European Parliament legislative resolution on the Council common position for adopting a European Parliament and Council directive on waste electrical and electronic equipment (WEEE) (11304/2/2001 – C5&nbhy;0636/2001 – 2000/0158(COD))

P5_TA(2002)0160 A5-0100/2002

(Codecision procedure: second reading)

The European Parliament,

–  having regard to the Council common position (11304/2/2001 – C5&nbhy;0636/2001),

–  having regard to its position at first reading(1) on the Commission proposal to Parliament and the Council (COM(2000) 347(2)),

–  having regard to the Commission's amended proposal (COM(2001) 315(3)),

–  having regard to Article 251(2) of the EC Treaty,

–  having regard to Rule 80 of its Rules of Procedure,

–  having regard to the recommendation for second reading of the Committee on the Environment, Public Health and Consumer Policy (A5&nbhy;0100/2002),

1.  Amends the common position as follows;

2.  Instructs its President to forward its position to the Council and Commission.

Position of the European Parliament adopted at second reading on 10 April 2002 with a view to the adoption of European Parliament and Council Directive 2002/…/EC on waste electrical and electronic equipment (WEEE)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 175(1) thereof,

Having regard to the proposal from the Commission(4),

Having regard to the Opinion of the Economic and Social Committee(5),

Having regard to the Opinion of the Committee of Regions(6),

Acting in accordance with the procedure laid down in Article 251 of the Treaty(7),

Whereas:

(1)  The objectives of the Community's environment policy are, in particular, to preserve, protect and improve the quality of the environment, protect human health and utilise natural resources prudently and rationally. That policy is based on the precautionary principle and the principles that preventive action should be taken, that environmental damage should as a priority be rectified at source and that the polluter should pay.

(2)  The Community programme of policy and action in relation to the environment and sustainable development ("Fifth Environmental Action Programme")(8) states that the achievement of sustainable development calls for significant changes in current patterns of development, production, consumption and behaviour and advocates, inter alia, the reduction of wasteful consumption of natural resources and the prevention of pollution. It mentions waste electrical and electronic equipment (WEEE) as one of the target areas to be regulated, in view of the application of the principles of prevention, recovery and safe disposal of waste.

(3)  The Commission Communication of 30 July 1996 on review of the Community strategy for waste management(9) states that, where the generation of waste cannot be avoided, it should be re-used or recovered for its material or energy.

(4)  The Council in its Resolution of 24 February 1997 on a Community strategy for waste management (10) insisted on the need for promoting waste recovery with a view to reducing the quantity of waste for disposal and saving natural resources, in particular by re-use, recycling, composting and recovering energy from waste and recognised that the choice of options in any particular case must have regard to environmental and economic effects but that until scientific and technological progress is made and life-cycle analyses are further developed, re&nbhy;use and material recovery should be considered preferable where and insofar as they are the best environmental options. The Council also invited the Commission to develop, as soon as possible, an appropriate follow-up to the projects of the priority waste streams programme, including WEEE.

(5)  The European Parliament, in its Resolution of 14 November 1996(11) on review of the Community strategy for waste management, asked the Commission to present proposals for Directives on a number of priority waste streams, including electrical and electronic waste, and to base such proposals on the principle of producer responsibility. The European Parliament, in the same Resolution, requests the Council and the Commission to put forward proposals for cutting the volume of waste.

(6)  Council Directive 75/442/EEC of 15 July 1975 on waste (12) provides that specific rules for particular instances or supplementing those of that Directive on the management of particular categories of waste may be laid down by means of individual Directives.

(7)  The amount of WEEE generated in the Community is growing rapidly. The content of hazardous components in electrical and electronic equipment is a major concern during the waste management phase and recycling of WEEE is not undertaken to a sufficient extent.

(8)  The objective of improving the management of WEEE cannot be achieved effectively by Member States acting individually. In particular, different national applications of the producer responsibility principle may lead to substantial disparities in the financial burden on economic operators. Having different national policies on the management of WEEE hampers the effectiveness of recycling policies. For that reason the essential criteria should be laid down at Community level.

(9)  The provisions of this Directive should apply to products and producers irrespective of the selling technique, including distance and electronic selling. In this connection the obligations of producers and distributors using distance and electronic selling channels should, as far as is practicable, take the same form and should be enforced in the same way in order to avoid other distribution channels having to bear the costs of the provisions of this Directive concerning WEEE for which the equipment was sold by distance or electronic selling.

(10)  This Directive should cover all electrical and electronic equipment used by consumers and electrical and electronic equipment intended for professional use which could end up in the municipal waste stream. This Directive should apply without prejudice to safety and health requirements in Community legislation protecting all actors in contact with WEEE or to requirements in specific Community waste management legislation, in particular Council Directive 91/157/EEC of 18 March 1991 on batteries and accumulators containing certain dangerous substances (13).

(11)  Directive 91/157/EEC needs to be revised as soon as possible, particularly in the light of this Directive.

(12)  By establishing producer responsibility this Directive encourages the design and production of electrical and electronic equipment which take into full account and facilitate its repair, possible upgrading, re-use, disassembly and recycling.

(13)  In order to guarantee the safety and health of distributors' personnel involved in the take-back and handling of WEEE, Member States should, in accordance with national and Community legislation on safety and health requirements, determine the conditions under which take-back may be refused by distributors.

(14)  Separate collection is the precondition to ensure specific treatment and recycling of WEEE and is necessary to achieve the chosen level of protection of human health and the environment in the Community. Consumers have to actively contribute to the success of such collection and should be encouraged to return WEEE. For this purpose, convenient facilities should be set up for the return of WEEE, including public collection points, where private households should be able to return their waste at least free of charge.

(15)  In order to attain the chosen level of protection and harmonised environmental objectives of the Community, Member States should ensure that WEEE is no longer disposed of together with unsorted urban waste and that all WEEE is collected separately. In order to ensure that Member States strive to set up efficient collection schemes, they should be required, without prejudice to the objective of collecting all WEEE separately, to produce evidence of the collection of an average of at least six kilograms of WEEE from private households per inhabitant per year.

(16)  Specific treatment for WEEE is indispensable in order to avoid the dispersion of pollutants into the recycled material or the waste stream. Such treatment is the most effective means of ensuring compliance with the chosen level of protection of the environment of the Community. Any establishment or undertaking carrying out recycling and treatment operations should comply with minimum standards to prevent negative environmental impacts associated with the treatment of WEEE. State-of-the art treatment and recovery and recycling technology should be used provided it ensures human health and high environmental protection.

(17)  With the exception of appliances to be re-used as a whole, all WEEE collected separately should be sent for recovery, in the course of which as high as possible a level of recycling and recovery should be achieved. Where appropriate, priority should be given to the re-use of WEEE and its components, sub-assemblies and consumables. In addition, producers should be encouraged to integrate recycled material in new equipment.

(18)  Member States should ensure that used electrical and electronic equipment exported to non-EU countries is suitable and intended for re-use and not for recycling, recovery or disposal.

(19)  Basic principles with regard to the financing of WEEE management have to be set at Community level and financing schemes have to contribute to high collection rates as well as to the implementation of the principle of producer responsibility.

(20)  Users of electrical and electronic equipment from private households should have the possibility of returning WEEE at least free of charge. Producers should therefore finance collection from collection facilities, and the treatment, recovery and disposal of WEEE. In order to give maximum effect to the concept of producer responsibility, producers should as far as possible meet the financing requirement individually. The costs of collection, treatment and environmentally sound disposal should be internalised within the product price. Member States in which other financing agreements are already in place before the entry into force of this Directive should be allowed to maintain those agreements, subject to the outcome of a review, but for no longer than 10 years after the entry into force of this Directive. The responsibility for the financing of the management of historical waste should be shared collectively by all producers existing at the time when the costs arise, in proportion to their respective share of the market by type of equipment by volume. Member States should ensure that, for a transitional period based on the average life of equipment, but for no longer than 10 years after the entry into force of this Directive, producers are allowed to show users, on a voluntary basis at the time of sale of new products, the cost of collecting, treating and disposing in an environmentally sound way of historical waste. Producers making use of this provision should ensure that the costs mentioned represent the actual costs incurred.

(21)  Information to users about the requirement no longer to dispose of WEEE together with unsorted urban waste and to collect all such waste separately, and about the collection systems and their role in the management of WEEE, is indispensable for the success of WEEE collection. Such information implies the proper marking of electrical and electronic equipment which could end up in rubbish bins or similar means of municipal waste collection.

(22)  Information on component and material identification to be provided by producers is important to facilitate the management, and in particular the treatment and recovery/recycling, of WEEE.

(23)  Member States should ensure that inspection and monitoring infrastructure is in place to enable the proper implementation of this Directive to be verified.

(24)  Information about the weight or, if this is not possible, the numbers of items of electrical and electronic equipment put on the market in the Community and the rates of collection, re-use (including as far as possible re-use of whole appliances), recovery/recycling and export of WEEE is necessary to monitor the achievement of the objectives of this Directive.

(25)  Member States may choose to implement certain provisions of this Directive by means of agreements between the competent authorities and the economic sectors concerned provided that particular requirements are met.

(26)  The adaptation to scientific and technical progress of certain provisions of the Directive, the list of products falling under the categories set out in Annex IA, the selective treatment for materials and components of WEEE, the technical requirements for storage and treatment of WEEE and the symbol for the marking of electrical and electronic equipment should be effected by the Commission under a committee procedure.

(27)  The measures necessary for the implementation of this Directive should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission (14),

HAVE ADOPTED THIS DIRECTIVE:

Article 1

Objectives

The purpose of this Directive is, as a first priority, the prevention of waste electrical and electronic equipment (WEEE), and in addition, the re-use, recycling and other forms of recovery of such wastes so as to reduce the disposal of waste. It also seeks to improve the environmental performance of all operators involved in the life cycle of electrical and electronic equipment, e.g. producers, distributors and consumers and in particular those operators directly involved in the treatment of WEEE.

Article 2

Scope

1.  This Directive shall apply to electrical and electronic equipment falling under the categories set out in Annex IA provided that the equipment concerned is not part of another type of equipment that does not fall within the scope of this Directive. Annex IB contains a list of products which fall under the categories set out in Annex IA.

2.  This Directive shall apply without prejudice to Community legislation on safety and health requirements and specific Community waste management legislation.

3.  Equipment which is connected with the protection of the essential interests of the security of Member States, arms, munitions and war material shall be excluded from this Directive. This does not, however, apply to products which are not intended for specifically military purposes.

Article 3

Definitions

Article 4

Product design

Article 5

Separate collection

1.  Member States shall ensure that by … [30 months after the entry into force of this Directive] WEEE is no longer disposed of together with unsorted urban waste and all WEEE is collected separately.

2.  For WEEE from private households, Member States shall ensure that by ... [30 months after the entry into force of this Directive]:

Member States may depart from this provision provided they ensure that returning the WEEE is not thereby made more difficult for the final holder and provided that these systems remain free of charge. Member States making use of this provision shall inform the Commission thereof.

Without prejudice to the provisions of (a) and (b), Member States shall ensure that producers can set up and operate individual and/or collective take-back systems for WEEE from private households.

Member States may provide for specific arrangements for the return of WEEE as under (a) and (b) if the equipment does not contain the essential components or if the equipment contains waste other than WEEE.

Member States shall ensure that WEEE regarded as externally contaminated, including by radioactive or biological contaminants, or as hazardous and liable to present a safety or health risk to personnel, is taken back in specific collection facilities staffed by personnel trained for the task and equipped with the necessary state-of-the-art technology.

In accordance with the provisions of Directives 67/548/EEC and 1999/45/EC, and having regard to national and Community legislation on safety and health requirements, distributors may refuse to take back WEEE deemed to be contaminated, including by radioactive or biological contaminants, or hazardous and liable to present a health or safety risk to personnel.

3.  Member States shall ensure that producers provide for the collection of WEEE from holders other than private households.

4.  Member States shall ensure that all WEEE collected under paragraphs 1, 2 and 3 above is transported to treatment facilities authorised under Article 6 unless the appliances are re-used as a whole. Member States shall ensure that the envisaged re-use does not lead to a circumvention of this Directive, in particular as regards Articles 6 and 7. The collection and transport of separately collected WEEE shall be carried out in a way which optimises re-use and recycling of those components or whole appliances capable of being re-used or recycled.

Member States shall ensure that used electrical and electronic equipment exported to non-EU countries is suitable and intended for re-use and not intended for recycling, recovery or disposal.

5.  Without prejudice to paragraph 1, Member States shall ensure that by 31 December 2005 at the latest a rate of separate collection of at least six kilograms on average per inhabitant per year of WEEE from private households is shown to have been achieved.

On the basis of the information required under Article 12, the European Parliament and the Council, acting on a proposal from the Commission and taking account of technical and economic experience in the Member States, shall establish by 31 December 2007 a new rate for the years beyond 2008. This may take the form of a percentage of the quantities of electrical and electronic equipment sold to private households in the preceding years.

Article 6

Treatment

1.  Member States shall ensure that producers or third parties acting on their behalf, in accordance with Community legislation, set up systems to provide for the treatment of WEEE using state-of-the-art recovery and recycling technology. The systems may be set up by producers individually and/or collectively. To ensure compliance with Article 4 of Directive 75/442/EEC, the treatment shall, as a minimum, include the removal of all fluids and a selective treatment in accordance with Annex II to this Directive.

Other treatment technologies ensuring at least the same level of protection for human health and the environment may be introduced in Annex II according to the procedure referred to in Article 14(2).

For the purposes of environmental protection, Member States may set up minimum quality standards for the treatment of collected WEEE. Member States who opt for such quality standards shall inform the Commission thereof who shall publish these standards.

2.  Member States shall ensure that any establishment or undertaking carrying out treatment operations obtains a permit from the competent authorities, in compliance with Articles 9 and 10 of Directive 75/442/EEC.

The derogation from the permit requirement referred to in Article 11(1)(b) of Directive 75/442/EEC may apply to recovery operations concerning WEEE if an inspection is carried out by the competent authorities before the registration in order to ensure compliance with Article 4 of Directive 75/442/EEC.

The inspection shall be carried out at least once a year and the results shall be communicated by the Member States to the Commission.

3.  Member States shall ensure that any establishment or undertaking carrying out treatment operations stores and treats WEEE in compliance with the technical requirements set out in Annex III.

4.  Member States shall ensure that the permit or the registration referred to in paragraph 2 includes all conditions necessary for compliance with the requirements of paragraphs 1 and 3 and for the achievement of the recovery targets set out in Article 7.

5.  The treatment operation may also be undertaken outside the respective Member State or the Community provided that the shipment of WEEE is in compliance with Council Regulation (EEC) No 259/93 of 1 February 1993 on the supervision and control of shipments of waste within, into and out of the European Community(18).

In this case, Member States shall ensure that producers deliver the WEEE to establishments or undertakings which meet minimum standards corresponding to the conditions set out in this Article, unless proof of re-use of whole appliances can be given.

In compliance with Regulation (EEC) No 259/93, Member States may oppose shipments destined for recovery or disposal if the minimum quality standards for treatment as laid down in paragraph 1 and the technical requirements as laid down in paragraph 3 are not met in the importing country.

6.  Member States shall encourage establishments or undertakings which carry out treatment operations to introduce certified environmental management systems in accordance with Regulation (EC) No 761/2001 of the European Parliament and of the Council of 19 March 2001 allowing voluntary participation by organisations in a Community eco-management and audit scheme (EMAS) (19).

Article 7

Recovery

1.  Member States shall ensure that producers or third parties acting on their behalf set up systems either on an individual or collective basis, in accordance with Community legislation, to provide for the recovery of WEEE collected separately in accordance with Article 5. Member States shall give priority to the re-use of whole appliances. Until the date referred to in paragraph 4, such appliances shall not be taken into account for the calculation of the targets set out in paragraph 2. 

2.  Regarding WEEE sent for treatment in accordance with Article 6, Member States shall ensure that, by 31 December 2005 at the latest, producers meet the following targets:

(a)  for WEEE falling under categories 1 (large household appliances) and 10 (automatic dispensers) of Annex IA,

European Parliament legislative resolution on the Council common position for adopting the proposal for a European Parliament and Council Directive on the restriction of the use of certain hazardous substances in electrical and electronic equipment (11356/1/2001 – C5&nbhy;0637/2001 – 2000/0159(COD))

P5_TA(2002)0161 A5-0097/2002

(Codecision procedure: second reading)

The European Parliament,

–  having regard to the Council common position (11356/1/2001 – C5&nbhy;0637/2001),

–  having regard to its position at first reading(1) on the Commission proposal to the European Parliament and the Council (COM(2000) 347(2)),

–  having regard to the Commission's amended proposal (COM(2001) 316(3)),

–  having regard to Article 251(2) of the EC Treaty,

–  having regard to Rule 80 of its Rules of Procedure,

–  having regard to the recommendation for second reading of the Committee on the Environment, Public Health and Consumer Policy (A5&nbhy;0097/2002),

1.  Amends the common position as follows;

2.  Instructs its President to forward its position to the Council and Commission.

Position of the European Parliament adopted at second reading on 10 April 2002 with a view to the adoption of European Parliament and Council Directive 2002/…/EC on the use of certain hazardous substances in electrical and electronic equipment (RoHS)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 95 thereof,

Having regard to the proposal from the Commission(4),

Having regard to the opinion of the Economic and Social Committee(5),

Having regard to the opinion of the Committee of Regions(6),

Acting in accordance with the procedure laid down in Article 251 of the Treaty(7),

Whereas:

(1)  The disparities between the laws or administrative measures adopted by the Member States as regards the restriction of the use of hazardous substances in electrical and electronic equipment could create barriers to trade and distort competition in the Community and may thereby have a direct impact on the establishment and functioning of the internal market. It therefore appears necessary to approximate the laws of the Member States in this field and to contribute to the protection of human health and the environmentally sound recovery and disposal of waste electrical and electronic equipment.

(2)  The European Council at its meeting in Nice on 7, 8 and 9 December 2000 endorsed the Council Resolution of 4 December 2000 on the precautionary principle.

(3)  The Commission Communication of 30 July 1996 on the review of the Community strategy for waste management stresses the need to reduce the content of hazardous substances in waste and points out the potential benefits of Community-wide rules limiting the presence of such substances in products and in production processes.

