilience Facility established by this Regulation;

The ex-post evaluation referred to in Article 25 shall be undertaken by the Commission also with the purpose of establishing the links between the overall financial support (including, where appropriate, the loan support) from Recovery and Resilience Facility and the implementation of the relevant measures in the Member State concerned with a view to enhancing recovery, resilience, sustainable growth, jobs and cohesion.

 

 

 

OPINION OF THE COMMITTEE ON EMPLOYMENT AND SOCIAL AFFAIRS (16.10.2020)

for the Committee on Budgets and the Committee on Economic and Monetary Affairs

on the proposal for a regulation of the European Parliament and of the Council establishing a Recovery and Resilience Facility

(COM(2020)0408 – C9‑0150/2020 – 2020/0104(COD))

Rapporteur for opinion: Dragoș Pîslaru

 

 

SHORT JUSTIFICATION

On 28 May 2020, the Commission put forward a proposal for the establishment of a Recovery and Resilience Facility which replaces the withdrawn Commission’s proposal for a Reform Support Programme (RSP). The new proposal is based on the latest text on RSP and is closely aligned with the policy guidance provided under the European Semester. Its objectives have been revised and the delivery mode of the Facility has been adapted to take into account the new realities resulting from the COVID-19 pandemic. In this new context, it is of crucial importance to strategically plan the recovery and ensure sustainable growth by strengthening the resilience of the European economies and societies.

The Recovery and Resilience Facility will be a key programme of the European Union Recovery Instrument as part of the revised Multiannual Financial Framework. The Facility is also part of a range of measures developed in response to the current COVID-19 pandemic such as the “Coronavirus Response Investment Initiative”.

The Facility aims to provide large scale financial support to boost the design and implementation of much needed longer-term reforms and related public investments in the Member States. Its general objective is to promote the Union’s economic, social and territorial cohesion, through measures that allow the Member States concerned to recover faster and in a more sustainable way and to become more resilient, mitigating the social and economic impact of the crisis and supporting the green and energy transitions, fostering employment creation and promoting sustainable growth.

In a broader perspective, the Recovery and Resilience Facility will also contribute to the implementation of the commitments of the Union and of Member States in the context of the European Pillar of Social Rights and the Charter of Fundamental Rights of the European Union.

Support under the Facility will be provided in response to a request from the Member State concerned made on a voluntary basis. This support will be delivered in the form of non-repayable support under direct management and in the form of loans.

Member States should prepare national recovery and resilience plans which comprise measures for the implementation of reforms and public investment projects through a coherent package and should be consistent with the relevant country-specific challenges and priorities identified in the context of the European Semester, with the national reform programmes, the national energy and climate plans, the just transition plans, and the partnership agreements and operational programmes adopted under the Union funds. These plans will constitute an annex of the National Reform Programme and reporting on the progress in the implementation of these plans will also take place within the process of the European Semester.

In parallel to the Recovery and Resilience Facility, the Commission has also proposed a regulation for Technical Support Instrument that will provide support for strengthening the administrative capacity and long-term structural reforms in the Member States and will foster the implementation of country-specific recommendations addressed to Member States in the context of the European Semester.

The rapporteur welcomes the new Commission proposal for the establishment of a Recovery and Resilience Facility and is convinced that this Facility will play a crucial role for the Union’s recovery and renewal. He advocates the creation of a pillar, within this Facility, dedicated to reforms and investments designed for the next generation, especially for youth and children. This reflects the rapporteur’s firm commitment to the idea that the Recovery and Resilience Facility should be a future-oriented instrument designed to the benefit of the next generation.

The current opinion builds on the opinion on ‘Establishment of the Reform Support Programme’ (2018/0213(COD)) which the Committee on Employment and Social Affairs adopted on 26 May 2020. Consequently, it incorporates all amendments which are also relevant to the Recovery and Resilience Facility.

Furthermore, the rapporteur would like to propose additional changes which highlight the importance of structural reforms based on solidarity, integration and social justice as part of the goals of the European Semester so as to ensure equality of and access to opportunity and social protection, to protect vulnerable groups and to improve the living standards of all citizens. In his view, the reforms pursued could gather wide support if Member States envisage, as part of the process of submitting requests for financial support under the Facility, consultations with relevant stakeholders and national parliaments.

The rapporteur proposes extension of the scope of the Facility (Article 3) by including a broad range of policy domains e.g. measures for education, life-long learning and training; measures for a better future for disadvantaged children, youth, elderly people and people with disabilities; measures to reduce gender discrimination and to promote gender equality; measures promoting conditions for boosting entrepreneurship opportunities and skills; measures for implementing climate action; measures to improve the capacity of public institutions to guarantee mobile and cross-border workers’ rights; measures for VET education and youth integration on the labour market; pension reform measures as well as measures to improve public health systems.

The rapporteur also proposes an amendment which specifically addresses the situation of Member States experiencing excessive imbalances and non-euro Member States that are subject to significant structural development delay.

AMENDMENTS

The Committee on Employment and Social Affairs calls on the Committee on Budgets and the Committee on Economic and Monetary Affairs, as the committees responsible, to take into account the following amendments:

Amendment  1

Proposal for a regulation

Recital 2 a (new)

Text proposed by the Commission	Amendment
	(2a) Articles 2 and 8 of the Treaty provide that equality between women and men is a value of the Union and that, in all its activities, the Union should aim to eliminate inequalities, and to promote equality between men and women. Gender mainstreaming, including gender budgeting, should therefore be implemented in all policies and regulations of the Union.

Amendment  2

Proposal for a regulation

Recital 3

Text proposed by the Commission	Amendment
(3) At Union level, the European Semester of economic policy coordination (‘European Semester’), including the principles of the European Pillar of Social Rights, is the framework to identify national reform priorities and monitor their implementation. Member States develop their own national multiannual investment strategies in support of those reforms. Those strategies should be presented alongside the yearly National Reform Programmes as a way to outline and coordinate priority investment projects to be supported by national and/or Union funding.	(3) At Union level, the European Semester of economic policy coordination (‘European Semester’), including the objectives of the European Green Deal,  the principles of the European Pillar of Social Rights (EPSR) and the United Nations Sustainable Development Goals (UNSDGs), is the framework to identify national reform priorities and monitor their implementation. As part of the goals of the European Semester, structural reforms based on solidarity, integration and social justice are also addressed, with the aim of creating quality employment and growth, ensuring equality of and access to opportunity and social protection, protecting vulnerable groups and improving the living standards for all. Member States develop their own national multiannual investment strategies in support of those reforms. Those strategies should be presented alongside the yearly National Reform Programmes as a way to outline and coordinate priority investment projects to be supported by national and/or Union funding.