(4)  The Council Resolution of 25 January 1988 on a Community action programme to combat environmental pollution by cadmium (8) invites the Commission to pursue without delay the development of specific measures for such a programme. Human health also has to be protected and an overall strategy that in particular restricts the use of cadmium and stimulates research into substitutes should therefore be implemented. The Resolution stresses that the use of cadmium should be limited to cases where suitable and safer alternatives do not exist.

(5)  The available evidence indicates that measures on the collection, treatment, recycling and disposal of waste electrical and electronic equipment (WEEE) as set out in Directive 2002/      /EC of the European Parliament and of the Council of .... on waste electrical and electronic equipment (9) are necessary to reduce the waste management problems linked to the heavy metals concerned and the flame retardants concerned. In spite of those measures, however, significant parts of WEEE will continue to be found in the current disposal routes. Even if WEEE were collected separately and submitted to recycling processes, its content of mercury, cadmium, lead, chromium VI, PBB and PBDE would be likely to pose risks to health or the environment.

(6)  Taking into account technical and economic feasibility, the most effective way of ensuring the significant reduction of risks to health and the environment related to those substances which can achieve the chosen level of protection in the Community is the substitution of those substances in electrical and electronic equipment by safe or safer materials. Restricting the use of these hazardous substances is likely to enhance the possibilities and economic profitability of recycling of WEEE and decrease the negative health impact on workers in recycling plants.

(7)  The substances covered by this Directive are scientifically well researched and evaluated and have been subject to different measures both at Community and national level.

(8)  The measures provided for in this Directive take into account existing international guidelines and recommendations and are based on an assessment of available scientific and technical information. The measures are necessary to achieve the chosen level of protection of human and animal health and the environment, having regard to the risks which the absence of measures would be likely to create in the Community. The measures should be kept under review and, if necessary, adjusted to take account of available technical and scientific information.

(9)  This Directive should apply without prejudice to safety and health requirements in Community legislation or to requirements in specific Community waste management legislation, in particular Council Directive 91/157/EEC of 18 March 1991 on batteries and accumulators containing certain dangerous substances (10).

(10)  The technical development of electrical and electronic equipment without heavy metals, PBDE and PBB should be taken into account. On the basis of scientific facts and taking into account the precautionary principle, the prohibition of other hazardous substances and their substitution by more environmentally friendly alternatives which ensure at least the same level of protection of consumers should be examined.

(11)  Exemptions from the substitution requirement should be permitted if substitution is technically or scientifically impossible or if the negative environmental, health and/or consumer safety impacts caused by substitution are likely to outweigh the environmental, health and/or consumer safety benefits of the substitution. Substitution of the hazardous substances in electrical and electronic equipment should also be carried out in such a way as to be compatible with the health and safety of users of such equipment.

(12)  As product re-use, refurbishment and extension of lifetime are beneficial, spare parts need to be available.

(13)  The adaptation to scientific and technical progress of the exemptions from the requirements concerning phasing out and prohibition of hazardous substances should be effected by the Commission under a committee procedure.

(14)  The measures necessary for the implementation of this Directive should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission (11),

HAVE ADOPTED THIS DIRECTIVE:

Article 1

Objectives

The purpose of this Directive is to approximate the laws of the Member States on the restrictions of the use of hazardous substances in electrical and electronic equipment and to contribute to the protection of human health and the environmentally sound recovery and disposal of waste electrical and electronic equipment.

Article 2

Scope

1.  Without prejudice to Article 6, this Directive shall apply to electrical and electronic equipment falling under the categories 1, 2, 3, 4, 5, 6, 7 and 10 set out in Annex I A to Directive 2002/   /EC (WEEE) and to electric light bulbs, and luminaires in households.

2.  This Directive shall apply without prejudice to safety and health requirements in Community legislation or to requirements in specific Community waste management legislation.

3.  This Directive does not apply to the re-use of electrical and electronic equipment or its components put on the market before the date mentioned in Article 4(1), including the re-use of these components in new electrical and electronic equipment put on the market.

Article 3

Definitions

Article 4

Prevention

1.  Member States shall ensure that, from 1 January 2006, new electrical and electronic equipment put on the market does not contain lead, mercury, cadmium, hexavalent chromium, polybrominated biphenyls (PBB) or polybrominated diphenyl ether (PBDE).

2.  Paragraph 1 shall not apply to the applications listed in the Annex.

3.  Furthermore, paragraph 1 shall not apply to spare parts for equipment or the repair of equipment put on the market before 1 January 2006.

4.  The European Parliament and the Council shall decide, as soon as the necessary scientific facts are available, and without prejudice to the powers of the Commission, on the prohibition of other hazardous substances and the substitution thereof by more environment-friendly alternatives which ensure at least the same level of protection for consumers.

Article 5

Adaptation to scientific and technical progress

1.  Any amendments which are necessary in order to adapt the Annex to scientific and technical progress for the following purposes shall be adopted in accordance with the procedure referred to in Article 7(2):

2.  Before the Annex is amended pursuant to paragraph 1, the Commission shall inter alia consult producers of electrical and electronic equipment, recyclers, treatment operators, environmental organisations and employee and consumer associations. Comments shall be forwarded to the Committee referred to in Article 7(1). The Commission shall provide an account of the information it receives.

Article 6

Review

Before  *(13), the Commission shall review the measures provided for in this Directive to take into account, as necessary, new scientific facts.

In particular the Commission shall by that date present proposals for including in the scope of this Directive equipment which falls under categories 8 and 9 set out in Annex IA to Directive 2002/   /EC (WEEE).

The Commission shall also study the need to adapt the list of substances of Article 4(1), on the basis of scientific facts and taking the precautionary principle into account, and present proposals to the European Parliament and Council for such adaptations, if appropriate.

Particular attention shall be paid during the review to the impact on the environment and on human health of other hazardous substances and materials used in electrical and electronic equipment. The Commission shall examine the feasibility of replacing such substances and materials and shall come forward with proposals to the European Parliament and to the Council in order to extend the scope of Article 4, as appropriate.

Article 7

Committee

1.  The Commission shall be assisted by the Committee set up by Article 18 of Council Directive 75/442/EEC of 15 July 1975 on waste(14).

2.  Where reference is made to this paragraph, Articles 5 and 7 of Decision 1999/468/EC shall apply, having regard to Article 8 thereof.

The period provided for in Article 5(6) of Decision 1999/468/EC shall be set at three months.

3.  The Committee shall adopt its rules of procedure.

Article 8

Penalties

Member States shall determine penalties applicable to breaches of the national provisions adopted pursuant to this Directive. The penalties thus provided for shall be effective, proportionate and dissuasive.

Article 9

Transposition

1.  Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before  *(15). They shall immediately inform the Commission thereof.

When Member States adopt those measures, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. The methods of making such a reference shall be laid down by the Member States.

2.  Member States shall communicate to the Commission the text of all laws, regulations and administrative provisions adopted in the field covered by this Directive.

Article 10

Entry into force

This Directive shall enter into force on the day of its publication in the Official Journal of the European Communities.

Article 11

Addressees

This Directive is addressed to the Member States.

Done at

For the European Parliament For the Council

The President The President

ANNEX

Applications of lead, mercury, cadmium and hexavalent chromium, to which Article 4(1) does not apply

1.  Mercury in compact fluorescent lamps not exceeding 5 mg per lamp.

2.  Mercury in straight fluorescent lamps for general purposes not exceeding.

3.  Mercury in straight fluorescent lamps for special purposes.

4.  Mercury in other lamps not specifically mentioned in this Annex.

5.  Lead in glass of cathode ray tubes, electronic components and fluorescent tubes.

6.  Lead as an alloying element in steel containing up to 0,35% lead by weight, aluminium containing up to 0,4% lead by weight and as a copper alloy containing up to 4% lead by weight.

7. –  Lead in high melting temperature type solders (i.e. tin-lead solder alloys containing more than 85% lead), 

8.  Cadmium plating except for applications banned under Council Directive 91/338/EEC of 18 June 1991(16) amending for the tenth time Directive 76/769/EEC (17) relating to restrictions on the marketing and use of certain dangerous substances and preparations

9.  Hexavalent chromium as an anti-corrosion of the carbon steel cooling system in absorption refrigerators.

(1) OJ C 34 E, 7.2.2002, p. 109. (2) OJ C 365 E, 19.12.2000, p. 195. (3) OJ C 240 E, 28.8.2001, p. 303. (4) OJ C 365E, 19.12.2000, p. 195 and OJ C 240 E, 28.8.2001, p. 303. (5) OJ C 116, 20.4.2001, p. 38. (6) OJ C 148, 18.5.2001, p. 1. (7) Position of the European Parliament of 15 May 2001 (OJ C 34E, 7.2.2002, p. 109), Council Common Position of 4 December 2001 and Position of the European Parliament of 10 April 2002. (8) OJ C 30, 4.2.1988, p. 1. (9) OJ L (10) OJ L 78, 26.3.1991, p. 38. Directive as amended by Commission Directive 98/101/EC (OJ L 1, 5.1.1999, p. 1). (11) OJ L 184, 17.7.1999, p. 23. (12) OJ L 144, 4.6.1997, p. 19. (13) * Two years after the entry into force of this Directive. (14) OJ L 194, 25.7.1975, p. 39, Directive as amended by Commission Decision 96/350/EC (OJ L135, 6.6.1996, p. 32). (15) * 18 months after the entry into force of this Directive. (16) OJ L 186, 12.7.1991, p. 59. (17) OJ L 262, 27.9.1976, p. 201.

European Parliament legislative resolution on the Council common position for adopting a European Parliament and Council directive amending for the 24th time Council Directive 76/769/EEC relating to restrictions on the marketing and use of certain dangerous substances and preparations (pentabromodiphenyl ether) (12332/1/2001 – C5&nbhy;0638/2001 – 2001/0018(COD))

(Codecision procedure: second reading)

The European Parliament,

–  having regard to the Council common position (12332/1/2001 – C5&nbhy;0638/2001),

–  having regard to its position at first reading(1) on the Commission proposal to Parliament and the Council (COM(2001) 12(2)),

–  having regard to the Commission's amended proposal (COM(2001) 555(3)),

–  having regard to Article 251(2) of the EC Treaty,

–  having regard to Rule 80 of its Rules of Procedure,

–  having regard to the recommendation for second reading of the Committee on the Environment, Public Health and Consumer Policy (A5&nbhy;0090/2002),

1.  Amends the common position as follows;

2.  Instructs its President to forward its position to the Council and Commission.

Position of the European Parliament adopted at second reading on 10 April 2002 with a view to the adoption of European Parliament and Council Directive 2002/…/EC amending for the 24th time Council Directive 76/769/EEC relating to restrictions on the marketing and use of certain dangerous substances and preparations (pentabromodiphenyl ether, octabromodiphenyl ether)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 95 thereof,

Having regard to the proposal from the Commission(4),

Having regard to the opinion of the Economic and Social Committee(5),

Acting in accordance with the procedure laid down in Article 251 of the Treaty(6),

Whereas:

(1)  Under Article 14 of the Treaty, an area without internal frontiers is to be established, in which the free movement of goods, persons, services and capital is ensured.

(2)  The risks to the environment of pentabromodiphenyl ether (pentaBDE) have been assessed under Council Regulation (EEC) No 793/93 of 23 March 1993 on the evaluation and control of the risks of existing substances (7). The risk assessment identified a need to reduce the risks to the environment posed by pentaBDE. In its opinion of 4 February 2000, the Scientific Committee on toxicity, ecotoxicity and the environment (CSTEE) confirmed the conclusions of the assessment of pentaBDE on the need to reduce risks to protect the environment. Furthermore, the CSTEE confirmed, in its opinion of 19 June 2000, the concern about exposure of breast-fed children to pentaBDE and that the increasing levels of pentaBDE in breast milk might be the result of a use not yet identified.

(3)  The Commission has adopted a Recommendation in the framework of Regulation (EEC) No 793/93 on a risk reduction strategy for pentaBDE providing for restrictions on marketing and use to control risk to the environment. It also recommended that any measures should take account of the concerns about infants exposed via breast milk.

(4)  In order to protect human health and the environment, the marketing and the use of pentaBDE and the marketing of articles containing pentaBDE should be prohibited.

(5)  The commercially available, technical grade diphenyl ethers are mixtures and contain molecules with different numbers of bromine atoms. Technical grade octabromodiphenyl ether (octaBDE) contains mainly octaBDE and heptaBDE, but also pentaBDE. In order to protect human health and the environment, the use of octaBDE containing more than 0,1% pentaBDE should no longer be allowed once pentaBDE is restricted. Furthermore, although the risk assessments for octaBDE and decaBDE are not yet complete, the marketing and use of these substances should be restricted, given that the current assessments have already established definite risks for human health and the environment.

(6)  Presence of pentaBDE in concentrations higher than 0,1% can be identified using standard analytical techniques such as GC-MS (gas chromatography-mass spectrometry). These techniques can distinguish between technical grades of octaBDE and pentaBDE.

3.  This Directive does not affect Community legislation laying down minimum requirements for the protection of workers contained in Council Directive 89/391/EEC of 12 June 1989 on the introduction of measures to encourage improvements in the safety and health of workers at work (8) and in individual directives based thereon, in particular Council Directive 90/394/EEC of 28 June 1990 on the protection of workers from the risks related to exposure to carcinogens at work (Sixth individual Directive within the meaning of Article 16(1) of Directive 89/391/EEC) (9) and Council Directive 98/24/EC of 7 April 1998 on protection of health and safety of workers from the risk related to chemical agents at work (fourteenth individual Directive within the meaning of Article 16(1) of Directive 89/391/EEC) (10),

HAVE ADOPTED THIS DIRECTIVE:

Article 1

Annex I to Directive 76/769/EEC is hereby amended as set out in the Annex to this Directive.

Article 2

Member States shall adopt and publish the laws, regulations and administrative provisions necessary to comply with this Directive no later than [...] *(11). They shall forthwith inform the Commission thereof.

They shall apply those provisions from [...] *(12)*.

When Member States adopt these measures, the provisions shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. The methods of making such a reference shall be laid down by the Member States.

Article 3

This Directive shall enter into force on the day of its publication in the Official Journal of the European Communities.

Article 4

This Directive is addressed to the Member States.

Done at

For the European Parliament For the Council

The President The President

ANNEX

The following points [XX], [XXI] and [XXII] are added to Annex I of Directive 76/769/EEC:

(1) OJ C 72 E, 21.3.2002, p. 286. (2) OJ C 154 E, 29.5.2001, p. 112. (3) OJ C 25 E, 29.1.2002, p. 472. (4) OJ C 154 E, 29.5.2001, p. 112 and OJ C 25 E, 29.1.2002, p. 472. (5) OJ C 193, 10.7.2001, p. 27. (6) Position of the European Parliament of 6 September 2001 (OJ C 72 E, 21.3.2002, p. 286), Council Common Position of 6 December 2001 and Position of the European Parliament of 10 April 2002. (7) OJ L 84, 5.4.1993, p. 1. (8) OJ L 183, 29.6.1989, p. 1. (9) OJ L 196, 26.7.1990, p. 1. Directive as last amended by Directive 1999/38/EC (OJ L 138, 1.6.1999, p. 66). (10) OJ L 131, 5.5.1998, p. 11. (11) * 12 months from the entry into force of this Directive. (12) ** 18 months from the entry into force of this Directive.

Proposal for a Council regulation on the Community patent (COM(2000) 412 – C5&nbhy;0461/2000 – 2000/0177(CNS))

P5_TA(2002)0163 A5-0059/2002

The proposal was amended as follows:

Text proposed by the Commission(1)   Amendments by Parliament Amendment 21 Recital 2 (2)  The Munich Convention on the Grant of European Patents of 5 October 1973 (hereinafter referred to as the "Munich Convention") established the European Patent Office (hereinafter referred to as "the Office") and entrusted it with the task of granting European patents. The expertise offered by the Office should be used in the granting and administration of the Community patent. (2)  The Munich Convention on the Grant of European Patents of 5 October 1973 (hereinafter referred to as the "Munich Convention") established the European Patent Office (hereinafter referred to as "the Office") and entrusted it with the task of granting European patents. The expertise offered by the Office should be used in the granting and administration of the Community patent. The national patent authorities may be enabled to carry out some of the work of dealing with Community patent cases, including the investigation of novelty, for the European Patent Organisation, provided that the national patent authorities meet quality standards agreed in advance. The granting of Community patents remains the sole responsibility of the European Patent Organisation. Amendments 2 and 22 Recital 5 a (new) (5a) A balance should be struck between the right of all citizens of the European Union to have any file processed in their own language, the principle of legal certainty making the content of the patent readily available and the need to guard against cost increases. This balance is present in the formula established for the language arrangements under Council Regulation (EC) No 40/94 of 20 December 19931 on the Community trade mark. ________________ 1 OJ L 11, 14.1.1994, p. 1. Amendment 3 Recital 7 (7)  For reasons of legal certainty, all actions relating to certain aspects of the Community Patent should come under the jurisdiction of one court, and the decisions of that court should be enforceable throughout the Community. Exclusive jurisdiction for a certain category of actions and applications relating to a Community patent, and in particular for actions relating to infringement and validity, should therefore be given to the Community intellectual property court. Judgements of a Chamber of First Instance of that court should be subject to appeal to a Chamber of Appeal of that court. (7)  All actions relating to certain aspects of the Community Patent should come under the jurisdiction, in the first instance, of the Community Patent courts (CPC) of Member States and, in the second instance, of the European Chamber for Intellectual Property (ECIP), created under Articles 225a and 229a EC, established by the Nice Treaty. (7a) The use of existing national courts with experience in patent cases as first instance courts (CPC) for Community Patent litigation follows, for the first instance, the example of Regulation (EC) No 40/94. The factors of speed, cost effectiveness, local language, proximity to users and the use of existing infrastructure and expertise are thus duly taken into account. (7b) The number of CPCs per Member State should be limited. CPCs covering two or more Member States may be created by agreement between Member States. (7c) The uniform application of community law should be safeguarded by the control of the CPC by the ECIP, acting as an appeal court. The ECIP may give leave to an appeal to the Court of First Instance regarding important questions of law. (7d) In patent cases two instances considering factual (mostly technical) questions are essential. The CPC and ECIP will therefore decide on questions of fact and of law. The implementing regulation may restrict the extent to which ECIP considers the factual basis for the decision of the CPC. (7e) The ECIP, acting as a central appeal court, is a "first instance" court within the meaning of Article 225a EC, established by the Nice Treaty, because the European Court structure, comprising the European Court of Justice (ECJ), the Court of First Instance (CFI) and the European Chamber for Intellectual Property (ECIP), is involved "for the first time" as a result of an appeal from a CPC, which in itself is not part of the European Court structure. This, again, follows the example of the Community Trademark System, where the CFI rules on actions brought against the decisions of the appeal boards of the Office for Harmonisation in the Interior Market (Alicante), thus acting as a second (or even third) instance. (7f) As institutions, the CPCs are national courts. They will, however, only apply European law, specifically the substantive and procedural provisions of this Regulation. Therefore, national sovereignty of Member States does not stand in the way of an appeal from CPC to ECIP. Amendment 4 Recital 8 (8)  The court ruling on infringement and validity should also be able to rule on penalties and compensation for damage on the basis of common rules. Those powers are without prejudice to the powers to apply any rules on criminal liability and unfair competition provided for under the Member States' national law. (8)  The CPC ruling on infringement and validity should also be able to rule on penalties and compensation for damage on the basis of common rules. These powers are without prejudice to the powers to apply any rules on criminal liability and unfair competition provided for under the Member States' national law. Amendment 5 Recital 9 (9)  The rules for proceedings before the Community intellectual property court are laid down in the court's statute and rules of procedure. (9)  The rules for proceedings before the CPC and ECIP are laid down in implementing regulations. Amendment 6 Article 1 a (new) Article 1a National patent offices 1.  With regard to the Community patent, the national patent offices may, under the terms laid down in the implementing regulation provided for in Article 59 of this Regulation, provide advisory services on application procedures for the Community patent, receive patent applications and forward them to the European Patent Office, and disseminate information on the Community patent. 2.  National patent offices which so request within the framework of the Munich Convention may, in their respective working languages, undertake other tasks relating to Community patent applications, particularly in the field of search and research operations. These activities shall not affect the uniformity of the Community patent, which in all cases must be granted by the European Patent Office. Amendment 7 Article 1 b (new) Article 1b Functions of national patent offices In the context of the application procedure for a European patent, the national patent offices shall support the applicant in entering a Community patent under the terms laid down in the implementing regulation provided for in Article 59 of this Regulation. In particular, they shall receive patent applications, forward them to the European Patent Office, and provide advisory and research services. They shall also provide information services in relation to the legal form which a Community patent should take. The Community patent shall in all cases be granted by the European Patent Office. Amendment 8 Article 9, point (b) (b) acts done for experimental purposes relating to the subject-matter of the patented invention; (b) acts done for experimental purposes relating to the subject-matter of the patented invention including experiments and tests necessary for registration purposes. Amendment 9 Article 25, paragraph 1 1.  Annual renewal fees in respect of Community patents shall be paid to the Office in accordance with the implementing regulations referred to in Article 60. These fees shall be due in respect of the years following the year in which the Community Patent Bulletin referred to in Article 57 mentions the grant of the Community patent. 1.  Annual renewal fees in respect of Community patents shall be paid to the Office in accordance with the implementing regulations referred to in Article 60. A certain part of the fees shall be paid in order to finance the Member States' duties in connection with patent information, in accordance with the significance of the national patent office. These fees shall be due in respect of the years following the year in which the Community Patent Bulletin referred to in Article 57 mentions the grant of the Community patent. Amendment 10 Article 30, paragraphs 3 and 4 3.  The actions and claims referred to in paragraph 1 come under the exclusive jurisdiction of the Community intellectual property court. In the first instance, they are brought before the Chamber of First Instance of that court. 3.  The actions and claims referred to in paragraph 1 come under the exclusive jurisdiction (a) in the first instance, of the Community Patent Courts (CPC) of Member States and (b) in the second instance, of the European Chamber for Intellectual Property (ECIP) created under Articles 225a and 229a EC, established by the Nice Treaty. 3a. Member States designate national courts with experience in patent litigation as CPCs. 3b. The number of CPCs in a Member State shall not exceed two. 3c. Member States may come to an agreement allowing a CPC in one Member State to act as CPC for each of them. 4.  Subject to the provisions of the treaty and of this regulation, the terms and procedures relating to actions and claims referred to in paragraph 1 and the rules applying to judgements given shall be established in the statute of rules of procedures of the Community intellectual property court. 4.  Subject to the provisions of the treaty and of this regulation, the terms and procedures relating to actions and claims referred to in paragraph 1 and the rules applying to judgements given by CPC and EICP shall be established by the implementing regulation referred to in Article 59. Amendment 11 Article 39 1.  An appeal to the Chamber of Appeal of the Community intellectual property court shall lie from judgements of the Chamber of First Instance of that court in respect of proceedings arising from the actions and claims referred to in the provisions of this section. 1.  An appeal to the ECIP shall lie from judgements of the CPCs of Member States in respect of proceedings arising from the actions and claims referred to in the provisions of this section. 2.  The action shall be brought before the Chamber of Appeal within two months of the date of notification of the judgement in accordance with the statute of the Community intellectual property court. 2.  The action shall be brought before the ECIP within two months of the date of notification of the judgement in accordance with the statute of the Community intellectual property court. 3.  The Chamber of Appeal shall have jurisdiction to rule on the facts of a particular case as well as on points of law and to annul or alter the contested decision. 3.  The ECIP shall have jurisdiction to rule on the facts of a particular case as well as on points of law and to annul or alter the contested decision. 4.  The action shall be open to any party to proceedings before the Community intellectual property court adversely affected by its decision. 4.  The action shall be open to any party to proceedings before the Community intellectual property court adversely affected by its decision. 5.  The action shall have suspensive effect. However, the Chamber of First Instance may declare its judgement enforceable while, if necessary, subjecting enforcement to the provision of security. 5.  The action shall have suspensive effect. However, the CPC may declare its judgement enforceable while, if necessary, subjecting enforcement to the provision of security. 5a. The ECIP may give leave to an appeal to the Court of First Instance regarding important questions of law. Amendment 12 Article 40 1.  Where necessary in the Community's interest, the Commission may bring invalidity proceedings against a Community patent before the Community intellectual property court. 1.  Where necessary in the Community's interest, the Commission may bring invalidity proceedings against a Community patent before the CPC which has jurisdiction for the Member State in which the owner is based. 2.  The Commission may also, under the condition referred to in paragraph 1, intervene in all proceedings before the Community intellectual property court. 2.  The Commission may also, under the condition referred to in paragraph 1, intervene in all proceedings before any CPC or before the ECIP. Amendment 13 Article 41 In the proceedings referred to in Articles 33 to 36, the Community intellectual property court shall have jurisdiction in respect of acts committed and activities undertaken in a part or in the entirety of the territory, zone or space to which this Regulation applies. 1.  In the proceedings referred to in Articles 33 to 36 brought before the CPC for the Member State in which the defendant is based, the CPC shall have jurisdiction regarding the actions and claims referred to in Article 30, paragraph 1. Regarding infringement proceedings and actions for a declaration of non-infringement, the CPC concerned has jurisdiction for the entirety of the territory, zone or space to which this Regulation applies. 2.  The first sentence of paragraph 1 applies to all CPCs in Member States where the patent is infringed, or, in the case of an action of non-infringement, where the patent is alleged to have been infringed. Regarding infringement procedures and actions for a declaration of non-infringement, the CPC concerned has jurisdiction only for that Member State. Amendment 14 Article 42 The Community intellectual property court may take any necessary provisional or protective measure in accordance with its statute. The CPC may take any necessary provisional or protective measure in accordance with its statute. Amendment 15 Article 44, paragraph 1 1.  The Community intellectual property court shall have the power to order the payment of compensation for the damage underlying the actions referred to in Articles 31 to 36. 1.  The CPC shall have the power to order the payment of compensation for the damage underlying the actions referred to in Articles 31 to 36. Amendment 16 Article 46 The national courts of the Member States shall have jurisdiction in actions relating to Community patents which do not come within the exclusive jurisdiction of either the Court of Justice under the Treaty or the Community intellectual property court according to the provisions of Chapter IV, Section 1. The national courts of the Member States shall have jurisdiction in actions relating to Community patents which do not come within the exclusive jurisdiction of either the Court of Justice under the Treaty or the CPC according to the provisions of Chapter IV, Section 1. Amendment 17 Article 51 1.  A national court hearing an action or application referred to in Article 30 shall declare of its own motion that it has no jurisdiction. 1.  A national court, other than a CPC, hearing an action or application referred to in Article 30 shall declare of its own motion that it has no jurisdiction. 2.  A national court hearing an action or claim relating to a Community patent other than the actions referred to in Article 30 shall treat the patent as valid unless it has been declared invalid by the Community intellectual property court in a decision which has the authority of res judicata. 2.  A national court hearing an action or claim relating to a Community patent other than the actions referred to in Article 30 shall treat the patent as valid unless it has been declared invalid by the CPC or the ECIP in a decision which has the authority of res judicata. 3.  A national court hearing an action or claim relating to a Community patent other than the actions referred to in Article 30 shall stay the proceedings if it considers a decision on an action or application referred to in Article 30 to be a prior condition for its judgement. Proceedings shall be stayed either by the court of its own motion, after hearing the parties, where an action or application referred to in Article 30 has been brought before the Community intellectual property court, or at the request of one of the parties, and after hearing the other parties, where proceedings have not yet been brought before the Community court. In the latter case, the national court shall invite the parties to bring such proceedings within a period prescribed by it. If such proceedings are not brought within the prescribed period, the proceedings before the national court shall continue. 3.  A national court hearing an action or claim relating to a Community patent other than the actions referred to in Article 30 shall stay the proceedings if it considers a decision on an action or application referred to in Article 30 to be a prior condition for its judgement. Proceedings shall be stayed either by the court of its own motion, after hearing the parties, where an action or application referred to in Article 30 has been brought before the CPC, or at the request of one of the parties, and after hearing the other parties, where proceedings have not yet been brought before the CPC. In the latter case, the national court shall invite the parties to bring such proceedings within a period prescribed by it. If such proceedings are not brought within the prescribed period, the proceedings before the national court shall continue. Amendment 39 Article 56a (new) Article 56a Role of national patent offices The Commission and Council shall ensure that, during the next diplomatic conference, - national patent offices may retain an important role in the processing of the Community patent, with particular regard to the giving of advice to applicants and to the forwarding of patents to the European Patent Office; - national patent offices which so desire may be instructed by the European Patent Office to produce research reports relating to a limited number of patent applications, provided that they fulfil the quality criteria established in advance with a view to guaranteeing the quality and uniformity of the Community patent. Such activity by national patent offices must on no account adversely affect the uniformity or quality of the Community patent which will, at all events, be issued by the European Patent Office. With a view to guaranteeing the quality and uniformity of the patent, a quality-control system shall be established under the authority of the Commission, working in conjunction with the European Patent Office.

Legislative resolution>\*MERGEFORMATEuropean Parliament legislative resolution on the proposal for a Council regulation on the Community patent (COM(2000) 412 – C5&nbhy;0461/2000 – 2000/0177(CNS))

(Consultation procedure)

The European Parliament,

–  having regard to the Commission proposal to the Council (COM(2000) 412)(2),

–  having been consulted by the Council pursuant to Article 308 of the EC Treaty (C5&nbhy;0461/2000),

–  having regard to Rule 67 of its Rules of Procedure,

–  having regard to the report of the Committee on Legal Affairs and the Internal Market and the opinion of the Committee on Industry, External Trade, Research and Energy (A5&nbhy;0059/2002),

1.  Approves the Commission proposal as amended;

2.  Calls on the Council and Commission to ensure that at the next Diplomatic Conference to revise the European Patent Convention it is established that the language regime for the Community patent will be that provided for in Council Regulation (EC) No 40/94 of 20 December 1993 on the Community trade mark(3);

3.  Calls on the Commission to alter its proposal accordingly, pursuant to Article 250(2) of the EC Treaty;

4.  Calls on the Council to notify Parliament should it intend to depart from the text approved by Parliament;

5.  Calls for the conciliation procedure to be initiated should the Council intend to depart from the text approved by Parliament;

6.  Asks to be consulted again if the Council intends to amend the Commission proposal substantially;

7.  Instructs its President to forward its position to the Council and Commission.

(1) OJ C 337 E, 28.11.2000, p. 278. (2) OJ C 337 E, 28.11.2000, p. 278. (3) OJ L 11 E, 14.1.1994, p. 1.

1.European Parliament decision concerning discharge in respect of the implementation of the general budget of the European Union for the financial year 2000 (Commission) (SEC(2001) 528 - C5-0234/2001 - 2001/2102(DEC))

P5_TA(2002)0164 A5-0103/2002

The European Parliament,

–  having regard to the revenue and expenditure account, the analysis of financial management and the balance sheet for the financial year 2000 (SEC(2001) 528 - C5&nbhy;0234/2001, SEC(2001) 529 - C5-0235/2001, SEC(2001) 531 - C5-0236/2001),

–  having regard to the annual report for the financial year 2000 and the special reports of the Court of Auditors, accompanied by the replies of the institutions audited (C5&nbhy;0617/2001)(1),

–  having regard to the Statement of Assurance as to the reliability of the accounts and the legality and regularity of the underlying transactions provided by the Court of Auditors pursuant to Article 248 of the EC Treaty (C5-0617/2001),

–  having regard to the Council recommendation of 5 March 2002 (C5-0124/2002),

–  having regard to Article 276 of the EC Treaty, Article 78g of the ECSC Treaty and Article 180b of the EAEC Treaty,

–  having regard to the Financial Regulation of 21 December 1977, and in particular Article 89 thereof,

–  having regard to Rule 93 of and Annex V to its Rules of Procedure,

–  having regard to the report of the Committee on Budgetary Control and the opinions of the other committees concerned (A5-0103/2002),

A.  whereas, pursuant to Article 275 of the EC Treaty, responsibility for drawing up the accounts lies with the Commission,

1.  Gives discharge in respect of the implementation, by the Commission, of the general budget of the European Union for the financial year 2000;

2.  Records its comments in the resolution which forms part of this decision;

3.  Instructs its President to forward this decision, and the resolution which forms an integral part of it, to the Council, the Commission, the Court of Justice, the Court of Auditors and the European Investment Bank and to have it published in the Official Journal of the European Communities (L series).

2.European Parliament decision closing the accounts in respect of the implementation of the general budget of the European Union for the financial year 2000 (Commission) (SEC(2001) 528 - C5-0234/2001 - 2001/2102(DEC))

The European Parliament,

–  having regard to the budget of the European Union for the financial year 2000,

–  having regard to the revenue and expenditure account and the consolidated balance sheet for the financial year 2000 (SEC(2001) 528 - C5-0234/2001, SEC(2001) 529 - C5&nbhy;0235/2001, SEC(2001) 531 - C5-0236/2001)(2),

–  having regard to the annual report for the financial year 2000 and the special reports of the Court of Auditors, accompanied by the replies of the institutions audited (C5&nbhy;0617/2001)(3),

–  having regard to the Statement of Assurance as to the reliability of the accounts and the legality and regularity of the underlying transactions provided by the Court of Auditors pursuant to Article 248 of the EC Treaty (C5-0617/2001),

–  having regard to the Council recommendation of 5 March 2002 (C5-0124/2002),

–  having regard to Article 276 of the EC Treaty, Article 78g of the ECSC Treaty and Article 180b of the EAEC Treaty,

–  having regard to the Financial Regulation of 21 December 1977, and in particular Article 89 thereof,

–  having regard to Rule 93 of and Annex V to its Rules of Procedure,

–  having regard to the report of the Committee on Budgetary Control and the opinions of the other committees concerned (A5-0103/2002),

A.  whereas, pursuant to Article 275 of the EC Treaty, responsibility for drawing up the accounts lies with the Commission,

1.  Notes that the revenue and expenditure authorised for the financial year 2000 amounted to:

2.  Notes that total revenue breaks down as follows:

3.  Notes that total expenditure breaks down as follows:

4.  Notes the following consolidated balance sheet drawn up by the Commission:

5.  Approves the closure of the accounts for the implementation of the general budget for the financial year 2000;

o
o   o

6.  Instructs its President to forward this decision to the Council, the Commission, the Court of Justice, the Court of Auditors and the European Investment Bank and to have it published in the Official Journal of the European Communities (L series).