Amendment  3

Proposal for a regulation

Recital 4

Text proposed by the Commission	Amendment
(4) The outbreak of the COVID-19 pandemic in early 2020 changed the economic outlook for the years to come in the Union and in the world, calling for an urgent and coordinated response from the Union in order to cope with the enormous economic and social consequences for all Member. The challenges linked to the demographic context have been amplified by COVID-19. The current COVID-19 pandemic as well as the previous economic and financial crisis have shown that developing sound and resilient economies and financial systems built on strong economic and social structures helps Member States to respond more efficiently to shocks and recover more swiftly from them. The medium and long-term consequences of the COVID-19 crisis will critically depend on how quickly Member States’ economies will recover from the crisis, which in turn depends on the fiscal space Member States have available to take measures to mitigate the social and economic impact of the crisis, and on the resilience of their economies. Reforms and investments to address structural weaknesses of the economies and strengthen their resilience will therefore be essential to set the economies back on a sustainable recovery path and avoid further widening of the divergences in the Union.	(4) The outbreak of the COVID-19 pandemic in early 2020 changed the economic outlook for the years to come in the Union and in the world, calling for an urgent and coordinated response from the Union in order to cope with the enormous economic and social consequences for all Member States. The challenges linked to the demographic and social context have been amplified by COVID-19, particularly for women and girls due to existing inequalities. The current COVID-19 pandemic as well as the previous economic and financial crisis have shown that developing sound and resilient economies and financial and social welfare systems built on strong economic and social structures ensuring a decent standard of living helps Member States to respond more efficiently to shocks and recover more swiftly from them. The medium and long-term consequences of the COVID-19 crisis will critically depend on how quickly Member States’ economies will recover from the crisis, which in turn depends on the fiscal space Member States have available to take measures to mitigate the social and economic impact of the crisis, and on the resilience of their economies. Reforms and investments to address structural weaknesses of the economies and strengthen their economic, social, ecological and administrative resilience will therefore be essential to set the economies back on a sustainable recovery path and avoid further widening of the divergences in the Union and avoidable spillover effects of shocks between Member States or within the Union as a whole, with consequential challenges to convergence and cohesion.

Amendment  4

Proposal for a regulation

Recital 4 a (new)

Text proposed by the Commission	Amendment
	(4a) Member States’ social welfare systems ensure that societies and citizens are provided with the integrated services and economic benefits necessary for a decent life, covering the following areas of intervention: social security, healthcare, education, housing, employment, justice and social services for vulnerable groups. They play a key role in achieving social sustainable development, promoting equality and social justice. Because of the COVID-19 crisis, the Member States’ social welfare systems are in  an unprecedented situation of strain and pressure, because they were not designed to cover the increasing social demand in the context of healthcare and economic emergency. The social welfare systems will need to be strengthened in a way that they can perform and assist the entire population, particularly in situations of crisis or systemic shocks.

Amendment  5

Proposal for a regulation

Recital 4 b (new)

Text proposed by the Commission	Amendment
	(4b) The economic consequences of the COVID-19 crisis have severely reduced the fiscal room for manoeuvre for many Member States, which undermines their ability to implement important reform and investment priorities. While the European Semester represents the Union framework to identify economic reforms and investment priorities, the need for recovery and resilience building, highlighted by the COVID-19 crisis, goes beyond the domain of economic policy and needs to be adequately prioritised in the design and establishment of the European Semester.

Amendment  6

Proposal for a regulation

Recital 5

Text proposed by the Commission	Amendment
(5) The implementation of reforms contributing to achieve a high degree of resilience of domestic economies, strengthening adjustment capacity and unlocking growth potential are among the Union’s policy priorities. They are therefore crucial to set the recovery on a sustainable path and support the process of upward economic and social convergence. This is even more necessary in the aftermath of the pandemic crisis to pave the way for a swift recovery.	(5) The implementation of reforms contributing to achieve a high degree of resilience of domestic economies and societies, strengthening adjustment capacity, unlocking inclusive growth potential and adapting to technological developments are among the Union’s policy priorities. They are therefore crucial to set the recovery on a sustainable path and support the process of upward economic and social convergence. Even prior to the COVID-19 crisis, economies and societies in the Union were in the process of profound change by climate change, environmental, digital and demographic challenges and a social investment gap. This is even more necessary in the aftermath of the pandemic crisis to pave the way for a swift recovery. Social sustainability and inclusion must be a cornerstone of this process of building inclusive and resilient societies.

Amendment  7

Proposal for a regulation

Recital 5 a (new)

Text proposed by the Commission	Amendment
	(5a) Women have been at the forefront of the COVID-19 crisis, forming the majority of healthcare workers across the Union, and balancing unpaid caring responsibilities with their employment responsibilities, made increasingly difficult in the case of single-parent families, of which 85 % are headed by women . Investment in robust care infrastructure is essential in order to ensure equality between women and men and women’s economic empowerment and to build resilient societies, combat precarious conditions in a female dominated sector, boost job creation, prevent poverty and social exclusion. Moreover, such investment has a positive effect on GDP as it allows more women to take part in paid work.

Amendment  8

Proposal for a regulation

Recital 6

Text proposed by the Commission	Amendment
(6) Past experiences have shown that investment is often drastically cut during crises. However, it is essential to support investment in this particular situation to speed up the recovery and strengthen long-term growth potential. Investing in green and digital technologies, capacities and processes aimed at assisting clean energy transition, boosting energy efficiency in housing and other key sectors of the economic are important to achieve sustainable growth and help create jobs. It will also help make the Union more resilient and less dependent by diversifying key supply chains.	(6) Past experiences have shown that investment is often drastically cut during crises. However, it is essential to support investment in this particular situation to speed up economic and social recovery and strengthen long-term sustainable growth potential, increase social resilience and cohesion, and to avoid an increase in of inequalities and poverty. Investing in green and digital technologies, capacities and processes aimed at assisting clean energy transition, boosting energy efficiency in housing and other key sectors of the economic are important to achieve sustainable growth, help create and maintain quality jobs and build resilient labour markets. It will also help make the Union more resilient and more independent by diversifying key supply chains.

Amendment  9

Proposal for a regulation

Recital 8

Text proposed by the Commission	Amendment
(8) Against this background, it is necessary to strengthen the current framework for the provision of support to Member States and provide direct financial support to Member States through an innovative tool. To that end, a Recovery and Resilience Facility (the ‘Facility’) should be established under this Regulation to provide effective financial and significant support to step up the implementation of reforms and related public investments in the Member States. The Facility should be comprehensive and should also benefit from the experience gained by the Commission and the Member States from the use of the other instruments and programmes.	(8) Against this background, it is necessary to strengthen the current framework for the provision of support to Member States and provide for a mechanism that allows the distribution of direct financial support to Member States through an innovative tool. To that end, a Recovery and Resilience Facility (the ‘Facility’) should be established under this Regulation to provide effective financial and significant support to step up the implementation of reforms linked to the Commission’s country-specific recommendations issued in the context of the European Semester and related public investments in the Member States, particularly in view of the objectives of the new sustainable growth strategy presented in the European Green Deal, the principles of the EPSR and the UNSDGs to achieve social and territorial cohesion. The Facility should be comprehensive and should also benefit from the experience gained by the Commission and the Member States from the use of the other instruments and programmes.

Amendment  10

Proposal for a regulation

Recital 10 a (new)

Text proposed by the Commission	Amendment
	(10a) The Facility should ensure synergies with and be  complementary with the InvestEU, allowing Member States to allocate in the Recovery and Resilience Plan an amount to be delivered through InvestEU to support the solvency of companies established in the Member States and preparatory, monitoring, control, audit and evaluation activities thereof.