3.European Parliament resolution containing the comments which form an integral part of the decision concerning discharge in respect of the implementation of the general budget of the European Union for the financial year 2000 (Commission) (SEC(2001) 528 - C5-0234/2001 - 2001/2102(DEC))

The European Parliament,

–  having regard to Article 276 of the EC Treaty,

–  having regard to Article 89(7) of the Financial Regulation of 21 December 1977, pursuant to which each Community institution is required to take all appropriate steps to act on the comments appearing in the decisions giving discharge,

–  having regard to the annual report of the Court of Auditors concerning the financial year 2000, accompanied by the replies of the institutions audited (C5-0617/2001)(4), and the special reports of the Court of Auditors,

–  having regard to the Council recommendation of 5 March 2002 (C5-0124/2002),

–  having regard to the report of the Committee on Budgetary Control and the opinions of the other committees concerned (A5-0103/2002),

A.  whereas the discharge decision is based on the way in which the Commission has implemented the budget during a given financial year, including the extent to which the Commission has genuinely acted on Parliament's budgetary priorities and political guidelines regarding budget implementation, as well as on earlier recommendations adopted under the discharge procedure and earlier external audits by the Court of Auditors, including its special reports, internal audits by the Financial Controller, assessments and checks by the operational directorates-general, allegations of bad management by Commission staff and Anti-Fraud Office reports on serious irregularities,

B.  whereas an appraisal also depends on the extent to which the policy of zero tolerance of fraud and irregularities has genuinely been implemented by the Commission, whose Members are accountable to the European Parliament, and whose directors-general, according to the reform programme, are responsible for carrying out appropriate internal checks within their departments,

C.  whereas the budget had a surplus of EUR 11.6 billion,

D.  whereas, in view of all the results of its audit, the Court of Auditors is of the opinion that the transactions underlying the financial statements, taken as a whole, are legal and regular in respect of revenue, commitments and administrative expenditure but declines to provide the assurance in respect of the other payments, as was the case for the financial year 1999 and earlier years,

E.  whereas the Court of Auditors still cannot give a positive Statement of Assurance (DAS) for the whole budget; whereas declining to do so reflects the inability of the Court and Parliament to ascertain that the transactions carried out by the Commission, and above all by the Member States, are regular,

F.  whereas it must be appreciated that Commission departments replied promptly by the deadline (21 December 2001) to the questions forwarded on 5 December 2001 by the members of the Committee on Budgetary Control in connection with the discharge procedure,

G.  whereas the outstanding feature of the financial year 2000 was the exceptionally high budget surplus (EUR 11.6 billion, or 14% of the budget), which reveals a major failure of budget forecasts (revenues exceeded projections) but also reveals the failure of the 1999 structural actions reform to provide timely and efficient mechanisms for the smooth operation of the Structural Funds,

H.  whereas management of the budget for the financial year 2000 falls in its entirety under the responsibility of the new Commission appointed in 1999,

I.  whereas the financial year 2000 marks the start of a new programming period extending to 2006, both for the Structural Funds and for pre-accession aids, and the introduction of new rules (Regulation (EC) No 1260/1999(5) plus Sapard and Ispa rules),

J.  whereas the financial year 2000 was marked by the proposals for Commission reforms, in accordance with the recommendations in the White Paper, in particular as regards the Financial Regulation, external actions (communication of 16 May 2000) and improvement of financial management and control within departments (global strategy of 1 March 2000 on administrative reform, COM(2000) 200),

K.  whereas although the management of 85% of the Community budget is shared with Member States, it is the Commission – under Articles 274 and 275 of the EC Treaty - which is solely responsible for controlling and supervising the utilisation of the budget and therefore ensuring that the Member States take full responsibility for any mismanagement which takes place at their level; whereas the Commission must therefore give itself the means to ascertain failures by Member States to fulfil their obligations and not hesitate to penalise them and inform the discharge authority what their precise responsibilities are,

L.  whereas 2000 was marked by a significant increase in the volume of fraud and irregularities identified by Member States and OLAF (EUR 2 billion), EUR 1,4 billion involving traditional own resources, EUR 885 million expenditure, including EUR 580 million involving agricultural spending, and EUR 156 million external actions, and the fact that these figures have risen, which reveals an alarming situation, might partially be the result of greater efforts to combat fraud and improved controls(6),

M.  whereas three Member States, namely Belgium, Ireland and Luxembourg, have not yet ratified the 1995 Convention on the Protection of Financial Interest,

N.  whereas in its resolution of 28 February 2002(7) Parliament criticised the follow-up to the1999 discharge, in particular the lack of adequate audit follow-up by the Commission; whereas Parliament made the following recommendations with regard to the follow-up to the 1999 discharge, in particular

O.  whereas the Commission, in its follow-up report to the abovementioned 1999 discharge follow-up resolution, stated that it would "be happy to present results of evaluations carried out" (COM (2001) 696) the Parliament now urges the Commission to submit each quarter the completed evaluations to its Committee on Budgetary Control and to announce which evaluation reports it expects to be concluded in the course of the next quarter,

P.  whereas, in considering budget implementation in 2000, the fundamental question is to establish, firstly, the Community management features which should be the basis for effectiveness but are deficient, and, secondly, the components within the system which are conducive to fraud and irregularity,

Q.  whereas this discharge seeks not to concentrate excessively on details in individual sectors, even if details can illustrate systematic problems, but to look in a more global and horizontal way at practices which in the past created problems and to identify solutions,

R.  whereas it is important to consider difficulties created by bad legislation and to note solutions proposed by the Court, it is also necessary to make distinctions between bad regulations on the one hand and poor administration for which the Commission alone is responsible; whereas it is also necessary to identify as clearly as possible the cases of fraud or error, caused by national or regional authorities and to support the Commission in enforcing improved management practices where Community resources are involved,

I.  whereas the intra-EU multinational nature of several EU irregularities and fraud involving food products for the falsification, export refunds and payments under Integrated Administration and Control System (IACS) calls for an enhanced role for the EU institutions in preventing fraud and irregularities and this role cannot be decentralised to Member States or any other sub-European authority,

Effectiveness

1.  Notes that Commission effectiveness must be gauged on the basis of three criteria in relation not only to compliance with the objectives laid down by the political authority, but also to the speed and simplicity of the administrative and budgetary measures taken to realise those objectives, and to the best possible use of the budget resources deployed;

2.  Takes the view that the following bases for that effectiveness must be examined as a matter of priority: the administrative machinery of the Commission; the various regulatory procedures and the system of checks; the respect by the Commission of the political priorities and budget guidelines as defined by the European Parliament;

The administrative machinery of the Commission

3.  Believes that Commission departments must be structured to ensure management with the utmost integrity and effectiveness; notes the administrative reform under way, some basic aspects of which were launched in the financial year 2000, and encourages the Commission to continue its efforts to ensure that results become visible as quickly as possible with regard, in particular, to reform of the external service according to the political guidelines adopted by the European Parliament and to the reform of financial management and control within departments;

4.  Notes a delay, however, in implementing some of the White Paper actions, as emerges from the implementation scoreboard forwarded by the Commission (Annex 5 to the replies to the questionnaire), because of ongoing interinstitutional procedures, concerning both the Financial Regulation and the Staff Regulations of Officials; notes concerning Action 96 (recovery of unduly paid funds) that the Commission in its December 2000 Communication has established a new organisational structure for treatment of recoveries; notes also that the internal procedures concerning enforced recovery are in preparation and wishes to be informed about the effectiveness of this new control system, in an area which is a matter of priority for the Budgetary Control Committee;

5.  Asks that the competent committees of the European Parliament be regularly informed about implementation of certain reform actions and management decisions, in particular:

6.  Asks the Commission, in view of the recent proliferation of decentralised bodies, to propose a review mechanism for Agencies, based on the cost-benefit ratio and the added value compared to other alternatives;

7.  Stresses that any measure involving amendment of the Staff Regulations of Officials and the Conditions of Employment of Other Servants, such as the new career system, underperformance, flexible retirement, and the rules governing whistleblowing must comply with the principles of independence, neutrality and continuity of the European civil service and modern standards of administration, especially providing service and openness towards the citizens;;

8.  Expects that the human resources allocated to the various aspects of the reform will be sufficient to ensure that it is introduced quickly and effectively, e.g. staff allocated for reform of the external service and staff affected by that reform; likewise, as regards reform of financial management and control within Commission's departments and delegations, wishes to know what recruitment problems, if any, the Commission faces;

9.  Takes the view that a motivated workforce is essential to the success of the policies implemented by the Commission and asks the Commission to ensure maximal consultation with all levels of staff; welcomes the fact that agreement has been reached between the Commission and trade unions representing a large majority of staff to the proposed amendment of the staff regulations which it considers to be an essential part of the Commission reform process and invites all parties concerned to cooperate constructively in the reform process;

10.  Calls on the Commission to make sure the process of reform does not have any adverse impact, e.g. as regards a reduction in the on-the-spot checks carried out by the Commission (cf. paragraph 3.72 of the Court of Auditors' annual report);

11.  Asks the Commission to assess the cost-benefit of introducing the reform, including the cost of professional training (in particular in the field of financial management), the cost of recruitment and of termination-of-service arrangements (regarding Article 50 of the Staff Regulations of Officials) and to inform it of the results;

12.  Considers that the "management declarations' by each director-general, introduced under the new internal-management system (and effective as of May 2002), will provide a welcome new tool in assessing the performance of Commission Directorates-General and will make it easier to identify areas where further improvements need to be made; underlines that the management declarations do not in any way diminish the individual or collective responsibility of Members of the Commission;

13.  Expects the Commission to inform the European Parliament in the event of any other reforms under way;

The procedures

14.  Notes, as the Court of Auditors' annual report stresses, that procedures are not commensurate with the objectives pursued; in particular,

15.  Asks the Commission to carry out special audits of the representations in the Member States in the light of the allegations of malpractice in the Stockholm representation; asks to be fully and adequately informed of the result of the disciplinary cases in relation to the Stockholm representation;

16.  Calls on the Commission to improve budget forecasts and reduce the divergences between estimates and out-turn and improve communication between Commission and Member states, especially in the framework of the budget network for information exchange;

17.  Takes the view that the Commission must equip itself with tools to improve budget forecasts and make greater use of the budget network, in order to prevent a recurrence of excessive budget surpluses;

18.  Is convinced that the management method of the present-day Union, and the enlarged Union of tomorrow, must continue to rely on the principle of decentralisation; this demands comparable and equally efficient management capacity on the part of the various national administrations, as required by the new rules on the Structural Funds (Regulation (EC) No 1260/1999) launched in 2000, which also involve a clarification of the respective roles of the Commission, the Member States and the various partners referred in article 8 of the regulation; notes, however, when a budgetary action involves several Member States in several operations of the CAP, more intervention by the Commission may be required; insists that the success of the decentralised management of Sapard and Ispa in the candidate countries and of the activity of their national administration will depend on the EU commitment to support these countries in improving their administrative capacity; encourages the Commission to continue its training efforts in the formation (via twinning with applicant countries) and information (such as round tables with the responsible bodies in the Member States);

Contractual management procedures and Community subsidies

19.  Asks the Court of Auditors to assess to what extent contractual management procedures for Community appropriations (invitation to tender, awarding of contracts) comply with transparency principles, in terms of objectives, selection board make-up, candidate selection, compliance with procedures and reasons for decisions, and in particular has concerns about invitation-to-tender procedures in the research sector; notes, that the Court of Auditors, in its annual report, has come to positive conclusions concerning the procurement procedures used by the institutions to purchase services, supplies and work and stresses the need for increased use of long term environmental and social benefit criteria in selection procedures; in particular, asks the Court of Auditors to assess the transparency of present Commission arrangements regarding external aid, such as the establishment of a set of shortlists where the same companies are supposed to be always the most efficient solution to apply Community grants of up to EUR 200 000 in every corner of the world;

20.  Calls on the Commission to always use the most appropriate procedure, having regard both to the difficulties for applicants, particularly with research projects and costs; underlines however, that research is a high risk sector and requires very intensive controls;

21.  Asks the Commission to explain, in connection with the selection procedure for the Media and Media Plus proposals, what type of TAO carries out preparatory work on which the Commission makes a final selection of the beneficiaries of programmes and decides on the support to be granted (cf. Council Decision 2000/821/EC(12)); asks the Commission to indicate what the geographical breakdown of programme beneficiaries was for 2000;

22.  Takes the view, as regards the current procedures for granting Community subsidies to specific organisations, namely in the context of A-302 lines, that a system of both earmarking and calling for proposals is unsatisfactory and calls on the Commission to suggest to the budgetary authority a more transparent system, which also might help to avoid the state of permanent insecurity which hangs over some organisations, without creating dependence on Community funds for their survival; notes that Activity Based Budgeting may help end the present system; calls on the Commission to ensure new organisations that wish to bid for money are not excluded from doing so; asks the Commission to cooperate with OLAF and the Court of Auditors in auditing associations or centres funded almost exclusively from the Union budget;

23.  Notes that in year 2000, EUR 800 000 earmarked under budget line A-3040 towards the operating cost and the work programme for European Migrants Forum; notes that an investigation has begun by OLAF after allegations of fraud and mismanagement in this organisation and that OLAF sent the case to the Belgian judicial authorities in June 2001; expects to be fully informed of the conclusions of the Belgian authorities; asks the Commission to ensure that this body and others funded under A-3 Community subsidies are effective in meeting their objectives;

The complexity of procedures and legislation

24.  Agrees with the Court of Auditors that, more often than not, Community rules are too complex, causing difficulties for beneficiaries, and asks the Commission to develop a systematic assessment of the efficiency of the various regulatory instruments in achieving the policy objectives as defined in the Treaty or otherwise approved by the European institutions;

25.  Notes that the Commission, in the new regulation on Structural Funds (EC) No 1260/1999, has declared its intention to simplify the rules; hopes that this will be verified in 2001, but deplores the under-implementation of the Structural Funds in 2000 due to delays in programming (itself accounting for much of the budget surplus); points out that the same difficulties occurred in the first year of the previous programming period (1994); also wonders whether the present system is the best system for planning the future of structural measures after 2006; calls on the Commission and the Member States to rationalise and simplify the procedures for implementing structural measures in order to prevent the same difficulties from recurring when new programmes are established;

26.  Considers that the lack of adoption of Community Initiative Programmes in 2000 is due to the late approval of Council regulations, to delay in publishing the user manual and late publication by the Commission, the long period taken by other institutions to give their opinion, and also to late reaction from the Member States;

27.  Notes with dissatisfaction that due to these delays transfers, carry-forwards and rebudgetisation were the norm rather than the exception; reiterates its critical view of transfer 40/2000 resulting in a reduction of EUR 164 million and of the rebudgetisation resulting in another EUR 30 million reduction in appropriations for innovative measures;

28.  Is particularly concerned at the serious delays in launching the Community initiative EQUAL, and calls on the Commission and Member States to provide assistance in establishing development partnerships and transnational connections;

29.  Also notes that the complexity of the rules and overlapping between measures under the various funds and under Community policies may bring about an incoherent situation, which can reduce the effectiveness of funds and programmes as is criticised by the Court in its Special Reports 1/2001(13) and 12/2001(14) and in its Annual Report (paragraph 3.121);

30.  Comes to the same conclusion as regards the Sapard and Ispa regulations, the complexity of whose implementation was underestimated by the Commission and poses a genuine challenge for the candidate countries; also acknowledges the efforts made by the Commission for "institution building' within the Sapard system and for better internal coordination of pre-accession aid programmes; but regrets that only half of the applicant states will be in a position to put the programmes into effect at the latest by 2002;

31.  Calls on the Commission to ensure, as a matter of priority, that procedures are simplified and that clear rules and objectives are laid down which are transparent and understandable to the citizens; calls on the Commission to make simplification of legislation, rules and procedures an intrinsic part of the midterm review of the agricultural and structural policies; acknowledges however, the difficulties faced by the Commission in fulfilling this goal in the specific case of the adoption of rules of implementation for certain programmes, such as the control procedures for the Structural Funds, where the comitology procedure" is applied; notes that often these committees, representing the administrative interests of the Member States, tend to contribute to the complexity of such rules;

32.  Points out that it will scrutinise carefully during the next discharge exercise the extent to which the Commission has properly respected the political priorities and budgetary guidelines as defined by the European Parliament, and fulfilled the undertakings it has given in response to criticism by the Court of Auditors (cf. paragraph 3.122 – annual report);

The controls

33.  Notes that the very complexity of the rules makes effective controls difficult;

34.  Calls on the Commission to substantially increase the number of "sunset clauses" and detailed business impact assessments included in legislation;

35.  Notes that the system of checks is marked by weaknesses, such as:

36.  Is concerned at the Court of Auditors' findings (Special Report 10/2001(16)) that the application of Regulation (EC) No 2064/97 posed difficulties for both the Commission and the Member States because there was insufficient coordination between the Commission DGs responsible, and the Member State bodies who are not familiar with the audit manual, which the Commission submitted too late;

37.  Calls, in view of these findings, for each Member State to designate a single national ministry with responsibility for monitoring progress in achieving the 5% control rate laid down for every individual Structural Fund programme in Commission Regulations (EC) No 2064/97 and (EC) No 438/2001(17); calls also for action to be taken to provide uniform coordination of controls in Member States with autonomous regional authorities; proposes that such coordination can best be achieved through the existing coordinating agencies and that those agencies can also serve as the basis both for information exchange between the regions and for coordinating and forwarding all information to the Commission;

38.  Urges the Commission and Member States to improve financial control of the Structural Funds, in view of the findings of Special Report 10/2001 of the Court of Auditors; in particular, calls for

39.  Asks the Court of Auditors to assess the present total cost of internal and external checks on Community funds, distinguishing between costs to the Community budget and to national budgets and comparing the cost of the various types of control carried out in each expenditure area with the amounts involved in known instances of fraud and irregularities and recoveries made in each chapter;

40.  Takes the view that the Commission ought to be concerned to ensure that checks are economically effective, and takes note, to that end, of the Commission's internal reforms concerning the 'management declaration' by directors-general, by which they will be bound, and the setting up of the Commission's internal audit system; considers that the impact of these changes on control effectiveness should be assessed during forthcoming discharge exercises;

41.  Calls on the Commission to try to find the perfect balance in terms of the cost of controls and the benefit of reduced level of error such controls lead to;

42.  Considers that the successful management of the Agency for Reconstruction in Kosovo was due to the closeness of the operations to the beneficiaries, focus on a small number of sectors and one structure for project identification to evaluation and to a large extent to the fact that ex ante financial control was carried out by the Agency's internal financial services, which allowed quick implementation of measures; notes that the Commission's amended proposal for a new Financial Regulation (COM(2001) 691) provides for the decentralisation of ex ante financial control across all Commission departments; calls on the Council to expedite its work on the Commission's amended proposal;

43.  Recommends, furthermore, that the Commission make further moves towards good institutional co-operation with the Court of Auditors and its audit bodies, but also with the Member States and their national audit bodies; wishes to be informed of progress made;

44.  Takes the view that a coordination of planning controls would make it possible to prevent unnecessary duplication of effort and allow better division between internal and external checks, between system audits and project controls, in the light of the risks and funding involved;

45.  Recognises that the actual method used by the Court of Auditors does not enable it to give a rate of error for each sector of Community expenses, and takes the view that the DAS should aim to give this information, as repeatedly asked by Parliament's Committee on Budgetary Control, with a distinction between fraud and error, with consideration also of differences in inherent risk between different sectors and taking into consideration corrections made by the Commission, including comparison from year to year, in order to make this instrument useful not only for the discharge authority, but also for the Commission, which should arrive at a positive DAS as soon as possible; believes, however, that on the basis of its present methodology, the Court of Auditors is unlikely to be able to give the Commission a positive DAS in the near future;

46.  Questions the utility of the global Statement of Assurance for 2000 so long as the figures are not given; notes that the Court of Auditors has not published substantive and formal error rates in recent years, recalls that the competent Commissioner for the agricultural sector provided the figures for the period 1995-1999 at a hearing at the Committee on Budgetary Control on 7 February 2001, asks the Court of Auditors and the Commission to provide the figures for 2000;

47.  Calls on the Court of Auditors to release a Statement of Assurance and error rate for each individual DG in order to highlight problem areas and substantially increase Commission and Member State accountability;

48.  Notes that the control and audit activities in relation to the EU budget are characterised by a large number of auditors and audit services, each carrying out visits and drawing up reports almost independently but often on the basis of different standards; asks the Commission to draw up a report on the feasibility of introducing a single audit model in relation to the EU budget in which each level of control builds on the preceding one, with a view to reducing the burden on the auditee and enhancing the quality of audit activities, but without undermining the independence of the audit bodies concerned; asks the Court of Auditors to prepare an opinion on the same subject; similarly requests the Commission to see to what extent controls and in particular on-the-spot controls could be organised in a more rational manner;

49.  Following Parliament's resolution of 17 May 2001(18), and in particular point 22 regarding adulteration of olive oil, its resolution of 4 April 2001(19), and in particular point 9 (iii) regarding adulteration of milk products, and the Court of Auditors' special report 7/2001 regarding export refunds(20), asks the Commission to report to the Parliament on the state of play regarding adulteration of agricultural products with a direct or indirect impact on the Community budget, addressing the regulatory framework, minimum percentage of physical analysis by sector, technical methods to detect adulteration and future actions envisaged by the Commission to deal with the situation;

Own resources

50.  Takes note of the trend towards a greater reliance on GNP-based contributions to the Community budget and corresponding decline in the importance of traditional own resources; observes that this is partly due to the capping of the third resource (VAT) and the Community's international commitments to reduce customs duties; points nevertheless to the difficulties in accurate revenue forecasting based largely on GNP wealth in Member States and asks the Commission to assess how this is likely to be affected after enlargement;

51.  Notes with concern the misgivings of both the Court of Auditors and the Commission that the VAT system is seriously affected by fraud although this does not necessarily lead to losses to the Community budget. Points to the fact that Member States identified EUR 534 million worth of fraud and irregularities in 2000, corresponding to 3.5% of own resource revenue that year, though mainly explicable by the case of New Zealand butter in the UK which accounts for half of the total; notes that Greece was alone in not informing the Commission of any irregularity detected that year in the area of own resources and questions whether this is due to a 100% clean record, late transmission of data or that irregularities simply went undetected;

52.  Underlines the criticism of the Court of Auditors that recovery measures by Member States are neither efficient nor evenly applied, indicating a reluctance or a difficulty in tackling the problem; notes, in this regard, that OLAF opened 120 files on suspected fraud in own resources collection in 2000 for a total amount of EUR 608,7 million; urges the Commission to bring forward the necessary proposals to amend Commission Decision 97/245/EC(21) on transmission of data from Member States with a view to creating equivalent standards of reporting in all Member States;

II.  Recalls that Member States have now ratified the new Own Resources Decision, raising the collection costs from 10% to 25%; calls on the Member States to ensure that this will lead to a crack-down on customs fraud and better detection of irregularities so far detected in the area of own resources;

Regularity, combating fraud and protection of financial interests

54.  Recognises that the present system of protection of the Communities' financial interests and prevention of fraud has to be strengthened;

55.  Notes that it is incumbent upon the Commission to make use of the same standards and rules across all sectors of Community expenditure in combating fraud and other irregularities if it is to fulfil the spirit of Article 280 of the EC Treaty and guarantee an equivalent level of protection of the financial interests of the Community,

56.  Considers that some common policies are themselves conducive to fraud, particularly where guide prices are fixed and export refunds are used to support the export of surpluses mainly for dairy products, sugar, cereals and beef;

57.  Considers that one of the main objectives of the Common Agricultural Policy as established by the Treaty is to insure "a fair standard of living for the agricultural community" and this objective makes imperative for the Commission to monitor carefully the patterns of the distribution of the Common agricultural budget by farmers and other beneficiaries;

58.  Considers that transparency rules that make it imperative for Commission to disclose the names of final recipients of its subventions in domains like science and technology or the Cohesion Fund, should also be applied to other budgetary lines and in particular to the Common Agricultural Policy;

Export Refunds

-  notes that expenditure on export refunds rose from EUR 5 695 million in 1980 (50,3% of the EAGGF Guarantee budget)(22) to EUR 10 159 million in 1993 (29% of the EAGGF Guarantee budget) and then fell to EUR 5 646 million (14 % of the EAGGF Guarantee budget) in 2000(23); notes, however, the relativity of these figures due to the changes in the dollar rate;

59.  Asks the Commission to ensure that the calculation of the refund rates to potato and cereal starch follows predictable and transparent criteria, as recommended by the point 40a) of Special Report No 8/2001 of the European Court of Auditors;

60.  Welcomes all the steps announced by the Commission in its reply to the Budgetary Control Committee's questionnaire in order to publish data on concentration of CAP funds per farmer and or per working unit, and asks the Commission to start presenting this data as soon as possible;

61.  Notes that, according to point 2.145 of the Annual Report of the Court of Auditors, the recent reform on the fresh fruit and vegetables sector concentrated Community funds in more developed countries and regions;

62.  Notes that some rules introduce neither verification mechanisms nor penalties, which may encourage fraud or simply involve public health risks;

63.  Calls, for instance as regards the sheepmeat and goatmeat CMO, for the introduction of a mandatory electronic identification system for animals in order to enable information-gathering on premiums and verification thereof;

64.  Calls, as regards the milk quotas regime, for a harmonised application of the rules for penalties for milk producers failing to comply with milk quotas, which, 17 years after they were introduced, are still not correctly applied in all Member States (cf. paragraph 2.193 - Court of Auditors' annual report); regrets that Italy has been paying the superlevy for the breaching of the milk quotas, on behalf of its farmers, thereby distorting competition across the Union;

65.  Calls, as regards application of BSE legislation by the Member States (cf. Court of Auditors' Special Report 14/2001) and measures concerning the prevention of foot and mouth disease, for procedures to be established to impose financial corrections or fines and penalties concerning veterinary expenditure or market-related measures financed by the European Union where Member States fail to comply with veterinary legislation;

66.  Calls on the Commission to consider whether it ought to have additional powers for special emergency situations where human and animal health are at risk;

67.  Notes that some rules have produced unwanted effects and that the Commission responded late to the Court of Auditors' warnings, and cites in this connection aid for fibre flax growing, in respect of which the Court of Auditors recommended as long ago as 1992(28) that the Commission avoid any further encouragement of fibre flax production, since there was already "a production surplus for which no buyer could be found"(29); deplores the way the Commission and the Member States reacted to the situation and the length of time; notes that Council and Parliament have in some cases obstructed proposals by the Commission to improve CAP legislation;

68.  Condemns rules which give rise to "premium hunting' with unintended, pernicious effects on the Community budget; again presses, as it did in in its resolution of 19 January 2000(30) on discharge 1997, for systematic and careful follow-up to the Court of Auditors' recommendations;

69.  Asks the Court of Auditors to assess to what extent the system of trade preferences is also a source of irregularities adversely impacting on Community resources (cf. judgment on the case involving television sets from Turkey), and calls on the Commission to develop alternatives to the present system as soon as possible;

70.  Deplores the situation where trafficking in adulterated butter, organised by professional criminals could have led to health risks and represents a potential loss for the budget; calls for appropriate penalties to be imposed on the adulterators and European firms involved and for all information on this affair to be forwarded as soon as possible to the European Parliament; regrets that the Commission has failed to warn the consumer against possible health hazards after the case became public knowledge in July 2000; expects the Commission in the future to give public health concerns priority over all other investigations; notes that nearly two years after the scandal was made public by OLAF, no Community financial corrections of any sort have yet been passed against the responsible undertakings involved in this affair, which is in sharp contrast with what happens with any violation of much lesser gravity (such as to produce milk over the allocated milk quota);

71.  Notes that detecting irregularities or fraud comes under the responsibility of the Member States (which are obliged to report them to the Commission), Commission departments, OLAF and the Court of Auditors, but that the Member States, as is pointed out in Court of Auditors' Special Report 10/2001, by no means meet their obligation in full to report irregularities relating to the Structural Funds and that the figures established are likely to be much higher in reality;

72.  Calls upon the Commission to evaluate and revise the existing arrangements for import of agriculture produce below EU-prices from third countries to be processed in the EU and re-exported to third countries;

73.  Calls for Member States, including regional administrations, to be made more aware of action to combat irregularities, given that, in particular in the field of structural measures, negligent or irregular use of Community budget appropriations is mirrored by equally negligent use of funds provided by cofinancing from national budgets;

74.  Urges the Commission to apply financial corrections in accordance with Commission Regulation (EC) No 448/2001(31) in connection with structural measures where there are irregularities;

75.  Takes note of the figures transmitted, at its request, by the Commission, concerning the amount of irregularities per Member State and the amount of recovery for the Structural Funds since the implementation of Commission Regulation (EC) No 1681/94(32); takes note of the significant amounts owing from some Member States (Italy, Spain, United Kingdom, Germany) and wishes to be informed about the reasons for the low recovery from those countries;

Corrections

76.  Recommends again (cf. Parliament's resolution of 4 April 2001 on discharge 1999) concerning the clearance of accounts (EAGGF), that the procedure be improved especially through increased financial corrections for Member States where there are repeated weaknesses in the control system, including delay in the setting up of the IACS, and through extending the deadline for conformity decisions from the current 24 months to 36 months, as already proposed in its abovementioned resolution on discharge 1999; asks the Commission to come forward with the necessary proposals;

77.  Asks the Commission to make proposals before the next discharge, so that non-respect of the criteria by the paying agencies in the Member States can be properly sanctioned (such as reduction of advances or financial corrections);

78.  Questions again if the current system of financial correction is sufficient to encourage Member States to combat fraud and irregularities; invites the Commission again to propose a simplification of the infringement procedure, which allows a lump sum or penalty payment to be paid by the Member State, following a judgment by the Court of Justice, if the Commission considers that the Member State concerned has failed to fulfil its obligations under the Treaty (Article 228);

79.  Calls on the Commission to inform Parliament more fully on progress towards more effective recovery of unduly paid funds (action 96 of the internal reform of the Commission); repeats its regret (cf. its abovementioned resolution of 28 February 2002) that the Commission has not followed Parliament's recommendation and introduced a requirement to launch recovery proceedings within three month of receipt of details of irregularities from the Court of Auditors;

80.  Congratulates the Commission on its guidelines on the application of the principle of proportionality to the waiving of debt recovery; is pleased that the guidelines introduce clear and transparent procedures for the writing-off of debt in accordance with Parliament's wishes;

81.  Demands that, once the Commission decision has been taken, the Commission informs the European Parliament of the basis for calculating the financial correction applied on the one hand to the Netherlands, in the framework of the ESF, on the other hand to Spain, in the framework of the flax case;

82.  Expects Commission decision-making procedures for financial corrections to be open and transparent; recalls Article 213 of the Treaty, which states that Members of the Commission "shall be completely independent in the performance of their duties" and "shall refrain from any action incompatible with their duties"; recalls the Code of Conduct for Commissioners, which states that "ruling out all risks of a conflict of interests" helps Members "to guarantee their independence"; notes that according to the Code of Conduct, the role of Members' private offices is "to act where necessary as the interface between Commissioners and the departments they are responsible for, but without interfering in departmental management"; expects the Members of the Commission and their private offices to continue to observe this set of rules; reminds the Commission of its undertaking to report in detail on any specific financial correction, and on the procedures followed, at the request of Parliament;

As regards the Anti-Fraud Office

83.  Notes the limits on action by OLAF, as set out in the annual report (Chapter III, point 3.2) of the OLAF Supervisory Committee since it was unable to provide precise information on the action taken by the competent national authorities on the various cases concerned, on the imposition of any administrative or criminal law penalties or on the recovery of funds; notes also the limits on its scope for action, (for example the VAT sectors stated by the Court of Auditors - point 1.90 of the annual report "another element likely to increase the risk of fraud is the absence of a clear basis for international coordination of VAT investigations by OLAF/Commission");

84.  Notes with concern the finding in the Supervisory Committee report (Chapter IV, point 3.1.1) that although a large proportion of OLAF cases involve criminal elements, the Office forwarded reports or information to the competent national judicial authorities in a tiny number of instances only;

85.  Asks to be informed about the exact role of OLAF in the context of fraud-proofing of legislation;

86.  Is seriously concerned at the current application of Article 7 of European parliament and Council Regulation (EC) No 1073/1999(33) on OLAF's investigations as regards the communication of information between Union bodies and institutions;

87.  Regards it as imperative that the revision of the regulation referred to above settle the question of national authority "recognition' of OLAF investigations and of how they should be followed up;

88.  Deplores the fact that the establishment of a European Public Prosecutor (cf. COM(2000) 608), was not taken up at the Nice European Council in December 2000; welcomes very much the Green Paper submitted in December 2001 (COM(2001) 715) as requested on several occasions by the European Parliament and considers that the establishment of the European Public Prosecutor is essential for effective combating of Community budget fraud; calls for the establishment of the European Public Prosecutor to be included within the Convention so that it can be enshrined in the Treaty in good time ahead of enlargement;

89.  Asks to be kept fully and adequately informed of developments as regards the "illicit traffic in butter-based products". "European Migrants Forum". "ESF", "Berlaymont", "ACEAL" and "IRELA"; regrets that the results of OLAF's internal investigation on possible disciplinary action in relation to IRELA has not yet been finalised;

Enlargement

90.  Considers that combating fraud and the effective protection of the Community's financial interests must be top priorities in the candidate countries and invites the Commission to make special efforts to ensure that, prior to accession, all candidate countries have introduced genuine accounting, auditing and control systems in accordance with the EU standards, in the areas benefiting from EU financial assistance and in particular where there is shared management of Community appropriations; insists that the annual country progress reports include clear and detailed information on the implementation of the financial pre-accession aid, on the measures taken to monitor it and on the out-come of auditing and checks on the spot and on chapter 28 (financial control); notes in this respect the importance of stronger EU financial and technical assistance with a view to improving the candidate countries administrative capacity;

91.  Is deeply concerned to note how little progress has been made towards computerising the the Community transit system since Parliament's committee of inquiry; expects the Commission to come forward with concrete proposals for improvement in the context of the follow-up to the 2000 discharge; demands that all possible necessary measures are taken before any candidate country joins the European Union and calls its Committee on Budgetary Control to review the situation as a matter of urgency and points to the recommendation of 13 March 1997 of the European Parliament Committee of Inquiry into the Community Transit System;

Involvement of Parliament

92.  Instructs its President, at this early stage, to champion its rights before the Court of Justice of the European Communities if the Council includes provisions in the new Financial Regulation which in any way at all attach provisos to the right of Parliament, under Article 276 of the EC Treaty, to have access to information and thus constrain its control powers;

Spending sectors
JUSTICE AND HOME AFFAIRS SECTOR (JHA)

93. (a)  Calls on the Court of Auditors to give explicit recognition to Title B5-8, Area of freedom, security and justice, in its list of internal policy actions and to devote the necessary attention to it;

94.  Takes the view that the low implementation rate for budget heading B5-503 was predominantly due to the strict conditions in the invitation for the submission of proposals; takes the view that the condition of transnationality as a prime requirement for entitlement to support must generally not exceed the requirement that there is a transnational partnership, with partners from three Member States;

AGENCIES

95. (a)  Takes the view that efficient assessment of the agencies' financial requirement in the budget procedure and scrutiny of their funding under the discharge procedure requires close cooperation between the committees involved;

DAPHNE PROGRAMME

96.  Asks the Commission to draw-up an evaluation report on the Daphne programme, as laid down in European parliament and Council Decision No 293/2000/EC(34), without delay; expects the Commission to incorporate into the report the results of the evaluations, as well as, information on Community financing in the different fields of action implemented under the programme; invites the Commission to report, in particular, on the low utilisation of payment appropriations in the financial year 2000;

TRANS EUROPEAN TRANSPORT

97.  Notes that the 2000 budget implementation rate for the Trans-European transport network budget line is satisfactory; recommends a further reduction in the number of projects by concentrating on those projects where important bottlenecks in the TEN-transport network are removed and thus a European added value is immediately ascertainable;

COOPERATION

98. (a)  Notes that poverty reduction is the fundamental objective of Community development policy and in order to achieve that objective it must be adapted to the terms and calendar adopted at the Millennium Summit;

Access to documents

99. (a)  Asserts that Parliament, as the discharge authority, must have the same acccess to Commission documents as the Court of Auditors;

(1) OJ C 359, 15.12.2001. (2) OJ C 370, 27.12.2001. (3) OJ C 359, 15.12.2001. (4) OJ C 359, 15.12.2001. (5) OJ L 161, 26.6.1999, p. 1. (6) Protection of the Communities' financial interests – Commission, cf annual report for 2000 (COM(2001) 255, point 12). (7) P5_TA(2002)0084. (8) OJ C 324, 20.11.2001. (9) OJ C 329, 23.11.2001. (10) OJ C 168, 12.6.2001. (11) OJ C 338, 30.11.2001. (12) OJ L 336, 30.12.2000, p. 82. (13) OJ C 124, 25.4.2001. (14) OJ C 334,28.11.2001. (15) OJ L 290, 23.10.1997, s.1. (16) OJ C 314, 8.11.2001, p. 26. (17) OJ L 63, 3.3.2001, p. 21. (18) OJ C 34 E, 7.2.2002, p. 367. (19) OJ L 160, 15.6.2001, p. 2. (20) OJ C 314, 8.11.2001, p. 1. (21) OJ L 97, 12.4.1997, p. 12. (22) Information provided by the Commission by mail of 7 February 2002 (23) Court of Auditors' Special Report 2/1990 and note from DG IV : "Restitutions à l'exportation" p. 6 (24) OJ L 388, 30.12.1989, p. 18. (25) OJ L 42, 16.2.1990, p. 6. (26) Texts Adopted, Item 11. (27) OJ L 180, 15.7.1999, p. 53. (28) OJ C 309, 16.11.1993. (29) Annual report of the Court of Auditors – paragraph 2.77. (30) OJ L 45, 17.2.2000, p. 33. (31) OJ L 64, 6.3.2001, p. 13. (32) OJ L 178, 12.7.1994, p. 43. (33) OJ L 136, 31.5.1999, p.1. (34) OJ L 34, 9.2.2000, p. 1.