Amendment  11

Proposal for a regulation

Recital 11

Text proposed by the Commission	Amendment
(11) Reflecting the European Green Deal as Europe’s sustainable growth strategy and the translation of the Union's commitments to implement the Paris Agreement and the United Nations’ Sustainable Development Goals, the Facility established by this Regulation will contribute to mainstreaming climate actions and environmental sustainability and to the achievement of an overall target of 25 % of the EU budget expenditures supporting climate objectives.	(11) Reflecting the European Green Deal as Europe’s sustainable growth strategy and the translation of the Union's commitments to implement the Paris Agreement and the United Nations’ Sustainable Development Goals, the Facility established by this Regulation will contribute to mainstreaming climate actions and environmental sustainability and to the achievement of a just transition that leaves no one behind and of an overall target of 37 % of the EU budget expenditures supporting climate objectives, with no funds going towards measures that negatively affect the pathway to a climate-neutral Union in 2050. Furthermore, given that the Agenda 2030 requires a holistic and cross-sector policy approach to ensure that economic, social and environmental challenges are addressed altogether, social sustainability needs to be equally prioritised in the framework of the Facility.

Amendment  12

Proposal for a regulation

Recital 11 a (new)

Text proposed by the Commission	Amendment
	(11a) Reflecting on the EPSR as Europe’s social strategy to make sure that the transitions of climate-neutrality, digitalisation and demographic change, as well as the recovery from the COVID-19 crisis, are socially fair and just, the Facility will contribute to the implementation of its 20 principles and to the achievement of social progress targets and milestones.

Amendment  13

Proposal for a regulation

Recital 13

Text proposed by the Commission	Amendment
(13) In order to enable measures to be taken that link the Facility to sound economic governance, with a view to ensuring uniform implementing conditions, the power should be conferred on the Council to suspend, on a proposal from the Commission and by means of implementing acts, the period of time for the adoption of decisions on proposals for recovery and resilience plans and to suspend payments under this Facility, in the event of significant non-compliance in relation to the relevant cases related to the economic governance process laid down in the Regulation (EU) No XXX/XX of the European Parliament and of the Council [CPR] (…). The power to lift those suspensions by means of implementing acts, on a proposal from the Commission, should also be conferred on the Council in relation to the same relevant cases.	(13) In order to enable measures to be taken that link the Facility to sound economic governance, the power to adopt acts in accordance with Article 290 of the Treaty should be delegated to the Commission in respect of suspending or lifting the suspension with regard to the period of time for the adoption of decisions on proposals for recovery and resilience plans and payments, partially or totally under this Facility, in the event of significant non-compliance in relation to the relevant cases related to the economic governance process laid down in the Regulation (EU) No XXX/XX of the European Parliament and of the Council [CPR] (…). The decision to suspend payments should not apply provided that the general escape clause is active. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level. The Commission, when preparing and drawing up delegated acts, should ensure a simultaneous, timely and appropriate transmission of relevant documents to the European Parliament and to the Council.

Amendment  14

Proposal for a regulation

Recital 13 a (new)

Text proposed by the Commission	Amendment
	(13a) The scope of application of the Facility should refer to policy areas related to economic, social and territorial cohesion, the green and digital transitions, health, competitiveness, entrepreneurship, resilience, productivity, stability of the financial systems, culture, education and skills, children and youth policies, research and innovation, smart, sustainable and inclusive growth, public healthcare systems, as well as policies in line with the EPSR which contribute to the implementation of its principles, such as social protection, high-quality jobs and investment, gender equality, and the integration of people with disabilities, social dialogue strengthening democratic systems, including efficient and independent judicial systems as well as media pluralism and media freedom.

Amendment  15

Proposal for a regulation

Recital 14

Text proposed by the Commission	Amendment
(14) The Facility’s general objective should be the promotion of economic, social and territorial cohesion. For that purpose, it should contribute to improving the resilience and adjustment capacity of the Member States, mitigating the social and economic impact of the crisis, and supporting the green and digital transitions aimed at achieving a climate neutral Europe by 2050, thereby restoring the growth potential of the economies of the Union in the aftermath of the crisis, fostering employment creation and to promoting sustainable growth.	(14) The Facility’s general objective should be the promotion of economic, social and territorial cohesion, and to contribute to the objectives of Union policies, the UNSDGs EPSR, the Paris Agreement, the strengthening of the internal market, resilient economic and social structures, resilient labour markets, addressing demographic challenges and strengthening the administrative and institutional capacity. For that purpose, it should contribute to improving the resilience and adjustment capacity of the Member States, mitigating the social and economic impact of the crisis, in particular as regards vulnerable groups, and supporting the green and digital transitions aimed at achieving a climate neutral Europe by 2050, thereby restoring the growth potential of the economies of the Union in the aftermath of the crisis, fostering the creation of quality jobs and the promotion of sustainable growth and gender equality, as well as innovative and sustainable re-industrialisation and infrastructure, reforms of education, training and reskilling and up-skilling systems and support for reforms in Member States whose currency is not the euro, in order to facilitate the adoption of the euro as their currency.

Amendment  16

Proposal for a regulation

Recital 15

Text proposed by the Commission	Amendment
(15) The specific objective of the Facility should be to provide financial support with a view to achieving the milestones and targets of reforms and investments as set out in recovery and resilience plans. That specific objective should be pursued in close cooperation with the Member States concerned.	(15) The specific objective of the Facility should be to provide Member States with financial support with a view to boosting projects fostering their development, investment in productive and strategic sectors and playing a structuring role in providing universal, free and high-quality public services. That specific objective should be pursued with due respect for the specific development strategies of the Member States concerned, making a meaningful contribution by providing immediate responses to the impact of the COVID-19 crisis and public investments playing a structuring role in ensuring the social and territorial cohesion of the Member States and the Union.

Amendment  17

Proposal for a regulation

Recital 16

Text proposed by the Commission	Amendment
(16) To ensure its contribution to the objectives of the Facility, the recovery and resilience plan should comprise measures for the implementation of reforms and public investment projects through a coherent recovery and resilience plan. The recovery and resilience plan should be consistent with the relevant country-specific challenges and priorities identified in the context of the European Semester, with the national reform programmes, the national energy and climate plans, the just transition plans, and the partnership agreements and operational programmes adopted under the Union funds. To boost actions that fall within the priorities of the European Green Deal and the Digital Agenda, the plan should also set out measures that are relevant for the green and digital transitions. The measures should enable a swift deliver of targets, objectives and contributions set out in national energy and climate plans and updates thereof. All supported activities should be pursued in full respect of the climate and environmental priorities of the Union.	(16) To ensure its contribution to the objectives of the Facility, the recovery and resilience plan should comprise measures for the implementation of reforms and public investment projects through a coherent recovery and resilience plan. In order for the reforms pursued to gather wide support, Member States wishing to benefit from the Facility should, as part of the process of drafting the recovery and resilience plans, consult regional and local authorities and municipalities and other stakeholders, including the social partners and civil society organisations, in line with the relevant provisions of the Code of Conduct on Partnership under cohesion policy, as well as national parliaments. The recovery and resilience plan should be consistent with the strategic autonomy of the Union, the UNSDGs, the Union’s commitments under the Paris Agreement and the ‘do no significant harm’ principle, and the country-specific challenges and priorities identified in the context of the European Semester, in particular those related to social and employment policies and taking into account specific social indicators identified for each Member State, with the national reform programmes, the national energy and climate plans, the just transition plans, and the partnership agreements and operational programmes adopted under the Union funds. The recovery and resilience plan should also contain specific social indicators to be achieved and a gender impact assessment consistent with the objectives of the European Gender Equality Strategy 2020-2025. To boost actions that fall within the priorities of the European Green Deal and the Digital Agenda, the Child Guarantee, the Youth Guarantee and the principles of the EPSR, the plan should also set out measures that are relevant for and contribute directly to the six policy areas identified in this Regulation. The measures should enable a swift deliver of targets, objectives and contributions set out in national energy and climate plans and updates thereof. All supported activities should be pursued in full respect of the climate and environmental priorities of the Union. Member States should ensure that social partners are consulted when drafting the national recovery and resilience plans and are given the possibility to provide their input at early stage.

Amendment  18

Proposal for a regulation

Recital 18

Text proposed by the Commission	Amendment
(18) To inform the preparation and the implementation of the recovery and resilience plans by Member States, the Council should be able to discuss, within the European Semester, the state of recovery, resilience and adjustment capacity in the Union. To ensure appropriate evidence, this discussion should be based on the Commission’s strategic and analytical information available in the context of the European Semester and, if available, on the basis of the information on the implementation of the plans in the preceding years.	(18) To inform the preparation and the implementation of the recovery and resilience plans by Member States, the European Parliament and the Council should be able to discuss, within the European Semester, the state of recovery, resilience and adjustment capacity in the Union. To ensure appropriate evidence, this discussion should be based on the Commission’s strategic and analytical information available in the context of the European Semester and, if available, on the basis of the information on the implementation of the plans in the preceding years.

Amendment  19

Proposal for a regulation

Recital 21

Text proposed by the Commission	Amendment
(21) In order to ensure the national ownership and a focus on relevant reforms and investments, Member States wishing to receive support should submit to the Commission a recovery and resilience plan that is duly reasoned and substantiated. The recovery and resilience plan should set out the detailed set of measures for its implementation, including targets and milestones, and the expected impact of the recovery and resilience plan on growth potential, job creation and economic and social resilience; it should also include measures that are relevant for the green and the digital transitions; it should also include an explanation of the consistency of the proposed recovery and resilience plan with the relevant country-specific challenges and priorities identified in the context of the European Semester. Close cooperation between the Commission and the Member States should be sought and achieved throughout the process.	(21) In order to ensure the national ownership and a focus on relevant reforms and investments, Member States wishing to receive support should submit to the Commission a recovery and resilience plan that is duly reasoned and substantiated. The recovery and resilience plan should set out the detailed set of measures for its implementation, the extent of the consultation of regional and local authorities and other stakeholders, including the social partners and civil society organisations, carried out before submission of the plan, including targets and milestones, and the expected impact of the recovery and resilience plan on the objectives of the European Green Deal, the principles of the EPSR and the UNSDGs, in particular the sustainable growth potential, quality, job creation and economic and social resilience, as well as the social indicators to be improved, in line with the principles of the EPSR and the UNSDGs; it should also include measures that are relevant for and contribute directly to the green and the digital transitions, and, where appropriate, an estimate of the impact of the green and digital transitions in terms of lost jobs and lack of social protection, as well as of appropriate measures to address those problems; it should also include an explanation of the consistency of the proposed recovery and resilience plan with the relevant country-specific challenges and priorities identified in the context of the European Semester and should also demonstrate how the plan is expected to contribute to gender equality and gender-balanced growth and job creation. Close cooperation between the Commission and the Member States should be sought and achieved throughout the process.

Amendment  20

Proposal for a regulation

Recital 22

Text proposed by the Commission	Amendment
(22) The Commission should assess the recovery and resilience plan proposed by the Member States and should act in close cooperation with the Member State concerned. The Commission will fully respect the national ownership of the process and will therefore take into account the justification and elements provided by the Member State concerned and assess whether the recovery and resilience plan proposed by the Member State is expected to contribute to effectively address challenges identified in the relevant country-specific recommendation addressed to the Member State concerned or in other relevant documents officially adopted by the Commission in the European Semester; whether the plan contains measures that effectively contribute to the green and the digital transitions and to addressing the challenges resulting from them; whether the plan is expected to have a lasting impact in the Member State concerned; whether the plan is expected to effectively contribute to strengthen the growth potential, job creation and economic and social resilience of the Member State, mitigate the economic and social impact of the crisis and contribute to enhancing economic, social and territorial cohesion; whether the justification provided by the Member State of the estimated total costs of the recovery and resilience plan submitted is reasonable and plausible and is commensurate to the expected impact on the economy and employment; whether the proposed recovery and resilience plan contains measures for the implementation of reforms and public investment projects that represent coherent actions; and whether the arrangement proposed by the Member State concerned are expected to ensure effective implementation of the recovery and resilience plan, including the proposed milestones and targets, and the related indicators.	(22) The Commission should assess the recovery and resilience plan proposed by the Member States and should act in close cooperation with the Member State concerned and with the participation of the social partners and civil society organisations. The Commission will fully respect the national ownership of the process and will therefore take into account the justification and elements provided by the Member State concerned and assess whether the recovery and resilience plan proposed by the Member State is expected to contribute to effectively address challenges identified in the relevant country-specific recommendation addressed to the Member State concerned or in other relevant documents officially adopted by the Commission in the European Semester; whether the plan contains measures that effectively contribute to the green and the digital transitions and to addressing the challenges resulting from them; whether the plan is expected to have a lasting impact in the Member State concerned; whether the plan is expected to effectively contribute to strengthen the growth potential, quality job creation and economic and social resilience of the Member State, mitigate the economic and social impact of the crisis, in particular as regards vulnerable groups and young people and contribute to the implementation of the Union’s strategic autonomy and the Union’s and Member States’ commitments, in particular the Paris Agreement, the UNSDGs and the EPSR, enhancing economic, social and territorial cohesion and the reduction of the infrastructural gap; whether the justification provided by the Member State of the estimated total costs of the recovery and resilience plan submitted is reasonable and plausible and is commensurate to the expected impact on the economy, employment and social progress; whether the proposed recovery and resilience plan contains measures for the implementation of reforms and public investment projects that represent coherent actions; and whether the arrangement proposed by the Member State concerned are expected to ensure effective implementation of the recovery and resilience plan, including the proposed milestones and targets, and the related indicators.

Amendment  21

Proposal for a regulation

Recital 24

Text proposed by the Commission	Amendment
(24) In order to contribute to the preparation of high-quality plans and assist the Commission in the assessment of the recovery and resilience plans submitted by the Member States and in the assessment of the degree of their achievement, provision should be made for the use of expert advice and, at the Member State request, peer counselling.	(24) In order to contribute to the preparation of high-quality plans and assist the Commission in the assessment of the recovery and resilience plans submitted by the Member States and in the assessment of the degree of their achievement, provision should be made for the use of expert advice and, at the Member State request, peer counselling. When such expertise concerns labour-related policies, social partners are informed and eventually involved. Technical assistance should not be requested in areas that entirely or partially fall into the remit of the social partners unless the social partners agree. Such activities cannot undermine the role of the social partners or threaten the autonomy of collective bargaining.