1.European Parliament decision on the discharge to the Commission in respect of the implementation of the budget of the sixth, seventh and eighth European Development Funds for the financial year 2000 (COM(2001) 233 - C5-0209/2001 - 2001/2096(DEC))

P5_TA(2002)0165 A5-0088/2002

The European Parliament,

–  having regard to the balance sheets and accounts of the sixth, seventh and eighth European Development Funds for the financial year 2000 (COM(2001) 233 - C5&nbhy;0209/2001),

–  having regard to the annual report of the Court of Auditors on the activities of the sixth, seventh and eighth European Development Funds for 2000 together with the institutions' replies (C5-0618/2001)(1),

–  having regard to the Court of Auditors' Statement of Assurance on the European Development Funds (C5-0618/2001),

–  having regard to the Council's recommendations of 5 February 2001 concerning the discharge to be given to the Commission in respect of the implementation of the operations of the European Development Funds for the financial year 2000 (5787/2002 - C5-0118/2002, 5788/2002 - C5-0119/2002, 5789/2002 - C5-0120/2002),

–  having regard to Article 33 of the Internal Agreement between the representatives of the Governments of the Member States, meeting within the Council, on the financing and administration of the Community aid under the Second Financial Protocol to the fourth ACP-EC Convention(2),

–  having regard to Article 276 of the EC Treaty,

–  having regard to Article 74 of the Financial Regulation of 16 June 1998 applicable to development finance cooperation under the fourth ACP-EC Convention(3),

–  having regard to Rule 93 and Annex V of its Rules of Procedure,

–  having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Development and Cooperation (A5-0088/2002),

A.  whereas, in its Statement of Assurance on the European Development Funds, the Court of Auditors concludes that, with certain exceptions, the accounts for the financial year 2000 reliably reflect the revenue and expenditure for the financial year and the financial situation at the end of the year,

B.  whereas the Court of Auditors has examined the underlying transactions on the basis of the documentation available but did not carry out any on-the-spot audits to ACP States in order to verify the reality of the works, supplies or services underlying the documentation,

C.  whereas the Court of Auditors finds that with certain exceptions these transactions underlying the financial statements are, taken as a whole, legal and regular,

1.  Gives discharge to the Commission in respect of the implementation of the budget of the sixth, seventh and eighth European Development Funds for the financial year 2000;

2.  Presents its comments in the attached resolution;

3.  Instructs its President to forward this decision, and the resolution which forms an integral part of this decision, to the Council, the Commission, the Court of Justice, the Court of Auditors and the European Investment Bank and to have it published in the Official Journal (L series);

2.European Parliament decision on closing the accounts of the sixth, seventh and eighth European Development Funds for the financial year 2000 (COM(2001) 233 - C5&nbhy;0209/2001 - 2001/2096(DEC))

The European Parliament,

–  having regard to the balance sheets and accounts of the sixth, seventh and eighth European Development Funds for the financial year 2000 (COM(2001) 233 - C5&nbhy;0209/2001),

–  having regard to the annual report of the Court of Auditors on the activities of the sixth, seventh and eighth European Development Funds for 2000 together with the institutions' replies (C5-0618/2001)(4),

–  having regard to the Court of Auditors' Statement of Assurance on the European Development Funds (C5-0618/2001),

–  having regard to the Council's recommendations of 5 February 2001 concerning the discharge to be given to the Commission in respect of the implementation of the operations of the European Development Funds for the financial year 2000 (5787/2002 - C5-0118/2002, 5788/2002 - C5-0119/2002, 5789/2002 - C5-0120/2002),

–  having regard to Article 74 of the Financial Regulation of 16 June 1998 applicable to development finance cooperation under the fourth ACP-EC Convention(5),

–  having regard to Rule 93 and Annex V of its Rules of Procedure,

–  having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Development and Cooperation (A5-0088/2002),

1.  Notes that the financial situation of the sixth, seventh and eighth EDF as at 31 December 2000 was as follows:

2.  Instructs its President to forward this decision and the resolution containing its observations to the Commission, the Council, the Court of Auditors and the European Investment Bank, and to have them published in the Official Journal (L series).

3.European Parliament resolution containing the comments which form part of the decision giving discharge to the Commission in respect of the implementation of the budget of the sixth, seventh and eighth European Development Funds for the financial year 2000 (COM(2001) 233 - C5-0209/2001 - 2001/2096(DEC))

The European Parliament,

–  having regard to the balance sheets and accounts of the sixth, seventh and eighth European Development Funds for the financial year 2000 (COM(2001) 233 - C5&nbhy;0209/2001),

–  having regard to the annual report of the Court of Auditors on the activities of the sixth, seventh and eighth European Development Funds for 2000 together with the institutions' replies (C5-0618/2001)(6),

–  having regard to the Court of Auditors' Statement of Assurance on the European Development Funds (C5-0618/2001),

–  having regard to the Council's recommendations of 5 February 2001 concerning the discharge to be given to the Commission in respect of the implementation of the operations of the European Development Funds for the financial year 2000 (5787/2002 - C5-0118/2002, 5788/2002 - C5-0119/2002, 5789/2002 - C5-0120/2002),

–  having regard to Article 33 of the Internal Agreement between the representatives of the Governments of the Member States, meeting within the Council, on the financing and administration of the Community aid under the Second Financial Protocol to the fourth ACP-EC Convention(7),

–  having regard to Article 74 of the Financial Regulation of 16 June 1998 applicable to development finance cooperation under the fourth ACP-EC Convention(8),

–  having regard to Rule 93 and Annex V of its Rules of Procedure,

–  having regard to the report of the Committee on Budgetary Control and the opinion of the Committee on Development and Cooperation (A5-0088/2002),

A.  whereas, pursuant to Article 74 of the Financial Regulation of 16 June 1998, the Commission is required to take all appropriate steps to act on the observations appearing in the discharge decisions,

B.  whereas EC development cooperation has poverty reduction as its central objective,

C.  whereas, with the conclusion of the Cotonou Agreement on 23 June 2000(9), the partnership between the ACP States and the EU has been put on a new footing, which should also entail reform of financial co-operation,

D.  whereas aid will more and more shift towards sectoral budget support programmes instead of aid earmarked for specific projects,

E.  whereas information is still imprecise; trusts that, in future budgetary procedures, the figures provided will be totally reliable and asks, in particular, for the terms and results of the application of social conditionality in relation to structural adjustment aid to be clarified,

F.  whereas aid will more and more focus on key sectors and heavy investment in a limited number of programmes,

G.  whereas the Commission has taken tangible steps within the framework of an action plan (creation of EuropeAid, strengthening of Commission delegations, simplification of procedures) to satisfy the demands the Parliament made in its resolution of 6 July 2000 containing its comments accompanying the European Parliament decision giving discharge to the Commission in respect of the sixth, seventh and eighth European Development Funds for the financial year 1998(10),

H.  whereas it is still too early to assess the effectiveness of these measures, which were to improve the performance of Commission services and delegations,

I.  whereas the budget 2000 had been the first to be implemented under the sole responsibility of the present Commission which took office in September 1999,

Budget and Budgetary Implementation in 2000

1.  Regrets that, according to the Commission's preliminary estimates for 2000, the funds set aside for infrastructure and social services are unacceptably low; recalls the results of the budgetary procedure for 2002, through which the Commission has undertaken to amend this situation in line with the objectives set;

2.  Notes that in 2000 both the level of commitments and the level of payments were markedly higher than in the previous year:

3.  Notes that in 2001 there was a further and significant increase in payments;

4.  Welcomes this trend but believes that it is too early to predict whether the fundamental problem of delays in implementing the EDF will be definitively solved in the coming years;

Monitoring of aid

5.  Stresses that a transparent information system which complies with Development Assistance Committee (DAC) standards is a first step towards an approach more closely geared to results, and stresses that indicators showing development results in relation to the objectives must be a priority for the Commission; calls for Parliament to be comprehensively informed and consulted on this process;

6.  Reaffirms its view(11) that the granting of further aid should be made conditional upon the submission and effective implementation of reform programmes to improve the quality of public financial management in the beneficiary countries; highlights again the importance of the following points:

7.  Stresses that the Commission has to increase and improve its audit capacities in a very substantial manner in order to meet these requirements;

8.  Welcomes the reply delivered on 15 March 2002 on points of concern regarding the number and nature of audits carried out by the Commission in 2000; is pleased with the thorough, systemic explanation on how the Commission's audit activities are supposed to work; regrets however that the Commission is not able to supply any additional information on the list of audits carried out in 2000 as DG-AIDCO "keeps a rather simple inventory of decentralised audits" (cf. Commission reply dated 13 March 2002);

9.  Asks the Commission if, on the basis of the system in place, it is able to give a declaration of assurance that all EDF funds have been spent legally and regularly and in accordance with the principles of sound and efficient management especially as regards:

10.  Asks the Commission to explain how the current control system will ensure that EDF money is spent legally and regularly with the increased use of direct budget support;

11.  Calls on the Commission to transmit to Parliament its indicative programme of audits of expenditure under the EDF for 2002 by its central services or under their close supervision, it being understood that these on-the-spot audits shall assess the implementation of measures designed to improve public administration in the ACP States and shall verify the reality of works, supplies or services financed from the EDF; 

12.  Deplores that the follow-up of audit results by the Commission services has not yet improved; agrees with the Court that the follow-up audits carried out on the instructions of the Commission itself or of the EDF authorising officers must be given a special place;

13.  Calls on the Commission to provide a more persuasive explanation as to why the cases of ineligible expenditure amounting to some EUR 14 million identified in a Court of Auditors study(12), have not yet been brought to a satisfactory conclusion;

14.  Asks the Commission to suspend payments to Senegal until a verdict from the Senegalese Court has been enforced regarding the misappropriation of around EUR 6 million of funds from the seventh EDF uncovered by an audit in 1995(13);

15.  Notes the continuing tendency for traditional cooperation in the form of projects to be replaced by a system whereby a growing proportion of funds known as rapid disbursement instruments – chiefly aid for structural adjustment – is allocated to direct support for budgets; believes that the Commission and Parliament must undertake a detailed analysis of the advantages and disadvantages of this approach and urges the Commission to submit a communication on this subject;

16.  Asks to be fully informed by OLAF of all enquiries started, conducted or finished in 2000; notes that OLAF is currently providing assistance to Kenya in connection with a criminal investigation into serious allegations concerning a tendering procedure; asks to be updated on this case;

17.  Notes that no disciplinary proceedings have been launched so far following the administrative enquiry into the effectiveness of monitoring and control arrangements on the use of counterpart funds in Ivory Coast, Tanzania and Togo; recalls(14) that there had been obvious fraud with, amongst other things, overpriced medical equipment in the Ivory Coast totalling about 28 million euro; expects to be informed of possible future cases as soon as they occur;

18.  Takes the view that complementarity with Member State development policies and coordination with other donors are a key element in achieving the above objectives; calls, in this context, for the Commission to provide Parliament, in future discharge procedures, with specific information on actions carried out jointly with other donors, and on their results;

19.  Notes the delays in the implementation of projects co-financed with NGOs; asks the Commission to provide information on the simplification and harmonisation of procedures;

Centre for Development of Enterprise (CDE)

20.  Notes that the EDF contribution for the CDE in 2000 was EUR 18 738; deplores that there have been serious problems with the management of the Centre including lack of monitoring of contracts, high representation expenses and costly travel arrangements during the period 1997-1999; regrets that the report on the audit of the 1999 financial year by the auditors appointed by the ACP-EC Committee of Ambassadors revealed that overall there was no improvement in the financial management of the Centre in 1999; welcomes the fact that the Commission has initiated an additional audit for the period 1997/98/99; looks forward to receiving a copy when finalised; informs the Commission that it will come back to the matter in the framework of the 2001 discharge;

ACP Secretariat

21.  Disapproves that the Commission signed on 9 March 2000 an EUR 18 million financing agreement for 2000-2004 for the benefit of the Brussels-based ACP Secretariat representing a 50 % increase per annum compared with the previous funding period,

22.  Asks the Commission to inform the ACP Secretariat that it must, in all cases, respect the final rulings of the Belgian Courts on matters still pending;

23.  Asks the Commission to comply with the recommendation of the Court of Auditors(15) and to request from the ACP Secretariat not only annual financial accounts and external audit reports but also activity reports, incorporating performance indicators in order to monitor progress towards results and to support claims for funding;

Parliament's budgetary and legislative powers with regard to the EDF

24.  Reaffirms its view(16) that the present situation, in which the European Parliament is called upon to take an annual discharge decision in respect of the EDF without having corresponding budgetary and legislative powers, is an anomaly; calls once again for EDF resources to be included in the development co-operation section of the general budget of the European Union;

Statement of Assurance

25.  Notes that the Court gives a positive Statement of Assurance, but that the Court states that in the case of payments made in the ACP countries the financial audits show that ineligible transactions can be charged to the EDFs (cf legality and regularity of the underlying transactions); notes that no on-the-spot audits were carried out by the Court in the ACP States; questions therefore the utility of the Statement of Assurance;

Decentralisation

26.  Calls on the Commission to report to Parliament in full on the launching of the deconcentration process as regards delegations in developing countries, and on the results for the management of aid by the delegations;

27.  Insists that Parliament must be fully involved in evaluating the pilot delegations selected for the deconcentration process, and that it must be informed of the assessment of the delegations' performance, which will be a crucial element in future staffing decisions;

Access to documents

28.  Notes that the EDF 2000 discharge exercise has once again shown that the rules in the existing Framework Agreement concerning access to confidential documents are unsatisfactory for Parliament as discharge authority; the rules

29.  Asserts that Parliament needs to have access to complete original documents without prior alterations or obliterated text;

30.  Instructs its President to open negotiations without delay on the revision of the Framework Agreement and to ensure that the new agreement is in accordance with the principles adopted by Parliament in its resolution of 4 April 2001 on the discharge for 1999(17);

31.  Warns the Council not to adopt new financial regulations limiting Parliament's untrammelled right of access to the information necessary for the exercise of its tasks related to discharge;

32.  Instructs its President to bring an action before the Court of Justice if the Council should adopt financial regulations limiting Parliament's budgetary control powers;

o
o   o

33.  Asks the Commission to report on steps taken to act on the observations in this resolution by 31 May 2002; asks its Committee on Budgetary Control to analyse this information and draw up a follow-up report to the discharge resolution 2000.

(1) OJ C 359, 15.12.2001, p. 417. (2) OJ L 156, 29.5.1998, p. 108. (3) OJ L 191, 7.7.1998, p. 53. (4) OJ C 359, 15.12.2001, p. 417. (5) OJ L 191, 7.7.1998, p. 53. (6) OJ C 359, 15.12.2001, p. 417. (7) OJ L 156, 29.5.1998, p. 108. (8) OJ L 191, 7.7.1998, p. 53. (9) OJ L 317, 15.12.2000, p. 3. (10) OJ L 234, 16.9.2000, p. 37. (11) See paragraphs 20 and 21 of the European Parliament resolution of 24 October 2001 on EDF discharge for 1999 (OJ L 321, 6.12.2001, p. 25). (12) See paragraph 58 of the Court of Auditors' annual report 2000. (13) See paragraph 60 of the Court of Auditors' annual report 2000. (14) See Commission press release N° JP/00/64 of 20.1.2000. (15) See paragraph 51 of the Court of Auditors' annual report 2000. (16) See paragraph 30 of the European Parliament resolution of 24 October 2001. (17) OJ L 160, 15.6.2001, p. 2.

1.Decision of the European Parliament concerning discharge in respect of the implementation of the budget of the European Coal and Steel Community (ECSC) for the 2000 financial year (C5-0043/2002 - 2001/2101(DEC))

P5_TA(2002)0166 A5-0079/2002

The European Parliament,

–  having regard to the financial statements of the ECSC at 31 December 2000(1) and the Court of Auditors' report thereon(2),

–  having regard to the Court of Auditors' annual report on the ECSC for the 2000 financial year (including the statement of assurance on the ECSC), and the Commission's replies (C5-0043/2002)(3),

–  having regard to the ECSC Treaty, and in particular Article 78g thereof,

–  having regard to Rule 93 and Annex V of its Rules of Procedure,

–  having regard to the report of the Committee on Budgetary Control (A5-0079/2002),

1.  Grants discharge to the Commission in respect of the management of the ECSC for the figures relating to the implementation of the operating budget for the 2000 financial year, shown in the annex below;

2.  Records its observations in the attached resolution;

3.  Instructs its President to forward this decision and the resolution which forms an integral part thereof to the Council, the Commission, the Court of Justice, the Court of Auditors, the European Investment Bank and the ECSC Consultative Committee and to have them published in the Official Journal (L series).