Amendment  22

Proposal for a regulation

Recital 29

Text proposed by the Commission	Amendment
(29) The request for a loan should be justified by the financial needs linked to additional reforms and investments included in the recovery and resilience plan, notably relevant for the green and digital transitions, and by therefore, by a higher cost of the plan than the maximum financial contribution (to be) allocated via the non-repayable contribution. It should be possible to submit the request for a loan together with the submission of the plan. In case the request for loan is made at a different moment in time, it should be accompanied by a revised plan with additional milestones and targets. To ensure frontloading of resources, Member States should request a loan support at the latest by 31 August 2024. For the purposes of sound financial management, the total amount of all the loans granted under this Regulation should be capped. In addition, the maximum volume of the loan for each Member State should not exceed 4.7% of its Gross National Income. An increase of the capped amount should be possible in exceptional circumstances subject to available resources. For the same reasons of sound financial management, it should be possible to pay the loan in instalments against the fulfilment of results.	(29) The request for a loan should be justified by the financial needs linked to additional reforms and investments included in the recovery and resilience plan, notably relevant for the green and digital transitions, and by therefore, by a higher cost of the plan than the maximum financial contribution (to be) allocated via the non-repayable contribution. It should be possible to submit the request for a loan together with the submission of the plan. In case the request for loan is made at a different moment in time, it should be accompanied by a revised plan with additional milestones and targets. To ensure frontloading of resources, Member States should request a loan support at the latest by 31 August 2024. For the purposes of sound financial management, the total amount of all the loans granted under this Regulation should be capped. In addition, the maximum volume of the loan for each Member State should not exceed 6,8 % of its Gross National Income. An increase of the capped amount should be possible in exceptional circumstances subject to available resources. For the same reasons of sound financial management, it should be possible to pay the loan in instalments against the fulfilment of results. The Commission should assess the request for a loan support within two months of the date of the request.

Amendment  23

Proposal for a regulation

Recital 32 a (new)

Text proposed by the Commission	Amendment
	(32a) Where the recovery and resilience plans, including relevant milestones and targets, are no longer achievable, either partially or totally, including where the changes of the social and economic indicators significantly affect the initial plan submitted by the Member State concerned because of objective circumstances, the Member State concerned may make a reasoned request to the Commission to amend or replace its decision. To that end, the Member State should be able to propose amendments to the recovery and resilience plan and make use of the Technical Support Instrument.

Amendment  24

Proposal for a regulation

Recital 32 b (new)

Text proposed by the Commission	Amendment
	(32b) If the Commission decides to suspend allocated funding to a Member State in the case of deficiency with regards to rule of law, regional and local level actions that are eligible should continue to benefit from the Facility.

Amendment  25

Proposal for a regulation

Recital 32 c (new)

Text proposed by the Commission	Amendment
	(32c) Member States experiencing excessive imbalances, Member States whose currency is not the euro and Member States that are subject to significant structural development delay should be able to propose reforms, which address the problems that have led to such excessive imbalances, in their recovery and resilience plans.

Amendment  26

Proposal for a regulation

Recital 34 a (new)

Text proposed by the Commission	Amendment
	(34a) Member States should ensure that communication activities, in particular with regard to the obligation to make visibility of the support provided within the framework of the Facility are properly disseminated at the appropriate regional and local level on multiple outlets, in a non-discriminatory manner.

Amendment  27

Proposal for a regulation

Recital 39

Text proposed by the Commission	Amendment
(39) The recovery and resilience plans to be implemented by the Member States and the corresponding financial contribution allocated to them should be established by the Commission by way of implementing act. In order to ensure uniform conditions for the implementation of this Regulation, implementing powers should be conferred on the Commission. The implementing powers relating to the adoption of the recovery and resilience plans and to the payment of the financial support upon fulfilment of the relevant milestones and targets should be exercised by the Commission in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council, under the examination procedure thereof13. After the adoption of an implementing act, it should be possible for the Member State concerned and the Commission to agree on certain operational arrangements of a technical nature, detailing aspects of the implementation with respect to timelines, indicators for the milestones and targets, and access to underlying data. To allow the continuous relevance of the operational arrangements in respect of the prevailing circumstances during the implementation of the recovery and resilience plan, it should be possible that the elements of such technical arrangements may be modified by mutual consent. Horizontal financial rules adopted by the European Parliament and the Council on the basis of Article 322 of the Treaty on the Functioning of the European Union apply to this Regulation. These rules are laid down in the Financial Regulation and determine in particular the procedure for establishing and implementing the budget through grants, procurement, prizes, indirect implementation, and provide for checks on the responsibility of financial actors. Rules adopted on the basis of Article 322 TFEU also concern the protection of the Union's budget in case of generalised deficiencies as regards the rule of law in the Member States, as the respect for the rule of law is an essential precondition for sound financial management and effective EU funding.	(39) The power to adopt acts in accordance with Article 290 of the Treaty should be delegated to the Commission in respect of establishing the recovery and resilience plans to be implemented by the Member States and the corresponding financial contribution to be allocated to them. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level. The Commission, when preparing and drawing up delegated acts, should ensure a simultaneous, timely and appropriate transmission of relevant documents to the European Parliament and to the Council. After the adoption of a delegated act, it should be possible for the Member State concerned and the Commission to agree on certain operational arrangements of a technical nature, detailing aspects of the implementation with respect to timelines, indicators for the milestones and targets, and access to underlying data. To allow the continuous relevance of the operational arrangements in respect of the prevailing circumstances during the implementation of the recovery and resilience plan, it should be possible that the elements of such technical arrangements may be modified by mutual consent. Horizontal financial rules adopted by the European Parliament and the Council on the basis of Article 322 of the Treaty apply to this Regulation. These rules are laid down in the Financial Regulation and determine in particular the procedure for establishing and implementing the budget through grants, procurement, prizes, indirect implementation, and provide for checks on the responsibility of financial actors. Rules adopted on the basis of Article 322 of the Treaty also concern the protection of the Union's budget in case of generalised deficiencies as regards the rule of law in the Member States, as the respect for the rule of law, an independent judiciary, media pluralism and media freedom are essential preconditions for sound financial management and effective Union funding.
________________________________
13 Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers (OJ L 55, 28.2.2011, p. 13).

Amendment  28

Proposal for a regulation

Article 3

Text proposed by the Commission	Amendment
The scope of application of the Recovery and Resilience Facility established by this Regulation shall refer to policy areas related to economic, social and territorial cohesion, the green and digital transitions, health, competitiveness, resilience, productivity, education and skills, research and innovation, smart, sustainable and inclusive growth, jobs and investment, and the stability of the financial systems.	The scope of application of the Recovery and Resilience Facility established by this Regulation shall, by means of creating a better future for the next generation, improving economic, social and territorial cohesion, promoting growth enhancing reforms and strengthening the internal  market, shall refer to the following six policy areas:

Amendment  29

Proposal for a regulation

Article 3 – point a (new)

Text proposed by the Commission	Amendment
	(a) green transition, taking into account the objectives of the European Green Deal;

Amendment  30

Proposal for a regulation

Article 3 – point b (new)

Text proposed by the Commission	Amendment
	(b) digital transformation, taking into account the objectives of the Digital Agenda;

Amendment  31

Proposal for a regulation

Article 3 – point c (new)

Text proposed by the Commission	Amendment
	(c) economic cohesion, productivity and competitiveness, taking into account the objectives of the Union strategies on industry and SMEs;

Amendment  32

Proposal for a regulation

Article 3 – point d (new)

Text proposed by the Commission	Amendment
	(d) social cohesion, taking into account the objectives of the EPSR;

Amendment  33

Proposal for a regulation

Article 3 – point e (new)

Text proposed by the Commission	Amendment
	(e) institutional resilience and capacity building;

Amendment  34

Proposal for a regulation

Article 3 – point f (new)

Text proposed by the Commission	Amendment
	(f) policies for the Next Generation, taking into account the objectives of the Youth Guarantee and Child Guarantee.

Amendment  35

Proposal for a regulation

Article 3 a (new)

Text proposed by the Commission	Amendment
	Article 3a
	1. The application of this Regulation fully observes Article 152 of the Treaty, and the national recovery and resilience plans issued under this Regulation respect national practices and institutions for wage formation. This Regulation respects Article 28 of the Charter of Fundamental Rights of the European Union, and accordingly does not affect the right to negotiate, conclude or enforce collective agreements or to take collective action in accordance with national law and practices.

Amendment  36

Proposal for a regulation

Article 4 – paragraph 1

Text proposed by the Commission	Amendment
1. The general objective of the Recovery and Resilience Facility shall be to promote the Union’s economic, social and territorial cohesion by improving the resilience and adjustment capacity of the Member States, mitigating the social and economic impact of the crisis, and supporting the green and digital transitions, thereby contributing to restoring the growth potential of the economies of the Union, fostering employment creation in the aftermath of the COVID-19 crisis, and promoting sustainable growth.	1. The general objective of the Recovery and Resilience Facility shall be to contribute to addressing the challenges of the six policy areas referred to in Article 3, thereby promoting the Union’s economic, social and territorial cohesion by improving the resilience and adjustment capacity of the Member States, mitigating the social and economic impact of the crisis, supporting the green and digital transitions, contributing to restoring the growth potential of the economies of the Union, fostering employment creation in the aftermath of the COVID-19 crisis, promoting sustainable growth and generating European added value.

Amendment  37

Proposal for a regulation

Article 4 – paragraph 1 a (new)

Text proposed by the Commission	Amendment
	1a. The Facility shall contribute to the objectives of Union policies the Union’s commitments under the Paris Agreement and the strengthening of the internal market, the EPSR, the UNSDGs,  through the implementation of measures, such as those:

Amendment  38

Proposal for a regulation

Article 4 – paragraph 1 a (new) – point a (new)

Text proposed by the Commission	Amendment
	(a) for the transition to a climate-neutral Union by 2050, a just transition with support for the most affected regions, sustainable mobility and infrastructure, tackling energy poverty, promoting energy and resource efficiency, renewable energy sources, achieving energy diversification and ensuring energy security, measures for the agricultural sector, fisheries and the sustainable development of rural and cross-border areas;

Amendment  39

Proposal for a regulation

Article 4 – paragraph 1 a (new) – point b (new)

Text proposed by the Commission	Amendment
	(b) for the digitisation and expansion of the role of public employment services, and which foster digital infrastructure, improve access to digital working and promote digital skills development;

Amendment  40

Proposal for a regulation

Article 4 – paragraph 1 a (new) – point c (new)

Text proposed by the Commission	Amendment
	(c) for the building of resilient labour markets with decent working conditions, strengthening the internal, fostering investment and supporting the process of upward economic and social convergence, measures for boosting entrepreneurship opportunities and skills, creating a favourable environment for investment and SMEs, including for innovative and sustainable re-industrialisation, investments in the industry sector, consolidating the productive and strategic capacity of the Union, development of industrial ecosystems and supporting Member States whose currency is not the euro in their efforts to adopt the single currency;

Amendment  41

Proposal for a regulation

Article 4 – paragraph 1 a (new) – point d (new)

Text proposed by the Commission	Amendment
	(d) for social inclusion, strengthening social security and social welfare and protection systems, social dialogue, the development of social infrastructure, quality jobs, the inclusion of people with disabilities, gender equality, tackling poverty and inequalities, the gender pay gap, suitable family leave and flexible working arrangements and increasing labour market participation of women, including through ensuring equal opportunities and career progression;

Amendment  42

Proposal for a regulation

Article 4 – paragraph 1 a (new) – point e (new)

Text proposed by the Commission	Amendment
	(e) for the strengthening of the administrative and institutional capacity of the Member States and their respective regional and local authorities in relation to challenges faced by institutions, governance, public administration, and economic and social sectors, to improve public health and healthcare systems, including better crisis response capacity, development of quality and affordable care and home care services, safer, higher quality and more accessible nursing homes and care centres, medical equipment and accessible medical services for all citizens, measures to improve the capacity of public institutions to guarantee mobile and cross-border workers’ rights, including that they enjoy safe and equal working conditions, wages in accordance with the law and all necessary information, for the stability of the financial systems, strengthening efficient and independent judicial systems, promoting media pluralism and media freedom;

Amendment  43

Proposal for a regulation

Article 4 – paragraph 1 a (new) – point f (new)

Text proposed by the Commission	Amendment
	(f) to address demographic challenges, and for culture, education, life-long learning and VET, including the development of national and regional up- and re-skilling strategies and actions, better forecasting of labour market evolutions, children and youth policies, equal opportunities and access for all, pension reforms, with a focus on the sustainability and adequacy of pension systems for workers and the self-employed, as well as equal opportunities for women and men to acquire pension rights.

Amendment  44

Proposal for a regulation

Article 4 – paragraph 2

Text proposed by the Commission	Amendment
2. To achieve that general objective, the specific objective of the Recovery and Resilience Facility shall be to provide Member States with financial support with a view to achieving the milestones and targets of reforms and investments as set out in their recovery and resilience plans. That specific objective shall be pursued in close cooperation with the Member States concerned.	2. To achieve that general objective, the specific objective of the Recovery and Resilience Facility shall be to provide Member States with financial support with a view to achieving the milestones and targets of reforms and investments as set out in their recovery and resilience plans, while taking into consideration that economic disparities, social inequality and poor social protection have spill over effects that undermine the overall stability of the Union. That specific objective shall be pursued in close cooperation with the Member States concerned.

Amendment  45

Proposal for a regulation

Article 4 – paragraph 2 a (new)

Text proposed by the Commission	Amendment
	2a. Member States whose currency is not the euro, which are subject to significant structural development delay may propose recovery and resilience plans that address their problems.

Amendment  46

Proposal for a regulation

Article 4 – paragraph 2 b (new)

Text proposed by the Commission	Amendment
	2b. Reforms and investments initiated by the Member States after 1 February 2020 are eligible under the Recovery and Resilience Facility.

Amendment  47

Proposal for a regulation

Article 5 – paragraph 2

Text proposed by the Commission	Amendment
2. The amounts referred to in paragraph 1(a) may also cover expenses pertaining to preparatory, monitoring, control, audit and evaluation activities, which are required for the management of each instrument and the achievement of its objectives, in particular studies, meetings of experts, information and communication actions, including corporate communication of the political priorities of the Union, in so far as they are related to the objectives of this Regulation, expenses linked to IT networks focusing on information processing and exchange, corporate information technology tools, and all other technical and administrative assistance expenses incurred by the Commission for the management of each instrument. Expenses may also cover the costs of other supporting activities such as quality control and monitoring of projects on the ground and the costs of peer counselling and experts for the assessment and implementation of reforms and investments.	2. The amounts referred to in paragraph 1(a) may also cover expenses pertaining to preparatory, monitoring, control, audit and evaluation activities, which are required for the management of each instrument and the achievement of its objectives, in so far as they are related to the objectives of this Regulation, and provided they are not eligible actions for technical support pursuant to Article 7 of Regulation ...[on a Technical Support Instrument, 2020/0103 (COD)]. Where a Member State does not make use of the allocated funding, that funding may be made available by the Commission for proposals drafted after consulting regional and local authorities and other stakeholders, including the social partners and civil society organisations, in order to promote an open debate to support actions to stimulate research, public debate and disseminate information regarding the reforms necessary to address the negative consequences of the COVID-19 crisis.

Amendment  48

Proposal for a regulation

Article 9 – paragraph 1

Text proposed by the Commission	Amendment
1. In the event of significant non-compliance in relation to any of the cases laid down in Article 15(7) of the Regulation laying down common provisions on the […)][CPR], the Council shall, on a proposal from the Commission, adopt a decision by means of an implementing act to suspend the time period for the adoption of the decisions referred to in Articles 17(1) and 17(2) or to suspend payments under the Recovery and Resilience Facility.	1. In the event of significant non-compliance in relation to any of the cases laid down in Article 15(7) of the Regulation laying down common provisions on the […)][CPR], the Commission shall adopt a delegated act in accordance with Article 27a concerning a decision to suspend the time period for the adoption of the decisions referred to in Articles 17(1) and 17(2) or to suspend payments, partially or totally under the Recovery and Resilience Facility.

Amendment  49

Proposal for a regulation

Article 9 – paragraph 1 a (new)

Text proposed by the Commission	Amendment
	1a.  The decision to suspend payments referred to in paragraph 1 shall apply to payment applications submitted after the date of the decision to suspend.

Amendment  50

Proposal for a regulation

Article 9 – paragraph 1 b (new)

Text proposed by the Commission	Amendment
	1b.  The suspension of the time period referred to in Article 17 shall apply from the day after the adoption of the decision referred to in paragraph 1 of this Article.

Amendment  51

Proposal for a regulation

Article 9 – paragraph 1 c (new)

Text proposed by the Commission	Amendment
	1c.  The decision to suspend payments referred to in paragraph 1 shall not apply provided that the general escape clause is active.

Amendment  52

Proposal for a regulation

Article 9 – paragraph 2

Text proposed by the Commission	Amendment
2. In the event of occurrence of any of the cases referred to in Article 15(11) of the Regulation laying down common provisions on the […], the Council shall, on a proposal from the Commission, adopt a decision by means of an implementing act to lift the suspension of the time period or of payments referred to in the previous paragraph.	2. In the event of occurrence of any of the cases referred to in Article 15(11) of the Regulation laying down common provisions on the […], the Commission shall adopt a delegated act in accordance with Article 27a concerning the decision to lift the suspension of the time period or of payments referred to in the previous paragraph. The relevant procedures or payments shall resume the day after the lifting of the suspension.

Amendment  53

Proposal for a regulation

Article 9 – paragraph 2 a (new)

Text proposed by the Commission	Amendment
	2a.  In the event that the Commission decides to suspend allocated funding to the Member State because of deficiency with regards to rule of law, regional and local level actions that are eligible shall continue to benefit from the Facility.

Amendment  54

Proposal for a regulation

Article 12 – paragraph 4

Text proposed by the Commission	Amendment
4. The loan support to the recovery and resilience plan of the Member State concerned shall not be higher than the difference between the total cost of the recovery and resilience plan, as revised where relevant, and the maximum financial contribution referred to in Article 10. The maximum volume of the loan for each Member State shall not exceed 4.7 % of its Gross National Income.	4. The loan support to the recovery and resilience plan of the Member State concerned shall not be higher than the difference between the total cost of the recovery and resilience plan, as revised where relevant, and the maximum financial contribution referred to in Article 10. The maximum volume of the loan for each Member State shall not exceed 6,8 % of its Gross National Income.

Amendment  55

Proposal for a regulation

Article 13 – paragraph 1 – point b a (new)

Text proposed by the Commission	Amendment
	(ba) an explanation of how the measures in the plan are expected to address deficiencies as regards the values enshrined in Article 2 of the Treaty on European Union;

Amendment  56

Proposal for a regulation

Article 13 – paragraph 1 – point b b (new)

Text proposed by the Commission	Amendment
	(bb) an explanation of how the measures in the plan  take into account the positions received from non-profit civil society organisations and local or regional authorities in the Member State.

Amendment  57

Proposal for a regulation

Article 14 – paragraph 1

Text proposed by the Commission	Amendment
1. In pursuance of the objectives set out in Article 4, Member States shall prepare national recovery and resilience plans. These plans shall set out the reform and investment agenda of the Member State concerned for the subsequent four years. Recovery and resilience plans eligible for financing under this instrument shall comprise measures for the implementation of reforms and public investment projects through a coherent package.	1. In pursuance of the objectives set out in Article 4, Member States shall prepare national recovery and resilience plans. These plans shall set out the reform and investment agenda of the Member State concerned for the subsequent four years. Recovery and resilience plans eligible for financing under this instrument shall comprise measures for the implementation of reforms and public investment projects through a coherent package. For the preparation of the recovery and resilience plans, Member States may make use of the Technical Support Instrument in accordance with Regulation XX/YYYY [establishing Technical Support Instrument].

Amendment  58

Proposal for a regulation

Article 14 – paragraph 1 a (new)

Text proposed by the Commission	Amendment
	1a.  Reflecting the European Green Deal as Europe’s sustainable growth strategy and the translation of the Union's commitments to implement the Paris Agreement and the UNSDGs, at least 37 % of the amount of each recovery and resilience plan shall contribute to mainstreaming climate and biodiversity actions and environmental sustainability objectives. By means of a delegated act, the Commission shall adopt the relevant methodology to help the Member States to fulfil that requirement.

Amendment  59

Proposal for a regulation

Article 14 – paragraph 1 b (new)

Text proposed by the Commission	Amendment
	1b.  Reflecting the EPSR as Europe’s strategy for social progress, a significant part of the amount of each recovery and resilience plan shall contribute to the implementation of the EPSR objectives. By means of a delegated act, the Commission shall adopt the relevant methodology to help Member States to fulfil that requirement.

Amendment  60

Proposal for a regulation

Article 14 – paragraph 1 c (new)

Text proposed by the Commission	Amendment
	1c.  Reflecting the future-oriented character of the Next Generation EU recovery instrument and acknowledging the importance of the Digital Skills Agenda, the Child Guarantee and the Youth Guarantee, each recovery and resilience plan shall contribute to tackling the risk of long-lasting damage to young people’s labour market prospects and to their overall well-being through quality employment, education and qualification solutions and responses targeting young people.

Amendment  61

Proposal for a regulation

Article 14 – paragraph 2

Text proposed by the Commission	Amendment
2. The recovery and resilience plans shall be consistent with the relevant country-specific challenges and priorities identified in the context of the European Semester, in particular those relevant for or resulting from the green and digital transition. The recovery and resilience plans shall also be consistent with the information included by the Member States in the national reform programmes under the European Semester, in their national energy and climate plans and updates thereof under the Regulation (EU)2018/199921, in the territorial just transition plans under the Just Transition Fund22, and in the partnership agreements and operational programmes under the Union funds.	2. The recovery and resilience plans shall be consistent with the relevant country-specific challenges and priorities identified in the context of the European Semester, in particular those relevant for the policy areas set out in Article 3, as well as territorial, social and economic cohesion, while taking into account the investment needs and challenges linked to regional and local disparities. The recovery and resilience plans shall contribute to the strategic autonomy of the Union, to the transition to climate-neutrality by 2050 and to social sustainability through the implementation of the EPSR and of the UNSDGs. The recovery and resilience plans shall also be consistent with the information included by the Member States in the national reform programmes under the European Semester, in their national energy and climate plans and updates thereof under the Regulation (EU)2018/199921, in the territorial just transition plans under the Just Transition Fund22, and in the partnership agreements and operational programmes under the Union funds.
______________________________	________________________
21 Regulation (EU)2018/1999 of the European Parliament and of the Council of 11 December 2018 on the Governance of the Energy Union and Climate Action.	21 Regulation (EU)2018/1999 of the European Parliament and of the Council of 11 December 2018 on the Governance of the Energy Union and Climate Action.
22 […]	22 […]

Amendment  62

Proposal for a regulation

Article 14 – paragraph 2 a (new)

Text proposed by the Commission	Amendment
	2a. The recovery and resilience plans shall be drawn up after consulting regional and local authorities and other stakeholders, including the social partners and civil society organisations, in accordance with Article 6 of Regulation (EU)XX/xx of the European Parliament and of the Council1a;
	____________________________
	1a Regulation (EU) XX/xx of the European Parliament and of the Council of XX laying down common provisions on the European Regional Development Fund, the European Social Fund Plus, the Cohesion Fund, and the European Maritime and Fisheries Fund and financial rules for those and for the Asylum and Migration Fund, the Internal Security Fund and the Border Management and Visa Instrument (OJ L ...).

Amendment  63

Proposal for a regulation

Article 14 – paragraph 2 b (new)

Text proposed by the Commission	Amendment
	2b. Taking into account technological developments, the Facility may contribute to the adoption of integrated investment plans in digital infrastructures and skills as well as the establishment of an effective funding framework in order to ensure the highest possible competitiveness of regions in the Union.

Amendment  64

Proposal for a regulation

Article 15 – paragraph 2

Text proposed by the Commission	Amendment
2. The recovery and resilience plan presented by the Member State concerned shall constitute an annex to its National Reform Programme and shall be officially submitted at the latest by 30 April. A draft plan may be submitted by Member State starting from 15 October of the preceding year, together with the draft budget of the subsequent year.	2. The recovery and resilience plan presented by the Member State concerned shall constitute an annex to its National Reform Programme and shall be officially submitted at the latest by 30 April. A draft plan may be submitted by Member State starting from 15 October of the preceding year, together with the draft budget of the subsequent year. Such draft plans shall be submitted to the social partners for consultation no later than in February before the April deadline for officially submitting the plan to the Commission, allowing the social partners at least 30 days to react in writing.

Amendment  65

Proposal for a regulation

Article 15 – paragraph 3 – point a

Text proposed by the Commission	Amendment
(a) an explanation of the way the relevant country-specific challenges and priorities identified in the context of the European Semester are expected to be addressed;	(a) an explanation of how the challenges and priorities identified in the framework of the European Semester are likely to be addressed, in particular those related to social and employment policies;

Amendment  66

Proposal for a regulation

Article 15 – paragraph 3 – point b

Text proposed by the Commission	Amendment
(b) an explanation of how the plan strengthens the growth potential, job creation and economic and social resilience of the Member State concerned, mitigates the economic and social impact of the crisis, and its contribution to enhance economic, social and territorial cohesion and convergence;	(b) an explanation of how the plan strengthens the growth potential, quality job creation, social progress and economic and social resilience of the Member State concerned, reduces the infrastructural gap, mitigates the economic and social impact of the crisis, in connection with the most vulnerable groups and youth and the economic impact of the SMEs, and its contribution to enhance economic, social and territorial cohesion and convergence, as well as the strategic autonomy of the Union;

Amendment  67

Proposal for a regulation

Article 15 – paragraph 3 – point b a (new)

Text proposed by the Commission	Amendment
	(ba) the extent of the consultation of regional and local authorities and other stakeholders, including of the social partners and civil society organisations, carried out prior to submission of the recovery and resilience plan; the social partners’ written contribution shall be submitted in addition to the plan;

Amendment  68

Proposal for a regulation

Article 15 – paragraph 3 – point c

Text proposed by the Commission	Amendment
(c) an explanation of how the measures in the plan are expected to contribute to the green and the digital transitions or to the challenges resulting from them;	(c) an explanation of how the measures in the plan are expected to contribute to the six pillars set out in Article 3;

Amendment  69

Proposal for a regulation

Article 15 – paragraph 3 – point c a (new)

Text proposed by the Commission	Amendment
	(ca) the social indicators to be achieved by the proposed recovery and resilience plan and the contribution made towards implementation of the EPSR and the achievement of the UNSDGs;

Amendment  70

Proposal for a regulation

Article 15 – paragraph 3 – point c b (new)

Text proposed by the Commission	Amendment
	(cb) an estimate, where appropriate, of the impact of the green and digital transitions in terms of jobs lost or jobs create, as well as of appropriate measures to address those problems, in particular in regions that will undergo significant energy transitions;

Amendment  71

Proposal for a regulation

Article 15 – paragraph 3 – point c c (new)

Text proposed by the Commission	Amendment
	(cc) an explanation of how the measures respect the principles of interoperability, energy efficiency, data protection, the promotion of digital equality, digital accessibility, open software and open hardware solutions and personal data;

Amendment  72

Proposal for a regulation

Article 15 – paragraph 3 – point c d (new)

Text proposed by the Commission	Amendment
	(cd) an explanation of the coherence of the plan with the relevant documents adopted in the context of the latest European Semester;

Amendment  73

Proposal for a regulation

Article 15 – paragraph 3 – point c e (new)

Text proposed by the Commission	Amendment
	(ce) a detailed explanation of how the measures are expected to ensure that at least 37 % of the amount requested for the recovery and resilience plan contribute to mainstreaming climate and biodiversity actions and environmental sustainability objectives based on the methodology provided by the Commission in accordance with Article14(1);

Amendment  74

Proposal for a regulation

Article 15 – paragraph 3 – point c f (new)

Text proposed by the Commission	Amendment
	(cf) a detailed explanation of how the measures are expected to ensure that a significant part of the amount requested for the recovery and resilience plan contribute to the implementation of the EPSR objectives based on the methodology provided by the Commission in accordance with Article 14(1);

Amendment  75

Proposal for a regulation

Article 15 – paragraph 3 – point c g (new)

Text proposed by the Commission	Amendment
	(cg) a gender impact assessment of the plan, in-line with the objectives outlined in the Gender Equality Strategy, to effectively address the negative impact of the crisis on gender equality, in particular by ensuring quality job creation for women, the reduction of the gender pay gap and access to credit for women entrepreneurs, and through measures to prevent and combat gender-based violence and sexual harassment;

Amendment  76

Proposal for a regulation

Article 15 – paragraph 3 – point c h (new)

Text proposed by the Commission	Amendment
	(ch) an assurance of the absence of any conflict of interest in relation to the implementation of the Union budget for all public investments measures contained in the plan;

Amendment  77

Proposal for a regulation

Article 15 – paragraph 3 – point c i (new)

Text proposed by the Commission	Amendment
	(ci) a demonstration that the envisaged reforms and investments included in the plan comply with the 'do no significant harm' principle;

Amendment  78