2.Resolution of the European Parliament containing the observations which form an integral part of the decision concerning discharge in respect of the implementation of the budget of the European Coal and Steel Community (ECSC) for the 2000 financial year (C5-0043/2002 - 2001/2101(DEC))

The European Parliament,

–  having regard to Article 78g and Article 97 of the ECSC Treaty,

–  having regard to the Protocol annexed to the Treaty establishing the European Community on the financial consequences of the expiry of the ECSC Treaty and on the research fund for coal and steel, agreed at Nice on 26 February 2001(4),

–  having regard to the ECSC Financial Report for the year 2000, published by the Commission's Directorate-General for Economic and Financial Affairs (Financial Operations Service),

–  having regard to the financial statement of the ECSC at 31 December 2000(5) and the Court of Auditors' report thereon(6),

–  having regard to Article 89(7) of the Financial Regulation of 21 December 1977, pursuant to which each of the Community institutions is required to take all appropriate steps to act on the observations appearing in the discharge decisions,

–  having regard to the Court of Auditors' report on the ECSC for the 2000 financial year (including the statement of assurance on the ECSC), together with the Commission's replies(7),

–  having regard to the Joint Declaration of the European Parliament, the Council and the Commission concerning post-ECSC arrangements adopted on 21 November 2001 in the context of the 'trialogue' budgetary procedure (Council of the European Union)(8),

–  having regard to the Council recommendation of 5 March 2002 (C5-0124/2002),

–  having regard to the Council resolutions of 20 July 1998(9) and 21 June 1999(10),

–  having regard to the Commission's communication to the Council, the European Parliament, the ECSC Consultative Committee, the Economic and Social Committee and the Committee of the Regions, 'Expiry of the ECSC Treaty: Financial activities after 2002' (COM(2000) 518), containing proposals for Council Decisions, now amended to take account of the Protocol to the Treaty of Nice (COM(2001) 121),

–  having regard to the follow-up report on the 1999 financial year presented by the Commission (COM(2001) 735),

–  having regard to the report of the Committee on Budgetary Control (A5-0079/2002),

A.  whereas, in view of the forthcoming expiry of the ECSC Treaty, the ECSC has ceased to grant new loans out of borrowed funds since 1997 and did not engage in any borrowing activity in 2000, although loans outstanding amounted to EUR 1 851 million from borrowed funds and EUR 130 million from own funds at 31 December 2000,

B.  whereas the ECSC continued in 2000 to finance research and redeployment of workers with an additional EUR 81 million committed from its operating budget for the first and EUR 31 million for the second of these purposes and with a further commitment of EUR 19 million to the Rechar programme of social measures in the coal industry,

C.  whereas, since 1 January 1998, the ECSC levy on coal and steel products, which was until then one of the main resources of the ECSC budget, has been set by the Commission at 0%,

D.  whereas the ECSC's main sources of funding are now represented by the net balance from the management of the various reserves and the cancellation of commitments which have not been implemented,

E.  whereas the balance sheet of the ECSC, which has continued to decline since 1997, shows a fall of EUR 504 million from 1999, with loans to credit institutions and to customers representing 54.1% of total assets in 2000,

F.  whereas the profit and loss account posted a fall of EUR 75.3 million from the previous year, with net losses on financial operations falling from EUR 42 to EUR 24 million, while on the income side interest received fell from EUR 254 to EUR 249 million and income relating to the operating budget fell from EUR 105 to EUR 75 million,

G.  whereas the level of reserves is expected to reach 100% of loans still outstanding which are not covered by government guarantees by 23 July 2002, and whereas the Guarantee Fund stood at EUR 565 million on 31 December 2000 or 98.8% of such loans;

H.  whereas the resolution of the European Council on growth and employment adopted in Amsterdam on 16 and 17 June 1997 and the abovementioned Council Resolution of 21 June 1999 on the future of the ECSC call for the revenues of outstanding reserves to be used for a research fund for activities related to the coal and steel industries,

I.  whereas the Commission indicated in its abovementioned Communication (COM(2000) 518) that the ECSC's assets in liquidation will amount to EUR 1.6 billion in 2002,

J.  whereas the sum remaining after deduction of repayment of outstanding debt should be considered as EU budgetary 'own resources' which should yield annual interest to the sum of approximately EUR 45 million, to be allocated to research related to the coal and steel industries (outside the Framework Programmes for research),

K.  whereas the expiry of the ECSC Treaty on 23 July 2002 will entail the complete disappearance of the ECSC's legal regime and procedures and the dissolution of the Consultative Committee set up by that Treaty,

L.  whereas the Annual Report on the ECSC for the financial year 2000 was adopted by the Court of Auditors on 10 October 2001,

M.  whereas the Court of Auditors concludes that the financial statements of the ECSC at 31 December 2000 give a true and fair view of the assets and financial situation of the ECSC at 31 December 2000 and of the results of its operations for the financial year ending on the same date,

N.  whereas the Court of Auditors states that the legality and regularity of the transactions, on the whole, are adequately guaranteed, and therefore proposes a positive statement of assurance,

1.  Welcomes the progress made in winding up the ECSC's activities, in particular its loans and interest subsidies, but regrets the delays in concluding an agreed legal basis for the new Research Fund for Coal and Steel which will replace the ECSC's activities in this area;

2.  Notes that the forecasts of expenditure in 2000 for rehabilitation aid made on the basis of estimates provided by Member States overstated actual expenditure by 46% and that the resultant surplus has, together with the cancellation of commitments, contributed to a further improvement in the solvency ratio;

3.  Accepts the arguments of the Commission concerning the impossibility of assessing the real impact of the ECSC Treaty on economic expansion, employment and the standard of living separately from the many other factors involved, but urges the Commission to publish a booklet summarising the work of the ECSC since its inception;

4.  Urges the Commission also to publish as soon as possible an overall assessment of research funded by the ECSC, in particular an assessment of the coal research programme and the criteria proposed for selecting new coal research projects, as has already been done for the steel sector; sees such assessments as an essential basis for the work of the proposed new Research Fund for Coal and Steel;

5.  Notes that 100% of those loans outstanding after 23 July 2002 which are not guaranteed by the government of a Member State will be covered by the ECSC reserves and acknowledges the strategy of prudent financial management of the ECSC up to the expiry of the Treaty adopted by the Commission;

6.  Notes the progress in reducing administrative costs reported in the document 'Expiry of the ECSC Treaty: Impact on the Administrative Costs at the Commission' provided to the Committee on Budgetary Control by Commissioner Schreyer on 8 March 2001; requests the Commission to inform Parliament of the outcome of its Annual Policy Strategy for 2003 with regard to redeployment of those staff currently involved in administering the activities of the ECSC;

7.  Welcomes the progress in transferring to the Economic and Social Committee the experience obtained in the context of the ECSC and supports the Commission in its efforts to promote a new working structure within the Economic and Social Committee to deal with issues involving industrial conversion, which will incorporate best practice as it has evolved in the context of the coal and steel industries;

8.  Urges the Commission to begin negotiations with candidate countries on the conditions of their participation in the new research fund as soon as the latter has been established, and asks the Commission to inform it of progress in these negotiations;

9.  Asks the Commission to explain the delays in improving the accounts relating to loans to officials, with particular reference to the presentation of the missing reports promised for the end of the year 2001, in its replies to point 22 of the Court of Auditors' annual report on the ECSC for the financial year 2000;

10.  Welcomes the positive assessment by the Court of Auditors of the Commission's management of the ECSC budget in the financial year 2000 and the introduction by the Commission of a performance measurement system which has revealed an average rate of yield on liquid assets of 4.72% for the financial year 2000; considers, however, that this rate of return should be accompanied by a benchmark rate of return for subsequent financial years if a meaningful assessment is to be made by the auditors;

11.  Asks the Commission, therefore, to submit to Parliament and Council a proposal regarding investment guidelines and a target rate of return on financial assets under its management, in particular those assets currently managed for the ECSC but which will become the revenue source for the proposed Research Fund for Coal and Steel; suggests that this target rate of return be tied to an objective calculation of average rates of return on government bonds in the EU;

12.  Asks the Commission also to explain the measures which it will adopt to ensure that all the revenue accruing from this financial management will be strictly limited to the Research Fund and not diverted in part to the general budget;

13.  Urges the Commission once again to ensure maximum transparency in disclosing data affecting the value of the ECSC's assets;

1.1.1.2.  Stresses that Parliament will continue to monitor the effective use of taxpayers' money, especially for the purpose of research in the areas of coal and steel, even after the winding-up of the ECSC.

ANNEX

ECSC BALANCE SHEET AT 31 DECEMBER 2000

IMPLEMENTATION OF THE ECSC OPERATING BUDGET

(1) OJ C 185, 30.6.2001, p, 2. (2) OJ C 363, 19.12.2001, p. 40. (3) OJ C 366, 20.12.2001, p. 1. (4) OJ C 80, 10.3.2001, p.67. (5) OJ C 185, 30.6.2001, p. 2. (6) OJ C 363, 19.12.2001, p. 40. (7) OJ C 366, 20.12.2001, p. 1. (8) SN 4609/01 Rev 1. (9) OJ C 247, 7.8.1998, p. 5. (10) OJ C 190, 7.7.1999, p. 1.

European Parliament decision concerning discharge in respect of the implementation of the general budget of the European Union for the 2000 financial year (Section I – European Parliament) (SEC(2001) 530 - C5-0238/2001 – 2001/2103(DEC))

P5_TA(2002)0167 A5-0098/2002

The European Parliament,

–  having regard to the Revenue and Expenditure Account and Balance Sheet in respect of the financial year 2000 (SEC(2001) 530 – C5-0238/2001),

–  having regard to the annual report of the Court of Auditors for the financial year 2000 and the institutions' replies (C5-0617/2001)(1),

–  having regard to the Statement of Assurance as to the reliability of the accounts and the legality and regularity of the underlying transactions provided by the Court of Auditors pursuant to Article 248 of the EC Treaty (C5-0617/2001),

–  having regard to Article 275 of the EC Treaty, Article 78d of the ECSC Treaty and Article 179a of the Euratom Treaty,

–  having regard to Article 77 of the Financial Regulation and Article 13 of the internal rules for the implementation of the European Parliament's budget,

–  having regard to its Rules of Procedure, and in particular Rule 184(3) thereof,

–  having regard to the report of the Committee on Budgetary Control (A5-0098/2002),

1.  Takes note of the figures with which the European Parliament's accounts for the 2000 financial year were closed, namely:

Implementation of the budget

2.  Notes the high level of implementation of the budget as evidenced by:

3.  Recognises, however, that the generally favourable picture with regard to the take-up rate is distorted by the systematic recourse to the end-of-year mopping-up transfer which in recent years has been used to collect appropriations available throughout Parliament's budget in order to make capital injections by way of early repayment of the amounts due in respect of the Institution's buildings;

4.  Notes as regards the level of utilisation of appropriations on individual budget lines that it was possible for EUR 4 410 000 to be transferred from item 1100 (salaries) and EUR 4 200 000 from item 1870 (interpreters and conference technicians) as part of mopping-up transfer C10 followed by a further EUR 700 000 from item 1870 as part of transfer C10 (complementary); recalls that the Administration's failure to keep an adequate record of interpreting costs during 2000 led to the Financial Controller's withholding of approval no. 01/06; instructs the Administration to inform it, no later than 1 July 2002, of the outcome of the administrative enquiry which was promised in the overruling decision signed by the President on 13 December 2001;

5.  Welcomes the information contained in the Financial Controller's report to the Institution no. 01/01 that the error rate (defined in terms of budgetary documents returned for correction and completion, as a percentage of the total number submitted) fell from 8.4% in 1999 to 7% in 2000 and that of the total number of documents controlled (33 335) only 8 ultimately gave rise to a withholding of approval by the Financial Controller - 5 of which were overruled - , both figures representing a downward trend; is concerned that the large number of errors, which are now detected and set right because of the activity of the Financial Controller, will go undetected when and if ex ante verification is abolished on the introduction of the proposed internal audit system;

6.  Notes the conclusion of the Court of Auditors in its communication of 12 November 2001 concerning decisions to overrule withholdings of approval during the financial year 2000 that this aspect of internal control is operating normally in that it has revealed anomalies in administrative management;

7.  Notes, however, that several cases giving rise to withholdings of approval in 2000 did not involve a 'prior legal obligation'; questions whether these should have been put forward by the Administration for overruling; insists that authorising officers must take personal responsibility for errors and legal infractions that give rise to such cases; calls on the Administration to take rapid corrective action, including the immediate cancellation of the proposals in question, rather than follow the current quasi-automatic recourse to the overruling procedure;

Presentation of the accounts

8.  Notes the Court's observation in its annual report for 2000 (paragraph 7.3) that the general approach adopted by the Institutions to the analysis of budgetary management fails to inform readers of the most significant features of expenditure for the year and its criticism that Parliament does not explain the procedure for applying unused appropriations on other lines to capital repayments on buildings; agrees with the Court that the Institutions in general and the European Parliament in particular should provide a more global analysis in the future, focusing on the main trends in expenditure and the major capital items, as well as identifying key savings and measures of efficiency;

9.  Believes that Parliament's accounts, comprising the balance sheet and revenue and expenditure account, as published with those of all the Institutions in the "compte de gestion"(3) produced by the Commission should accordingly be presented in a more user-friendly form (by analogy with a company's report to its shareholders) in such a way as to be accessible to the citizens of the Union and to be readily understandable to the ordinary reader without requiring specialist knowledge of accountancy or the financial workings of the European Union;

10.  Instructs its Secretary-General to submit a working document on the feasibility and overall implications of revising the presentation of Parliament's accounts to its Committee on Budgetary Control by 1 July 2002;

11.  Points out that while the Court of Auditors gives a single Statement of Assurance based on the consolidated accounts of all revenue and expenditure of the Community in accordance with Article 248(1) of the EC Treaty, that Statement of Assurance nevertheless contains remarks concerning the legality and regularity of the transactions carried out by individual institutions; asks the Court in the interests of greater transparency to examine the possibility of issuing a separate Statement of Assurance for each Institution in its next annual report; requests its Secretary-General to make available to the Budgetary Control Committee the sector letter from the Court of Auditors and the Administration's replies;

12.  Observes that since Parliament's statement of revenue includes amounts of €19 600 463 in respect of staff pension contributions (Article 401) and €1 290 126 in respect of Members' pension contributions (Article 910), it would be desirable for Parliament's balance sheet to include an explanation of the way such potential liabilities are to be discharged, e.g. by reference to the notes on off-balance-sheet commitments appended to the European Union's consolidated accounts;

Management

13.  Welcomes the progress made in the introduction of activity-based management into the management of the European Parliament, but regards the results as quite modest and preliminary; calls for more ambitious steps to be taken; underlines the need to delegate power and responsibilities to a lower level of administration and the need to clarify and enforce the individual duties and responsibilities of each member of staff;

14.  Notes the recommendations of the European Parliament "Rome-PE" interim report on staff policy(4) on improving the efficiency of European Parliament human resources; suggests that the recommendations be taken into account along with existing staff reform proposals with a view to promoting efficient management and clarifying the personal responsibility and accountability of officials;

15.  Underlines Parliament's commitment to establish an independent internal audit service in accordance with Council Regulation (EC, ECSC, Euratom) No 762/2001 amending Article 24 of the Financial Regulation(5); notes the Bureau decision of 28 November 2001 to set up such a service; stresses that the service must be independent with the possibility of communicating directly to the President of Parliament when issues of gravity come to the attention of the internal auditor; urges the Bureau to approve the necessary changes to its Internal Financial Rules as a matter of priority; considers that the internal auditor must be a highly qualified and experienced audit professional who is able to perform his duties in a fully independent manner and in accordance with the relevant international standards; believes that the recent experiences of certain banks and large conglomerates, which suffered catastrophic losses due to weak internal controls show that the weakening of control mechanisms would be detrimental to the sound management of European taxpayer's money; insists that the independence of controllers and of the control function be safeguarded from being subordinated to expenditure managers;

Staff policy

16.  Supports the principle underlying the policy of staff mobility; accepts the need, in exceptional cases, for flexibility in order to maintain continuity and stability at particular times when officials with considerable expertise in a given field are necessary to the completion of important tasks; considers that Parliament should make more use of non-permanent staff to carry out certain specialist tasks;

17.  Regrets the low proportion of women in positions of responsibility; requests the Secretary-General to reflect on this shortage and, when new posts are filled, seek to strike a balance between men and women;

18.  Points out that Parliament has repeatedly committed itself to equal opportunities, in particular the promotion of women to senior posts in the European institutions; points in this connection to its resolution of 11 February 1994 on women in decision making bodies(6), which called on the European institutions, as employers, to lay down targets for the recruitment of women and the proportion of women in top posts and, should those targets not be achieved by 2000, to introduce quota arrangements (targets to 2000: 40% for women's recruitment; 30% for women in category A, with the same percentage in all grades;

19.  Very much deplores the fact that that commitment by Parliament has not been acted on; notes that, in the period from July 2000 to December 2001, for three A1 posts men were appointed, for three A2 posts only one woman was appointed, and for 12 A3 posts no woman was appointed, though there had been applications from women for many of the posts; criticises the situation in Parliament, which is alarming at present; asks, in addition, to be informed of the status of Copec in recruitment and promotion procedures;

20.  Insists that from now on, as is the case at the Commission, a yearly number of appointments of women to senior posts (A3, A2 and A1) be laid down, and reserves the right to challenge all further promotions to those posts if the Appointing Authority does not appoint women whose applications were accepted;

21.  Encourages the Administration to take all appropriate action to make part-time working possible, if applied for by officials, in all Directorates-General;

22.  Is aware of the relatively low level of women in senior positions in Parliament's administration; urges its Secretary General to pursue a policy of interinstitutional mobility to widen the pool of suitable female candidates to Parliament's senior posts;

23.  Notes that the application of the rules governing the exchange of officials with national and regional administrations gave rise to two withholdings of approval in 2000 (Nos 00/04 and 00/08), for which the Administration did not seek an overruling decision; asks the Secretary-General to report on the application of the policy of exchanging officials since these events took place;

24.  Notes the cases illustrating the potential for abuse in the system for weighting of staff pensions, which were brought to light in the Financial Controller's reports to the Institution Nos. 00/03 and 01/01; observes that the Administration has now revised its internal procedures in accordance with the Financial Controller's recommendations; asks the Secretary-General to maintain a vigilant approach to the verification of pensioners' declarations of place of residence; calls on its Committee on Legal Affairs and the Internal Market to consider, when it examines the upcoming Commission proposal to amend the Staff Regulations, whether the existing system of weighting of staff pensions should be maintained;

25.  Expresses its satisfaction at the continuing downward trend in the overall number and cost of missions of staff between the three working places of Parliament and particularly between Luxembourg and Brussels as evidenced by the following figures:

26.  Recalls paragraph 9 of its decision of 4 April 2001(7) on Parliament's discharge for 1999 referring to OLAF investigations into the issues arising from Withholdings of Approval Nos. 99/07 and 99/09 and invites OLAF to communicate its findings forthwith;

Training

27.  Underlines the importance of making more efficient use of existing human resources through training and redeployment rather than recourse to increasing the establishment plan;

28.  Whilst welcoming introductory courses in accounting and auditing, considers that such courses are no substitute for sound professional qualifications and commercial experience; reliance on brief courses is quite inadequate for managers;

29.  Urges that, in addition to mandatory financial management training for all new authorising officers, all officials with management responsibility should be required to complete a course in human resource management; those already in management posts should be encouraged to do likewise;

30.  Expresses surprise that the number of officials participating in professional training programmes in 2000 fell from that in 1999 as did the number of courses available; stresses that all officials should have the opportunity to develop new skills as well as to improve existing ones; encourages the emphasis on vocational skills of particular benefit to the service;

31.  Recognises the work already begun in each Directorate General to establish their own training plans and the availability of on-line subscription to professional training courses for staff; recognises the need to support training possibilities if Parliament is to meet its new challenges and work more efficiently;

Recruitment

32.  Considers that open competition should be conducted on an interinstitutional basis and that Parliament, like other institutions, should be able to recruit from a common list of successful candidates in order to ensure a common European civil service, make cost savings and improve subsequent mobility between the Institutions; awaits the definitive decision setting up an interinstitutional recruitment office; considers that an analysis of applicants' teamworking skills should be duly taken into account in the recruitment process;

Places of work and buildings

33.  Notes that even the variable costs of an ordinary five-day session in Strasbourg are about 33% higher than in Brussels in addition to other, much higher costs due to buildings, hotel expenses etc; admits that the decision on the meeting places of the Parliament has been laid down in the Treaty, but against the will of the Parliament; instructs its Secretary-General to provide the Convention with a detailed analysis of the cost of maintaining three places of work;

34.  Observes, however, that reducing the length of a Strasbourg part-session from five to four days, cutting it by one eighth, produces a derisory level of savings (0.97% of the total cost of the meeting);

35.  Stresses firmly that the issue of the investment cost of the new LOW building in Strasbourg has to be solved immediately, and calls on the main partners and main shareholders of the promoter of the building, the city of Strasbourg and the Alsace Region to contribute in solving this issue; regrets that the Parliament has had to refer to the European Court of Justice to settle the dispute on the contractual completion date of the LOW building; underlines that the disputes between the promoter and the subcontractors of the LOW building shall not have any influence on the final investment cost;

36.  Recalls that the signing of the contract for the LOW building was the subject of Special Report No 5/95(8) by the Court of Auditors; further recalls paragraphs 13, 14 and 15 of its resolution of 13 April 2000(9), postponing the decision on the 1998 Parliament discharge, in which it expressed concerns in relation to the application of the interim interest payments and penalties for late delivery; insists that no further capital repayments should be made until the final investment cost has been agreed between the parties or otherwise determined;

37.  Stresses the need for economising the use of space in order to limit the budgetary cost of the new D4/D5 buildings;

38.  Takes note of the evaluation of the use of the garage, indicating that no more parking spaces will be needed for the EP in Brussels even after enlargement;

39.  Instructs its Secretary-General in accordance with the recommendation of the Court of Auditors in its annual report for 2000 (paragraph 7.35) to amend its budgetary nomenclature so as to distinguish between rent, costs of acquisition and other types of expenditure, such as lease payments where there is an option to purchase;

40.  Notes that Parliament paid off the D1, D2 and D3 buildings in Brussels on 15 January 2001 and that the successful strategy of capital injections will permit substantial savings on future interest payments on outstanding capital;

Political groups

41.  Recalls that in 2000 the use by the political groups of the appropriations made available to them by the European Parliament from budget items 3707 and 3708 was governed by the rules adopted by the Bureau on 14 December 1998; notes that while budget items 3707 and 3708 in 2000 accounted for around 3% of Parliament's budget, the Court of Auditors(10) estimates the total share attributable to the political groups (items 3707, 3708 together with staff, premises and equipment) at 13%; points out that according to the relevant Bureau rules the reports by the political groups on their utilisation of appropriations for 2000 are in the public domain(11); notes the Bureau ruling on budget line 3701 following the answers from the political groups to the Court of Auditors' special report;

42.  Recalls that the relevant Bureau rules(12) empower the Committee on Budgetary Control each year to draw up a report on the basis of the statements of income and expenditure, the balance sheet and auditor's certificate forwarded by the political groups;

43.  Notes that there is a tension between the necessity of separating the responsibilities of Parliament's administration and those of the political groups on the one hand and the Financial Regulation on the other which does not explicitly provide for any such separation; instructs its Bureau to ensure that Parliament's implementating rules of the Financial Regulation include a provision identifying the specific status of political groups so that their particular responsibilities can be clearly and properly regulated; recalls the remarks by the Court of Auditors that the differing audit procedures employed by the various auditors mean that these external audits have had limited effectiveness in assessing overall control mechanisms on the 3701 budget line; expects the situation to show marked improvement in the future following the decision to limit the choice of external auditors to a short list of internationally recognised audit firms and a common audit framework;

44.  Takes the view that, in consideration of the discharge decision of 6 July 2000(13), the rules for the spending and responsibility of the political groups must be more clearly and precisely defined within the framework of the information campaign to allow for party political identification of Members in their respective national contexts and to avoid the collective liability of all political groupings; asks the Bureau to undertake the corresponding revision;

45.  Observes as regards the certificates issued by the external auditors selected by the political groups that the information and guarantees as to the reliability of the accounts contained therein and the verifications carried out by the auditor display very considerable variations from one group to another;

46.  Notes that the statements of income and expenditure disclose in 2000 a relatively low level of utilisation of appropriations and a consequently high level of carry-overs to the following year and acknowledges the remarks by the Court of Auditors in its Special Report no 13/2000 (paragraph 19) as to the risk of poor financial management unless such carry-overs are accompanied by a corresponding volume of commitments;

47.  Notes as regards the political groups' balance sheets that they do not in general contain sufficiently clear information on the assets which the political groups acquire with the appropriations made available by the European Parliament, nor, as the Court of Auditors points out in its Annual Report for 2000 (paragraph 7.10), do such assets appear in the balance sheet of the Institution;

48.  Endorses the Court of Auditors' recommendations in its Special Report No. 13/2000 (paragraph 48) that the political groups' certified accounts should be published; instructs its Secretary-General to set aside a section within Parliament's website for the publication of the certified accounts of the political groups;

49.  Repeats the request set out in its resolution of 13 April 2000(14) and its above-mentioned decision of 4 April 2001 that the Court of Auditors conduct an audit of the political groups' finances every two years with a view to assisting the Committee on Budgetary Control in drawing up the report required by Article 2.7.3 of the rules governing the use of appropriations from budget item 3701(15);

50.  Notes the observation of the Court of Auditors in its Special Report No. 13/2000 (paragraph 21) that in relations with third parties decisions taken by political groups as to employment, rental and purchase contracts are considered as being taken with Parliament's authority and to engage its responsibility; recognises that this often results in Parliament's administration being held liable for decisions outside its control; calls on the Legal Service to draw up an opinion recommending a solution to this issue of financial and contractual liability and for clear rules to be put in place which clearly indicate the responsibilities concerning the execution of the budget and personnel (including claims and questions regarding labour laws) between Parliament's administration and the political groups;

51.  Observes that 2 years after the publication of Special Report No. 13/2000 by the Court of Auditors, a proper legal base for the transparent financing of European political parties has still not been approved; criticises in particular the Council for failing to capitalise on progress achieved under the Belgian Presidency in this regard and calls on the Spanish and Danish Presidencies to ensure that agreement is reached this year;

Non-attached Members

52.  Instructs its Committee on Budgetary Control to carry out a full and detailed examination in the context of the 2001 discharge procedure, equivalent to that carried out for the political groups, of the subsidies payable to non-attached Members;

Inventory

53.  Welcomes the fact that for the first time the value of the fixed assets recorded in the balance sheet has been adjusted to reflect depreciation(16); repeats the request contained in its resolution(17) of 6 July 2000 for the balance sheet for every year to include a detailed account of the physical permanent inventory; notes the Financial Controller's conclusion(18) that the introduction of the ELS system has provided a framework for improving the management, control and recording of inventory movements but that there remains scope for further strengthening internal controls, notably over the de-commissioning process;

54.  Notes the reply (Court's annual report 2000, paragraph 7.10) by the European Parliament that it is aware that its inventory does not show assets purchased by the political groups using appropriations made available to them and that it will try to find a solution with the assistance of the political groups;

55.  Recalls the Court's recommendation in its Special Report No. 13/2000 (paragraph 66) that clear rules must be laid down in respect of ownership and inventory of assets acquired using the relevant appropriations in order to ensure the protection and optimum management of all the equipment at the groups' disposal; recalls the finding by the Court of Auditors (Special Report No. 13/2000, paragraph 23) that the appropriations earmarked for the political groups are not a subsidy to an external body but a delegation of the implementation of these appropriations to an internal body, which should therefore comply with the regulatory framework applicable to budgetary expenditure; instructs its Secretary-General to submit a report to the Committee on Budgetary Control by 1 July 2002 containing proposals as to how the assets purchased by the political groups using Parliament's funds might be included in the Institution's inventory;

Award of contracts

56.  Acknowledges that the Secretary-General now provides the Committee on Budgetary Control with the quarterly reports of the ACPC (Advisory Committee on Procurements and Contracts) as requested in its decision of 4 April 2001; notes that according to the Annual Report for 2000 by the ACPC there is a continuing trend towards competitive tendering for the award of contracts compared to the conclusion of contracts by private treaty or negotiated procedures, as shown in the following table, but regards the level of non-competitive contracts as still too high:

57.  Recalls the need to publicise competitive tendering procedures as widely as possible including approaches to professional bodies, trade associations and advertisements in specialised journals; recommends that in order to ensure maximum transparency in the case of restricted calls for tender, competitive tendering should be organised only after publication of a call for expressions of interest or a prior information notice in the Official Journal of the European Communities and on the Internet;

58.  Insists that in restricted procedures the geographical base of the suppliers invited to tender should be as wide as possible; welcomes the information contained in the ACPC report for 2000 that on the instructions of the Secretary-General, in order to enhance legal certainty and to reduce the length of procedures, standardised contract documents and general conditions have been drawn up and made available to Parliament's services in all languages; urges increased use of environmental product-lifecycle criteria;

Contract for security services in Strasbourg

59.  Recalls that in accordance with paragraph 16 of Parliament's above-mentioned resolution of 13 April 2000 postponing the 1998 discharge, the Court of Auditors was asked to examine problems in connection with its contracts for security services and, in particular, the applicability to a specific call for tender of a French national provision applying to the security sector; notes that the Court shares the concerns expressed by the Financial Controller when uttering withholding of approval No. 00/05; asks the Legal Service for an opinion on the compatibility of this aspect of French law with Community law with a view to ensuring fair competition in such contract procedures;

60.  Points out that the Bureau's decision to overrule the withholding of approval was taken on the basis of the advice of Parliament's Legal Service containing an assessment of the relevant provisions of national and Community law; asks, nevertheless, the Secretary-General to ensure that on the occasion of the next renewal of the Strasbourg security contract the outgoing contractor provides the necessary information to potential successors at the appropriate stage in the tender procedure;

Imprest accounts

61.  Questions whether imprest accounts are still necessary and requests the Secretary-General to give a justification for their continuation;

Information policy

62.  Points to the relatively meagre budgetary resources allocated to Information and Communication (€25 million in 2000, representing only 2.5% of the total budget for the Parliament); notes that almost half of that amount is used by the visitors programme which should itself be modernised; expects therewith the observance of comprehensible standards for distance-related allowances; recommends the consequent need for an appropriate increase in budgetary resources for information in parallel with a strategic review of the content and methods of Parliament's information policy and better synergy with other Institutions;

63.  Notes the very high percentage of young people making up nearly half of all visitors to Parliament through the visitors programme; points to the need to redesign the visitors programme in such a way as to hold greater appeal for younger people, for example, by maximising use of audiovisual and multimedia facilities, and using interactive, pedagogical tools;

64.  Underlines the pivotal role of the European Parliament's external information offices in disseminating information about the Institution in Member States as well as collating public reaction and response; believes that the launching of the public debate on the future of Europe makes this a matter of urgency; notes that the sharing of premises with the Commission, joint implementation of the PRINCE programme and the inter-institutional working party on information facilitate cost-savings which can be used to improve performance; asks to be kept informed of the work of the interinstitutional working group on information;

65.  Is aware of the annual work programme objectives set out by DG III (Directorate-General for Information and Public Relations) for the information offices and calls for rigorous assessment of whether the objectives are being achieved and providing value for money; approves of the emphasis on building closer relations with the visual media at national and regional level as well as making better use of MEPs in those areas to personalise the work of Parliament to the public; requests that all Members be provided on request with presentational material (e.g. overhead projection slides, videos, etc.) that can assist them in explaining the role and functioning of Parliament to visitors groups and their electorate;

66.  Invites the Parliament governing bodies to apply a policy of transparency regarding their practices on subventions and allowances, making public, in a user-friendly form, the regulations as well as any other decisions or interpretations, relevant for the calculations of allowances and subventions for the transport of visitors;

67.  Notes that the Parliament's public website is not currently managed by DG III; considers that the Parliament's internet activities should form an integral part of Parliament's information and public relations activities, and that this could constitute a more efficient use of resources; therefore calls on its Secretary-General to examine the possibility of transferring responsibility for maintaining Parliament's internet activities to DG III;

68.  Considers that the unpublished rule followed by the Administration by which no mixed group of visitors of different Member States is accepted to be contrary to the basic objective of promoting European contacts which lies at the heart of the programme; considers that the European Parliament rules and procedures, namely those regarding groups of visitors, should give more attention to the goals of the programmes than to their perceived administrative burden;

Members' allowances

69.  Recalls that on 10 April and 6 July 2000 the Bureau adopted amendments to Article 14 of the Rules on Members' expenses and allowances(19) for entry into force on 1 January 2001; points out that in the course of its audit work the Court of Auditors expressed the view that Parliament's Administration and the Financial Controller should review the new arrangements and report on compliance with the Financial Regulation by the end of 2001; asks the Secretary-General to submit a report to the Committee on Budgetary Control by 1 July 2002;

70.  Recognises the importance of ensuring that the necessary safeguards are in place for the protection of the rights of all assistants who are employees of Members, including proper insurance and social security cover, and for this to be achieved through the full implementation by Parliament's governing bodies of Article 14 of the Rules governing the payment of expenses and allowances to Members and through adoption of an Assistants' Statute;

71.  Believes that the status and contractual arrangements related to parliamentary assistants need to be clarified through the establishment of a statute for this category of staff; is of the opinion that such a statute should provide a regulated basis for the employment of all accredited assistants (working on a full or part-time basis for one or more Members); considers that such a statute should nevertheless provide an exemption for service providers hired to carry out specific and time-limited tasks; underlines that whilst the Members themselves remain responsible for the appointment, category of remuneration and dismissal of their personal staff, it is Parliament's administration that must take overall responsibility for the administrative and contractual arrangements related to remuneration and social security being carried out in a proper and transparent manner;

72.  Recalls the Court of Auditors' recommendations for the payments made regarding travel and subsistence expenses and allowances to reflect the real cost of travelling and the real time of displacement; recalls that this system is already used by the Administration whenever a Member has meetings outside the European Community's territory (Article 3 of the Rules on Members' expenses and allowances);

The case relating to the Members' Cash Office

73.  Notes that the procedure provided for in Article 22 of the Staff Regulations has been initiated and is at a preparatory stage with a view to defining responsibilities in connection with the discrepancy of BEF 4 136 125 between the current cash situation and the corresponding accounts in 1982; requests a clear update on this affair which has dragged on for almost 20 years;

Environment

74.  Considers that further effort should be made to reduce the amount of paper used in Parliament; calls on its Secretary-General to examine the development of a secure intranet-based interface for the submission and signature of amendments, parliamentary questions, written declarations, and other parliamentary forms and documents currently submitted on paper; believes that this would also lead to other efficiency gains; instructs its Secretary-General to cease the paper distribution of those parliamentary documents (such as committee agendas, communications to Members etc.) which can be also be made available by e-mail or through the intranet, and to make multiple copies of public relations material available to Members only on request;

75.  Underlines the necessity of implementing 'green housekeeping principles' for new buildings (e.g. a sustainable mobility plan including the installation of a mobility management centre/desk, potential for energy efficiency and use of renewables);

76.  Instructs its Secretary-General to improve environmental management routines and to present yearly figures for consumption of paper, water, energy and other major indicators;

Conclusion

77.  Draws the attention of the Administration to the serious concerns, expressed in this resolution, about a wide range of management weaknesses affecting many areas of budget implementation and calls on it to draw the necessary conclusions;

o
o   o

78.  Gives its Secretary-General discharge in respect of the implementation of the budget for the 2000 financial year;

79.  Authorises the giving of discharge to the Accounting Officer for the 2000 financial year;

80.  Instructs its President to forward this decision to the Commission, the Council, the Court of Justice, the Court of Auditors and the European Ombudsman and to have it published in the Official Journal (L series).

(1) OJ C 359, 15.12.2001. (2) Including Supplementary and Amending Budget n° 2/2000. (3) Compte de gestion et bilan financier afférents aux opérations du budget de l'exercice 2000 (volume III - SEC(2001)530 - FR) (4) PE 305.179/BUR (ROME = "répertoire opérationnelle des métiers et emplois") (5) OJ L 111, 20.4.2001, p. 1. (6) OJ C 61, 28.2.1994, p. 248. (7) OJ L 160, 15.6.2001, p. 25. (8) OJ C 27, 31.1.1996, p. 1. (9) OJ C 40, 7.2.2001, p. 398. (10) Special Report no. 13/2000 on the expenditure of the European Parliament's political groups together with the European Parliament's replies, footnote to paragraph 5 (OJ C 181, 28.6.2000). (11) Article 8 of the rules governing item 3707 and Article 5 of the rules governing item 3708 (see Bureau minutes of 14.12.1998). (12) See footnote above and the Bureau's rules governing budget item 3701 which were adopted on 11 December 2000 and entered into force on 1 January 2001. (13) OJ C 121, 24.4.2001, p. 366. (14) OJ C 40, 7.2.2001, p. 398. (15) PE 298.252/BUR/def - see Bureau minutes 11.12.2000 and 1.2.2001. (16) Notes accompanying Parliament's balance sheet, "compte de gestion", p. 96. (17) OJ C 121, 24.4.2001, p. 366. (18) Report to the Institution no. 01/01 with replies (note from Secretary-General to the Bureau dated 24.4.2001. (19) PE 133.116/Quaest.

European Parliament decision concerning discharge to the Administrative Board of the European Foundation for the Improvement of Living and Working Conditions in respect of the implementation of its budget for the 2000 financial year (C5-0126/2002 – 2001/2111(DEC))

P5_TA(2002)0168 A5-0101/2002

The European Parliament,

–  having regard to the report of the Court of Auditors on the financial statements and management of the European Foundation for the Improvement of Living and Working Conditions for the financial year ended 31 December 2000, together with the Foundation's replies(1) (C5-0126/2002),

–  having regard to the Council Recommendation of 5 March 2002 (C5-0122/2002),

–  having regard to Article 276 of the EC Treaty,

–  having regard to Rule 93 of and Annex V to its Rules of Procedure,

–  having regard to the report of the Committee on Budgetary Control (A5-0101/2002),

A.  whereas the European Foundation for the Improvement of Living and Working Conditions (Dublin Foundation) pursues its mission to contribute to the planning and establishment of better working conditions through action designed to increase and disseminate knowledge likely to assist this development by following six mid-term research priorities, namely, in the areas of employment practice, worker participation, equal opportunities, social cohesion, health and well-being and sustainable development,

B.  whereas, on the basis of the Code of Conduct of 14 July 1998, the Committee on Employment and Social Affairs is responsible for monitoring the work of the Dublin Foundation, which in 2000 received a subsidy of EUR 14 700 000,

C.  whereas on 4 April 2001(2) Parliament gave discharge to the Administrative Board of the Foundation in respect of the implementation of its budget for the 1999 financial year and, at the same time: