Index 
Texts adopted
Tuesday, 7 June 2005 - Strasbourg
Trans-European energy networks ***I
 Energy end-use efficiency ***I
 Infrastructure for spatial information in the Community (INSPIRE) ***I
 Reinsurance ***I
 EAFRD support for rural development *
 Exchange of information and intelligence (serious offences, including terrorism) *
 Information exchange and cooperation on terrorist offences *
 Protection of the Communities' financial interests and the fight against fraud
 EU action plan against terrorism
 Preventing, preparing for and responding to terrorist attacks
 Protection of critical infrastructure
 Combating terrorist financing
 Exchange of information and cooperation concerning terrorist offences

Trans-European energy networks ***I
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Resolution
Consolidated text
European Parliament legislative resolution on the proposal for a decision of the European Parliament and of the Council laying down guidelines for trans-European energy networks and repealing Decisions No 96/391/EC and No 1229/2003/EC (COM(2003)0742 – C5-0064/2004 – 2003/0297(COD))
P6_TA(2005)0211A6-0134/2005

(Codecision procedure: first reading)

The European Parliament,

–   having regard to the Commission proposal to the European Parliament and the Council (COM(2003)0742)(1),

–   having regard to Article 251(2) and Article 156 of the EC Treaty, pursuant to which the Commission submitted the proposal to Parliament (C5-0064/2004),

–   having regard to Rule 51 of its Rules of Procedure,

–   having regard to the report of the Committee on Industry, Research and Energy and the opinions of the Committee on Economic and Monetary Affairs, the Committee on the Environment, Public Health and Food Safety, and the Committee on Transport and Tourism (A6-0134/2005),

1.  Approves the Commission proposal as amended;

2.  Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text;

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

POSITION OF THE EUROPEAN PARLIAMENT adopted at first reading on 7 June 2005 with a view to the adoption of Decision No .../2005/EC of the European Parliament and of the Council laying down guidelines for trans-European energy networks and repealing Decision 96/391/EC and Decision No 1229/2003/EC

P6_TCI-COD(2003)0297


THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 156 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the Economic and Social Committee(2), after consulting the Committee of the Regions, acting in accordance with the procedure laid down in Article 251 of the Treaty(3),

Whereas:

(1)  Since the adoption of Decision No 1229/2003/EC of the European Parliament and of the Council of 26 June 2003 laying down a series of guidelines for trans-European energy networks(4), the need has arisen to fully integrate the acceding countries in those guidelines and to further adapt them, as appropriate, to the new proximity policy of the European Union.

(2)  The priorities for trans-European energy networks stem from the creation of a more open and competitive internal energy market as a result of the implementation of Directive 2003/54/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in electricity(5) and of Directive 2003/55/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in natural gas(6). Those priorities follow the conclusions of the Stockholm European Council of March 2001 concerning the development of the infrastructures needed for the operation of the energy market. A special effort should be undertaken to achieve the objective of making greater use of renewable energy sources as a contribution to further a sustainable development policy. However, this should be achieved without creating disproportionate disturbances to the normal market equilibrium. Full account should also be taken of the objectives of the Community's transport policy and specifically the possibility of reducing road traffic by using pipelines for natural gas and olefins.

(3)  This Decision will serve to move closer towards realising the objective, set at the Barcelona European Council of a minimum level of electricity interconnection between Member States equivalent to 10% of installed generating capacity in each Member State, thereby improving network reliability and security and ensuring security of supply and the effective operation of the internal market.

(4)  As a rule, the construction and maintenance of energy infrastructure should be subject to market principles. This is also in line with the common rules for the completion of the internal market in energy and the common rules on competition law which aim at the creation of a more open and competitive internal energy market. Community financial aid for construction and maintenance should therefore remain exceptional. Those exceptions should be duly justified.

(5)  Energy infrastructure should be constructed and maintained so as to enable the internal energy market to operate efficiently, with due regard to the procedures for consulting the people affected, without detracting from strategic and universal service criteria, and public service obligations.

(6)  The priorities for trans-European energy networks also stem from the growing importance of the trans-European energy networks for securing and diversifying the Community's energy supplies, incorporating the energy networks of the new Member States and acceding countries, and ensuring the coordinated operation of the energy networks in the Community and in neighbouring countries after consulting the Member States concerned. Indeed neighbouring countries to the European Union play a vital role in the Union's energy policy. They supply a major part of the Union's requirements of natural gas, they are key partners for the transit of primary energy to the Union and they will progressively become more important players in the Community's internal gas and electricity markets.

(7)  Among the projects relating to trans-European energy networks, it is necessary to highlight the priority projects, which are very important for the operation of the internal energy market or the security of energy supply. In addition a Declaration of European Interest needs to be established for those projects receiving the highest priority, as well as enhanced coordination, where appropriate.

(8)  The procedure for identifying projects of common interest relating to trans-European energy networks should ensure the harmonious application of Council Regulation (EC) No 2236/95 of 18 September 1995 laying down general rules for the granting of Community financial aid in the field of trans-European networks (7). That procedure should distinguish two levels: a first level establishing a restricted number of criteria for the identification of such projects, and a second level describing the projects in detail, referred to as specifications.

(9)  Since the project specifications are liable to change, they are given indicatively. The Commission should therefore be empowered to update them. Since projects may have considerable political, environmental and economic implications, it is important to find the appropriate balance between legislative oversight and flexibility in determining projects that merit potential Community support.

(10)  It should be possible to improve the preparation and implementation of some priority projects, or sections of priority projects, or groups of priority projects by creating a coordination team, in which the Community would take part, for the duration of the priority projects concerned. The Commission should, therefore, be empowered to designate a European coordinator for such projects, to encourage cooperation with users and operators, and ensure that the necessary monitoring is carried out in order to keep the Community informed of progress.

(11)  A more favourable context for the development and construction of trans-European energy networks should be created, mainly by providing stimulus for technical cooperation between the entities responsible for the operation and regulation of electricity and gas systems, by facilitating the implementation of the authorisation procedures applicable to network projects in the Member States in order to reduce delays and by mobilizing as appropriate those Funds, instruments and financial programmes of the Community available for network projects. The European Union should support measures taken by the Member States in pursuit of that objective.

(12)  Since the Community budget earmarked for the trans-European energy networks is relatively modest and mainly intended to finance feasibility studies, it is the Community Structural Funds, programmes and financial instruments that enable, if necessary, funding to be provided for such - in particular interregional - interconnection networks.

(13)  The identification of projects of common interest, their specifications and priority projects, in particular those of European interest, should be without prejudice to the results of the environmental impact assessment of the projects and of the plans or programmes.

(14)  The measures necessary for the implementation of this Decision 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(8).

(15)  The Commission should periodically draw up reports on the implementation of this Decision.

(16)  Since this Decision has the same subject matter and scope as Council Decision 96/391/EC of 28 March 1996 laying down a series of measures aimed at creating a more favourable context for the development of trans-European networks in the energy sector(9) and Decision No 1229/2003/EC, those two decisions should be repealed,

HAVE ADOPTED THIS DECISION:

Article 1

Subject matter

This Decision defines the nature and scope of Community action to establish guidelines for trans-European energy networks. It establishes a series of guidelines covering the objectives, priorities and broad lines of action by the Community in respect of trans-European energy networks. These guidelines identify projects of common interest and priority projects, including projects of European interest, among trans-European electricity and gas networks.

Article 2

Scope

This Decision shall apply:

  1) as regards electricity networks, to:
   a) all high-voltage lines, excluding those of distribution networks, and to submarine links, provided that this infrastructure is used for inter-regional or international transmission or connection;
   b) any equipment or installations essential for the system in question to operate properly, including protection, monitoring and control systems;
  2) as regards gas networks (transporting natural gas or olefin gases), to:
   a) high-pressure gas pipelines, excluding those of distribution networks, making it possible to supply regions of the Community from internal or external sources;
   b) underground storage facilities connected to the above mentioned high-pressure gas pipelines;
   c) reception, storage and regaseification facilities for liquefied natural gas (LNG) and also LNG carriers according to the capacities to be supplied;
   d) any equipment or installations essential for the system in question to operate properly, including protection, monitoring and control systems.

Article 3

Objectives

The Community shall promote the interconnection, interoperability and development of trans-European energy networks and access to such networks in accordance with current Community law, with the aim of:

   a) encouraging the effective operation and development of the internal market in general and of the internal energy market in particular, while encouraging the rational production, transportation, distribution and utilisation of energy resources and the development and connection of renewable energy resources, so as to reduce the cost of energy to the consumer and contribute to the diversification of energy sources;
   b) facilitating the development and reducing the isolation of the less-favoured and island regions of the Community, thereby helping to strengthen economic and social cohesion;
   c) reinforcing the security of energy supplies, in particular by strengthening relations with third countries in the energy sector in the interest of all parties concerned, in particular in the framework of the Energy Charter Treaty and cooperation agreements concluded by the Community.
   d) enhancing sustainable development and protection of the environment, in particular with regard to cogeneration, energy efficiency, energy services and renewable energy sources, and by reducing the social and environmental risks associated with the transportation and transmission of energy.

Article 4

Priorities for action

The priorities for action by the Community on trans-European energy networks shall be compatible with sustainable development and shall be as follows:

  1) for both electricity and gas networks, with particular regard to olefin gas networks:
   a) adapting and developing the energy networks in support of the operation of the internal energy market and, in particular, solving the problems of bottlenecks, especially transfrontier ones, congestion and missing links, and taking account of the needs arising from the functioning of the internal market for electricity and natural gas and the enlargement of the European Union;
   b) establishing energy networks in island, isolated, peripheral and ultraperipheral regions while promoting the diversification of energy sources and the use of renewable energy sources, together with the connection of those networks, where necessary;
  2) for electricity networks:
   a) adapting and developing networks to facilitate the integration and connection of renewable energy production;
   b) ensuring interoperability of electricity networks within the Community with those in the acceding countries and other countries in Europe and the Mediterranean and Black Sea basins;
  3) for gas networks:
   a) development of natural gas networks in order to meet the Community's natural gas consumption needs and to control its natural gas supply systems;
   b) ensuring interoperability of natural gas networks within the Community with those in other countries in Europe, in the Mediterranean, Black Sea and Caspian Sea basins, as well as in the Middle East and the Gulf regions, and diversification of natural gas sources and supply routes;
   c) development and integration of olefin gases networks in order to meet the olefin gases consumption needs of the industries in the Community.

Article 5

Lines of action

The broad lines of action by the Community on trans-European energy networks shall be:

   a) the identification of projects of common interest and priority projects, including those of European interest;
   b) the creation of a more favourable context for development of such networks.

Article 6

Criteria for projects of common interest

1.  The generic criteria to be applied when a decision is taken on identification of, modifications to, specifications or applications for updating projects of common interest are the following:

   a) the projects fall within the scope of Article 2;
   b) the projects reflect the objectives and priorities for action set out in Articles 3 and 4 respectively;
   c) the projects have potential economic viability.

The evaluation of economic viability shall be based upon a cost-benefit analysis which shall take account of all costs and benefits, including those in the medium and/or long term, in connection with all environmental externalities and other environmental aspects, security of supply and the contribution to economic and social cohesion. Projects of common interest which relate to the territory of a Member State shall require the approval of the Member State concerned.

2.  Additional criteria for identifying projects of common interest are set out in Annex II.

Any modifications to the additional criteria for identifying projects of common interest set out in Annex II shall be made in accordance with the procedure laid down in Article 251 of the Treaty.

3.  Only those projects listed in Annex III shall be eligible for Community financial aid under Regulation (EC) No 2236/95. Those projects shall fulfil the criteria laid down in paragraph 1 and set out in Annex II.

4.  The indicative project specifications, comprising the detailed description of the projects and, where appropriate, their geographical description, are set out in Annex III. Those specifications shall be updated in accordance with the procedure referred to in Article 14 (2). Updates are of a technical nature and must be limited to technical changes of project, or to modification of a part of the specified routing, or to limited adaptation of the location of the project.

5.  Member States shall take any measures they consider necessary to facilitate and speed up the completion of projects of common interest and to minimise delays while complying with Community law and international conventions on the environment. In particular, the necessary authorisation procedures shall be completed rapidly.

6.  Where parts of projects of common interest are situated within the territory of third countries, the Commission may, after consulting the Member States concerned, put forward proposals, where appropriate within the framework of the management of the agreements between the Community and those third countries and in accordance with the Energy Charter Treaty in respect of third countries which are parties to that Treaty, for the projects also to be recognised as being of reciprocal interest by the third countries concerned, in order to facilitate their implementation.

Article 7

Priority projects

1.  The projects of common interest set out in Annex I shall have priority for the grant of Community financial aid under Regulation (EC) No 2236/95.

Modifications to Annex I shall be decided upon in accordance with the procedure laid down in Article 251 of the Treaty.

2.  The Member States concerned and the Commission shall endeavour, each within their own sphere of competence, to further the carrying out of the priority projects especially cross-border projects.

As regards cross-border investment projects, Member States shall take the necessary measures to ensure that, in the context of national authorisation procedures, the fact that such projects increase the capacity for interconnection of two or more Member States and consequently strengthen Europe-wide security of supply is treated as a decisive criterion in the assessment undertaken by the competent national authorities.

3.  Priority projects shall be compatible with sustainable development and meet the following criteria:

   (a) They shall have a significant impact on the competitive operation of the internal market, and/or
   b) they shall strengthen security of supply in the Community, and/or
   c) they shall result in an increase in the use of renewable energies, energy efficiency services or cogeneration.

Article 8

Projects of European Interest

1.  A selection of projects on the priority axes referred to in Article 7 which are of cross-border nature or which have significant impact on cross-border transmission capacity are declared to be of European interest. Those projects are set out in Annex I.

2.  When submitting projects under the Cohesion Fund, in accordance with Article 10 of Council Regulation (EC) No 1164/94 of 16 May 1994 establishing a cohesion fund(10), the Member States shall give appropriate priority to the projects declared to be of European interest.

3.  When submitting projects under the budget for the trans-European networks, in accordance with Article 10 of Regulation (EC) No 2236/95, the Member States shall give appropriate priority to the projects declared to be of European interest.

4.  When submitting projects under the Structural Funds, in accordance with Council Regulation (EC) No 1260/1999 of 21 June 1999 laying down general provisions on structural funds(11), the Member States shall give appropriate priority to the projects declared to be of European interest.

5.  The Commission shall ensure that the countries qualifying for the instrument for structural policies for pre-accession shall give appropriate priority, when submitting projects under Articles 2 and 7 of Council Regulation (EC) No 1267/1999 of 21 June 1999 establishing an instrument for structural policies for pre-accession(12), to the projects declared to be of European interest.

6.  If there is a significant current or prospective delay in starting work on one of the projects declared to be of European interest, the Commission shall ask the Member States concerned to give the reasons for the delay within three months.

After receiving and examining the reply from the Member States concerned, the Commission may, with due regard to the principle of proportionality, decide to withdraw the declaration as a project of European interest.

7.  Five years after the completion of a project declared to be of European interest or of one of the sections thereof, the Member States concerned shall carry out an assessment of its socio-economic impact and its impact on the environment, including its impact on trade between Member States, on territorial cohesion and on sustainable development.

Member States shall inform the Commission of the results of this assessment.

8.  To ensure that project authorisation procedures are completed within a reasonable time, if a project is declared to be of European interest the Member States concerned shall coordinate, for each section of the project in question as appropriate, their environmental and socio-economic impact assessments and public consultation procedures prior to authorisation of the project.

9.  If a project which is declared to be of European interest includes a cross-border section which is technically and financially indivisible, the two Member States concerned shall conduct a transnational enquiry with a view to evaluating the cross-border section and consulting the public prior to authorisation of the project.

10.  The coordinated or transnational enquiry procedures referred to in paragraphs 8 and 9 shall apply without prejudice to the obligations relating to environmental protection, particularly environmental impact assessment under Community law.

The Member States concerned shall inform the Commission when such coordinated or transnational enquiry procedures are launched and of the results thereof.

Article 9

Implementation of Projects of European Interest

1.  The projects of European Interest shall be rapidly implemented.

No later than ...(13) Member States shall submit to the Commission a timetable for the completion of those projects including details of:

   a) the envisaged passage of the project through the planning approval process,
   b) the timetable for the feasibility and design phase,
   c) the timetable for the construction of the project,
   d) the entry into service of the project.

2.  Member States shall provide annual reports to the Commission on the progress of the projects referred to in paragraph 1.

Where progress is slower than in the timetable submitted to the Commission, Member States must submit a revised plan to the Commission.

3.  Member States shall take appropriate measures to ensure that the authorisation procedure for projects of European Interest is efficient and does not include any unnecessary delays.

Article 10

European Coordinator

1.  Where projects pose implementation difficulties, the Commission may designate, by agreement with the Member States concerned and after consultation of the European Parliament, a European Coordinator.

The European Coordinator shall act in the name and on behalf of the Commission. The mission of the European Coordinator shall cover a single priority project or a section of a priority project. If necessary, the mission of the European Coordinator may be extended to other related priority projects.

2.  The European Coordinator shall be chosen on the basis of his experience of the European institutions and knowledge of issues relating to the technical, financial, socio-economic and environmental evaluation of major projects.

3.  The decision designating the European Coordinator shall specify how the coordinator is to perform his tasks.

4.  The European Coordinator shall:

   a) promote joint methods for the evaluation of projects; advise project promoters on the financial package for the projects; and give, if appropriate, an opinion on issues relating to the operation of networks;
   b) submit an annual report to the Commission regarding progress achieved in the implementation of the project(s) for which he has been designated, new regulatory or other developments which could affect the characteristics of the project(s) and any difficulties or obstacles which are likely to result in a significant delay;
   c) contribute to the dialogue with operators, users, regional and local authorities and representatives of civil society with a view to gaining fuller knowledge of the demand for transmission services, of the constraints and of the service parameters required to optimise the use of the infrastructure concerned.

5.  The Member States concerned shall cooperate with the European Coordinator and give the Coordinator the information required to carry out the tasks referred to in paragraph 4.

6.  The Commission may seek the opinion of the European Coordinator when examining applications for Community funding for projects or groups of projects for which he has been designated.

7.  In order to avoid unnecessary administrative burden, the level of co-ordination must be proportionate to the costs of the project.

Article 11

More favourable context

1.  In order to contribute to creating a more favourable context for the development of trans-European energy networks and their interoperability, the Community shall take account of Member States' efforts in line with that objective, and attach the greatest importance to the following measures, promoting them as necessary:

   a) technical cooperation between the entities responsible for the trans-European energy networks, in particular for the proper functioning of the connections mentioned in Annex II, points 1, 2 and 7;
   b) facilitating implementation of the authorisation procedures for projects on trans-European energy networks in order to reduce delays;
   c) the provision of assistance to the projects of common interest from its Funds, instruments and financial programmes applicable to those networks.

2.  The Commission shall, in close collaboration with the Member States concerned, take all initiatives for promoting the coordination of the activities referred to in paragraph 1.

3.  The measures necessary for the implementation of the activities referred to in points (a) and (b) of paragraph 1 shall be taken by the Commission in accordance with the procedure referred to in Article 14(2).

Article 12

Effects on competition and security of supply

When projects are considered, their effects on competition and on security of supply shall be taken into account. Private financing or financing by the economic operators shall be encouraged while respecting competition and other EU rules. Any competitive distortion between market operators shall be avoided, in accordance with the provisions of the Treaty.

Article 13

Restrictions

1.  This Decision shall not prejudice financial commitments entered into by a Member State or by the Community.

2.  This Decision shall be without prejudice to the results of the environmental impact assessment of projects and of the plans or programmes which define the future authorisation framework for such projects. The results of the environmental impact assessment, where such an assessment is requested in accordance with relevant Community legislation, shall be taken into consideration before a decision on the carrying out of the projects is actually taken in accordance with the relevant Community legislation.

Article 14

Committee

1.  The Commission shall be assisted by a Committee.

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

The period laid down 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 15

Report

Every two years the Commission shall draw up a report on the implementation of this Decision, which it shall submit to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions.

In this report, attention shall be given to the implementation and progress made in the carrying out of priority projects, as well as the arrangements for their financing, especially as regards the contribution of Community funding, which concern cross-border connections as mentioned in Annex II, points 1, 2 and 7.

Article 16

Repeal

Decision 96/391/EC and Decision No 1229/2003/EC are hereby repealed.

Article 17

Entry into force

This Decision shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

Article 18

Addressees

This Decision is addressed to the Member States.

Done at ...,

For the European Parliament For the Council

The President The President

ANNEX I

TRANS-EUROPEAN ENERGY NETWORKS

Priority project axes, including sites of projects of European interest, as defined in Articles 7 and 8

The priority projects, including projects of European interest, to be carried out on each priority axis are listed below.

ELECTRICITY NETWORKS

EL.1.  France – Belgium – Netherlands – Germany:

electricity network reinforcements in order to resolve congestion in electricity flow through the Benelux.

Including the following projects of European interest:

Aveline (FR) – Avelgem (BE) line

Moulaine (FR) – Aubange (BE) line

EL.2.  Borders of Italy with France, Austria, Slovenia and Switzerland:

increasing electricity interconnection capacities.

Including the following projects of European interest:

Lienz (AT) – Cordignano (IT) line

New interconnection between Italy and Slovenia

Udine Ovest (IT) – Okroglo (SI) line

Fiorano (IT) – Nave (IT) – Gorlago (IT) line

Venezia Nord (IT) – Cordignano (IT) line

St-Peter (AT) – Tauern (AT) line

Südburgenland (AT) – Kainachtal (AT) line

Austria-Italy (Thaur-Brixen) interconnection through the Brenner rail tunnel

EL.3.  France – Spain – Portugal:

increasing electricity interconnection capacities between these countries and for the Iberian peninsula and grid development in island regions.

Including the following projects of European interest:

Sentmenat (ES) – Becanó (ES) – Baixas (FR) line

Valdigem (PT) – Douro Internacional (PT) – Aldeadávila (ES) line and Douro Internacional facilities

EL.4.  Greece – Balkan countries – UCTE System:

development of electricity infrastructure to connect Greece to the UCTE System and to enable the South-Eastern Europe electricity market.

Including the following projects of European interest:

Philippi (EL) – Hamidabad (TR) line

EL.5.  United Kingdom – Continental Europe and Northern Europe:

establishing/increasing electricity interconnection capacities and possible integration of offshore wind energy.

Including the following projects of European interest:

Undersea cable link between England (UK) and the Netherlands

EL.6.  Ireland – United Kingdom:

increasing electricity interconnection capacities and possible integration of offshore wind energy.

Including the following projects of European interest:

Undersea cable link between Ireland and Wales (UK)

EL.7.  Denmark – Germany – Baltic Ring (including Norway – Sweden – Finland – Denmark – Germany – Poland – Baltic States – Russia):

increasing electricity interconnection capacities and possible integration of offshore wind energy.

Including the following projects of European interest:

Kassø (DK) – Hamburg/Dollern (DE) line

Hamburg/Krümmel (DE) – Schwerin (DE) line

Kassø (DK) – Revsing (DK) – Tjele (DK) line

Hassing (DK) - Trige (DK) line

Skagerrak 4 (DK) – Norway undersea cable

Connection of Poland and Lithuania, including the upgrading of the Polish electricity network and the PL-DE section as necessary to allow participation in the internal energy market

Estlink undersea cable link between Finland and Estonia

Fennoscan undersea cable link between Finland and Sweden

Halle/Saale (DE) – Schweinfurt (DE)

EL.8.  Germany – Poland – Czech Republic – Slovakia – Austria – Hungary – Slovenia:

increasing electricity interconnection capacities.

Including the following projects of European interest:

Neuenhagen (DE) – Vierraden (DE) – Krajnik (PL) line

Dürnrohr (AT) – Slavětice (CZ) line

New interconnection between Germany and Poland

Veľké Kapušany (SK) – Lemešany (SK) – Moldava (SK) – Sajoivanka (HU)

Gabčíkovo (SK) – Veľký Ďur (SK)

Stupava (SK) – south-east Vienna (AT)

EL.9.  Mediterranean Member States – Mediterranean Electricity Ring:

increasing electricity interconnection capacities between Mediterranean Member States and Morocco – Algeria – Tunisia – Libya – Egypt – Near-East Countries – Turkey.

Including the following projects of European interest:

Electricity connection between Tunisia and Italy

GAS NETWORKS

NG.1.  United Kingdom – Northern Continental Europe, including Netherlands, Belgium, Denmark, Sweden, and Germany – Poland – Lithuania – Latvia – Estonia – Finland – Russia:

Gas pipelines to connect some of the main gas sources in Europe, improve network interoperability, and increase security of supply, including the North Transgas pipeline and Yamal – Europe natural gas pipeline, construction of new pipelines and increases in network capacity in and between Germany, Denmark and Sweden, and in and between Poland, the Czech Republic, Slovakia, Germany, and Austria.

Including the following projects of European interest:

North Transgas gas pipeline

Yamal – Europe gas pipeline

Natural gas pipeline linking Denmark, Germany and Sweden

Increase in transmission capacity on the Germany – Belgium – United Kingdom axis

NG.2.  Algeria – Spain – Italy – France – Northern Continental Europe:

construction of new natural gas pipelines from Algeria to Spain, France and Italy, and increasing network capacities in and between Spain, France and Italy.

Including the following projects of European interest:

Algeria – Tunisia – Italy gas pipeline

Algeria – Italy gas pipeline, via Sardinia and Corsica, with a branch to France

Medgas gas pipeline (Algeria – Spain – France – Continental Europe)

NG.3.  Caspian Sea countries – Middle East – European Union:

new natural gas pipeline networks to the European Union from new sources, including the Turkey – Greece, Greece – Italy, Turkey – Austria, and Greece – Slovenia – Austria (via the western Balkans) natural gas pipelines.

Including the following projects of European interest:

Turkey – Greece – Italy gas pipeline

Turkey – Austria gas pipeline

NG.4.  LNG terminals in Belgium, France, Spain, Portugal, Italy, Greece, Cyprus, and Poland:

diversifying sources of supply and entry points, including the LNG terminals" connections with the transmission grid.

NG.5.  Underground natural gas storage in Spain, Portugal, France, Italy, Greece and the Baltic Sea region:

increasing capacity in Spain, France, Italy and the Baltic Sea region and construction of the first facilities in Portugal, Greece, and Lithuania

NG.6.  Mediterranean Member States – East Mediterranean Gas Ring:

Establishing and increasing natural gas pipeline capacities between the Mediterranean Member States and Libya – Egypt – Jordan – Syria – Turkey.

Including the following projects of European interest:

Libya – Italy gas pipeline

ANNEX II

TRANS-EUROPEAN ENERGY NETWORKS

Additional criteria for identifying projects of common interest referred to in Article 6(2)

ELECTRICITY NETWORKS

1.  Developing electricity networks in island, isolated, peripheral and ultraperipheral regions while promoting the diversification of energy sources and enhancing the use of renewable energies, and connection of the electricity networks of those regions, if appropriate.

‐  • Ireland – United Kingdom (Wales)

‐  • Greece (islands)

‐  • Italy (Sardinia) – France (Corsica) – Italy (mainland)

‐  • Connections in island regions, including connections to the mainland

‐  • Connections in ultraperipheral regions in France, Spain, Portugal

2.  Developing electricity connections between the Member States needed for the functioning of the internal market and in order to ensure the reliability and dependability of the operation of electricity networks.

‐  • France – Belgium – Netherlands – Germany

‐  • France – Germany

‐  • France – Italy

‐  • France – Spain

‐  • Portugal – Spain

‐  • Finland – Sweden

‐  • Finland – Estonia – Latvia – Lithuania

‐  • Austria – Italy

‐  • Italy – Slovenia

‐  • Austria – Italy – Slovenia – Hungary

‐  • Germany – Poland

‐  • Germany – Poland – Czech Republic – Austria – Slovakia – Hungary

‐  • Hungary – Slovakia

‐  • Hungary – Austria

‐  • Poland – Lithuania

‐  • Ireland – United Kingdom (Northern Ireland)

‐  • Austria – Germany – Slovenia – Hungary

‐  • Netherlands – United Kingdom

‐  • Germany – Denmark – Sweden

‐  • Greece – Italy

‐  • Hungary – Slovenia

‐  • Malta – Italy

‐  • Finland – Estonia

‐  • Italy – Slovenia

3.  Developing electrical connections within the Member States where this is needed in order to take advantage of the connections between the Member States, the functioning of the internal market or the connection of renewable energy sources

‐  • All Member States

4.  Developing electricity connections with the non-member states, and more particularly with the candidate countries for accession, thus contributing towards interoperability, the operational reliability and dependability of the electricity grids or the supply of electricity within the European Community.

‐  • Germany – Norway

‐  • The Netherlands – Norway

‐  • Sweden – Norway

‐  • United Kingdom – Norway

‐  • Baltic Electricity Ring: Germany – Poland – Belarus – Russia – Lithuania – Latvia – Estonia – Finland – Sweden – Norway – Denmark

‐  • Norway – Sweden – Finland – Russia

‐  • Mediterranean Electricity Ring: France – Spain – Morocco – Algeria – Tunisia – Libya – Egypt – near eastern countries – Turkey – Greece – Italy

‐  • Greece – Turkey

‐  • Italy – Switzerland

‐  • Austria – Switzerland

‐  • Hungary – Romania

‐  • Hungary – Serbia

‐  • Hungary – Croatia

‐  • Italy – Tunisia

‐  • Greece – Balkan countries

‐  • Spain – Morocco

‐  • Spain – Andorra – France

‐  • EU – Balkan countries – Belarus – Russia – Ukraine

‐  • Black Sea Electricity Ring: Russia – Ukraine – Romania – Bulgaria – Turkey – Georgia

‐  • Bulgaria – FYROM/Greece – Albania – Italy or Bulgaria – Greece – Italy

5.  Actions improving the functioning of the interconnected electricity networks within the internal market and, in particular, identifying the bottlenecks and missing links, developing solutions in order to deal with congestion and adapting the methods of forecasting and of operating electricity networks.

–  • Identifying the bottlenecks and missing links, especially cross border, within electricity networks

–  • Developing solutions for electricity flow management in order to deal with the problems of congestion within electricity networks

–  • Adapting the methods of forecasting and of operating electricity networks required by the functioning of the internal market and the use of a high percentage of renewable energy sources.

GAS NETWORKS

6.  Introducing natural gas into new regions, mainly island, isolated, peripheral and ultraperipheral regions and developing natural gas networks in these regions.

–  • United Kingdom (Northern Ireland)

–  • Ireland

–  • Spain

–  • Portugal

–  • Greece

–  • Sweden

–  • Denmark

–  • Italy (Sardinia)

–  • France (Corsica)

–  • Cyprus

–  • Malta

–  • Ultraperipheral regions in France, Spain, Portugal

7.  Developing natural gas connections in order to meet the needs of the internal market or strengthening of the security of supply, including connection of separate natural gas and olefin gas networks.

–  • Ireland – United Kingdom

–  • France – Spain

–  • France – Switzerland

–  • Portugal – Spain

–  • Austria – Germany

–  • Austria – Hungary

–  • Austria – Hungary – Slovakia – Poland

–  • Poland – Czech Republic

–  • Slovakia – Czech Republic – Germany – Austria

–  • Austria – Italy

–  • Greece – Other Balkan countries

–  • Austria – Hungary – Romania – Bulgaria – Greece – Turkey

–  • France – Italy

–  • Greece – Italy

–  • Austria – Czech Republic

–  • Germany – Czech Republic – Austria – Italy

–  • Austria – Slovenia – Croatia

–  • Hungary – Croatia

–  • Hungary – Romania

–  • Hungary – Slovakia

–  • Hungary – Ukraine

–  • Slovenia – Balkan countries

–  • Belgium – Netherlands – Germany

–  • United Kingdom – The Netherlands – Germany

–  • Germany – Poland

–  • Denmark – United Kingdom

–  • Denmark – Germany – Sweden

–  • Denmark – Netherlands

8.  Developing capacities for receiving LNG and for storage of natural gas, needed in order to meet demand, control gas supply systems, and diversify sources and supply routes.

–  • All Member States

9.  Developing natural gas transport capacity (gas supply pipelines) needed in order to meet demand and diversify supplies from internal and external sources, as well as supply routes.

–  • Nordic Gas Grid: Norway – Denmark – Germany – Sweden – Finland – Russia – Baltic States – Poland

–  • Algeria – Spain – France

–  • Russia – Ukraine – EU

–  • Russia – Belarus – Ukraine – EU

–  • Russia – Belarus – EU

–  • Russia – Baltic Sea – Germany

–  • Russia – Baltic States – Poland – Germany

–  • Germany – Czech Republic – Poland – Germany – Other Member States

–  • Libya – Italy

–  • Tunisia – Libya – Italy

–  • Caspian Sea countries – EU

–  • Russia – Ukraine – Moldavia – Romania – Bulgaria – Greece – Slovenia – Other Balkan countries

–  • Russia – Ukraine – Slovakia – Hungary – Slovenia – Italy

–  • The Netherlands – Germany – Switzerland – Italy

–  • Belgium – France – Switzerland – Italy

–  • Denmark – (Sweden) – Poland

–  • Norway – Russia – EU

–  • Ireland

–  • Algeria – Italy – France

–  • Algeria – Tunisia – Italy

–  • Middle East – East Mediterranean Gas Ring – EU

–  • Winksele blending installation on north-south axis (blending of H gas with nitrogen)

–  • Capacity upgrade on east-west axis: Zeebrugge Eynatten

10.  Actions improving the functioning of the interconnected natural gas networks within the internal market and transit countries, in particular, identifying the bottlenecks and missing links, developing solutions in order to deal with congestion and adapting methods of forecasting and of operating natural gas networks efficiently and safely.

–  • Identifying the bottlenecks and missing links, especially cross-border, within the natural gas networks.

–  • Developing solutions for natural gas flow management in order to deal with the problems of congestion within the gas networks.

–  • Adapting the methods of forecasting and operating natural gas networks required by the functioning of the internal market.

–  • Increasing the overall performance, safety and security of the natural gas networks in transit countries.

11.  Developing and integrating olefin gases transport capacity needed in order to meet demand within the internal market.

–  • All Member States

ANNEX III

TRANS–EUROPEAN ENERGY NETWORKS

Projects of common interest and their specifications, currently identified according to the criteria set out in Annex II

ELECTRICITY NETWORKS

1.  1 Developing electricity networks in isolated regions

1.1  Submarine cable Ireland ‐ Wales (UK)

1.2  Connection of the Southern Cyclades (EL)

1.  3 30 kV underwater cable link between the islands of Faial, Pico and S. Jorge (Azores, PT)

1.4  Connection and reinforcement of the grid in Terceira, Faial and S Miguel (Azores, PT)

1.5  Connection and reinforcement of the grid in Madeira (PT)

1.6  Submarine cable Sardinia (IT) ‐ Italy mainland

1.7  Submarine cable Corsica (FR) ‐ Italy

1.8  Connection Italy mainland ‐ Sicily (IT) : doubling of the connection Sorgente (IT) ‐ Rizziconi (IT)

1.9  New connections in the Balearic and Canary Islands (ES)

2.  2 Developing electricity connections between the Member States

2.1  Moulaine (FR) ‐ Aubange (BE) line

2.2  Avelin (FR) ‐ Avelgem (BE) line

2.3  Interconnection between Germany and Belgium

2.4  Vigy (FR) ‐ Marlenheim (FR) line

2.5  Vigy (FR) ‐ Uchtelfangen (DE) line

2.6  La Praz (FR) phase transformer

2.7  Further increase of capacity through existing interconnection between France and Italy

2.8  New interconnection between France and Italy

2.9  New trans-Pyrenean interconnection between France and Spain

2.10  Eastern Pyrenees connection between France and Spain

2.11  Connections between northern Portugal and north-western Spain

2.12  Sines (PT) ‐ Alqueva (PT) ‐ Balboa (ES) line

2.13  Connection between southern Portugal and south-western Spain

2.14  Valdigem (PT) ‐ Douro Internacional (PT) ‐ Aldeadávila (ES) line and Douro Internacional facilities

2.15  Connection north of the Gulf of Bothnia and Fennoscan undersea cable between Finland and Sweden

2.16  Lienz (AT) ‐ Cordignano (IT) line

2.17  Somplago (IT) – Wuermlach (AT) interconnection

2.18  Austria-Italy (Thaur-Brixen) interconnection through the Brenner rail tunnel

2.19  Connection between Ireland and Northern Ireland

2.20  St Peter (AT) ‐ Isar (DE) line

2.21  Submarine cable between south eastern England and central Netherlands

2.22  Reinforcement of connections between Denmark and Germany, e.g. the Kasso ‐ Hamburg line

2.23  Reinforcement of the connections between Denmark and Sweden

2.24  New interconnection between Slovenia and Hungary: Cirkovce (SI) – Heviz (HU)

2.25  Sajoivanka (HU) – Rimavská Sobota (SK)

2.26  Moldava – Sajoivanka (HU)

2.27  Stupava (SK) – south-east Vienna (AT)

2.28  Poland – Germany line: (Neuenhagen (DE) – Vierraden (DE) – Krajnik (PL)

2.29  Poland – Lithuania link (Elk – Alytus)

2.30  Undersea cable link between Finland and Estonia

2.31  Installation of flexible alternating current transmission systems linking Italy and Slovenia

2.32  New connections between the UCTE and CENTREL systems

2.33  Dürnrohr (AT) – Slavětice (CZ)

2.34  Undersea electricity connection between Malta (MT) and Sicily (IT)

2.35  New interconnections between Italy and Slovenia

2.36  Udine Ovest (IT) – Okroglo (SI) line

3.  3 Developing electrical connections within the Member States

3.1  Connections on the Danish east-west axis: connection between Denmark's western (UCTE) and eastern (NORDEL) networks.

3.2  Connection on the Danish north–south axis

3.3  New connections in northern France

3.4  New connections in south-western France

3.5  Trino Vercellese (IT) ‐ Lacchiarelle (IT) line

3.6  Turbigo (IT) ‐ Rho ‐Bovisio (IT)line

3.7  Voghera (IT) ‐ La Casella (IT) line

3.8 S.  Fiorano (IT) ‐ Nave (IT) – Gorlago (IT) line

3.9  Venezia Nord (IT) ‐ Cordignano (IT) line

3.10  Redipuglia (IT) ‐ Udine Ovest (IT) line

3.11  New connections on the east-west axis of Italy

3.12  Tavarnuzze (IT) ‐ Casellina (IT) line

3.13  Tavarnuzze (IT) ‐ S.Barbara (IT) line

3.14  Rizziconi (IT) ‐ Feroleto (IT) ‐ Laino (IT) line

3.15  New connections on the north-south axis Italy

3.16  Network modifications for facilitating renewables connections in Italy

3.17  New wind energy connections in Italy

3.18  New connections on the north axis of Spain

3.19  New connections in the Mediterranean axis of Spain

3.20  New connections on the Galicia (ES) ‐ Centro (ES) axis

3.21  New connections on the Centro (ES) ‐ Aragón (ES) axis

3.22  New connections on the Aragón (ES) ‐ Levante (ES) axis

3.23  New connections on the Spanish south-centre axis (ES)

3.24  New connections on the Spanish east-centre axis (ES)

3.25  New connections in Andalucía (ES)

3.26  Pedralva (PT) ‐ Riba d'Ave (PT) line and Pedralva facilities

3.27  Recarei (PT) ‐ Valdigem (PT) line

3.28  Picote (PT) ‐ Pocinho (PT) line (upgrading)

3.29  Modification of the current Pego (PT) ‐ Cedillo (ES)/Falagueira (PT) line and Falagueira facilities

3.30  Pego (PT) ‐ Batalha (PT) line and Batalha facilities

3.31  Sines (PT) ‐ Ferreira do Alentejo (PT) I line (upgrading)

3.32  New wind energy connections in Portugal

3.33  Pereiros (PT) ‐ Zêzere (PT) ‐ Santarém (PT) lines and Zêzere facilities

3.34  Batalha (PT) ‐ Rio Maior (PT) I and II lines (upgradings)

3.35  Carrapatelo (PT) ‐ Mourisca (PT) line (upgrading)

3.36  Valdigem (PT) ‐ Viseu (PT) ‐ Anadia (PT) line

3.37  Deviation of the current Rio Maior (PT) ‐ Palmela (PT) line to Ribatejo (PT) and Ribatejo facilities

3.38  Thessaloniki (EL), Lamia (EL) and Patras (EL) substations and connecting lines

3.39  Connections of the regions of Evia (EL), Lakonia (EL) and Thrace (EL)

3.40  Strengthening of existing connections of peripheral regions in the mainland in Greece

3.41  Tynagh (IE) ‐ Cashla (IE) line

3.42  Flagford (IE) ‐ East Sligo (IE) line

3.43  Connections in the North-East and West of Spain, in particular to connect to the network wind-power generation capacities

3.44  Connections in the Basque country (ES), Aragón (ES) and Navarra (ES)

3.45  Connections in Galicia (ES)

3.46  Connections in central Sweden

3.47  Connections in southern Sweden

3.48  Hamburg (DE) – Schwerin region (DE) line

3.49  Halle/Saale region (DE) – Schwerin region (DE) line

3.50  New wind energy connections off-and onshore in Germany

3.51  Upgrading of 380 kV grid in Germany for connection of offshore windmill parks

3.52  Connections in Northern Ireland, in relation to the interconnections with Ireland

3.53  Connections in the North-West of United Kingdom

3.54  Connections in Scotland and England, with a view to the greater use of renewable sources in electricity generation

3.55  New offshore wind energy connections in Belgium, including upgrade of 380 kV grid

3.56  Borssele substation (NL)

3.57  Implementation of reactive power compensation equipment (NL)

3.58  Installation of phase shifters and/or capacitor batteries in Belgium

3.59  Upgrading of 380 kV grid in Belgium to increase import capacity

3.60  St. Peter (AT) ‐ Tauern (AT) line

3.61  Süd-Burgenland (AT) ‐ Kainachtal (AT) line

3.62  Dunowo (PL) – Zydowo (PL) – Krzewina (PL) – Plewiska (PL)

3.63  Patnow (PL) – Grudziadz (PL)

3.64  Ostrow (PL) – Plewiska (PL)

3.65  Ostrow (PL) – Trebaczew (Rogowiec) (PL)

3.66  Plewiska (PL) – Patnow (PL)

3.67  Tarnow (PL) – Krosno (PL)

3.68  Elk (PL) – Olsztyn Matki (PL)

3.69  Elk (PL) – Narew (PL)

3.70  Mikulowa (PL) – Swiebodzice-Dobrzen (Groszowice) (PL)

3.71  Patnow (PL) – Sochaczew (PL) – Warsaw (PL)

3.72  Krsko (SI) – Bericevo (SI)

3.73  Upgrade of Slovene transmission system from 220 kV to 400 kV

3.74  Medzibrod (SK) – Liptovská Mara (SK)

3.75  Lemešany (SK) – Moldava (SK)

3.76  Lemešany (SK) – Veľké Kapušany (SK)

3.77  Gabčíkovo (SK) – Veľký Ďur (SK)

3.78  Connections in northern Sweden

3.79  Transferring Saaremaa (ET) supply to 110 kV

3.80  Improving Tartu (ET) power supply

3.81  Renovation of Eesti (ET) substation (300 kV)

3.82  Renovation of Kiisa (ET), Püssi (ET), and Viljandi (ET) substations (110kV)

3.83  Nošovice (CZ) – Prosenice (CZ): reconstruction of the 400 kV single line as a 400 kV double-circuit line

3.84  Krasíkov (CZ) – Horni Životice (CZ): new 400 kV single line

3.85  New wind energy connections in Malta (MT)

4.  4 Developing electricity connections with the non-member states

4.1  New interconnection Italy ‐ Switzerland

4.2  Philippi (EL) ‐ Maritsa 3 (Bulgaria) line

4.3  Amintaio (EL) ‐ Bitola (FYROM) line

4.4  Kardia (EL) ‐ Elbasan (Albania) line

4.5  Elbasan (Albania) ‐ Podgorica (Serbia and Montenegro) line

4.6  Mostar (Bosnia–Herzegovina) substation and connecting lines

4.7  Ernestinovo (Croatia) substation and connecting lines

4.8  New connections between Greece and Albania, Bulgaria and FYROM

4.9  Philippi (EL) ‐ Hamidabad (TR) line

4.10  Submarine cable between north – east/east England and southern Norway

4.11  Eemshaven (NL) ‐ Feda (NO) link

4.12  Submarine cable between south Spain and Morocco (strengthening of existing connection)

4.13  Connections for the Baltic Electricity Ring: Germany ‐ Poland ‐ Russia ‐ Estonia ‐ Latvia ‐ Lithuania ‐ Sweden ‐ Finland ‐ Denmark ‐ Belarus

4.14  Southern Finland ‐ Russia links

4.15  New connections between north Sweden and north Norway

4.16  New connections between mid-Sweden and mid-Norway

4.17  Borgvik (S) ‐ Hoesle (NO) ‐ Oslo region (NO) line

4.18  New connections between the UCTE/CENTREL system and the Balkan countries

4.19  Connections and interface between the extended UCTE system and Belarus, Russia and Ukraine, including relocation of HVDC conversion stations operating previously between Austria and Hungary, Austria and the Czech Republic, and Germany and the Czech Republic

4.20  Connections in the Black Sea Electricity Ring: Russia ‐ Ukraine ‐ Romania ‐ Bulgaria ‐ Turkey ‐ Georgia

4.21  New connections in the Black Sea area with a view to interoperability of the extended UCTE system with the networks in the countries covered

4.22  New connections in the Mediterranean Electricity Ring: France ‐ Spain ‐ Morocco ‐ Algeria ‐ Tunisia ‐ Libya ‐ Egypt ‐ Near Eastern countries ‐ Turkey ‐ Greece ‐ Italy

4.23  Submarine cable between south Spain and north-west Algeria

4.24  Submarine cable between Italy and North Africa (Algeria, Tunisia, Libya)

4.25  Electricity connection between Tunisia and Italy

4.26  New connections in the Barents region/area

4.27  Upgrading of connections between Denmark and Norway

4.28  Obermoorweiler (DE) – Meiningen (AT) – Bonaduz (CH): further capacity increase

4.29  Bekescsaba (HU) – Oradea (RO)

4.30  Pecs (HU) – Sombor (YU)

4.31  Pecs (HU) – Ernestinovo (HR)

4.32  Veľké Kapušany (SK) – Ukraine border

4.33  Andrall (ES) – Encamp (AND): capacity increase to 220 kV

4.34  Spain – Andorra –France: upgrade of connections

5.  5 Actions improving the functioning of the interconnected electricity networks within the internal market

(No specifications defined yet)

GAS NETWORKS

6.  6 Introducing natural gas into new regions

6.1  Developing gas network from Belfast towards the north-west region of Northern Ireland (UK) and, if appropriate, to the western coast of Ireland

6.2  LNG in Santa Cruz de Tenerife, Canary Islands (ES)

6.3  LNG in Las Palmas de Gran Canaria (ES)

6.4  LNG in Madeira (PT)

6.5  Development of gas network in Sweden

6.6  Connection between the Balearic Islands (ES) and mainland Spain

6.7  High-pressure branch to Thrace (EL)

6.8  High-pressure branch to Corinth (EL)

6.9  High-pressure branch to north-west Greece (EL)

6.10  Connection of Lolland (DK) and Falster (DK) islands

6.11  LNG in Cyprus, Vasilikos Energy Centre

6.12  Connection of Vasilikos (CY) LNG plant and Moni (CY) power station

6.13  LNG in Crete (EL)

6.14  High-pressure branch to Patra (EL)

6.15  LNG in Malta

7.  7 Developing gas connections in order to meet the needs of the internal market or strengthening of the security of supply, including connection of separate natural gas networks

7.1  Additional gas interconnection pipeline between Ireland and Scotland

7.2  North–South interconnection, including Dublin ‐ Belfast pipeline

7.3  Compression station on the Lacq (FR) ‐ Calahorra (ES) pipeline

7.4  Lussagnet (FR) ‐ Bilbao (ES) pipeline

7.5  Perpignan (FR) ‐ Barcelona (ES) pipeline

7.6  Increasing transport capacity of gas pipelines supplying Portugal through south Spain and Galicia and Asturias through Portugal

7.7  Puchkirchen (AT) ‐ Burghausen (DE) pipeline

7.8  Andorf (AT) ‐ Simbach (DE) pipeline

7.9  Wiener Neustadt (AT) ‐ Sopron (HU) pipeline

7.10  Bad Leonfelden (DE) ‐ Linz (AT) pipeline

7.11  North-west Greece ‐ Elbasan (AL) pipeline

7.12  Greece ‐ Italy interconnection pipeline

7.13  Compression station on the main pipeline in Greece

7.14  Connection between the networks of Austria and Czech Republic

7.15  Gas transport corridor in South-East Europe across Greece, FYROM, Serbia and Montenegro, Bosnia Herzegovina, Croatia, Slovenia and Austria

7.16  Gas transport corridor between Austria and Turkey through Hungary, Romania and Bulgaria

7.17  Interconnecting pipelines between United Kingdom, the Netherlands and Germany, linking the main sources and markets of north-west Europe

7.18  Connection between north-east Germany (Berlin area) and north-west Poland (Szczecin area) with a branch from Schmölln to Lubmin (DE, Greifswald area)

7.19  Cieszyn (PL) – Ostrava (CZ) gas pipeline

7.20  Görlitz (DE) – Zgorzelec (PL): extension and interconnection of natural gas networks

7.21  Bernau (DE) – Szczecin (PL) extension

7.22  Connection between offshore facilities in the North Sea, or from Danish offshore to United Kingdom onshore facilities

7.23  Reinforcement of the capacity of transport between France and Italy

7.24  The Baltic gas interconnector between Denmark ‐ Germany ‐ Sweden

7.25  Winksele (BE) blending station on north-south axis

7.26  Zeebrugge (BE) – Eynatten (BE) capacity upgrade

7.27  Capacity upgrading along north-west axis: Zelzate (BE) – Zeebrugge (BE)

7.28  Construction of a gas pipeline linking Denmark and the Netherlands and connecting existing North Sea production facilities

8.  8 Developing capacities for receiving liquefied natural gas (LNG) and for storage of natural gas

8.1  LNG at Le Verdon-sur-mer (FR, new terminal) and pipeline to Lussagnet (FR) storage

8.2  LNG at Fos-sur-mer (FR)

8.3  LNG at Huelva (ES), extending existing terminal

8.4  LNG at Cartagena (ES), extending existing terminal

8.5  LNG at Galicia (ES), new terminal

8.6  LNG at Bilbao (ES), new terminal

8.7  LNG in the Valencia region (ES), new terminal

8.8  LNG in Barcelona (ES), extending existing terminal

8.9  LNG in Sines (PT), new terminal

8.10  LNG at Revithoussa (EL), extending existing terminal

8.11  LNG on the North Adriatic coast (IT)

8.12  LNG offshore in the North Adriatic Sea (IT)

8.13  LNG on the South Adriatic coast (IT)

8.14  LNG on the Ionian coast (IT)

8.15  LNG on the Tyrrenian coast (IT)

8.16  LNG on the Ligurian coast (IT)

8.17  LNG at Zeebrugge (BE, second phase of capacity extension)

8.18  LNG at Isle of Grain, Kent (UK)

8.19  Construction of a second LNG terminal in mainland Greece

8.20  Developing underground gas storage facilities in Ireland

8.21  Storage at South Kavala (EL), conversion of an offshore depleted gas field

8.22  Storage at Lussagnet (FR, extending existing site)

8.23  Storage at Pecorade (FR, conversion of a depleted oil field)

8.24  Storage in Alsace region (FR, developing of saline cavities)

8.25  Storage in Centre region (FR, developing water table).

8.26  Storage on the north-south axis of Spain (new sites) in Cantabria, Aragon, Castilla y León, Castilla ‐ La Mancha and Andalucia

8.27  Storage on the Mediterranean axis of Spain (new sites) in Catalonia, Valencia and Murcia

8.28  Storage in Carriço (PT, new site)

8.29  Storage at Loenhout (BE, extending existing site)

8.30  Storage at Stenlille (DK) and Lille Torup (DK, extending existing site)

8.31  Storage at Tønder (DK, new site)

8.32  Storage at Puchkirchen (AT, extending existing site), including pipeline to the Penta West system near Andorf (AT)

8.33  Storage at Baumgarten (AT, new site)

8.34  Storage at Haidach (AT, new site), including pipeline to the European gas grid

8.35  Developing underground gas storage facilities in Italy

8.36  Storage at Wierzchowice (PL, extension of existing site)

8.37  Storage at Kossakowo (PL, development of underground storage)

8.38  Malta (MT) – Sicily (IT) gas pipeline

8.39  Storage in Lithuania (new site)

9.  9 Developing gas transport capacity (gas supply pipelines)

9.1  Creation and development of connections Nordic Gas Grid: Norway ‐ Denmark ‐ Germany ‐ Sweden ‐ Finland ‐ Russia ‐ Baltic States ‐ Poland

9.2  The Mid-Nordic gas pipeline: Norway, Sweden, Finland

9.3  The North European gas pipeline: Russia, Baltic Sea, Germany

9.4  Gas pipeline from Russia to Germany, via Latvia, Lithuania and Poland, including developing underground gas storage facilities in Latvia ("Amber" project)

9.5  Gas pipeline Finland–Estonia

9.6  New gas pipelines from Algeria to Spain and France and related capacity increase of the internal networks in these countries

9.7  Increasing transport capacity of the Algeria ‐ Morocco ‐ Spain (up to Córdoba) pipeline

9.8  Córdoba (ES) ‐ Ciudad Real (ES) pipeline

9.9  Ciudad Real (ES) ‐ Madrid (ES) pipeline

9.10  Ciudad Real (ES) ‐ Mediterranean coast (ES) pipeline

9.11  Branches in Castilla (ES) ‐ La Mancha (ES)

9.12  Extension towards north-west Spain

9.13  Algeria ‐ Spain submarine pipeline and pipelines for the connection to France

9.14  Increasing transport capacity from Russian resources to the European Union, via Ukraine, Slovakia and the Czech Republic

9.15  Increasing transport capacity from Russian resources to the European Union, via Belarus and Poland

9.16  Yamal – Europe II natural gas pipeline

9.17  Yagal Sud gas pipeline (between the STEGAL pipeline leading to the DE, FR, CH triangle)

9.18  SUDAL East gas pipeline (between MIDAL pipeline near Heppenheim to Burghausen connection with the PENTA pipeline in Austria)

9.19  Increase in transport capacity of the STEGAL gas pipeline for transport of additional gas from the Czech-German border and from the Polish-German border through Germany to other Member States

9.20  Gas pipeline from Libyan resources to Italy

9.21  Gas pipeline from resources in the Caspian Sea countries to the European Union

9.22  Greece ‐ Turkey gas pipeline

9.23  Increasing transport capacity from Russian resources to Greece and other Balkan countries, via Ukraine, Moldavia, Romania and Bulgaria

9.24  St. Zagora (BG) ‐ Ihtiman (BG) gas pipeline

9.25  Trans-Adriatic pipeline – Natural gas pipeline to transport natural gas imported from the Caspian Sea region, Russia, and the Middle East, connecting Italy and the South-East European energy markets

9.26  Connecting pipelines between the German, Czech, Austrian and Italian gas networks

9.27  Gas pipeline from Russian resources to Italy, via Ukraine, Slovakia, Hungary and Slovenia

9.28  Increasing transport capacity of the TENP gas pipeline running from the Netherlands through Germany to Italy

9.29  Taisnieres (FR) ‐ Oltingue (CH) gas pipeline

9.30  Gas pipeline from Denmark to Poland, possibly via Sweden

9.31  Nybro (DK) ‐ Dragør (DK) gas pipeline, including connecting pipeline to the storage at Stenlille (DK)

9.32  Gas network from the Barents Sea resources to the European Union, via Sweden and Finland

9.33  Gas pipeline from the Corrib field (IE, offshore)

9.34  Gas pipeline from Algerian resources to Italy, via Sardinia with a branch to Corsica

9.35  Gas network from resources in the Middle East to the European Union

9.36  Gas pipeline from Norway to the United Kingdom

9.37  Pécs (HU) – Croatia connection

9.38  Szeged (HU) – Oradea (RO) connection

9.39  Vecses (HU) – Slovakia connection

9.40  Beregdaroc (HU) – Ukraine capacity increase

10.  10 Actions improving the functioning of the interconnected gas networks within the internal market

(No specifications defined yet)

(1) Not yet published in OJ.
(2) OJ C 241, 28.9.2004, p. 17.
(3) Position of the European Parliament of 7 June 2005.
(4) OJ L 176, 15.7.2003, p. 11.
(5) OJ L 176, 15.7.2003, p. 37. Directive as amended by Council Directive 2004/85/EC (OJ L 236, 7.7.2004, p. 10).
(6) OJ L 176, 15.7.2003, p. 57.
(7) OJ L 228, 23.9.1995, p.1, Regulation as last amended by Regulation (EC) No 807/2004 of the European Parliament and of the Council (OJ L 143, 30.4.2004, p. 46).
(8) OJ L 184, 17.7.1999, p. 23.
(9) OJ L 161, 29.6.1996, p. 154
(10) OJ L 130, 25.5.1994, p. 1. Regulation as last amended by the 2003 Act of Accession.
(11) OJ L 161, 26.6.1999, p. 1. Regulation as last amended by Regulation (EC) No 173/2005 (OJ L 29, 2.2.2005, p. 3).
(12) OJ L 161, 26.6.1999, p. 73. Regulation as last amended by Regulation (EC) No 2257/2004 (OJ L 389, 30.12.2004, p.1).
(13)* Six months after the entry into force of this Decision.


Energy end-use efficiency ***I
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Resolution
Consolidated text
European Parliament legislative resolution on the proposal for a directive of the European Parliament and of the Council on energy end-use efficiency and energy services (COM(2003)0739 – C5-0642/2003 – 2003/0300(COD))
P6_TA(2005)0212A6-0130/2005

(Codecision procedure: first reading)

The European Parliament,

–   having regard to the Commission proposal to the European Parliament and the Council (COM(2003)0739)(1),

–   having regard to Article 251(2) and Article 175(1) of the EC Treaty, pursuant to which the Commission submitted the proposal to Parliament (C6-0642/2003),

–   having regard to Rule 51 of its Rules of Procedure,

–   having regard to the report of the Committee on Industry, Research and Energy and the opinions of the Committee on Economic and Monetary Affairs and the Committee on the Environment, Public Health and Food Safety (A6-0130/2005),

1.  Approves the Commission proposal as amended;

2.  Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text;

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

POSITION OF THE EUROPEAN PARLIAMENT adopted at first reading on 7 June 2005 with a view to the adoption of Directive 2005/.../EC of the European Parliament and of the Council on energy end-use efficiency and energy services

P6_TC1-COD(2003)0300


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,

Having regard to the opinion of the European Economic and Social Committee(2),

Having regard to the opinion of the Committee of the Regions(3),

Acting in accordance with the procedure laid down in Article 251 of the Treaty(4),

Whereas:

(1)  In the European Community there is a need for improved end-use energy efficiency, managed demand for energy and promotion of the production of renewable forms of energy, as there is relatively limited scope for any other influence on energy supply and distribution conditions in the short to medium term, either by building new capacity or improving transmission and distribution(5). This Directive thus contributes to improved security of supply.

(2)  Improved end-use energy efficiency will also contribute to the mitigation of CO2 and other greenhouse gas emissions. These emissions continue to increase, making it more and more difficult to meet the Kyoto commitments. Human activities attributed to the energy sector constitute as much as 78% of the Community greenhouse gas emissions. The 6th environmental action program envisages that further reductions are required to achieve the United Nations Framework Convention on Climate Change (UNFCCC) long term objective of stabilising greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system.

(3)  In order to achieve the general objective of preventing dangerous climate change by keeping the global mean temperature below a peak of 2°C above pre-industrial levels, concrete policies and measures must be implemented.

(4)  Improved energy efficiency will make it possible to exploit potential cost-effective savings in an economically efficient way. Energy efficiency measures and demand-side management could realise these energy savings and thus help Europe reduce its dependence on energy imports. Furthermore, a move towards more energy-efficient technologies can boost Europe's innovativeness and competitiveness as underlined in the report of the High-Level Group, chaired by Wim Kok, on the Lisbon strategy.

(5)  The proposed targets for energy savings do not automatically lead to energy reduction in each Member State or at EU level, and therefore do not automatically achieve the general objective of preventing dangerous climate change.

(6)  The Commission Communication on the implementation of the first phase of the European Climate Change Programme (ECCP) listed a directive on energy demand management as one of the priority climate change measures to be taken at community level.

(7)  Directive 2003/54/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in electricity(6) and Directive 2003/55/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in natural gas(7) provide for the possibility of using energy efficiency and demand-side management as an alternative to new supply and for environmental protection, allowing Member State authorities, inter alia, to tender for new capacity or to opt for energy efficiency and demand-side measures, including systems for "white certificates".

(8)  This Directive is without prejudice to Article 3 of Directive 2003/54/EC, which requires that Member States ensure that all household customers and, where Member States deem it appropriate, small enterprises, enjoy universal service, that is the right to be supplied with electricity of a specified quality within their territory at reasonable, easily and clearly comparable and transparent prices.

(9)  The liberalisation of the retail markets for end-use customers for electricity, natural gas, coal and lignite, heating, and in some cases also district heating and cooling have almost exclusively led to improved efficiency and lower costs on the energy generation, transformation and distribution side(8). This liberalisation has not led to significant competition on the basis of products and services which could have resulted in improved efficiency on the demand side.

(10)  The aim of this Directive is thus not only to continue to promote the supply side of energy services, but also to create stronger incentives for the demand side. The public sector in each Member State should therefore be required to set a good example regarding investments, maintenance and other expenditure for energy-using equipment, energy services and other energy efficiency measures.

(11)  In its resolution of 7 December 1998 on energy efficiency in the European Community(9), the Council endorsed a target for the Community as a whole to improve energy intensity of final consumption by an additional one percentage point per annum up to the year 2010.

(12)  In its resolution of 14 March 2001 on the Commission's Action Plan to Improve Energy Efficiency in the European Community(10), the European Parliament reaffirmed its earlier view that annual reductions in final energy intensity of 2.5% were achievable and stressed the importance of energy efficiency for the achievement of the Lisbon objectives.

(13)  Member States should therefore adopt mandatory national targets to promote energy end-use efficiency and to ensure the continued growth and viability of the market for energy services, and thus contribute to the implementation of the Lisbon strategy. Member States should also draw up agreements for the adoption of adequate standards to improve energy efficiency.

(14)  Improved end-use efficiency can be achieved by increasing the availability of and demand for energy services.

(15)  The Council Conclusions of 5 December 2000(11) list the promotion of energy services through the development of a Community strategy as a priority area for action to improve energy efficiency.

(16)  Energy distributors and retail energy sales companies, as well as other suppliers of energy services, can improve energy efficiency in the European Community if energy services that include efficient end use, such as efficient thermal comfort, domestic hot water, refrigeration, illumination and motive power are marketed. Profit maximisation for these companies thus becomes more closely related to selling energy services to as many customers as possible instead of selling as much energy as possible to each customer. With a view to guaranteeing a level playing field between all energy service providers, cross-subsidies between the various activities of energy suppliers and retailers should be strictly prohibited. The national regulatory authorities should endeavour to avoid any distortion of competition in this area.

(17)  The funding of supply and the costs on the demand side have an important role to play in energy services. The creation of funds to subsidise the implementation of energy efficiency programmes and other energy efficiency measures and to promote the development of a market for energy services is thus an important tool for the provision of non-discriminatory start-up funding in such a market.

(18)  The energy services, energy efficiency programmes and other energy efficiency measures put into effect to reach the energy savings target may be supported and/or implemented through voluntary agreements between stakeholders and independent public sector bodies appointed by the Member States.

(19)  In defining mechanisms for savings in the amount of energy distributed and/or sold to final customers, account should be taken of efficiency gains obtained through the widespread use of technological innovations relating to electronic metering.

(20)  With the adoption of this Directive, all substantive provisions of Council Directive 93/76/EEC of 13 September 1993 to limit carbon dioxide emissions by improving energy efficiency(12) are covered by other community legislation and therefore Directive 93/76/EEC should be repealed.

(21)  Since the objectives of promoting energy end-use efficiency and developing a market for energy services cannot be sufficiently achieved by the Member States and can therefore be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve those objectives.

(22)  The requisite measures to implement this Directive should be enacted pursuant to Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission(13).

(23)  This Directive is in line with the provisions of Directive 2003/54/EC,

HAVE ADOPTED THIS DIRECTIVE:

CHAPTER I

SUBJECT MATTER AND SCOPE

Article 1

Purpose

The purpose of this Directive is to enhance the cost-effective and efficient end use of energy in the Member States by:

   providing the necessary targets, mechanisms, incentives and institutional, financial and legal frameworks to remove existing market barriers and imperfections that impede the efficient end use of energy;
   developing a market for energy services and for the delivery of energy efficiency programmes and other energy efficiency measures to end users.

Article 2

Scope

1.  This Directive shall apply to the distribution and retail sales to final customers of energy.

2.  Member States may exclude small distributors or retail energy sales companies from the application of this Directive.

3.  Member States may exclude the buildings listed in Article 4(3) of the Directive 2002/91/EC of the European Parliament and of the Council of 16 December 2002 on the energy performance of buildings(14) from the application of this Directive, as well as facilities that come within the scope of Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community(15) and Council Directive 96/61/EC of 24 September 1996 concerning integrated pollution prevention and control(16).

Article 3

Definitions

For the purposes of this Directive, the following definitions shall apply:

(a)  "Energy": energy in the form of electricity, gas (including liquefied natural gas and liquefied petroleum gas), district heating and cooling, heating fuel, coal and lignite, transport fuels, forestry and agricultural energy products and waste, and energy products and waste from landscape conservation measures.

   (b) "Energy efficiency": the reduction of energy consumption on the basis of technological and/or economic changes and/or changes in behaviour, by which the same or a higher standard or degree of comfort is assured.
   (c) "Energy saving": the value arising from the comparison between energy consumption without a specific (energy efficiency) measure being carried out and energy consumption with that measure being carried out, taking into account other external conditions which influence energy consumption.

(d)   "Energy efficiency measures": all actions, such as energy efficiency services, energy efficiency programmes and mechanisms or similar activities, initiated by any market player, including governments and authorities, that lead to verifiable and measurable improvements in end-use energy efficiency, and thus to energy end-use savings, during the period of measurement.

(e)  "Energy efficiency service": an energy service that leads to verifiable and measurable improvements in end-use energy efficiency, and thus to energy end-use savings, during the period of measurement. An energy service is the physical amenity for energy end users derived from a combination of energy and energy using technology and, in certain cases, the operations and maintenance necessary to deliver the service (examples are indoor thermal comfort, lighting comfort, domestic hot water, refrigeration, product manufacturing, etc.) meeting quality performance requirements and improving energy efficiency, contracted for a fixed period of time and paid for directly by the customer or agent who benefits from them. The provision of individual components of energy services, such as energy advice and the installation of energy-saving equipment, shall also fall within the scope of this Directive.

The provision of such individual components by those energy distributors and retail energy sales companies that sell motor fuel shall constitute compliance by such distributors and companies with their obligations under this Directive.

(f)  "Energy efficiency programmes": measures (e.g. energy audits, financial rebates for energy-efficient equipment and information and other measures of the kind mentioned in Annex III) targeting energy end users or market agents and designed to help them undertake energy efficiency measures, normally paid for collectively and offered by national agencies, energy retail suppliers, distributors and other market players.

(g)  "Energy efficiency mechanisms": specific measures, such as certification, regulated tariffs, taxes, subsidy schemes, funds, etc., undertaken by governments or government bodies to create a supportive framework or incentives for energy companies, energy service companies, installers or other market players to provide energy efficiency services and energy efficiency programmes, not addressing end users directly.

h)   "Final customer": end-use customer in the household, agricultural, commercial, public, industrial sector (excluding those installations listed in Annex I of Directive 2003/87/EC and those industrial activities listed in Annex I of Directive 96/61/EC) or transport sector (excluding means of transport in aviation and maritime shipping).

(i)  "Third-party financing contract": a contractual arrangement involving a third party – in addition to the energy supplier and the beneficiary of the energy efficiency measure - that provides the energy efficiency measures, usually finances the investment and charges the beneficiary a fee equivalent to a part of the energy savings achieved as a result of the energy efficiency measure.

(j)  "Energy performance contracting": a contractual commitment that provides a guarantee during the term of the contract that the amount of energy efficiency improvement agreed as a result of the implementation of an energy efficiency service will actually be achieved. This commitment entered into by a company shall be accompanied by an obligation to achieve a guaranteed result as to the service provided (convenience, nature of services, etc.).

k)   "Financial instruments for energy savings": third-party financing contracts, energy performance contracting, guarantee of savings contracts, energy outsourcing and other related contracts used in the market for energy efficiency services to ensure a level of savings and a level and quality of performance.

(l)  "Energy distributor": the natural or legal person responsible for transporting energy, either through grids and pipelines ("grid-bound"), such as electricity (medium and low voltage), natural gas and district heating, or through other transportation and distribution networks designed to deliver such energy as heating fuel, coal, lignite and transportation fuels to final customers.

(m)  "Retail energy sales company": a retail energy sales company, natural or legal person, with sales to final household, commercial and industrial customers purchasing energy for their own use.

n)   "Small distributors and retail energy sales companies": distributors or retail suppliers with annual turnover less than the equivalent of 50 GWh metered electricity of district heat and cooling consumption or equivalent delivered cubic metres or tonnes of the remaining energy carriers.

(o)  "Energy service company" (ESCO): a company that delivers energy efficiency services, energy efficiency programmes and/or other energy efficiency measures in a user's facility.

p)   "Energy audits": a systematic procedure to obtain adequate knowledge of the existing energy consumption profile of the building, industrial operation, etc., identify and quantify cost-effective energy savings opportunity, and report the findings.

q)   "White certificates": certificates issued by independent certifying bodies confirming the energy savings claimed by market actors, as a consequence of energy end-use efficiency measures.

   (r) "Public sector": all public administrative authorities within the meaning of Article 1(9) of Directive 2004/18/EC(17) and of Article 2(1) of Directive 2004/17/EC(18) and the services that they perform, as well as services of general economic interest.
   (s) "Energy savings performance contracts": contracts whereby energy service companies update and retrofit existing public buildings/facilities without using budgeted public funds. The company is responsible for providing the financing and the project upgrades, and are reimbursed over a number of years, based on the guaranteed savings resulting from the upgrades.
   (t) "Public-private partnership": a form of cooperation between the public sector and the private sector aimed at efficiently performing the tasks laid down in this Directive that are traditionally carried out by the public sector. Potential contracting partners of public authorities may be private organisations operating in the energy industry in so far as they supply energy or provide other energy efficiency services.

CHAPTER II

ENERGY SAVINGS TARGETS

Article 4

General targets

1.  Member States shall adopt and meet mandatory targets for cumulative energy savings attributable to energy efficiency services, energy efficiency programmes and other energy efficiency measures such as those listed in Annex III.

2.  The targets shall consist of an amount of energy to be saved that in the first three years following the implementation of this Directive is equal to at least 3% overall, in the next three years at least 4% overall, and in the three years after that at least 4.5% overall, of the amount of energy distributed and/or sold to final customers, as calculated according to Annex I. The costs of the measures adopted to achieve these targets should not exceed their benefits.

3.  Each Member State shall draw up programmes and measures to improve energy efficiency.

4.  The first savings in the distribution and/or retail sales to final customers, according to these targets, will be applied to the first calendar year after the year this Directive is transposed into national legislation. These savings will increase by the cumulative application of the targets of the following years, until and including the year 2015.

5.  The base year energy consumption and other conditions, such as the taking into account of the effects of measures implemented in previous years, shall be calculated in accordance with the methodology set out in Annex I, and the savings measured and verified in accordance with the guidelines in Annex IV. For purposes of comparison and for conversion to a comparable unit, the conversion factors provided for in Annex II shall apply.

6.  Should the reporting pursuant to Article 19(2) show that the measures implemented by the Member State are not leading to the increases in energy efficiency required pursuant to paragraph 2, the Member State concerned shall be required to implement additional measures to reach the targets.

7.  Member States shall provide for the appointment of one or more new or existing independent public sector authorities or agencies to be assigned overall control and responsibility for overseeing the framework for reaching the targets set out in paragraph 2, and therefore verifying the savings delivered by energy efficiency services, programmes and other energy efficiency measures, including existing national energy efficiency measures, and reporting the results.

Parts of those tasks may be delegated to private bodies.

8.  At least two years before expiry of the period during which the targets set out in paragraph 2 are applied, the Commission shall present a proposal setting further mandatory targets for energy efficiency to come into force at the end of that period.

9.  After having reviewed and reported on these targets for the first time, the Commission will examine whether it is appropriate to come forward with a proposal for a directive to develop further the market approach in energy efficiency by means of white certificates.

10.  The Commission may, within a year of the entry into force of this Directive, use the committee procedure pursuant to Article 20 to develop and adopt mandatory differentiated national targets.

In calculating the relevant percentage, consideration should be given to the energy efficiency levels achieved by individual Member States (also taking into account CO2 emissions reduction achieved through energy efficiency measures).

Overall, those differentiated national targets must meet the respective mandatory three-year EU-wide targets pursuant to paragraph 2 of this Article.

Annex I, point 3, shall then no longer apply.

11.  The Member States shall work towards the setting of common EU-wide benchmarks to improve energy efficiency in all the relevant areas on the basis of sectoral energy efficiency indicators.

In accordance with the procedure set out in Article 20 the Commission shall work on harmonised energy efficiency indicators, and benchmarks based upon them, for the energy conversion markets and sub-markets set out in Annex V.

The Commission shall present to the European Parliament and the Council not later than three years after the implementation of this Directive a report on the progress on setting indicators and benchmarks.

As soon as the Commission, together with the Member States, elaborates, in accordance with the procedure set out in Article 20, indicators for all energy conversion markets and sub-markets set in Annex V, Member States shall decide together whether or not to replace the overall targets pursuant to paragraph 2 of this Article by benchmarks, as long as the amount of energy saved by reaching the benchmarks meets the respective mandatory targets set in that paragraph.

Article 5

Procurement of energy end-use efficiency by the public sector

1.  Member States shall adopt and meet mandatory targets for annual energy savings in the public sector through the procurement of energy efficiency services, energy efficiency programmes and other energy end-use efficiency measures. These targets may be sub-targets of the overall targets referred to in Article 4(1), meaning that fulfilment of the public sector targets will contribute to fulfilling the overall targets.

2.  The public sector targets shall consist of savings in the first three years following the entry into force of this Directive of at least 4.5% overall, in the next three years at least 5.5% overall, and in the three years after that at least 6% overall of energy distributed and/or sold to this sector, allocated and calculated in accordance with Article 4(4) and the methodology in Annex I. For purposes of comparison and for conversion to primary energy, the conversion factors set out in Annex II shall be applied.

3.  Member States shall appoint a new or existing organisation or organisations to assume the administrative, management and implementing responsibility for fulfilling the targets on public purchasing and for providing advice and purchasing guidelines for energy efficiency. These may be the same independent public sector authorities or agencies as referred to in Article 4(7).

4.  To achieve the targets adopted pursuant to paragraph 1, Member States shall lay down public purchasing guidelines to oblige public administrations to integrate energy efficiency considerations into their investment and operating budgets and activities through the use of energy efficiency services, energy efficiency programmes and other energy efficiency measures and to establish energy efficiency as an assessment criterion in competitive tendering for public contracts. While respecting the procedures enshrined in national and Community public procurement legislation, the guidelines shall cover at least the following:

   a) requirements for the use of financial instruments for energy savings, such as third-party financing and energy performance contracting, that stipulate the delivery of measurable and pre-determined energy savings (including whenever public administrations have outsourced responsibilities) when purchasing energy efficiency services and energy efficiency measures;
   b) requirements to purchase equipment and vehicles from energy-efficient products of each category of equipment and vehicles, using, where applicable, minimised life cycle cost analysis or comparable methods to ensure cost effectiveness;
   c) requirements to purchase products that have low standby power consuming mode using, where applicable, minimised life cycle cost analysis or comparable methods to ensure cost effectiveness.

Member States shall publish the guidelines adopted on energy efficiency in public procurement and the Commission shall evaluate these guidelines upon expiry of the period during which the targets in paragraph 2 are applied.

5.  Upon expiry of the period during which the targets are applied, the Commission will review the targets mentioned in paragraph 2 and examine whether it shall present a proposal for prolongation or amendment of these targets. At the same time the Commission shall evaluate the usefulness of a proposal on harmonised guidelines and measures to promote energy efficiency in the public sector.

Article 6

Energy end-use efficiency in other sectors

Undertakings may conclude agreements within their sector on promoting energy end-use efficiency.

To this end, undertakings may submit an application to the Commission, which shall indicate within two months whether binding targets can be set for energy savings in the sector.

CHAPTER III

PROMOTION OF ENERGY END-USE EFFICIENCY AND ENERGY EFFICIENCY SERVICES

Article 7

Energy distributors and retail energy sales companies

Member States shall remove barriers to the demand for energy efficiency measures and energy efficiency services, and restrictions on the delivery thereof and ensure, in compliance with the objectives of energy market liberalisation, that energy distributors and/or retail energy sales companies selling electricity, gas, district heat and/or heating oil, coal and motor fuel:

   a) offer and actively promote energy efficiency services as an integral part of the distribution and/or sales of energy to customers, either directly or through other energy service be providers;
   b) refrain from any activities that might impede the demand for and delivery of energy efficiency services, energy efficiency programmes and other energy efficiency measures or hinder the development of the market for energy efficiency services and energy efficiency measures in general. The Member States shall take the necessary measures to bring such activities to an end where they occur;
   c) provide the information on their end-use customers necessary for the appointed authorities or agencies designated in Article 4(7) to properly design and implement energy efficiency programmes, and to promote energy efficiency services and energy efficiency measures. This information should include historical and current information on end-user consumption, load profiles, customer segmentation, and geographical location of customers, where applicable, while preserving the integrity and confidentiality of commercially sensitive information and complying with obligations under national or Community law to safeguard the privacy of the end user.

The Member States shall guarantee sufficient incentives, the same competitive conditions, equal treatment and transparency for those undertakings which are not covered by this article, to enable them to offer and deliver energy services independently.

Article 8

Implementation of savings

1.  Member States shall ensure that energy efficiency services, energy efficiency programmes or other energy efficiency measures are offered to all eligible customers, including small and medium-sized enterprises, consumers and voluntary aggregations of smaller customers; and that these energy efficiency services, programmes and other measures can be delivered and implemented, as appropriate, by qualified bodies, including installers, energy service companies, energy advisors and energy consultants.

2.  Member States shall ensure that the motor fuel and transport sector meets its particular obligations regarding energy efficiency and energy savings.

3.  Member States shall ensure that each energy sector fulfils the specific obligations incumbent upon it with regard to energy efficiency and energy saving, determined in the light of the sector's importance to the economy and the trend in consumption in recent years.

Article 9

Information and advice

1.  The Member States shall ensure that greater efforts are made to promote energy end-use efficiency in school, vocational and university education, in vocational training and in adult education.

2.  The Member States shall establish appropriate conditions and incentives for market operators to provide more information and advice to final customers on energy end-use efficiency.

3.  The Member States shall support the objectives of this Directive through their national information policy.

Article 10

Energy Performance contracting

The Member States shall adopt measures to remove the substantial obstacles hampering the further development of markets for contracting and create incentives for contracting arrangements.

Article 11

Qualification, certification and accreditation of energy service providers

1.  Member States shall ensure the availability of appropriate qualification, accreditation and/or certification schemes for market players delivering energy efficiency services, with a view to maintaining a high level of technical competence of personnel, and quality and reliability of energy efficiency services offered. Proof of qualification, certification and accreditation for this purpose delivered by Member States authorities shall, if required by another Member State, be mutually recognized.

2.  In accordance with Article 19, Member States shall include in their report to the Commission an assessment of the effectiveness of their national schemes for qualification, certification and/or accreditation and on the possible need for EU harmonization.

Article 12

Financial instruments for energy savings

1.  Member States shall remove or amend national legislation and regulations that impede or restrict the use of financial instruments and contracts for energy savings in the market for energy efficiency services, such as third-party financing and energy performance contracting.

2.  Member States shall make these instruments and contracts mentioned in paragraph (1) available, in the form of model contracts, both to public and to private purchasers of energy efficiency services and energy efficiency measures.

Article 13

Tariffs and other regulations for net-bound energy

Member States shall ensure that incentives to increase the volume of transmitted energy or sales of energy embedded in tariff regulation schemes in monopoly segments of the distribution of net-bound energy are removed. This may be done by the introduction of transmission and distribution tariff structures that take into account, in addition to the volume of sales, such factors as the number of customers served, by the use of revenue caps or by any other measures that can be deemed to have the same effect.

Article 14

Funds and funding Mechanisms

1.  Without prejudice to Articles 87 and 88 of the Treaty, Member States may establish a fund or funds to subsidise the delivery of energy efficiency programmes and other energy efficiency measures and to promote the development of a market for energy efficiency services, including the promotion of energy auditing, financial instruments for energy savings and, where appropriate, improved metering and informative billing. If established, the funds shall also target end-use sectors with higher transaction costs and higher risks, and promote the development of markets for providers of energy efficiency services.

2.  If established, the funds may provide for grants, loans, financial guarantees and/or other types of financing that guarantee results.

3.  The funds shall be open to all qualified providers of energy efficiency services, energy efficiency programmes and other energy efficiency measures active in the internal energy efficiency services market, such as ESCOs, independent energy advisors and installers. Tendering shall be carried out in full compliance with current public procurement regulations, ensuring also that the funds complement and do not compete with, commercially-financed energy efficiency services, energy efficiency programmes and other energy efficiency measures.

4.  The fund or funds to be established may be financed by means of a surcharge on tariffs and/or prices, a contribution from the energy operators mentioned in Article 7, an energy tax or other financial instruments.

5.  Member States may also achieve their targets through energy savings performance contracts, whereby a company is awarded the task of upgrading energy equipment and services at public facilities without using earmarked funds. The company concerned shall be responsible for providing the financing and the project upgrades and reimbursed over a number of years based on the savings resulting from the upgrades.

Article 15

Energy audits

Member States shall ensure the availability of independent, high quality energy audit schemes designed to identify potential energy efficiency measures and energy efficiency service needs and prepare for their implementation. The audits shall also be available for smaller domestic, commercial and small and medium-sized industrial premises and undertakings with comparatively high transaction costs; where applicable, the Energy Efficiency Management and Auditing Scheme (E2MAS) shall be implemented.

Article 16

Conversion of energy and energy consuming equipment

Not later than two years after the implementation of this Directive the Commission shall assess to what extent energy efficiency is and may further be achieved through conversion of energy and installations, such as shifting from individual boilers to district heating or from a fossil energy source to a renewable energy.

This assessment shall be an additional tool for Member States to achieve more savings potential and ecological benefits in reaching their energy savings targets.

Article 17

Metering and informative billing of energy consumption

1.  Member States shall, in cooperation with energy companies ensure that always when a new connection is made or an existing meter needs to be replaced, and otherwise in so far as it is technically possible, financially reasonable and proportionate in relation to the potential savings, end-use customers of net-bound energy companies are provided with competitively priced individual meters that accurately reflect the customer's actual energy consumption and actual time of use.

2.  Member States shall ensure that billing reflects actual consumption in understandable terms. Customers shall regularly receive information about their consumption figures, to enable them to regulate their own energy consumption. For net-bound energy, and where appropriate, distribution charges and energy charges shall be displayed in the same bill.

3.  Member States shall, in co-operation with energy companies, ensure that in or with bills, contracts, transactions, receipts at distribution stations and in promotional material, all energy distributors and/or retailers make the following information available to final customers:

   a) current actual prices and, where appropriate, actual consumption;
   b) where appropriate, comparisons of the consumer's current energy consumption with consumption for the same period in the previous year, with corrections, e.g. for weather conditions, where appropriate;
   c) comparisons with an average normalised or benchmarked user of energy of the same category and with an average normalised or benchmarked user of energy of the ecologically most efficient substituting category;
   d) environmental impact, such as CO2, of energy distributed or sold for consumption. For the electricity industry, Article 3(6)(b) of Directive 2003/54/EC shall prevail over this provision;
   e) contact information for consumers' organisations, energy agencies or similar bodies, including websites, where information on available energy efficiency services, energy efficiency programmes and other energy efficiency measures, comparative end-user profiles, as well as technical specifications for energy-using equipment, including any 'factor 4' equipment available on the market, may be obtained.

Article 18

Definition of energy savings mechanisms

In defining mechanisms for energy savings on the amount of energy distributed and/or sold to final customers, account should be taken of efficiency gains obtained through the widespread use of technological innovations relating to electronic metering.

CHAPTER IV

FINAL PROVISIONS

Article 19

Report

1.  Member States shall report to the Commission, one year after the implementation of this Directive, on the overall administration and implementation thereof. The report shall include information on the measures taken or planned, including the qualification, certification and/or accreditation of energy service providers, and on the application of the bottom-up system. It shall also include information on energy audit schemes, on the use of financial instruments for energy savings, on improved metering of consumption, and on informative billing. Information on the expected impact and financing of the measures should also be included.

2.  Not later than 1 October 2009 and every three years thereafter up to and including 2015, Member States shall submit to the Commission a report on their success in meeting the national energy savings targets, as set out in Article 4(1), on the public sector targets, as set out in Article 5(1) and on the development of energy efficiency services, as set out in Article 7(a). The effect of measures of previous years that has been taken into account in the calculation of the savings shall be duly specified and quantified. This shall continue until the final year of the targets set out in Articles 4 and 5 is reported on.

3.  On the basis of the Member States' reports the Commission shall assess to what extent Member States have made progress towards achieving their national targets. The Commission shall publish its conclusions in a report, for the first time not later than four years after the implementation of this Directive and thereafter every three years. This report shall be accompanied, as appropriate and where necessary, by proposals to the European Parliament and to the Council for additional measures. The Commission shall ensure that information on best energy-saving practices is exchanged between Member States.

4.  Not later than two years after the implementation of this Directive, the Commission shall publish a cost-benefit impact assessment examining the linkages between EU standards, regulations, policies and measures on end-use energy efficiency.

Article 20

Committee procedure

1.  The Commission shall be assisted by a committee.

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

The period laid down in Article 5(6) of Decision 1999/468/EC is hereby set at three months.

3.  The committee shall adopt its rules of procedure.

Article 21

Repeal

Directive 93/76/EEC shall be repealed with effect from the date of entry into force indicated in Article 24.

Article 22

Transposition

1.  Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 1 June 2006 at the latest. They shall forthwith communicate to the Commission the text of those provisions and a correlation table between those provisions and this Directive.

When Member States adopt those provisions, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. Member States shall determine how such reference is to be made.

2.  Member States shall communicate to the Commission the texts of the main provisions of national law which they adopt in the field governed by this Directive.

Article 23

Further legislation

The Commission shall present to the European Parliament and the Council no later than 1 January 2007 a proposal for a new directive comprehensively covering the promotion of energy efficiency and energy services in the fuel and transport sector.

Article 24

Entry into force

This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

Article 25

Addressees

This Directive is addressed to the Member States.

Done at […]

For the European Parliament For the Council

The President The President

ANNEX I

Methodology for calculating targets for end-use efficiency

The methodology used for calculating the national targets set out in Articles 4 and 5 shall be the following:

1.  Member States shall calculate the arithmetical average of total final domestic energy consumption for the most recent five calendar-year period, previous to the implementation of this Directive, for which official data are available. The energy savings to be achieved shall be calculated on the basis of those figures. The data shall be used for the total duration of this Directive. These data shall be the amount of energy distributed or sold to final customers during the period, not adjusted for degree days, structural changes or for production changes.

2.  The energy savings targets shall be calculated on the average energy consumption for the five-year period and expressed in absolute terms in GWh, or equivalent, using the conversion factors in Annex II. This method shall be independent of growth in GDP.

3.  Energy savings in a particular year following the entry into force of this Directive that result from energy efficiency measures initiated in a previous year not earlier than 2000 and that have a lasting effect may be taken into account in the calculation of savings. These energy savings must be measurable and verifiable, in accordance with the guidelines in Annex IV to this Directive.

ANNEX II

Primary energy content of selected fuels for end use - conversion table

Energy commodity

kJ (NCV)

kgoe (NCV)

kWh (NCV)

1 kg coke

28500

0.676

7.917

1 kg hard coal

17200 - 30700

0.411 - 0.733

4.778 - 8.528

1 kg brown coal briquettes

20000

0.478

5.556

1 kg black lignite

10500 - 21000

0.251 - 0.502

2.917 - 5.833

1 kg brown coal

5600 - 10500

0.134 - 0.251

1.556 - 2.917

1 kg oil shale

8000 - 9 000

0.191 - 0.215

2.222 - 2.500

1 kg peat

7800 -13800

0.186 - 0.330

2.167 - 3.833

1 kg residual fuel oil (heavy oil)

40000

0.955

11.111

1 kg light fuel oil

42300

1.010

11.750

1 kg motor spirit (petrol)

44000

1.051

12.222

1 kg paraffin

40000

0.955

11.111

1 kg LPG

46000

1.099

12.778

1 kg natural gas(19)

47200

1.126

13.10

1 kg LNG

45190

1.079

12.553

1 kg wood (25% humidity)(20)

13800

0.330

3.833

1 kg pellets/wood bricks

16800

0.401

4.667

1 kg waste

7400 - 10700

0.177 - 0.256

2.056 - 2.972

1 MJ derived heat

1000

0.024

278

1 kWh electrical energy

3600

0.086

2.5(21)

ANNEX III

Eligible energy efficiency programmes and other energy efficiency measures

This annex provides examples of where energy efficiency programmes and other energy efficiency measures may be developed and implemented. To be taken into account for meeting the energy savings targets set out in Articles 4 and 5, energy efficiency services, energy efficiency programmes and other energy efficiency measures must contain activities that result in verifiable and measurable savings that reduce energy use, without increasing the environmental impact. The energy efficiency services, energy efficiency programmes and other energy efficiency measures shall be cost-effective and their delivery and implementation open to all certified, qualified and/or accredited providers of energy efficiency services, energy efficiency programmes and energy efficiency enabling equipment and other energy efficiency measures. This list is not exhaustive but is intended to provide guidance.

1.  Eligible areas where energy efficiency programmes and other energy efficiency measures may be identified and implemented:

   a) heating and cooling (e.g. heat pumps, new efficient boilers, installation/efficient update of district heating/cooling systems, etc.);
   b) mobility (e.g. fuel efficient engines, hybrid cars, electric cars, trolleys, trams, underground systems, freight trains, heavy rail transport);
   c) combined heat and power generation, which must be encouraged at the smallest possible scale to ensure the highest possible thermodynamic exploitation of energy sources; modification of the electricity grid should be promoted in order to allow the electricity thus produced to be fed into the distribution system;
   d) insulation and ventilation (e.g. wall cavity and roof insulation, double/triple glazing of windows, etc.);
   e) improvements to building shells and structures aimed at achieving summer comfort at no or low energy consumption, such as technologies to control fluxes of heat and solar radiation (higher thermal insulation of walls, low emissivity and solar control glazing, ventilated roofs with radiant barriers), technologies for the connection of buildings to low temperature environmental sources in summer (coupling with soil through air or water circulation, night ventilation accompanied with increased thermal mass); improvements to building shells and structures aimed at achieving winter comfort (thicker walls, roof and basement insulation, window frames with low transmittance and low infiltration rate, low emissivity glazing);
   f) hot water (e.g. installation of new devices, direct and efficient use in space heating, washing machines, etc.);
   g) lighting (e.g. new efficient bulbs and ballasts, digital control systems, use of motion detectors in place of 24-hour lighting in commercial buildings, etc.);
   h) cooking and refrigeration (e.g. new efficient devices, heat recovery systems, etc.);
   i) other equipment and appliances (e.g. combined and power appliances, innovative technologies such as individual metering instruments managed by remote-automated meter management (AMM), new efficiency devices, time control for optimised energy use, stand-by loss reduction, reduction of devices with stand-by mode, etc.);
   j) product manufacturing processes (e.g. more efficient use of compressed air, condensate and switches and valves, use of automatic and integrated systems, efficient stand-by modes, etc.);
   k) motors and drives (e.g. increase in the use of electronic controls, variable speed drives, integrated application programming, frequency conversion, etc.);
   l) fans, variable speed drives and ventilation (e.g. new devices/systems, use of natural ventilation, etc.);
   m) demand response management (e.g. load management, peak shaving control systems, etc.);
   n) training in energy efficiency and energy savings at work;
   o) measures leading end users to switch from fossil fuels to renewable forms of energy;
  p) mode of travel used, e.g.
   subsidised financing of buying/leasing energy-efficient vehicles;
   incentives for transport fleet drivers to reduce fuel per trip/day/week/month, etc.;
   energy efficiency add-ons for vehicles, e.g. streamlining for trucks, fuel computers, tyre pressure monitors;
   eco-driving courses with measurable follow-up activities;
   energy efficiency audits on vehicles, e.g. tyres, emissions, roof racks, etc.;
   third-party financing projects involving transport fleet companies with the aim of reducing the amount of energy used;
   measures to introduce high-lubricity oils and low-resistance tyres;
   q) measures leading to a switch to vehicles which operate using biofuels;
   r) measures which make transport more efficient in general; measures which boost the use of public transport;
   s) optimisation and control technologies (e.g. building management systems, lighting dimming systems, weather forecasting controls);
  t) modal shifts of travel, programmes that provide, e.g.
   car free home/office obliging, implementation of mobility guarantees for residents/workers, e.g. bicycle, public transport pass, easy access to hire cars, etc.;
   car-free days;
   de-investment: car users renounce car ownership and in return receive reduced-cost alternative mobility, e.g. bicycle, public transport pass, easy access to hire cars, etc.;
   parking spaces in connection with public transport stops (park and ride systems);
   policies and measures that reduce the need for transport;
   policies and measures that promote the use of public transport;
   policies and measures that promote the transportation of goods by railways;

u)   the introduction of the 'top runner' principle, the setting of benchmarks and the introduction of national energy labels.

2.  Eligible horizontal measures

Focused horizontal measures may be considered eligible if energy savings can be clearly measured and verified according to the guidelines in Annex IV of this Directive. This includes the following (non-exhaustive):

   regulations, taxes, etc. that aim primarily at reducing energy end-use consumption;
   standards and norms that aim primarily at increasing the energy efficiency of products and services;
   campaigns that promote energy efficiency and energy efficiency measures.

ANNEX IV

Guidelines for Measurement and Verification of Energy Savings

1.  How Energy Savings should be measured

Energy savings shall be determined by estimating and/or measuring without and comparing to the use with the implementation of the measure, while ensuring adjustment and normalisation for extrinsic conditions commonly affecting energy use. Conditions commonly affecting energy use may also differ over time. Such conditions may be the likely impact of one or several plausible factors (not exhaustive):

   weather conditions, such as degree days;
   occupancy levels;
   opening hours for non-domestic buildings;
   installed equipment intensity (plant throughput);
   using schedule for installation and vehicles;
   relationship with other units.

In measuring the energy savings set out in Articles 4 and 5, a bottom-up model shall be used. This means that energy savings obtained through a specific energy service, or in a specific energy efficiency programme, measure or project, shall be measured in kilowatt-hours (kWh), in Joules (J) or in kilogram oil equivalent (kgoe) and added together with energy savings results from other specific services, programmes, measures or projects. The assigned public authorities or agencies set out in Article 4(7) will ensure that double counting of energy saving, which results from a combination of energy efficiency measures, is avoided.

The committee referred to in Article 20 shall be responsible for framing, within one year of the entry into force of this Directive, a clear, transparent, non-bureaucratic, Europe-wide harmonised bottom-up system and facilitating its implementation.

This system should be based on the bottom-up systems which have already been developed in some countries and which are being applied unbureaucratically and effectively. The evaluation costs should not exceed 2% of the programme costs, with the exception of pilot programmes.

The Member States shall have a maximum of one year after the Directive's entry into force in which to adapt their measurement and verification of energy savings to this Europe-wide harmonised bottom-up system.

The bottom-up system may be used in a simplified procedure in connection with energy efficiency programmes (e.g. promotional programmes or free advice on energy savings) where the expected overall energy savings are likely to be less than 40 million kWh p.a. equivalent. For instance: saving in kWh = saving per type of measure x scale of the measure (number of participants covered and measures per participant; if these are not available, they may be established using e.g. market data, indicators or estimates based on representative, sample-type surveys). The saving determined per type of measure must also include a deduction calculated for 'piggyback' effects.

With regard to the evaluation of energy services (e.g. energy-saving contracting or remunerated advice on energy savings) where the expected energy savings per customer are likely to be less than 40 000 kWh p.a. equivalent, the simplified procedure for energy efficiency programmes may be used.

With regard to the evaluation of horizontal measures, energy efficiency indicators may be used provided that the way in which they would have developed without the horizontal measures can be determined. However, it must be possible to rule out, as far as possible, double counting with savings achieved through targeted energy efficiency programmes, energy services and other policy instruments. This applies particularly to energy or CO2 taxes and information campaigns.

The achieved energy result to be reported in accordance with Article 19 in the Directive shall be based on the following:

(a)  If the service or programme/project is finalised and sufficient data are available at the time of reporting, the results shall be measured according to point 2.1 in this Annex.

(b)  If the service or programme/project is not finalised or sufficient data are not available at the time of reporting, the results shall be measured according to point 2.2 in this Annex.

How to calculate the base year energy consumption is described in Annex I, a conversion table is contained in Annex II and examples of energy efficiency services, energy efficiency programmes and other energy efficiency measures are listed in Annex III.

2.  Data and Methods that may be used (Measurability)

Several methods for collecting data to measure and estimate energy savings exist. At the time of the evaluation of an energy efficiency service, energy efficiency programme, measure or project, it will not always be possible to rely strictly on measurements. A distinction is therefore made between methods measuring energy savings and methods estimating energy savings.

2.1  Data and Methods based on Measurements

Bills from Distribution Companies or Retailers

Metered utility bills may form the basis for measurement for a suitable and sufficiently long period before the introduction of the energy efficiency service, energy efficiency measure, service or programme. These may then be compared to metered bills for the period after the introduction and use of the measure, also for a suitable and adequately long period of time. The findings shall also be compared to a control group (no participation group) if possible.

Energy Product Sales Data

The consumption of different energy products (e.g. petroleum, coal, wood, etc.) may be measured by comparing the sales data from the retailer or distributor obtained before the introduction of the energy efficiency services, programmes or other energy efficiency measures with the sales data from the time after the measure. A control group shall be used.

Equipment and Appliance Sales Data

Performance of equipment and appliances may be calculated on the basis of information obtained directly from the manufacturer. Data on equipment and appliance sales can generally be obtained from the retailers. In some cases special surveys and measurements may also be carried out to obtain more precise data from the manufacturer or the retailer. The accessible data can be checked against sales figures to determine the size of savings.

End-Use Load Data

Energy use of a building or facility can be fully monitored to record energy demand before and after the introduction of an energy efficiency service, programme or other energy efficiency measure. Important relevant factors (e.g. production process, special equipment, heating installations, etc.) can be metered more closely. At the micro level, specific circuits or equipment affected by the introduction of the new measure can also be monitored to record energy demand before and after.

2.2  Data and Methods based on Estimates

Enhanced Engineering Estimated Data: Inspection

Energy data may be calculated on the basis of information obtained by an external expert during an audit of, or other type of visit to, one or several targeted sites. On this basis, more sophisticated algorithms/simulation models could be developed and be applied to a larger population of sites (e.g. buildings, facilities, vehicles, etc.). This method will only confirm energy savings, not verify them.

Simple Engineering Estimated Data: Non-inspection

Data may be estimated using engineering principles, without using on-site data, but with assumptions based on equipment specifications, performance characteristics, operation profiles of measures installed and stipulations based on statistics.

3.  How to Deal with Uncertainty

All the methods listed in Chapter 2 of this Annex may contain some degree of uncertainty. Uncertainty may derive from(22):

   instrumentation errors: these typically occur because of errors in specifications given by the product manufacturer;
   modelling errors: these typically refer to errors in the model used to estimate parameters of interest from the data collection;
   sampling error: this typically refers to errors resulting from the fact that a sample of units was observed rather than the entire set of units under study.

Uncertainty may also derive from planned and unplanned assumptions; these are typically associated with estimates, stipulations and/or the use of engineering data. The occurrence of errors is related to the chosen system of data collection that is outlined in Chapter 2 of this Annex. A further specification of uncertainty is advised.

Member States may choose to use the system of quantified uncertainty when reporting on the targets set out in this Directive. Quantified uncertainty shall then be expressed in a statistically meaningful way, declaring both accuracy and confidence level. For example, "the quantifiable error is found with 90% confidence to be ± 20%".

If the method of quantified uncertainty is used, Member States must also take account of the fact that the acceptable level of uncertainty required in savings calculations is a function of the level of savings and the cost-effectiveness of decreasing uncertainty.

4.  How to Verify the Energy Savings

As far as economically feasible, the energy savings obtained through a specific energy service, energy efficiency programme or measure shall be verified by a third party. This could be done by certified consultants, ESCOs or other market players. The appropriate Member State authorities or agencies referred to in Article 4 may give further instructions on this matter.

Sources: A European Ex-post Evaluation Guidebook for DSM and EE Service Programmes; IEA, INDEEP database; IPMVP, Volume 1 (Version March 2002).

ANNEX V

For the following energy conversion markets and sub-markets benchmarks may be calculated:

1.  The market for household appliances/information technology and lighting:

1.1  Kitchen appliances (white goods);

1.2  Entertainment/information technology;

1.3  Lighting.

2.  The market for domestic heating technology:

2.1  Heating;

2.2  Hot water provision;

2.3  Air conditioning;

2.4  Ventilation;

2.5  Heat insulation;

2.6  Windows.

3.  The market for industrial ovens.

4.  The market for motorised power in industry.

5.  The market for public-sector institutions:

5.1  Schools/public administration;

5.2  Hospitals;

5.3  Swimming pools;

5.4  Street lighting.

6.  The market for transport services.

(1) Not yet published in OJ.
(2) OJ C 120, 20.5.2005, p. 115.
(3) OJ C 318, 22.12.2004, p. 19.
(4) Position of the European Parliament of 7 June 2005.
(5) Green Paper "Towards a European Strategy for Energy Supply" (COM(2000)769).
(6) OJ L 176, 15.7.2003, p. 37. Directive last amended by Council Directive 2004/85/EC (OJ L 236, 7.7.2004, p. 10).
(7) OJ L 176, 15.7.2003, p. 57.
(8) Implementing the internal energy market: First benchmarking report; European Commission, 2002.
(9) OJ C 394, 17.12.1998, p. 1.
(10) OJ C 343, 5.12.2001, p. 190.
(11) Council Conclusions: Bulletin 5-2000, point 1.4.41.
(12) OJ L 237, 22.9.1993, p. 28.
(13) OJ L 184, 17.7.1999, p. 23.
(14) OJ L 1, 4.1.2003, p. 65.
(15) OJ L 275, 25.10.2003, p. 32. Directive as amended by Directive 2004/101/EC (OJ L 338, 13.11.2004, p. 18).
(16) OJ L 257, 10.10.1996, p. 26. Directive as last amended by the 2003 Act of Accession.
(17) Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts (OJ L 134, 30.4.2004, p. 114). Directive as amended by Commission Regulation (EC) No 1874/2004 (OJ L 326, 29.10.2004, p. 17).
(18) Directive 2004/17/EC of the European Parliament and of the Council of 31 March 2004 coordinating the procurement procedures of entities operating in the water, energy, transport and postal services sectors (OJ L 134, 30.4.2004, p. 1). Directive as amended by Regulation (EC) No 1874/2004.
(19) 93.0% methane.
(20) Member States may apply other values depending on the type of wood most used in the Member State.
(21) For savings in kWh electricity Member States may apply a default co-efficient of 2.5 reflecting the estimated 40% average EU generation efficiency during the target period. Source: Eurostat.
(22) A model for establishing a level of quantifiable uncertainty based on these three errors is given in Appendix B in the International Performance Measurement & Verification Protocol (IPMVP).


Infrastructure for spatial information in the Community (INSPIRE) ***I
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Resolution
Consolidated text
European Parliament legislative resolution on the proposal for a directive of the European Parliament and of the Council establishing an infrastructure for spatial information in the Community (INSPIRE) (COM(2004)0516 – C6-0099/2004 – 2004/0175(COD))
P6_TA(2005)0213A6-0108/2005

(Codecision procedure: first reading)

The European Parliament,

–   having regard to the Commission proposal to the European Parliament and the Council (COM(2004)0516)(1),

–   having regard to Articles 251(2) and 175(1) of the EC Treaty, pursuant to which the Commission submitted the proposal to Parliament (C6-0099/2004),

–   having regard to Rule 51 of its Rules of Procedure,

–   having regard to the report of the Committee on the Environment, Public Health and Food Safety (A6-0108/2005),

1.  Approves the Commission proposal as amended;

2.  Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text;

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

Position of the European Parliament adopted at first reading on 7 of June 2005with a view to the adoption of European Parliament and Council Directive 2005/…/ΕC establishing an infrastructure for spatial information in the Community (INSPIRE)

P6_TC1-COD(2004)0175


(Text with EEA relevance)

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,

Having regard to the opinion of the European Economic and Social Committee(2),

Having regard to the opinion of the Committee of the Regions(3),

Acting in accordance with the procedure laid down in Article 251 of the Treaty(4),

Whereas:

(1)  Community policy on the environment must aim at a high level of protection, while taking into account the diversity of situations in the various regions of the Community. In preparing its policy on the environment, the Community is required to take account of available scientific and technical data, environmental conditions in the various regions of the Community, the economic and social development of the Community as a whole and the balanced development of its regions. Many information themes related to spatial features are required for a broad range of environmental policies. Moreover, the same information is often needed for the formulation and implementation of other Community policies, which must integrate environmental protection requirements, in accordance with Article 6 of the Treaty. In order to bring about such integration, it is necessary to establish a measure of coordination between the users and providers of the information on those themes so that information and knowledge from different sectors can be combined.

(2)  The Sixth Environment Action Programme adopted by Decision No 1600/2002/EC of the European Parliament and of the Council(5) requires full consideration to be given to ensuring that the Community's environmental policy-making is undertaken in an integrated way, taking into account regional and local differences. That Programme further calls for emphasis on the development of European initiatives to raise the awareness of the public and of local authorities and to improve scientific knowledge of and data and information on the state and trends of the environment. It also requires the following priority actions to be pursued: ex-ante and ex-post evaluation of policy measures, development of bridges between environmental and other actors in the fields of information, training, research, education and policies, ensuring regular information inter alia to inform the wider public and reviewing and regularly monitoring information and reporting systems. It additionally requires monitoring and data collection to be addressed efficiently in future environmental legislation and the development to be stepped up of earth monitoring applications and tools to support Member States in setting up adequate data collection systems. A number of serious problems exist regarding the availability, quality, organisation and accessibility of spatial information needed in order to achieve the objectives set out in the Sixth Environment Action Programme.

(3)  The problems regarding the availability, quality, organisation and accessibility of spatial information are common to a large number of policy and information themes and are experienced across the various levels of public authority. Solving these problems requires measures that address exchange, sharing, access and use of interoperable spatial data and spatial data services from across the various levels of public authority and from across different sectors. An infrastructure for spatial information in the Community should therefore be established.

(4)  The Infrastructure for Spatial Information in the European Community, also referred to as INSPIRE, should be based on the infrastructures for spatial information that are created by the Member States and that are made compatible with common rules and are supplemented with measures at Community level. These measures should ensure that the infrastructures for spatial information created by the Member States are compatible and are useable in a transboundary context.

(5)  The infrastructures for spatial information in the Member States should be designed to ensure that spatial data are stored, made available and maintained at the most appropriate level; that it is possible to combine spatial data from different sources across the Community in a consistent way and share them between several users and applications; that it is possible for spatial data collected at one level of public authority to be shared between all the different levels of public authorities; that spatial data are made available under conditions that do not restrict their extensive use; that it is easy to discover available spatial data, to evaluate their fitness for purpose and to know the conditions applicable to their use.

(6)  There is a degree of overlap between the spatial information covered by this Directive and the information covered by Directive 2003/4/EC of the European Parliament and of the Council of 28 January 2003 on public access to environmental information(6). However, the technical and economic aspects of spatial information hamper its use in support of environmental policies and of the integration of environmental considerations into other policies. Consequently, it is necessary to make specific provisions for spatial information in terms of obligations, exceptions and safeguards. This Directive is without prejudice to Directive 2003/4/EC except with respect to certain provisions that address the grounds for limiting access to the spatial data covered by this Directive, avoiding the possibility of unduly limitations of access to the spatial data covered by this Directive.

(7)  This Directive should be without prejudice to Directive 2003/98/EC of the European Parliament and of the Council of 17 November 2003 on the re-use of public sector information,(7) the objectives of which are complementary to those of this Directive. However, the Commission should take further measures to address issues relevant for the re-use of the specific category of public sector information covered by this Directive.

(8)  The establishment of an Infrastructure for Spatial Information in the European Community will represent significant added value for - and will also benefit from - other Community initiatives such as Council Regulation (EC) No 876/2002 of 21 May 2002 setting up the Galileo Joint Undertaking(8) and Global Monitoring for Environment and Security (GMES): Establishing a GMES capacity by 2008(9). In order to exploit the synergies between these initiatives, Member States should consider using the data and services resulting from Galileo and GMES as they become available, in particular those related to the time and space references from Galileo.

(9)  Many initiatives are taken at national and Community level to collect, harmonise or organise the dissemination or use of spatial information. Such initiatives may be established by Community legislation (for example by Commission Decision 2000/479/EC of 17 July 2000 on the implementation of a European pollutant emission register (EPER) according to Article 15 of Council Directive 96/61/EC of 24 September 1996 concerning integrated pollution prevention and control (IPPC) (10), Regulation (EC) No 2152/2003 of the European Parliament and of the Council of 17 November 2003 concerning monitoring of forests and environmental interactions in the Community (Forest focus) (11), in the framework of Community funded programmes (for example CORINE land cover, European Transport Policy Information System) or may emanate from initiatives taken at national or regional level. Not only will this Directive complement such initiatives by providing a framework that will enable them to become interoperable, it will also build upon existing experience and initiatives rather than duplicate the work that has already been done.

(10)  This Directive should apply to spatial data held by or on behalf of public authorities and to the use of spatial data by public authorities in the performance of their public tasks. Subject to certain conditions, however, it should also apply to spatial data held by natural or legal persons other than public authorities, provided that these natural or legal persons request this.

(11)  This Directive should not set requirements for the collection of new data on the state of the environment, or for reporting such information to the Commission, since those matters are regulated by other legislation related to the environment.

(12)  The implementation of the national infrastructures should be progressive and, accordingly, the spatial data themes covered by this Directive should be accorded different levels of priority. The implementation should take account of the extent to which spatial data is needed for a wide range of applications in various policy areas, of the priority of actions provided for under Community policies that need harmonised spatial data and of the progress already made by the harmonisation efforts undertaken in the Member States.

(13)  The loss of time and resources in searching for existing spatial data or in discovering if they may be used for a particular purpose is a key obstacle to the full exploitation of the data available. Member States should therefore provide descriptions of available spatial data sets and services in the form of metadata.

(14)  Since the wide diversity of formats and structures in which spatial data are organised and accessed in the Community hampers the efficient formulation, implementation, monitoring and evaluation of Community legislation that directly or indirectly affect the environment, implementing measures should be provided for in order to facilitate the use of spatial data from different sources across the Member States. Those measures should be designed to make the spatial data sets interoperable and Member States should ensure that any data or information needed for the purposes of achieving interoperability is not restricted in any way.

(15)  Network services are necessary for sharing spatial data between the various tiers of public authorities in the Community. Those network services should make it possible to discover, transform, view and download spatial data and to invoke spatial data and e-commerce services. The services of the network should work in accordance with commonly agreed specifications and minimum performance criteria in order to ensure the interoperability of the infrastructures established by the Member States. The network of services should also include network connection services to enable public authorities to make their spatial data sets and services available.

(16)  Experience in the Member States has shown that it is important, for the successful implementation of an infrastructure for spatial information, that a minimum number of services be made available to the public free of charge. Member States and the European Union should therefore make available, as a minimum and free of charge, the services for discovering and viewing spatial data sets.

(17)  Certain spatial data sets and services relevant to Community policies that directly or indirectly affect the environment are held and operated by third parties. Member States should therefore offer third parties the possibility of contributing to the national infrastructures, provided that the cohesion and ease of use of the spatial data and spatial data services covered by those infrastructures is thereby not impaired.

(18)  In order to assist the integration of the national infrastructures into the infrastructure for spatial information in the Community, Member States should provide access to their infrastructures through a Community geo-portal operated by the Commission, as well as through any access points they themselves decide to operate.

(19)  In order to make available information from various levels of public authority, Member States should remove the barriers faced in that regard by public authorities at national, regional and local level when performing their public tasks that may have a direct or indirect impact on the environment. These barriers should be removed at the point where the information is to be used for the public task. Where public authorities carry out commercial activities as well as public tasks, Member States should take appropriate measures to prevent distortion of competition.

(20)  Frameworks for the sharing of spatial data between public authorities should be neutral in respect not only of the public authorities within a Member State, but also of the public authorities in other Member States and of the Community institutions. Since the Community institutions and bodies frequently need to integrate and assess spatial information from all the Member States, they should be able to gain access to and use spatial data and spatial data services in accordance with harmonised conditions.

(21)  The preclusion of restrictions of a financial nature at the point of use does not prevent public authorities that produce spatial data sets and services from receiving financial compensation from the public authorities that use these spatial data sets and services.

(22)  With a view to stimulating the development of added-value services by third parties, for the benefit both of public authorities and the public, it is necessary to facilitate access to and re-use of spatial data that extend over administrative or national borders.

(23)  The effective implementation of infrastructures for spatial information requires coordination by all those with an interest in the establishment of such infrastructures, whether as contributors or users. Appropriate coordination structures should therefore be established which extend to the various levels of government and take account of the distribution of powers and responsibilities within the Member States.

(24)  In order to benefit from the relevant experience of European and international Standardisation bodies, it is appropriate that the measures necessary for the implementation of this Directive could be supported by standards adopted by European standardisation bodies in accordance with the procedure laid down in Directive 98/34/EC of the European Parliament and of the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations(12), and standards adopted by international standardisation bodies.

(25)  Since the European Environment Agency set up by Council Regulation (EEC) No 1210/90 of 7 May 1990 on the establishment of the European Environment Agency and the European Environment Information and Observation Network(13) has the task of providing the Community with objective, reliable and comparable environmental information at Community level, and aims inter alia to improve the flow of policy-relevant environmental information between Member States and the Community institutions, it should contribute actively to the implementation of this Directive.

(26)  This being a framework Directive, its implementation requires further decisions that take into account the evolving political, institutional and organisational context and the rapid technological progress in relation to spatial data systems and services. The measures necessary for the implementation of this Directive should therefore 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).

(27)  Preparatory work for decisions concerning the implementation of this Directive and for the future evolution of the infrastructure for spatial information in the Community requires continuous monitoring of the implementation of the Directive and regular reporting.

(28)  The objective of this Directive, namely the establishment of an infrastructure for spatial information in the Community, cannot be sufficiently achieved by the Member States because of the transnational aspects and because of the general need within the Community to co-ordinate the conditions of access to spatial information. It can therefore be better achieved at Community level, and the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve that objective,

HAVE ADOPTED THIS DIRECTIVE:

Chapter I

General provisions

Article 1

1.  This Directive lays down the components or keystones of strategic planning designed to establish an infrastructure for spatial information in the Community, for the purposes of sustainable development policy in regard to the Community and policies or activities which may have a direct or indirect impact on the environment and spatial management.

2.  The infrastructure for spatial information in the Community shall be based on infrastructures for spatial information established and operated by the Member States and on any relevant infrastructure which already exists at Community level.

The component elements of those infrastructures shall include metadata, spatial data sets and spatial data services; network services and technologies; agreements on sharing, access and use; and coordination and monitoring mechanisms, processes and procedures.

Article 2

1.  This Directive is without prejudice to Directive 2003/4/EC, save where otherwise provided.

2.  This Directive is without prejudice to Directive 2003/98/EC.

Article 3

For the purposes of this Directive, the following definitions shall apply:

   1) "infrastructure for spatial information" means an infrastructure whose component elements include metadata, spatial data sets and spatial data services; network services and technologies; agreements on sharing, access and use; and coordination and monitoring mechanisms, processes and procedures, established, operated or made available in accordance with this Directive;
   2) "spatial data" means any data with a direct or indirect reference to a specific location or geographical area;
   3) "spatial data set" means an identifiable collection of spatial data;
   4) "spatial data services" means the operations which may be performed, by invoking a computer application, on the spatial data contained in spatial data sets or on the related metadata;
   5) "spatial object" means an abstract representation of a real-world entity related to a specific location or geographical area;
   6) "metadata" means information describing spatial data sets and spatial data services and making it possible to discover, inventory and use them;
   7) "public authority" means:

Member States may provide that when bodies or institutions are acting in a judicial or legislative capacity, they are not to be regarded as public authorities for the purposes of this Directive;

   a) any government or other public administration, including public advisory bodies, at national, regional or local level;
   b) any natural or legal person performing public administrative functions under national law, including specific duties, activities or services in relation to the environment and the technological support provided on each occasion with the aim of improving it; and
   c) any natural or legal person having public responsibilities or functions, or providing public services under the control of a body or person falling within (a) or (b).
   8) "third party" means any natural or legal person other than a public authority.

Article 4

1.  This Directive shall cover spatial data sets which fulfil the following conditions:

   a) they are related to an area where a Member State exercises jurisdictional rights;
   b) they are in electronic format;
  c) they are held by or on behalf of any of the following:
   i) a public authority, having been produced or received by a public authority, or being managed or updated by that authority;
   ii) a third party to whom network connection services have been made available in accordance with Article 14(3);
   d) they relate to one or more of the themes listed in Annex I, II or III.

2.  This Directive shall also cover the spatial data services relating to the data contained in the spatial data sets referred to in paragraph 1.

3.  In the case of spatial data sets which comply with the condition set out in point (c) of paragraph 1, but in respect of which a third party holds intellectual property rights, the public authority may take action under this Directive only with the consent of that third party.

4.  By way of derogation from paragraph 1, this Directive shall cover spatial data sets held by or on behalf of a public authority operating at the lowest level of government within a Member State only where the collection or dissemination of those spatial data sets is coordinated by another public authority or is required under national law.

5.  The spatial data themes referred to in Annexes I, II and III may be adapted by the Commission in accordance with the procedure referred to in Article 27(2) to take into account the evolving needs for spatial data in support of Community policies that directly or indirectly affect the environment.

Chapter II

Metadata

Article 5

1.  Member States shall ensure that metadata are created for spatial data sets and services, and that those metadata are kept up to date.

2.  Metadata shall include information on the following:

   a) the conformity of spatial data sets with the implementing rules referred to in Article 8(1);
   b) rights of use of spatial data sets and services, and any costs pertaining to them;
   c) the quality and validity of spatial data;
   d) the public authorities responsible for the establishment, management, maintenance and distribution of spatial data sets and spatial data services;
   e) the spatial data sets to which public access is limited in accordance with Article 16 and the reasons for such limitation.

3.  Member States shall take the necessary measures to ensure that metadata are complete and of appropriate quality.

Article 6

Member States shall create the metadata referred to in Article 5 in accordance with the following timetable:

   a) no later than ...(15) in the case of spatial data sets relating to the themes listed in Annexes I and II;
   b) no later than ...(16)* in the case of spatial data sets relating to the themes listed in Annex III.

Article 7

The Commission shall, in accordance with the procedure referred to in Article 27(2), adopt rules for the implementation of Article 5.

Chapter III

Interoperability of spatial data sets and services

Article 8

1.  The Commission shall, in accordance with the procedure referred to in Article 27(2), adopt implementing rules laying down the following:

   a) specifications for the harmonisation of spatial data;
   b) arrangements for the exchange of spatial data.

2.  Representatives of the Member States at national, regional and local level may, by virtue of their importance as producers, holders and providers of spatial data, as well as natural and legal persons with an interest in the spatial data concerned by virtue of their role in the spatial information infrastructure that includes user, producer, added value service provider or coordinating body shall be given the opportunity to participate in preparatory discussions on the content of the implementing rules provided for in paragraph 1, prior to consideration by the Committee referred to in Article 27(1).

Article 9

1.  The implementing rules provided for in Article 8(1) shall be designed to ensure that it is possible for spatial data sets to be combined, or for services to interact, in such a way that the result is a coherent combination of spatial data sets or services that represents added value, without requiring specific efforts on the part of a human operator or a machine.

2.  The implementing rules provided for in Article 8(1) shall cover the definition and classification of spatial objects relevant to the spatial data and the way in which those spatial data are geo-referenced.

Article 10

1.  In the case of spatial data sets corresponding to the themes listed in Annex I or II, the implementing rules provided for in Article 8(1) shall meet the conditions laid down in paragraphs 2, 3 and 4 of this Article.

2.  The implementing rules shall address the following aspects of spatial data:

   a) a common system of unique identifiers for spatial objects;
   b) the relationship between spatial objects;
   c) the key attributes and the corresponding multilingual thesauri commonly required for policies which may have a direct or indirect impact on the environment;
   d) the way in which information on the temporal dimension of the data is to be exchanged;
   e) the way in which updates of the data are to be exchanged.

3.  The implementing rules shall be designed to ensure consistency as between items of information which refer to the same location or between items of information which refer to the same object represented at different scales.

4.  The implementing rules shall be designed to ensure that information derived from different spatial data sets is comparable as regards the aspects referred to in Article 9(2) and in paragraph 2 of this Article.

Article 11

The implementing rules provided for in Article 8(1) shall be adopted in accordance with the following timetable:

   a) no later than ...(17) in the case of spatial data sets relating to the themes listed in Annex I;
   b) no later than ...(18)* in the case of spatial data sets relating to the themes listed in Annex II or III.

Article 12

Member States shall ensure that spatial data sets collected or updated later than two years after the date of adoption of the corresponding specifications provided for in Article 8(1) are brought into conformity with those specifications, either through the adaptation of the spatial data sets or through their transformation.

Article 13

1.  Member States shall ensure that any information or data needed for compliance with the implementing rules provided for in Article 8(1) are made available to public authorities or third parties in accordance with conditions that do not restrict their use for that purpose.

2.  In order to ensure that spatial data relating to a spatial feature the location of which spans the frontier between two or more Member States are coherent, Member States shall, where appropriate, decide by mutual consent on the depiction and position of such common features.

Chapter IV

Network services

Article 14

1.  Member States shall establish and operate network connection services for making metadata and spatial data sets and services accessible through the services referred to in Article 15(1).

2.  The network connection services referred to in paragraph 1 shall be made available to the public authorities.

3.  The network connection services referred to in paragraph 1 shall be made available to third parties upon their request, provided that their spatial data sets and services comply with implementing rules laying down obligations with regard, in particular, to metadata, network services and interoperability.

Article 15

1.  Member States shall establish and operate a network of the following services for the spatial data sets and services for which metadata have been created in accordance with this Directive:

   a) discovery services making it possible to search for spatial data sets and spatial data services on the basis of the content of the corresponding metadata and to display the content of the metadata;
   b) view services making it possible, as a minimum, to display, navigate, zoom in/out, pan, or overlay spatial data sets and to display legend information and any relevant content of metadata;
   c) download services, enabling copies of complete spatial data sets, or of parts of such sets, to be downloaded;
   d) transformation services, enabling spatial data sets to be transformed;
   e) "invoke spatial data services" services, enabling data services to be invoked.

Those services shall be easy to use, available to the public, and accessible via the Internet or any other appropriate means of telecommunication.

2.  For the purposes of the services referred to in point (a) of paragraph 1, as a minimum the following combination of search criteria shall be implemented:

   a) keywords;
   b) classification of spatial data and services;
   c) spatial data quality and accuracy;
   d) degree of conformity with the specifications for the harmonisation of spatial data provided for in Article 8;
   e) geographical location;
   f) conditions applying to the access to and use of spatial data sets and services;
   g) the public authorities responsible for the establishment, management, maintenance and distribution of spatial data sets and services.

3.  The transformation services referred to in point (d) of paragraph 1 shall be combined with the other services referred to in that paragraph in such a way as to enable all those services to be operated in conformity with the implementing rules provided for in Article 8.

Article 16

1.  By way of derogation from Article 4(2) of Directive 2003/4/EC and Article 15(1) of this Directive, Member States may limit public access to the services referred to in points (b) to (e) of Article 15(1), or to the e-commerce services referred to in Article 17(2), where such access would adversely affect any of the following:

   a) the confidentiality of the proceedings of public authorities, where such confidentiality is provided for by law;
   b) international relations, public security or national defence;
   c) the course of justice, the ability of any person to receive a fair trial or the ability of a public authority to conduct an enquiry of a criminal or disciplinary nature;
   d) the confidentiality of commercial or industrial information where such confidentiality is provided for by national or Community law to protect a legitimate economic interest, including the public interest in maintaining statistical confidentiality and tax secrecy;
   e) the confidentiality of personal data and/or files relating to a natural person where that person has not consented to the disclosure of the information to the public, where such confidentiality is provided for by national or Community law;
   f) the protection of the environment to which such information relates, such as the location of rare species.

2.  The grounds for limiting access, as provided for in paragraph 1, shall be interpreted in a restrictive way, taking into account for the particular case the public interest served by providing this access. In every particular case, the public interest served by disclosure shall be weighed against the interest served by the limiting or conditioning the access. Member States may not, by virtue of paragraph 1(a), (d), (e) and (f), limit access to information on emissions into the environment.

Article 17

1.  Member States shall ensure that the services referred to in Article 15(1)(a) and (b) are available to the public free of charge. In order to protect intellectual property rights held by public authorities in respect of spatial data, the data made available through the view services mentioned in Article 15 (1)(b) may be in a form preventing their re-use for commercial purposes, and a click-licence may be included to restrict the use that can be made of the data.

2.  Where public authorities levy charges for the services referred to in Article 15(1)(c) or (e), Member States shall ensure that e-commerce services are available.

Article 18

1.  The Commission shall establish and operate a Community geo-portal.

2.  Member States shall provide access to the services referred to in Article 15(1) through the Community geo-portal.

Member States may also provide access to those services through their own access points.

Article 19

The Commission shall, in accordance with the procedure referred to in Article 27(2), adopt rules for the implementation of this Chapter, and shall in particular lay down the following:

   a) technical specifications for the services referred to in Articles 14(1), 15 and 17(2) and, taking into account technological progress, minimum performance criteria for those services;
   b) the obligations referred to in Article 14(3).

Chapter V

Data-sharing and re-use

Article 20

1.  Member States shall adopt measures for the sharing of spatial data sets and services between public authorities. Those measures shall enable the public authorities of Member States, and the institutions and bodies of the Community, to gain access to spatial data sets and services, and to exchange and use those sets and services, for the purposes of public tasks that may have a direct or indirect impact on the environment.

The measures provided for in the first subparagraph shall preclude, at the point of use, any restrictions, in particular of a transactional, procedural, legal, institutional or financial nature. Member States shall ensure that the implementation of these measures does not adversely affect the availability of spatial data sets and services.

2.  The same arrangements for sharing of spatial data as provided for in paragraph 1 shall be open to bodies established by international agreement to which the Community or Member States are party, for the performance of tasks that may have a direct or indirect impact on the environment.

3.  Member States shall take appropriate measures to prevent distortion of competition.

4.  The institutions and bodies of the Community shall have harmonised conditions for access to spatial data sets and services. The Commission shall, in accordance with the procedure referred to in Article 27(2), adopt implementing rules governing such access and the related rights of use.

Article 21

The Commission shall, in accordance with the procedure referred to in Article 27(2), adopt implementing rules to increase the potential of re-use of spatial data sets and services by third parties. These implementing rules may include the establishment of common licensing conditions.

The establishment of common licences shall not unnecessarily restrict possibilities for re-use of data and use of services and shall not be used to restrain competition.

Chapter VI

Coordination and complementary measures

Article 22

1.  Member States shall ensure that appropriate structures and mechanisms for coordinating the contributions of all those with an interest in their infrastructures for spatial information, across the different levels of government, are designated. All those with an interest in their infrastructures for spatial information shall include users, producers, added-value service providers and coordinating bodies.

2.  Those contributions shall include identification of user needs, provision of information on existing practices and provision of feedback on the implementation of this Directive.

Article 23

1.  The Commission shall be responsible for coordinating the infrastructure for spatial information in the Community at Community level and shall be assisted for that purpose by the European Environmental Agency.

2.  Each Member State shall identify the coordination structure to be responsible for contacts with the Commission in relation to this Directive, taking account of the distribution of powers and responsibilities within the Member States.

Article 24

The standards adopted by European standardisation bodies in accordance with the procedure laid down in Directive 98/34/EC and by international standardisation bodies may support the implementation of this Directive.

Chapter VII

Final provisions

Article 25

1.  Member States shall monitor the implementation and use of their infrastructures for spatial information.

2.  The monitoring provided for in paragraph 1 shall be carried out in accordance with implementing rules adopted by the Commission in accordance with the procedure referred to in Article 27(2).

3.  The information resulting from the monitoring provided for in paragraph 1 shall be made accessible to the public and the Commission on a permanent basis.

Article 26

1.  Member States shall report to the Commission on the implementation of this Directive and on the experience gained in applying it. The report shall include:

   a) a description of how public sector providers and users of spatial data sets and services and intermediary bodies are coordinated, and of the relationship with the third parties and of the organisation of quality assurance;
   b) a description of the contribution made by public authorities or third parties to the functioning and coordination of the infrastructure for spatial information;
   c) a summary of the availability and quality of spatial data sets and the availability and performance of spatial data services;
   d) a summary of information on the use of the infrastructure for spatial information;
   e) a description of the agreements between public authorities on harmonising and sharing information;
   f) a summary of the costs and benefits of implementing this Directive.

2.  The report referred to in paragraph 1 shall be sent to the Commission every three years, starting in ...(19).

3.  The Commission shall, in accordance with the procedure referred to in Article 27(2), adopt rules for the implementation of paragraph 1.

Article 27

1.  The Commission shall be assisted by a Committee.

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

The period laid down 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 28

The Commission shall present to the European Parliament and to the Council by ...(20) and every six years thereafter a report on the application of this Directive, based on the reports of the Member States referred to in Article 26.

Where necessary, the report shall be accompanied by proposals for Community action.

Article 29

1.  Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by ...(21)*. They shall forthwith communicate to the Commission the text of those measures and a correlation table between those measures and this Directive.

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

2.  Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.

Article 30

This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

Article 31

This Directive is addressed to the Member States.

Done at .....,

For the European Parliament For the Council

The President The President

ANNEX I

SPATIAL DATA THEMES REFERRED TO IN ARTICLES 6(A), 10(1) AND 11(A)

1.  Coordinate reference systems

Systems for uniquely referencing spatial information in space as a set of coordinates (x,y,z) and/or latitude and longitude and height, based on a geodetic horizontal and vertical datum

2.  Geographical grid systems

Harmonised multi-resolution grid with a common point of origin and standardised location and size of grid cells.

3.  Geographical names

Names of areas, regions, localities, cities, suburbs, towns or settlements, or any geographical or topographical feature of public or historical interest.

4.  Administrative units

Units of administration dividing national territory for local, regional and national governance. The administrative units are separated by administrative boundaries. Also includes the boundaries of national territory and the coastline.

5.  Transport networks

Road, rail, air and water transport networks and related infrastructure. Includes links between different networks. Also includes the trans-European transport network as defined in Decision N° 1692/96/EC(22) and the future revisions of this decision.

6.  Hydrography

Hydrographic elements, both natural and artificial including rivers, lakes, transitional waters, reservoirs, aquifers, channels or other water bodies, where appropriate in the form of networks and linked with other networks. Includes river basins and sub-basins as defined in Directive 2000/60/EC(23).

7.  Protected sites

Area designated or regulated and managed to achieve specific conservation objectives.

ANNEX II

SPATIAL DATA THEMES REFERRED TO IN ARTICLES 6(A), 10(1) AND 11(B)

1.  Elevation

Digital elevation models for land, ice and ocean surface. Includes terrestrial elevation, bathymetry and shoreline.

2.  Identifiers of properties

Geographic location of properties based on address identifiers, usually by road name, building number, postal code.

3.  Cadastral parcels

Areas defined by cadastral borders, with specific legal status of ownership.

4.  Land cover

Physical and biological cover of the earth's surface including artificial surfaces, agricultural areas, forests, (semi-)natural areas, wetlands, water bodies.

5.  Orthoimagery

Geo-referenced image data of the Earth's surface, from either satellite or airborne sensors.

6.  Geology

Geology characterised according to composition and structure, and the changes and restructuring it has undergone in its stratification. Includes bedrock and geomorphology.

ANNEX III

SPATIAL DATA THEMES REFERRED TO IN ARTICLES 6(B) AND 11(B)

1.  Statistical units

Units for referencing census or other statistical information.

2.  Buildings

Geographical location of buildings.

3.  Soil

Soils and subsoil characterised according to depth, texture, structure and content of particles and organic material, stoniness, erosion, where appropriate mean slope and anticipated water storage capacity.

4.  Land use

Territory characterised according to its current and future functional dimension or socio-economic purpose (e.g. residential, industrial, commercial, agricultural, forestry, recreational).

5.  Human health and safety

Geographical distribution of morbidity and mortality linked directly (epidemics, spread of diseases, natural disasters, health effects due to environmental stress, air pollution, chemicals, depletion of the ozone layer, noise, etc.) or indirectly (food, genetically modified organisms under applicable Community legislation, stress, etc.) to the quality of the environment. Geographical distribution of road accidents.

6.  Utility and government services

Utility and government services comprise underground and above-ground utility networks and facilities such as drains, waste treatment, energy supply, telecommunications and water supply, and administrative and social government services such as authorities, schools and hospitals.

7.  Environmental monitoring facilities

The installation and operation of environmental monitoring facilities entail the observation and measurement of emissions, of the state of environmental media (marine environment, inland surface waters and underground waters, air and soil) and of other parameters of the ecosystem (biodiversity, ecological conditions for plant growth, etc.) by or on behalf of the authorities.

8.  Production and industrial facilities

Industrial production sites. Includes water abstraction facilities, mining, storage sites.

9.  Agricultural and aquaculture facilities

Farming equipment and production facilities (including irrigation systems, greenhouses and stables).

10.  Population distribution – demography

Geographical distribution of people aggregated by grid, region, administrative unit or other analytical unit. This also includes population characteristics and activity levels.

11.  Area management/restriction/regulation zones & reporting units

Areas managed, regulated or used for reporting at international, European, national, regional and local levels. Includes dumping sites, restricted areas around drinking water sources, nitrate-vulnerable zones, regulated fairways at sea or large inland waters, areas for the dumping of waste, noise restriction zones, prospecting and mining permit areas, river basin districts, areas for management of the coast and reporting units relevant to the environment.

12.  Areas under anthropogenic stress

Areas under anthropogenic stress including polluted areas and noise and radiation zones.

13.  Natural risk zones

Vulnerable areas characterised according to natural hazards (all atmospheric, hydrologic, seismic, volcanic and wildfire phenomena that, because of their location, severity, and frequency, have the potential to seriously affect society), e.g. floods, snowslides, avalanches, forest fires, earthquakes, volcanic eruptions, landslides and subsidence.

14.  Atmospheric conditions

Physical conditions in the atmosphere. Includes spatial data based on measurements, on models or on a combination thereof and includes measurement locations.

15.  Meteorological geographical features

Weather conditions and their measurements; precipitation, temperature, evapotranspiration, wind speed and direction.

16.  Oceanographic geographical features

Physical conditions of oceans (currents, salinity, wave heights, etc.).

17.  Sea regions

Physical conditions of seas and saline water bodies divided into regions and sub-regions with common characteristics.

18.  Bio-geographical regions

Areas of relatively homogeneous ecological conditions with common characteristics.

19.  Habitats and biotopes

Geographical areas characterised by specific ecological conditions and physically supporting the organisms that live there. Includes terrestrial or aquatic areas distinguished by geographical, abiotic and biotic features, whether entirely natural or semi-natural. Includes small features of the rural landscape – hedgerows, brooks, etc.

20.  Species distribution

Geographical distribution of occurrence of animal and plant species aggregated by grid, region, administrative unit or other analytical unit.

21.  Renewable energy resources

(1) Not yet published in OJ.
(2) OJ C
(3) OJ C
(4) Position of the European Parliament of 7 June 2005.
(5) OJ L 242, 10.9.2002, p. 1.
(6) OJ L 41, 14.2.2003, p. 26.
(7) OJ L 345, 31.12.2003, p. 90.
(8) OJ L 138, 28.5.2002, p. 1.
(9) COM(2004)0065.
(10) OJ L 192, 28.7.2000, p. 36.
(11) OJ L 324, 11.12.2003, p. 1. Regulation as amended by Regulation (EC) No 788/2004 (OJ L 138, 30.4.2004, p. 17).
(12) OJ L 204, 21.7.1998, p. 37. Directive as last amended by the 2003 Act of Accession.
(13) OJ L 120, 11.5.1990, p. 1. Regulation as last amended by Regulation (EC) No 1641/2003 of the European Parliament and of the Council (OJ L 245, 29.9.2003, p. 1).
(14) OJ L 184, 17.7.1999, p. 23.
(15)* 3 years after the date of entry into force of this Directive.
(16)** 6 years after the date of entry into force of the Directive.
(17)* 2 years after the date of entry into force of this Directive.
(18)** 5 years after the date of entry into force of this Directive.
(19)* Three years after the date of entry into force of this Directive.
(20)* Seven years after the date of entry into force of this Directive.
(21)** Two years after the date of entry into force of this Directive.
(22) Decision No 1692/96/EC of the European Parliament and of the Council of 23 July 1996 on Community guidelines for the development of the trans-European transport network (OJ L 228, 9.9.1996, p. 1). Decision as last amended by Decision No 884/2004/EC (OJ L 167, 30.4.2004, p. 1).
(23) Directive 2000/60/EC of the European Parliament and of the Council of 23 October 2000 establishing a framework for Community action in the field of water policy (OJ L 327, 22.12.2000, p. 1). Directive as amended by Decision No 2455/2001/EC (OJ L 331, 15.12.2001, p. 1).


Reinsurance ***I
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Resolution
Consolidated text
European Parliament legislative resolution on the proposal for a directive of the European Parliament and of the Council on reinsurance and amending Council Directives 73/239/EEC, 92/49/EEC and Directives 98/78/EC and 2002/83/EC (COM(2004)0273 – C6-0038/2004 – 2004/0097(COD))
P6_TA(2005)0214A6-0146/2005

(Codecision procedure: first reading)

The European Parliament,

–   having regard to the Commission proposal to the European Parliament and the Council (COM(2004)0273)(1),

–   having regard to Article 251(2) and Articles 47(2) and 55 of the EC Treaty, pursuant to which the Commission submitted the proposal to Parliament (C6-0038/2004),

–   having regard to Rule 51 of its Rules of Procedure,

–   having regard to the report of the Committee on Economic and Monetary Affairs and the opinion of the Committee on Legal Affairs (A6-0146/2005),

1.  Approves the Commission proposal as amended;

2.  Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text;

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

Position of the European Parliament adopted at first reading on 7 June 2005 with a view to the adoption of Directive 2005/..../EC of the European Parliament and of the Council on reinsurance and amending Council Directives 73/239/EEC, 92/49/EEC and Directives 98/78/EC and 2002/83/EC

P6_TC1-COD(2004)0097


(Text with EEA relevance)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Articles 47(2) and 55 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Economic and Social Committee(2),

Having regard to the opinion of the Committee of the Regions(3),

Acting in accordance with the procedure laid down in Article 251 of the Treaty(4),

Whereas:

(1)  Council Directive 73/239/EEC of 24 July 1973 on the coordination of laws, regulations and administrative provisions relating to the taking-up and pursuit of the business of direct insurance other than life assurance(5), Council Directive 92/49/EEC of 18 June 1992 on the coordination of laws, regulations and administrative provisions relating to direct insurance other than life assurance(6) and Directive 2002/83/EC of the European Parliament and of the Council of 5 November 2002 concerning life assurance(7) have laid down the provisions relating to the taking-up and pursuit of direct insurance in the Community.

(2)  Those Directives provide for the legal framework for insurance undertakings to conduct insurance business in the internal market, from the point of view both of the right of establishment and of the freedom to provide services, in order to make it easier for insurance undertakings with head offices in the Community to cover commitments situated within the Community and to make it possible for policy holders to have recourse not only to insurers established in their own country, but also to insurers which have their head office in the Community and are established in other Member States.

(3)  The regime laid down by those Directives applies to direct insurance undertakings in respect of their entire business carried on, both direct insurance activities as well as reinsurance activities by way of acceptances; however reinsurance activities conducted by specialised reinsurance undertakings are neither subject to this regime nor any other regime provided for by Community law.

(4)  Reinsurance is a major financial activity as it allows direct insurance undertakings, by facilitating a wider distribution of risks at worldwide level, to have a higher underwriting capacity to engage in insurance business and provide insurance cover and also to reduce their capital costs; furthermore reinsurance plays a fundamental role in financial stability, since it is an essential element to ensure the financial soundness and the stability of direct insurance markets as well as the financial system as a whole, because of its role of a major financial intermediary and institutional investor.

(5)  Council Directive 64/225/EEC of 25 February 1964 on the abolition of restrictions on freedom of establishment and freedom to provide services in respect of reinsurance and retrocession(8) has removed the restrictions to the right of establishment and the freedom to provide services related to the nationality or residence of the provider of reinsurance. It has not however removed restrictions caused by divergences between national provisions as regards prudential regulation of reinsurance. This situation has resulted in significant differences in the level of supervision of reinsurance undertakings in the Community, which create barriers to the pursuit of reinsurance business, such as the obligation for the reinsurance undertaking to pledge assets in order to cover its part of the technical provisions of the direct insurance undertaking, as well as the compliance by reinsurance undertakings with different supervisory rules in different Member States in which they conduct business or an indirect supervision of the different aspects of a reinsurance undertaking by the competent authorities of direct insurance undertakings.

(6)  The Action Plan for Financial Services has identified reinsurance as a sector which requires action at Community level in order to complete the internal market for financial services. Moreover, major financial fora such as the International Monetary Fund and the International Association of Insurance Supervisors (IAIS) have highlighted the lack of harmonised reinsurance supervision rules at Community level as an important gap in the financial services regulatory framework that should be filled.

(7)  This Directive aims at establishing a prudential regulatory framework for reinsurance activities in the Community. It forms part of the body of Community legislation in the field of insurance aimed at establishing the Internal Market in the insurance sector.

(8)  This Directive is consistent with major international work carried out on reinsurance prudential rules, in particular the IAIS.

(9)  This Directive follows the approach of Community legislation adopted in respect of direct insurance by carrying out the harmonisation which is essential, necessary and sufficient to ensure the mutual recognition of authorisations and prudential control systems, thereby making it possible to grant a single authorisation valid throughout the Community and apply the principle of supervision by the home Member State.

(10)  As a result, the taking up and the pursuit of the business of reinsurance are subject to the grant of a single official authorisation issued by the competent authorities of the Member State in which a reinsurance undertaking has its head office. Such authorisation enables an undertaking to carry on business throughout the Community, under the right of establishment or the freedom to provide services. The Member State of the branch or of the provision of services may not require a reinsurance undertaking which wishes to carry on reinsurance business there and which has already been authorised in its home Member State to seek fresh authorisation. Furthermore a reinsurance undertaking which has already been authorised in its home Member State should not be subject to additional supervision or checks related to its financial soundness which are performed by the competent authorities of an insurance undertaking which is reinsured by that reinsurance undertaking. In addition, Member States should not be allowed to require a reinsurance undertaking authorised in the Community to post collateral of assets in order to cover its part of the cedent's technical provisions. The conditions for the granting or withdrawal of such authorisation should be defined. The competent authorities should not authorise or continue the authorisation of a reinsurance undertaking which do not fulfil the conditions laid down in this Directive.

(11)  This Directive should apply to reinsurance undertakings which conduct exclusively reinsurance business and do not engage in direct insurance business; it should also apply to the so-called "captive" reinsurance undertakings created or owned by either a financial undertaking other than an insurance or reinsurance undertaking or a group of insurance or reinsurance undertakings to which Directive 98/78/EC of the European Parliament and of the Council of 27 October 1998 on the supplementary supervision of insurance undertakings in an insurance group(9) applies, or by one or several non-financial undertakings, the purpose of which is to provide reinsurance cover exclusively to the risks of the undertakings to which they belong. When in this Directive reference is made to reinsurance undertakings it shall include captive reinsurance undertakings, except when special provision is made for captive reinsurance undertakings. Captive reinsurance undertakings do not cover risks deriving from the external direct insurance or reinsurance business of an insurance or reinsurance undertaking belonging to the group. Furthermore, insurance or reinsurance undertakings belonging to a financial conglomerate may not own a captive undertaking.

(12)  This Directive should however not apply to insurance undertakings which are already subject to Directives 73/239/EEC and 2002/83/EC; however in order to ensure the financial soundness of insurance undertakings which also carry on reinsurance business and that the specific characteristics of these activities is duly taken into account by the capital requirements of these insurance undertakings, the provisions relating the solvency margin of reinsurance undertakings contained in this Directive should apply to reinsurance business of these insurance undertakings, if the volume of their reinsurance activities represents a significant part of their entire business.

(13)  This Directive should not apply to the provision of reinsurance cover carried out or fully guaranteed by a Member State for reasons of substantial public interest, in the capacity of reinsurer of last resort, in particular where because of a specific situation in a market, it is not feasible to obtain adequate commercial cover; in this regard a lack of "adequate commercial cover" should mainly mean a market failure which is characterised by an evident lack of a sufficient range of insurance offers, although excessive premiums should not per se imply inadequacy of that commercial cover. Article 1(2)(d)  also applies to arrangements between insurance undertakings to which Directives 73/239/EEC and 2002/83/EC apply that aim to pool financial claims ensuing from large risks such as terrorism.

(14)  The reinsurance undertaking must limit its objects to the business of reinsurance and related operations. This requirement may allow a reinsurance undertaking to carry on, for instance, activities such as provision of statistical or actuarial advice, risk analysis or research for its clients. It may also include a holding company function and activities with respect to financial sector activities within the meaning of Article 2, point 8, of Directive 2002/87/EC of the European Parliament and of the Council of 16 December 2002 on the supplementary supervision of credit institutions, insurance undertakings and investment firms in a financial conglomerate(10). In any case this requirement does not allow the carrying on of unrelated banking and financial activities.

(15)  This Directive should clarify the powers and means of supervision vested in the competent authorities. The competent authorities of the reinsurance undertaking's home Member State should be responsible for monitoring the financial health of reinsurance undertakings, including their state of solvency, the establishment of adequate technical provisions and equalisation reserves and the covering of those provisions and reserves by quality assets.

(16)  The competent authorities of the Member States should have at their disposal such means of supervision as are necessary to ensure the orderly pursuit of business by reinsurance undertakings throughout the Community whether carried on under the right of establishment or the freedom to provide services. In particular, they should be able to introduce appropriate safeguards or impose sanctions aimed at preventing irregularities and infringements of the provisions on reinsurance supervision.

(17)  The provisions governing transfers of portfolios should be in line with the single authorisation provided for in this Directive. They should apply to different kinds of transfers of portfolios between reinsurance undertakings, such as transfers of portfolios resulting from mergers between reinsurance undertakings or other instruments of company law or transfers of portfolios of outstanding losses in run-off to another reinsurance undertaking. Moreover, the provisions governing transfers of portfolios should include provisions specifically concerning the transfer to another reinsurance undertaking of the portfolio of contracts concluded under the freedom of establishment or the freedom to provide services.

(18)  Provision should be made for the exchange of information between the competent authorities and authorities or bodies which, by virtue of their function, help to strengthen the stability of the financial system. In order to preserve the confidential nature of the information forwarded, the list of addressees should remain within strict limits. It is therefore necessary to specify the conditions under which the abovementioned exchanges of information are authorised; moreover, where it is stipulated that information may be disclosed only with the express agreement of the competent authorities, these may, where appropriate, make their agreement subject to compliance with strict conditions. In this regard, and with a view to ensuring the proper supervision of reinsurance undertakings by the competent authorities, this Directive should provide for rules enabling Member States to conclude agreements on exchange of information with third countries provided that the information disclosed is subject to appropriate guarantees of professional secrecy.

(19)  For the purposes of strengthening the prudential supervision of reinsurance undertakings, it should be stipulated that an auditor must have a duty to report promptly to the competent authorities, wherever, as provided for by this Directive, he/she becomes aware, while carrying out his/her tasks, of certain facts which are liable to have a serious effect on the financial situation or the administrative and accounting organisation of a reinsurance undertaking. Having regard to the aim in view, it is desirable for Member States to provide that such a duty should apply in all circumstances where such facts are discovered by an auditor during the performance of his/her tasks in an undertaking which has close links with a reinsurance undertaking. The duty of auditors to communicate, where appropriate, to the competent authorities certain facts and decisions concerning a reinsurance undertaking which they discover during the performance of their tasks in a non-reinsurance undertaking does not in itself change the nature of their tasks in that undertaking nor the manner in which they must perform those tasks in that undertaking.

(20)  Provision should be made to define the application of this Directive to existing reinsurance undertakings which were already authorised or entitled to conduct reinsurance business in accordance with the provisions of the Member States before the application of the Directive.

(21)  In order to allow a reinsurance undertaking to meet its commitments, the home Member State should require a reinsurance undertaking to establish adequate technical provisions. The amount of such technical provisions should be determined in accordance with Council Directive 91/674/EEC of 19 December 1991 on the annual accounts and consolidated accounts of insurance undertakings(11) and, in respect of life reinsurance activities, the home Member State should also be allowed to lay down more specific rules in accordance with Directive 2002/83/EC.

(22)  A reinsurance undertaking conducting reinsurance business in respect of credit insurance, whose credit reinsurance business amounts to more than a small proportion of its total business should be required to set up an equalisation reserve which does not form part of the solvency margin; this reserve should be calculated according to the one of the methods laid down in Directive 73/239/EEC and which are recognised as equivalent; furthermore this Directive should allow the home Member State to also require reinsurance undertakings whose head office is situated within its territory to set up equalisation reserves for classes of risks other than credit reinsurance, following the rules laid down by that home Member State. Following the introduction of the IFRS 4, International Financial Reporting Standards, this Directive should clarify the prudential treatment of equalisation reserves established in accordance with this Directive. However, since supervision of reinsurance needs to be reassessed under the Solvency II project, this Directive does not pre-empt any future reinsurance supervision under Solvency II.

(23)  The reinsurance undertaking should have assets to cover technical provisions and equalisation reserves which should take account of the type of business carried out by a reinsurance undertaking, in particular the nature, amount and duration of the expected claims payments, in such a way as to secure sufficiency, liquidity, security, quality, profitability and matching of its investments, which the undertaking should ensure are diversified and adequately spread and which gives the undertaking the possibility of responding adequately to changing economic circumstances, in particular developments in the financial markets and real estate markets or major catastrophic events.

(24)  It is necessary that, over and above technical provisions, reinsurance undertakings should possess a supplementary reserve, known as the solvency margin, represented by free assets and, with the agreement of the competent authority, by other implicit assets, which shall act as a buffer against adverse business fluctuations. This requirement is an important element of prudential supervision. Pending the revision of the existing solvency margin regime, which the Commission is carrying on under the so-called "Solvency II project", in order to determine the required solvency margin of reinsurance undertakings the rules provided for in existing legislation in the field of direct insurance should be applicable.

(25)  In the light of the similarities between life reassurance covering mortality risk and non-life reinsurance, in particular the cover of insurance risks and the duration of the life reassurance contracts, the required solvency margin for life reassurance should be determined in accordance with the provisions laid down in this Directive for the calculation of the required solvency margin for non-life reinsurance; the home Member State should however be allowed to apply the rules provided for in Directive 2002/83/EC for the establishment of the required solvency margin in respect of life reassurance activities which are linked to investment funds or participating contracts.

(26)  In order to take account of the particular nature of some types of reinsurance contracts or specific lines of business, provision should be made to make adjustments to the calculation of the required solvency margin; these adjustments should be made by the Commission, after consulting the European Insurance and Occupational Pensions Committee, set up by Commission Decision 2004/9/EC of 5 November 2003(12) in the exercise of its implementing powers conferred on by the Treaty. These measures should be adopted by the use of the regulatory procedure provided for in Article 5 of Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission (13).

(27)  The list of items eligible to represent the available solvency margin laid down by this Directive should be that provided for in Directives 73/239/EEC and 2002/83/EC.

(28)  Reinsurance undertakings should also possess a guarantee fund in order to ensure they possess adequate resources when they are set up and that in the subsequent course of business the solvency margin in no event falls below a minimum of security; however in order to take account of the specificities of captive reinsurance undertakings, provision should be made to allow the home Member State to set the minimum guarantee fund required to captive reinsurance undertakings at a lower amount.

(29)  Certain provisions of this Directive define minimum standards. A home Member State should be able to lay down stricter rules for reinsurance undertakings authorised by its own competent authorities, in particular with respect to solvency margin requirements.

(30)  This Directive should be applicable to finite reinsurance activities; therefore a definition of finite reinsurance for the purposes of the application of this Directive should be necessary; owing to the special nature of this line of reinsurance activity, the home Member State should be given the option of laying down specific provisions for the pursuit of finite reinsurance activities. These provisions could differ from the general regime laid down in this Directive on a number of specific points.

(31)  This Directive should provide rules concerning those special purpose vehicles that assume risks from insurance and reinsurance undertakings. The special nature of such special purpose vehicles, which are not insurance or reinsurance undertakings, calls for the establishment of specific provisions in Member States. Furthermore, this Directive should provide that the home Member State should lay down more detailed rules in order to set the conditions under which outstanding amounts from a special purpose vehicle can be used as assets covering technical provisions by an insurance or a reinsurance undertaking. This Directive should also provide that recoverable amounts from a special purpose vehicle may be considered as amounts deductible under reinsurance or retrocession contracts within the limits set out in this Directive, subject to an application by the insurance undertaking to the competent authority and after agreement of that authority.

(32)  It is necessary to provide for measures in cases where the financial position of the reinsurance undertaking becomes such that it is difficult for it to meet its underwriting liabilities. In specific situations, there is also a need for the competent authorities to be empowered to intervene at a sufficiently early stage, but in the exercise of those powers, competent authorities should inform the reinsurance undertakings of the reasons motivating such supervisory action, in accordance with the principles of sound administration and due process. As long as such a situation exists, the competent authorities should be prevented from certifying that the reinsurance undertaking has a sufficient solvency margin.

(33)  It is necessary to make provision for cooperation between the competent authorities of the Member States in order to ensure that a reinsurance undertaking carrying on its activities under the freedom of establishment and the free provision of services complies with the provisions applicable to it in the host Member State.

(34)  Provision should be made for the right to apply to the courts should an authorisation be refused or withdrawn.

(35)  It is important to provide that reinsurance undertakings whose head office is situated outside the Community and which conduct reinsurance business in the Community should not be subject to provisions which result in treatment more favourable than that provided to reinsurance undertakings having their head office in a Member State.

(36)  In order to take account of the international aspects of reinsurance, provision should be made to enable the conclusion of international agreements with a third country aimed at defining the means of supervision over reinsurance entities who conduct business in the territory of each contracting party.

(37)  A provision should be made for a flexible procedure to make it possible to assess prudential equivalence with third countries on a Community basis, so as to improve liberalisation of reinsurance services in third countries, be it through establishment or cross-border provision of services. To that end, this Directive provides for procedures for negotiating with third countries.

(38)  The Commission should be empowered to adopt implementing measures provided that these do not modify the essential elements of this Directive. These implementing measures should enable the Community to take account of the future development of reinsurance. The measures necessary for implementation of this Directive should be adopted in accordance with Decision 1999/468/EC.

(39)  The existing Community legal framework for insurance should be adapted in order to take account of the new supervisory regime for reinsurance undertakings laid down by this Directive and in order to ensure a consistent regulatory framework for the whole insurance sector. In particular, the existing provisions which permit 'indirect supervision' of reinsurance undertakings by the authorities competent for the supervision of direct insurance undertakings should be adapted. Furthermore the current provisions enabling Member States to require pledging of assets covering the technical provisions of an insurance undertaking, whatever form this requirement might take, when the insurer is reinsured by a reinsurance undertaking authorised pursuant to this Directive or by an insurance undertaking should be abolished. Finally, it should be provided that the solvency margin required to insurance undertakings conducting reinsurance activities, when such activities represent a significant part of their business, is subject to the solvency rules provided for reinsurance undertakings in this Directive. Directives 73/239/EEC, 92/49/EEC and 2002/83/EC should therefore be amended accordingly.

(40)  Directive 98/78/EC should be amended in order to guarantee that reinsurance undertakings in an insurance or a reinsurance group are subject to supplementary supervision in the same manner as insurance undertakings which are currently part of an insurance group.

(41)  The Council, in accordance with paragraph 34 of the Interinstitutional agreement on better law-making(14), should encourage Member States to draw up, for themselves and in the interest of the Community, their own tables illustrating, as far as possible, the correlation between this Directive and the transposition measures, and to make them public.

(42)  Since the objective of the proposed action, namely the establishment of a legal framework for the taking up and pursuit of reinsurance activities, cannot be sufficiently achieved by the Member States and can therefore, by reason of the scale and the effects of the action, be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve this objective. Since this Directive defines minimum standards, Member States may lay down stricter rules,

HAVE ADOPTED THIS DIRECTIVE:

TITLE I

SCOPE AND DEFINITIONS

Article 1

Scope

1.  This Directive lays down rules for the taking up and pursuit of the self-employed activity of reinsurance carried on by reinsurance undertakings, which conduct only reinsurance activities, and which are established in a Member State or wish to become established therein.

2.  This Directive shall not apply to the following:

   a) insurance undertakings to which Directives 73/239/EEC and 2002/83/EC apply;
   b) activities and bodies referred to in Articles 2 and 3 of Directive 73/239/EEC;
   c) activities and bodies referred to in Article 3 of Directive 2002/83/EC;
   d) the activity of reinsurance conducted or fully guaranteed by the government of a Member State when this is acting, for reasons of substantial public interest, in the capacity of reinsurer of last resort including in circumstances where such a role is required by a situation in the market in which it is not feasible to obtain adequate commercial cover.

Article 2

Definitions

1.  For the purposes of this Directive the following definitions shall apply:

   a) reinsurance means the activity consisting in accepting risks ceded by an insurance undertaking or by another reinsurance undertaking. In the case of the association of underwriters known as Lloyd's, reinsurance also means the accepting by an insurance or reinsurance undertaking other than the association of underwriters known as Lloyd's of risks ceded by any member of Lloyd's;
   b) captive reinsurance undertaking means a reinsurance undertaking owned either by a financial undertaking other than an insurance or a reinsurance undertaking or a group of insurance or reinsurance undertakings to which Directive 98/78/EC applies, or by a non financial undertaking, the purpose of which is to provide reinsurance cover exclusively for the risks of the undertaking or undertakings to which it belongs or of an undertaking or undertakings of the group of which the captive reinsurance undertaking is a member;
   c) reinsurance undertaking means an undertaking which has received official authorisation in accordance with Article 3;
   d) branch means an agency or a branch of a reinsurance undertaking;
   e) establishment means the head office, branch of a reinsurance undertaking, account being taken of point (d);

f)   home Member State means the Member State in which the head office of the reinsurance undertaking is situated;

(g)  Member State of the branch means the Member State in which the branch of a reinsurance undertaking is situated;

h)   host Member State means the Member State in which a reinsurance undertaking has a branch or provides services;

   i) control means the relationship between a parent undertaking and a subsidiary, as defined in Article 1 of Directive 83/349/EEC(15), or a similar relationship between any natural or legal person and an undertaking;
   j) qualifying holding means a direct or indirect holding in an undertaking which represents 10% or more of the capital or of the voting rights or which makes it possible to exercise a significant influence over the management of the undertaking in which a holding subsists;
   k) parent undertaking means a parent undertaking as defined in Articles 1 and 2 of Directive 83/349/EEC;
   l) subsidiary means a subsidiary undertaking as defined in Articles 1 and 2 of Directive 83/349/EEC;
   m) competent authorities means the national authorities which are empowered by law or regulation to supervise reinsurance undertakings;
  n) close links means a situation in which two or more natural or legal persons are linked by:
   i) participation, which shall mean the ownership, direct or by way of control, of 20% or more of the voting rights or capital of an undertaking, or
   ii) control, in all the cases referred to in Article 1(1) and (2) of Directive 83/349/EEC or a similar relationship between any natural or legal person and an undertaking;
  o) financial undertaking means one of the following entities:
   i) a credit institution, a financial institution or an ancillary banking services undertaking within the meaning of Article 1(5) and (23) of Directive 2000/12/EC of the European Parliament and of the Council of 20 March 2000 relating to the taking up and pursuit of the business of credit institutions(16);
   ii) an insurance undertaking, a reinsurance undertaking or an insurance holding company within the meaning of Article 1(i) of Directive 98/78/EC;
   iii) an investment firm or a financial institution within the meaning of point 1 of Article 4(1) of Directive 2004/39/EC of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments(17);
   iv) a mixed financial holding company within the meaning of Article 2(15) of Directive 2002/87/EC;
   p) special purpose vehicle (SPV) means any undertaking, whether incorporated or not, other than an existing insurance or reinsurance undertaking, which assumes risks from insurance or reinsurance undertakings and which fully funds its exposure to such risks through the proceeds of a debt issuance or some other financing mechanism where the repayment rights of the providers of such debt or other financing mechanism are subordinated to the reinsurance obligations of such vehicle;
  q) finite reinsurance means reinsurance under which the explicit maximum loss potential, expressed as the maximum economic risk transferred, arising both from a significant underwriting risk and timing risk transfer, exceeds the premium over the lifetime of the contract, by a limited but significant amount, together with at least one of the following two features:
   i) explicit and material consideration of the time value of money;
   ii) contractual provisions to  moderate the balance of  economic experience between the parties over time to achieve the target risk transfer.

2.  For the purposes of paragraph 1(a), the provision of cover by a reinsurance undertaking to an institution for occupational retirement provision falling under the scope of Directive 2003/41/EC of the European Parliament and of the Council of 3 June 2003 on the activities and supervision of institutions for occupational retirement provision(18), where the law of the institution's home Member State permits such provision, shall also be considered as an activity falling under the scope of this Directive.

For the purposes of paragraph 1(d) any permanent presence of a reinsurance undertaking in the territory of a Member State shall be treated in the same way as an agency or branch, even if that presence does not take the form of a branch or agency, but consists merely of an office managed by the undertaking's own staff or by a person who is independent but has permanent authority to act for the undertaking as an agency would.

For the purposes of paragraph 1(j), and in the context of Articles 12 and 19 to 23 and of the other levels of holding referred to in Article 19 to 23, the voting rights referred to in Article 92 of Directive 2001/34/EC(19) shall be taken into account.

For the purposes of paragraph 1(l), any subsidiary of a subsidiary undertaking shall also be regarded as a subsidiary of the undertaking which is those undertakings' ultimate parent undertaking.

For the purposes of paragraph 1(n), any subsidiary undertaking of a subsidiary undertaking shall be considered a subsidiary of the parent undertaking which is at the head of those undertakings.

For the purposes of paragraph 1(n) a situation in which two or more natural or legal persons are permanently linked to one and the same person by a control relationship shall also be regarded as constituting a close link between such persons.

3.  Wherever this Directive refers to the euro, the conversion value in national currency to be adopted shall, as from 31 December of each year, be that of the last day of the preceding month of October for which euro conversion values are available in all the Community currencies.

TITLE II

THE TAKING-UP OF THE BUSINESS OF REINSURANCE AUTHORISATION OF THE REINSURANCE UNDERTAKING

Article 3

Principle of authorisation

The taking up of the business of reinsurance shall be subject to prior official authorisation.

Such authorisation shall be sought from the competent authorities of the home Member State by:

   a) any reinsurance undertaking which establishes its head office in the territory of that State;
   b) any reinsurance undertaking which, having received the authorisation, extends its business to other reinsurance activities than those already authorised.

Article 4

Scope of authorisation

1.  An authorisation pursuant to Article 3 shall be valid for the entire Community. It shall permit a reinsurance undertaking to carry on business there, under either the right of establishment or the freedom to provide services.

2.  Authorisation shall be granted for non-life reinsurance activities, life reassurance activities or all kinds of reinsurance activities, according to the request made by the applicant.

It shall be considered in the light of the scheme of operations to be submitted pursuant Articles 6(b) and 11 and the fulfilment of the conditions laid down for authorisation by the Member State from which the authorisation is sought.

Article 5

Form of the reinsurance undertaking

1.  The home Member State shall require every reinsurance undertaking for which authorisation is sought to adopt one of the forms set out in Annex I.

A reinsurance undertaking may also adopt the form of a European Company (SE) as defined in Regulation (EC) No 2157/2001(20).

2.  Member States may, where appropriate, set up undertakings in any public-law form provided that such bodies have as their objects reinsurance operations under conditions equivalent to those under which private-law undertakings operate.

Article 6

Conditions

The home Member State shall require every reinsurance undertaking for which authorisation is sought to:

   a) limit its objects to the business of reinsurance and related operations; this requirement may include a holding company function and activities with respect to financial sector activities within the meaning of Article 2, point 8, of Directive 2002/87/EC;
   b) submit a scheme of operations in accordance with Article 11;
   c) possess the minimum guarantee fund provided for in Article 40(2);
   d) be effectively run by persons of good repute with appropriate professional qualifications or experience.

Article 7

Close links

1.  Where close links exist between the reinsurance undertaking and other natural or legal persons, the competent authorities shall grant authorisation only if those links do not prevent the effective exercise of their supervisory functions.

2.  The competent authorities shall refuse authorisation if the laws, regulations or administrative provisions of a non-member country governing one or more natural or legal persons with which the reinsurance undertaking has close links, or difficulties involved in their enforcement, prevent the effective exercise of their supervisory functions.

3.  The competent authorities shall require reinsurance undertakings to provide them with the information they require to monitor compliance with the conditions referred to in paragraph 1 on a continuous basis.

Article 8

Head office of the reinsurance undertaking

Member States shall require that the head offices of reinsurance undertakings be situated in the same Member State as their registered offices

Article 9

Policy conditions and scales of premiums

1.  This Directive shall not prevent Member States from maintaining in force or introducing laws, regulations or administrative provisions requiring approval of the memorandum and articles of association and communication of any other documents necessary for the normal exercise of supervision.

2.  However, Member States may not, however, adopt provisions requiring the prior approval or systematic notification of general and special policy conditions, scales of premiums and forms and other printed documents which a reinsurance undertaking intends to use in its dealings with ceding or retro-ceding undertakings.

Article 10

Economic requirements of the market

Member States may not require that any application for authorisation be considered in the light of the economic requirements of the market.

Article 11

Scheme of operations

1.  The scheme of operations referred to in Article 6(b) shall include particulars or evidence of:

   a) the nature of the risks which the reinsurance undertaking proposes to cover;
   b) the kinds of reinsurance arrangements which the reinsurance undertaking proposes to make with ceding undertakings;
   c) the guiding principles as to retrocession;
   d) the items constituting the minimum guarantee fund;
   e) estimates of the costs of setting up the administrative services and the organisation for securing business and the financial resources intended to meet those costs.

2.  In addition to the requirements in paragraph 1, the scheme of operations shall for the first three financial years contain:

   a) estimates of management expenses other than installation costs, in particular current general expenses and commissions;
   b) estimates of premiums or contributions and claims;
   c) a forecast balance sheet;
   d) estimates of the financial resources intended to cover underwriting liabilities and the solvency margin.

Article 12

Shareholders and members with qualifying holdings

The competent authorities of the home Member State shall not grant an undertaking authorisation to take up the business of reinsurance before they have been informed of the identities of the shareholders or members, direct or indirect, whether natural or legal persons, who have qualifying holdings in that undertaking and of the amounts of those holdings.

The same authorities shall refuse authorisation if, taking into account the need to ensure the sound and prudent management of a reinsurance undertaking, they are not satisfied as to the qualifications of the shareholders or members.

Article 13

Refusal of authorisation

Any decision to refuse an authorisation shall be accompanied by the precise grounds for doing so and notified to the undertaking in question.

Each Member State shall make provision for a right to apply to the courts, pursuant to Article 53, should there be any refusal.

Such provision shall also be made with regard to cases where the competent authorities have not dealt with an application for an authorisation upon the expiry of a period of six months from the date of its receipt.

Article 14

Prior consultation with the competent authorities of other Member States

1.  The competent authorities of the other Member State involved shall be consulted prior to the granting of an authorisation to a reinsurance undertaking, which is:

   a) a subsidiary of an insurance or reinsurance undertaking authorised in another Member State; or
   b) a subsidiary of the parent undertaking of an insurance or reinsurance undertaking authorised in another Member State; or
   c) controlled by the same person, whether natural or legal, who controls an insurance or reinsurance undertaking authorised in another Member State.

2.  The competent authority of a Member State involved, who is responsible for the supervision of credit institutions or investment firms shall be consulted prior to the granting of an authorisation to a reinsurance undertaking which is:

   a) a subsidiary of a credit institution or investment firm authorised in the Community; or
   b) a subsidiary of the parent undertaking of a credit institution or investment firm authorised in the Community; or
   c) controlled by the same person, whether natural or legal, who controls a credit institution or investment firm authorised in the Community.

3.  The relevant competent authorities referred to in paragraphs 1 and 2 shall in particular consult each other when assessing the suitability of the shareholders and the reputation and experience of directors involved in the management of another entity of the same group. They shall inform each other of any information regarding the suitability of shareholders and the reputation and experience of directors which is of relevance to the other competent authorities involved for the granting of an authorisation as well as for the ongoing assessment of compliance with operating conditions.

TITLE III

CONDITIONS GOVERNING THE BUSINESS OF REINSURANCE

Chapter 1 – Principles and methods of financial supervision

Section 1- Competent authorities and general rules

Article 15

Competent authorities and object of supervision

1.  The financial supervision of a reinsurance undertaking, including that of the business it carries on either through branches or under the freedom to provide services, shall be the sole responsibility of the home Member State.

If the competent authorities of the host Member State have reason to consider that the activities of a reinsurance undertaking might affect its financial soundness, they shall inform the competent authorities of the reinsurance undertaking's home Member State. The latter authorities shall determine whether the reinsurance undertaking is complying with the prudential rules laid down in this Directive.

2.  The financial supervision pursuant to paragraph 1 shall include verification, with respect to the reinsurance undertaking's entire business, of its state of solvency, of the establishment of technical provisions and of the assets covering them in accordance with the rules laid down or practices followed in the home Member State under provisions adopted at Community level.

3.  The home Member State of the reinsurance undertaking shall not refuse a retrocession contract concluded by the reinsurance undertaking with a reinsurance undertaking authorised in accordance with this Directive or an insurance undertaking authorised in accordance with Directives 73/239/EEC or 2002/83/EC on the grounds directly related to the financial soundness of that reinsurance undertaking or that insurance undertaking.

4.  The competent authorities of the home Member State shall require every reinsurance undertaking to have sound administrative and accounting procedures and adequate internal control mechanisms.

Article 16

Supervision of branches established in another Member State

The Member State of the branch shall provide that where an reinsurance undertaking authorised in another Member State carries on business through a branch the competent authorities of the home Member State may, after having first informed the competent authorities of the Member State of the branch, carry out themselves or through the intermediary of persons they appoint for that purpose, on-the-spot verification of the information necessary to ensure the financial supervision of the undertaking. The authorities of the Member State of the branch may participate in that verification.

Article 17

Accounting, prudential and statistical information: Supervisory powers

1.  Each Member State shall require every reinsurance undertaking whose head office is situated in its territory to produce an annual account, covering all types of operation, of its financial situation and of its solvency.

2.  Member States shall require reinsurance undertakings with head offices within their territories to render periodically the returns, together with statistical documents, which are necessary for the purposes of supervision. The competent authorities shall provide each other with any documents and information that are useful for the purposes of supervision.

3.  Every Member State shall take all steps necessary to ensure that the competent authorities have the powers and means necessary for the supervision of the business of reinsurance undertakings with head offices within their territories, including business carried on outside those territories,

In particular, the competent authorities must be enabled to:

   a) make detailed enquiries regarding an reinsurance undertaking's situation and the whole of its business, inter alia, by gathering information or requiring the submission of documents concerning its reinsurance and retrocession business, and by carrying out on-the-spot investigations at the reinsurance undertaking's premises;
   b) take any measures with regard to a reinsurance undertaking, its directors or managers or the persons who control it, that are appropriate and necessary to ensure that that reinsurance undertaking's business continues to comply with the laws, regulations and administrative provisions with which the reinsurance undertaking must comply in each Member State;
   c) ensure that those measures are carried out, if need be by enforcement and where appropriate through judicial channels.

Member States may also make provision for the competent authorities to obtain any information regarding contracts which are held by intermediaries.

Article 18

Transfer of portfolio

Under the conditions laid down by national law, each Member State shall authorise reinsurance undertakings with head offices within its territory to transfer all or part of their portfolios of contracts, including those concluded either under the right of establishment or the freedom to provide services, to an accepting office established within the Community, if the competent authorities of the home Member State of the accepting office certify that, after taking the transfer into account, the latter possesses the necessary solvency margin referred to in Chapter 3.

Section 2 - qualifying holdings

Article 19

Acquisitions

Member States shall require any natural or legal person who proposes to hold, directly or indirectly, a qualifying holding in a reinsurance undertaking first to inform the competent authorities of the home Member State, indicating the size of his intended holding. That person must likewise inform the competent authorities of the home Member State if he proposes to increase his qualifying holding so that the proportion of the voting rights or of the capital he holds would reach or exceed 20%, 33% or 50% or so that the reinsurance undertaking would become his subsidiary.

The competent authorities of the home Member State shall have up to three months from the date of the notification provided for in the first subparagraph to oppose such a plan if, in view of the need to ensure sound and prudent management of the reinsurance undertaking in question, they are not satisfied as to the qualification of the person referred to in the first subparagraph. If they do not oppose the plan in question, they may fix a maximum period for its implementation.

Article 20

Acquisitions by financial undertakings

If the acquirer of the holdings referred to in Article 19 is an insurance undertaking, a reinsurance undertaking, a credit institution or an investment firm authorised in another Member State, or the parent undertaking of such an entity, or a natural or legal person controlling such an entity, and if, as a result of that acquisition, the undertaking in which the acquirer proposes to hold a holding would become a subsidiary or subject to the control of the acquirer, the assessment of the acquisition must be subject to the prior consultation referred to in Article 14.

Article 21

Disposals

Member States shall require any natural or legal person who proposes to dispose, directly or indirectly, of a qualifying holding in a reinsurance undertaking first to inform the competent authorities of the home Member State, indicating the size of his intended holding.

Such a person must likewise inform the competent authorities if he proposes to reduce his qualifying holding so that the proportion of the voting rights or of the capital he holds would fall below 20%, 33% or 50% or so that the reinsurance undertaking would cease to be his subsidiary.

Article 22

Information to the competent authority by the reinsurance undertaking

On becoming aware of them, reinsurance undertakings shall inform the competent authorities of their home Member States of any acquisitions or disposals of holdings in their capital that cause holdings to exceed or fall below any of the thresholds referred to in Articles 19 and 21.

They shall also, at least once a year, inform them of the names of shareholders and members possessing qualifying holdings and the sizes of such holdings as shown, for example, by the information received at annual general meetings of shareholders or members or as a result of compliance with the regulations relating to companies listed on stock exchanges.

Article 23

Qualifying holdings: Powers of the competent authority

Member States shall require that, where the influence exercised by the persons referred to in Article 19 is likely to operate against the prudent and sound management of a reinsurance undertaking, the competent authorities of the home Member State shall take appropriate measures to put an end to that situation. Such measures may consist, for example, in injunctions, sanctions against directors and managers, or suspension of the exercise of the voting rights attaching to the shares held by the shareholders or members in question.

Similar measures shall apply to natural or legal persons failing to comply with the obligation to provide prior information imposed pursuant to Article 19. If a holding is acquired despite the opposition of the competent authorities, the Member States shall, regardless of any other sanctions to be adopted, provide either for exercise of the corresponding voting rights to be suspended, or for the nullity of votes cast or for the possibility of their annulment.

Section 3 –Professional secrecy and exchanges of information

Article 24

Obligation

1.  Member States shall provide that all persons working or who have worked for the competent authorities, as well as auditors and experts acting on behalf of the competent authorities, are bound by an obligation of professional secrecy.

Pursuant to that obligation no confidential information which they may receive while performing their duties may be divulged to any person or authority whatsoever, except in summary or aggregate form, such that individual reinsurance undertakings cannot be identified, without prejudice to cases covered by criminal law.

2.  However, where a reinsurance undertaking has been declared bankrupt or is being compulsorily wound up, confidential information which does not concern third parties involved in attempts to rescue that undertaking may be divulged in civil or commercial proceedings.

Article 25

Exchange of information between competent authorities of Member States

Article 24 shall not prevent the competent authorities of different Member States from exchanging information in accordance with the directives applicable to reinsurance undertakings. Such information shall be subject to the conditions of professional secrecy laid down in Article 24.

Article 26

Co-operation agreements with third countries

Member States may conclude co-operation agreements providing for exchange of information with the competent authorities of third countries or with authorities or bodies of third countries as defined in Article 28(1) and (2) only if the information disclosed is subject to guarantees of professional secrecy at least equivalent to those referred to in this Section. Such exchange of information must be intended for the performance of the supervisory task of the authorities or bodies mentioned.

Where the information originates in another Member State, it may not be disclosed without the express agreement of the competent authorities which have disclosed it and, where appropriate, solely for the purposes for which those authorities gave their agreement.

Article 27

Use of confidential information

Competent authorities receiving confidential information under Articles 24 and 25 may use it only in the course of their duties:

   a) to check that the conditions governing the taking up of the business of reinsurance are met and to facilitate monitoring of the conduct of such business, especially with regard to the monitoring of technical provisions, solvency margins, administrative and accounting procedures and internal control mechanisms,
   b) to impose sanctions,
   c) in administrative appeals against decisions of the competent authorities, or
   d) in court proceedings initiated under Article 53 or under special provisions provided for in this Directive and other Directives adopted in the field of insurance and reinsurance undertakings.

Article 28

Exchange of information with other authorities

1.  Articles 24 and 27 shall not preclude the exchange of information within a Member State, where there are two or more competent authorities in the same Member State, or, between Member States, between competent authorities and:

in the discharge of their supervisory functions, or the disclosure to bodies which administer compulsory winding-up proceedings or guarantee funds of information necessary to the performance of their duties. The information received by those authorities, bodies and persons shall be subject to the conditions of professional secrecy laid down in Article 24.

   a) authorities responsible for the official supervision of credit institutions and other financial organisations and the authorities responsible for the supervision of financial markets,
   b) bodies involved in the liquidation and bankruptcy of insurance and reinsurance undertakings and in other similar procedures, and
   c) persons responsible for carrying out statutory audits of the accounts of insurance undertakings, reinsurance undertakings and other financial institutions,

2.  Notwithstanding Articles 24-27, Member States may authorise exchanges of information between the competent authorities and:

   a) the authorities responsible for overseeing the bodies involved in the liquidation and bankruptcy of insurance or reinsurance undertaking and other similar procedures, or
   b) the authorities responsible for overseeing the persons charged with carrying out statutory audits of the accounts of insurance or reinsurance undertakings, credit institutions, investment firms and other financial institutions, or
   c) independent actuaries of insurance or reinsurance undertakings carrying out legal supervision of those undertakings and the bodies responsible for overseeing such actuaries.

Member States which have recourse to the option provided for in the first subparagraph shall require at least that the following conditions are met:

   a) this exchange of information shall be for the purpose of carrying out the overseeing or legal supervision referred to in the first subparagraph;
   b) information received in this context shall be subject to the conditions of professional secrecy imposed in Article 24;
   c) where the information originates in another Member State, it may not be disclosed without the express agreement of the competent authorities which have disclosed it and, where appropriate, may only be disclosed for the purposes for which those authorities gave their agreement.

Member States shall communicate to the Commission and to the other Member States the names of the authorities, persons and bodies which may receive information pursuant to this paragraph.

3.  Notwithstanding Articles 24-27, Member States may, with the aim of strengthening the stability, including integrity, of the financial system, authorise the exchange of information between the competent authorities and the authorities or bodies responsible under the law for the detection and investigation of breaches of company law.

Member States which have recourse to the option provided for in the first subparagraph shall require at least that the following conditions are met:

   a) the information shall be for the purpose of performing the task referred to in the first subparagraph;
   b) information received in this context shall be subject to the conditions of professional secrecy imposed in Article 24;
   c) where the information originates in another Member State, it may not be disclosed without the express agreement of the competent authorities which have disclosed it and, where appropriate, solely for the purposes for which those authorities gave their agreement.

Where, in a Member State, the authorities or bodies referred to in the first subparagraph perform their task of detection or investigation with the aid, in view of their specific competence, of persons appointed for that purpose and not employed in the public sector, the possibility of exchanging information provided for in the first subparagraph may be extended to such persons under the conditions laid down in the second subparagraph.

In order to implement the final indent of the second subparagraph, the authorities or bodies referred to in the first subparagraph shall communicate to the competent authorities which have disclosed the information the names and precise responsibilities of the persons to whom it is to be sent.

Member States shall communicate to the Commission and to the other Member States the names of the authorities or bodies which may receive information pursuant to this paragraph.

Article 29

Transmission of information to central banks and monetary authorities

This Section shall not prevent a competent authority from transmitting to central banks and other bodies with a similar function in their capacity as monetary authorities, and where appropriate, to other public authorities responsible for overseeing payment systems, information intended for the performance of their task. Nor shall it prevent such authorities or bodies from communicating to the competent authorities such information as they may need for the purposes of Article 27.

Information received in this context shall be subject to the conditions of professional secrecy imposed in this Section.

Article 30

Disclosure of information to government administrations responsible for financial legislation

Notwithstanding Articles 24 and 27, Member States may, under provisions laid down by law, authorise the disclosure of certain information to other departments of their central government administrations responsible for legislation on the supervision of credit institutions, financial institutions, investment services and insurance or reinsurance undertakings and to inspectors acting on behalf of those departments.

However, such disclosures may be made only where necessary for reasons of prudential control.

Member States shall, however, provide that information received under Articles 25 and 28(1) and that obtained by means of the on-the-spot verification referred to in Article 16 may never be disclosed in the cases referred to in this Article except with the express consent of the competent authorities which disclosed the information or of the competent authorities of the Member State in which on-the-spot verification was carried out.

Section 4 – Duties of auditors

Article 31

Duties of auditors

1.  Member States shall provide at least that any person authorised in accordance with Directive 84/253/EEC(21), performing in a reinsurance undertaking the task described in Article 51 of Directive 78/660/EEC(22), Article 37 of Directive 83/349/EEC or Article 31 of Directive 85/611/EEC(23) or any other statutory task, shall have a duty to report promptly to the competent authorities any fact or decision concerning that undertaking of which he has become aware while carrying out that task which is liable to:

   a) constitute a material breach of the laws, regulations or administrative provisions which lay down the conditions governing authorisation or which specifically govern pursuit of the activities of insurance or reinsurance undertakings, or
   b) affect the continuous functioning of the reinsurance undertaking, or
   c) lead to refusal to certify the accounts or to the expression of reservations;

That person shall also have a duty to report any facts and decisions of which he/she becomes aware in the course of carrying out a task as described in the first subparagraph in an undertaking having close links resulting from a control relationship with the reinsurance undertaking within which he/she is carrying out the abovementioned task.

2.  The disclosure to the competent authorities, by persons authorised in accordance with Directive 84/253/EEC, of any relevant fact or decision referred to in paragraph 1 shall not constitute a breach of any restriction on disclosure of information imposed by contract or by any legislative, regulatory or administrative provision and shall not involve such persons in liability of any kind.

Chapter 2 – Rules relating to technical provisions

Article 32

Establishment of technical provisions

1.  The home Member State shall require every reinsurance undertaking to establish adequate technical provisions in respect of its entire business.

The amount of such technical provisions shall be determined in accordance with the rules laid down in Directive 91/674/EEC. Where applicable the home Member State may lay down more specific rules in accordance with Article 20 of Directive 2002/83/EC.

2.  Member States shall not retain or introduce a system with gross reserving which requires pledging of assets to cover unearned premiums and outstanding claims provisions if the reinsurer is a reinsurance undertaking authorised in accordance with this Directive or an insurance undertaking authorised in accordance with Directives 73/239/EEC or 2002/83/EC.

3.  When the home Member State allows any technical provisions to be covered by claims against reinsurers who are not authorised in accordance with this Directive or insurance undertakings which are not authorised in accordance with Directives 73/239/EEC or 2002/83/EC, it shall set the conditions for accepting such claims.

Article 33

Equalization reserves

1.  The home Member State shall require every reinsurance undertaking which reinsures risks included in class 14 in point A of the Annex to Directive 73/239/EEC to set up an equalization reserve for the purpose of offsetting any technical deficit or above-average claims ratio arising in that class in any financial year.

2.  The equalization reserve for credit reinsurance shall be calculated in accordance with the rules laid down by the home Member State in accordance with one of the four methods set out in point D of the Annex to Directive 73/239/EEC, which shall be regarded as equivalent.

3.  The home Member State may exempt reinsurance undertakings from the obligation to set up equalization reserves for reinsurance of credit insurance business where the premiums or contributions receivable in respect of reinsurance of credit insurance are less than 4% of the total premiums or contributions receivable by them and less than EUR 2 500 000.

4.  The home Member State may require every reinsurance undertaking to set up equalization reserves for classes of risks other than credit reinsurance. The equalization reserves shall be calculated according to the rules laid down by the home Member State.

Article 34

Assets covering technical provisions

1.  The home Member State shall require every reinsurance undertaking to invest the assets covering the technical provisions and the equalization reserve referred to in Article 33 in accordance with the following rules:

   a) the assets shall take account of the type of business carried out by a reinsurance undertaking, in particular the nature, the amount and the duration of the expected claims payments, in such a way as to secure sufficiency, liquidity, security, quality, profitability and matching of its investments;
   b) the reinsurance undertaking shall ensure that the assets are diversified and adequately spread and allow the undertaking to respond adequately to changing economic circumstances, in particular developments in the financial markets and real estate markets or major catastrophic events. The undertaking has to assess the impact of irregular market circumstances on its assets and has to diversify the assets in such a way that it reduces such impact;
   c) investment in assets which are not admitted to trading on a regulated financial market must in any event be kept to prudent levels;
   d) investment in derivative instruments shall be possible insofar as they contribute to a reduction of investment risks or facilitate efficient portfolio management. They must be valued on a prudent basis, taking into account the underlying assets, and included in the valuation of the institution's assets. The institution shall also avoid excessive risk exposure to a single counterparty and to other derivative operations;
   e) the assets shall be properly diversified in such a way as to avoid excessive reliance on any one particular asset, issuer or group of undertakings and accumulations of risk in the portfolio as a whole. Investments in assets issued by the same issuer or by issuers belonging to the same group shall not expose the undertaking to excessive risk concentration.

Member States may decide not to apply the requirements referred to in point (e) to investment in government bonds.

2.  Member States shall not require reinsurance undertakings located in their territory to invest in particular categories of assets.

3.  Member States shall not subject the investment decisions of a reinsurance undertaking located in their territory or its investment manager to any kind of prior approval or systematic notification requirements.

4.  Notwithstanding the provisions of paragraphs 1 to 3, the home Member State may, for every reinsurance undertaking whose head office is situated in its territory, lay down the following quantitative rules, provided they are prudentially justified:

   a) investments of gross technical provisions in currencies other than those in which technical provisions are set should be limited to 30%;
   b) investments of gross technical provisions in shares and other negotiable securities treated as shares, bonds, debt securities which are not admitted to trading on a regulated market should be limited to 30%;
   c) the home Member State may require every reinsurance undertaking to invest no more than 5% of its gross technical provisions in shares and other negotiable securities treated as shares, bonds, debt securities and other money and capital market instruments from the same undertaking, and no more than 10% of its total gross technical provisions in shares and other negotiable securities treated as shares, bonds, debt securities and other money and capital market instruments from undertakings which are members of the same group.

5.  Furthermore, the home Member State shall lay down more detailed rules setting the conditions for the use of amounts outstanding from a special purpose vehicle as assets covering technical provisions pursuant to this Article.

Chapter 3 – Rules relating to the solvency margin and to the guarantee fund

Section 1 – Available Solvency margin

Article 35

General rule

Each Member State shall require of every reinsurance undertaking whose head office is situated in its territory an adequate available solvency margin in respect of its entire business at all times, which is at least equal to the requirements in this Directive.

Article 36

Eligible items

1.  The available solvency margin shall consist of the assets of the reinsurance undertaking free of any foreseeable liabilities, less any intangible items, including:

  a) the paid-up share capital or, in the case of a mutual reinsurance undertaking, the effective initial fund plus any members' accounts which meet all the following criteria:
   i) the memorandum and articles of association must stipulate that payments may be made from these accounts to members only in so far as this does not cause the available solvency margin to fall below the required level, or, after the dissolution of the undertaking, if all the undertaking's other debts have been settled;
   ii) the memorandum and articles of association must stipulate, with respect to any payments referred to in point (i) for reasons other than the individual termination of membership, that the competent authorities must be notified at least one month in advance and can prohibit the payment within that period;
   iii) the relevant provisions of the memorandum and articles of association may be amended only after the competent authorities have declared that they have no objection to the amendment, without prejudice to the criteria stated in points (i) and (ii);
   b) statutory and free reserves not corresponding to underwriting liabilities or classified as equalisation reserves;
   c) the profit or loss brought forward after deduction of dividends to be paid.

2.  The available solvency margin shall be reduced by the amount of own shares directly held by the reinsurance undertaking.

For those reinsurance undertakings which discount or reduce their non-life technical provisions for claims outstanding to take account of investment income as permitted by Article 60(1)(g) of Directive 91/674/EEC, the available solvency margin shall be reduced by the difference between the undiscounted technical provisions or technical provisions before deductions as disclosed in the notes on the accounts, and the discounted or technical provisions after deductions. This adjustment shall be made for all risks listed in point A of the Annex to Directive 73/239/EEC, except for risks listed under classes 1 and 2 of that Annex. For classes other than 1 and 2 of that Annex, no adjustment need be made in respect of the discounting of annuities included in technical provisions.

In addition to the deductions in subparagraphs 1 and 2, the available solvency margin shall be reduced by the following items:

  a) participations which the reinsurance undertaking holds in the following entities:
   i) insurance undertakings within the meaning of Article 6 of Directive 73/239/EEC, Article 4 of Directive 2002/83/EC, or Article 1(b) of Directive 98/78/EC,
   ii) reinsurance undertakings within the meaning of Article 3 of this Directive or non-member-country reinsurance undertaking within the meaning of Article 1(l) of Directive 98/78/EC,
   iii) insurance holding companies within the meaning of Article 1(i) of Directive 98/78/EC,
   iv) credit institutions and financial institutions within the meaning of Article 1(1) and (5) of Directive 2000/12/EC,
   v) investment firms and financial institutions within the meaning of Article 1(2) of Council Directive 93/22/EEC of 10 May 1993 on investment services in the securities field(24) and of Article 2(4) and (7) of Council Directive 93/6/EEC of 15 March 1993 on the capital adequacy of investments firms and credit institutions(25);
  b) each of the following items which the reinsurance undertaking holds in respect of the entities defined in (a) in which it holds a participation:
   i) instruments referred to in paragraph 4,
   ii) instruments referred to in Article 27(3) of Directive 2002/83/EC,
   iii) subordinated claims and instruments referred to in Article 35 and Article 36(3) of Directive 2000/12/EC.

Where shares in another credit institution, investment firm, financial institution, insurance or reinsurance undertaking or insurance holding company are held temporarily for the purposes of a financial assistance operation designed to reorganise and save that entity, the competent authority may waive the provisions on deduction referred to under (a) and (b) of the fourth subparagraph.

As an alternative to the deduction of the items referred to in (a) and (b) of the fourth subparagraph which the reinsurance undertaking holds in credit institutions, investment firms and financial institutions, Member States may allow their reinsurance undertakings to apply mutatis mutandis methods 1, 2, or 3 of Annex I to Directive 2002/87/EC. Method 1 (Accounting consolidation) shall only be applied if the competent authority is confident about the level of integrated management and internal control regarding the entities which would be included in the scope of consolidation. The method chosen shall be applied in a consistent manner over time.

Member States may provide that, for the calculation of the solvency margin as provided for by this Directive, reinsurance undertakings subject to supplementary supervision in accordance with Directive 98/78/EC or to supplementary supervision in accordance with Directive 2002/87/EC, need not deduct the items referred to in (a) and (b) of the fourth subparagraph which are held in credit institutions, investment firms, financial institutions, insurance or reinsurance undertakings or insurance holding companies which are included in the supplementary supervision.

For the purposes of the deduction of participations referred to in this paragraph, participation shall mean a participation within the meaning of Article 1(f) of Directive 98/78/EC.

3.  The available solvency margin may also consist of:

   a) cumulative preferential share capital and subordinated loan capital up to 50 % of the available solvency margin or the required solvency margin, whichever is the smaller, no more than 25 % of which shall consist of subordinated loans with a fixed maturity, or fixed-term cumulative preferential share capital, provided in the event of the bankruptcy or liquidation of the reinsurance undertaking, binding agreements exist under which the subordinated loan capital or preferential share capital ranks after the claims of all other creditors and is not to be repaid until all other debts outstanding at the time have been settled.

Subordinated loan capital must also fulfil the following conditions:

   i) only fully paid-up funds may be taken into account;
   ii) for loans with a fixed maturity, the original maturity must be at least five years. No later than one year before the repayment date the reinsurance undertaking must submit to the competent authorities for their approval a plan showing how the available solvency margin will be kept at or brought to the required level at maturity, unless the extent to which the loan may rank as a component of the available solvency margin is gradually reduced during at least the last five years before the repayment date. The competent authorities may authorise the early repayment of such loans provided application is made by the issuing reinsurance undertaking and its available solvency margin will not fall below the required level;
   iii) loans the maturity of which is not fixed must be repayable only subject to five years' notice unless the loans are no longer considered as a component of the available solvency margin or unless the prior consent of the competent authorities is specifically required for early repayment. In the latter event the reinsurance undertaking must notify the competent authorities at least six months before the date of the proposed repayment, specifying the available solvency margin and the required solvency margin both before and after that repayment. The competent authorities shall authorise repayment only if the reinsurance undertaking's available solvency margin will not fall below the required level;
   iv) the loan agreement must not include any clause providing that in specified circumstances, other than the winding-up of the reinsurance undertaking, the debt will become repayable before the agreed repayment dates;
   v) the loan agreement may be amended only after the competent authorities have declared that they have no objection to the amendment;
  b) securities with no specified maturity date and other instruments, including cumulative preferential shares other than those mentioned in point (a), up to 50 % of the available solvency margin or the required solvency margin, whichever is the smaller, for the total of such securities and the subordinated loan capital referred to in point (a) provided they fulfil the following:
   i) they may not be repaid on the initiative of the bearer or without the prior consent of the competent authority;
   ii) the contract of issue must enable the reinsurance undertaking to defer the payment of interest on the loan;
   iii) the lender's claims on the reinsurance undertaking must rank entirely after those of all non-subordinated creditors;
   iv) the documents governing the issue of the securities must provide for the loss-absorption capacity of the debt and unpaid interest, while enabling the reinsurance undertaking to continue its business;
   v) only fully paid-up amounts may be taken into account.

4.  Upon application, with supporting evidence, by the undertaking to the competent authority of the home Member State and with the agreement of that competent authority, the available solvency margin may also consist of:

   a) one half of the unpaid share capital or initial fund, once the paid-up part amounts to 25 % of that share capital or fund, up to 50 % of the available solvency margin or the required solvency margin, whichever is the smaller;
   b) in the case of non-life mutual or mutual-type association with variable contributions, any claim which it has against its members by way of a call for supplementary contribution, within the financial year, up to one half of the difference between the maximum contributions and the contributions actually called in, and subject to a limit of 50 % of the available solvency margin or the required solvency margin, whichever is the smaller. The competent national authorities shall establish guidelines laying down the conditions under which supplementary contributions may be accepted;
   c) any hidden net reserves arising out of the valuation of assets, in so far as such hidden net reserves are not of an exceptional nature.

5.  In addition, with respect to life reinsurance activities, the available solvency margin may, upon application, with supporting evidence, by the undertaking to the competent authority of the home Member State and with the agreement of that competent authority, consist of:

   a) until 31 December 2009 an amount equal to 50 % of the undertaking's future profits, but not exceeding 25 % of the available solvency margin or the required solvency margin, whichever is the smaller; the amount of the future profits shall be obtained by multiplying the estimated annual profit by a factor which represents the average period left to run on policies; the factor used may not exceed six; the estimated annual profit shall not exceed the arithmetical average of the profits made over the last five financial years in the activities listed in Article 2(1) of Directive 2002/83/EC.

Competent authorities may only agree to include such an amount for the available solvency margin:

   i) when an actuarial report is submitted to the competent authorities substantiating the likelihood of emergence of these profits in the future; and
   ii) in so far as that part of future profits emerging from hidden net reserves referred to in paragraph 4(c) has not already been taken into account;
   b) where Zillmerising is not practised or where, if practised, it is less than the loading for acquisition costs included in the premium, the difference between a non-Zillmerised or partially Zillmerised mathematical provision and a mathematical provision Zillmerised at a rate equal to the loading for acquisition costs included in the premium; this figure may not, however, exceed 3,5 % of the sum of the differences between the relevant capital sums of life assurance activities and the mathematical provisions for all policies for which Zillmerising is possible; the difference shall be reduced by the amount of any undepreciated acquisition costs entered as an asset.

6.  Amendments to paragraphs 1 to 5 to take into account developments that justify a technical adjustment of the elements eligible for the available solvency margin, shall be adopted in accordance with the procedure laid down in Article 55(2) of this Directive.

Section 2- Required solvency margin

Article 37

Required solvency margin for non-life reinsurance activities

1.  The required solvency margin shall be determined on the basis either of the annual amount of premiums or contributions, or of the average burden of claims for the past three financial years.

In the case, however, of reinsurance undertakings which essentially underwrite only one or more of the risks of credit, storm, hail or frost, the last seven financial years shall be taken as the reference period for the average burden of claims.

2.  Subject to Article 40, the amount of the required solvency margin shall be equal to the higher of the two results as set out in paragraphs 3 and 4.

3.  The premium basis shall be calculated using the higher of gross written premiums or contributions as calculated below, and gross earned premiums or contributions.

Premiums or contributions in respect of the classes 11, 12 and 13 listed in point A of the Annex to Directive 73/239/EEC shall be increased by 50%.

Premiums or contributions in respect of classes other than 11, 12 and 13 listed in point A of the Annex to Directive 73/239/EEC, may be enhanced up to 50%, for specific reinsurance activities or contract types, in order to take account of the specificities of these activities or contracts, in accordance with the procedure referred to in Article 55(2) of this Directive. The premiums or contributions, inclusive of charges ancillary to premiums or contributions, due in respect of reinsurance business in the last financial year shall be aggregated.

From this sum there shall then be deducted the total amount of premiums or contributions cancelled in the last financial year, as well as the total amount of taxes and levies pertaining to the premiums or contributions entering into the aggregate.

The amount so obtained shall be divided into two portions, the first portion extending up to EUR 50 000 000, the second comprising the excess; 18% and 16% of these portions respectively shall be calculated and added together.

The sum so obtained shall be multiplied by the ratio existing in respect of the sum of the last three financial years between the amount of claims remaining to be borne by the reinsurance undertaking after deduction of amounts recoverable under retrocession and the gross amount of claims; this ratio may in no case be less than 50%. Upon application, with supporting evidence, by the reinsurance undertaking to the competent authority of the home Member State and with agreement of that authority, amounts recoverable from special purpose vehicles referred to in Article 46 of this Directive may also be deducted as retrocession.

With the approval of the competent authorities, statistical methods may be used to allocate the premiums or contributions.

4.  The claims basis shall be calculated, as follows, using in respect of the classes 11, 12 and 13 listed in point A of the Annex to Directive 73/239/EEC, claims, provisions and recoveries increased by 50%.

Claims provisions and recoveries in respect of classes other than 11, 12 and 13 listed in point A of the Annex to Directive 73/239/EEC, may be enhanced up to 50%, for specific reinsurance activities or contract types, in order to take account of the specificities of these activities or contracts, in accordance with the procedure referred to in Article 55(2) of this Directive.

The amounts of claims paid, without any deduction of claims borne by retrocessionaires, in the periods specified in paragraph 1 shall be aggregated.

To this sum there shall be added the amount of provisions for claims outstanding established at the end of the last financial year.

From this sum there shall be deducted the amount of recoveries effected during the periods specified in paragraph 1.

From the sum then remaining, there shall be deducted the amount of provisions for claims outstanding established at the commencement of the second financial year preceding the last financial year for which there are accounts. If the period of reference established in paragraph 1 equals seven years, the amount of provisions for claims outstanding established at the commencement of the sixth financial year preceding the last financial year for which there are accounts shall be deducted.

One-third, or one-seventh, of the amount so obtained, according to the period of reference established in paragraph 1, shall be divided into two portions, the first extending up to EUR 35 000 000 and the second comprising the excess; 26% and 23% of these portions respectively shall be calculated and added together.

The sum so obtained shall be multiplied by the ratio existing in respect of the sum of the last three financial years between the amount of claims remaining to be borne by the undertaking after deduction of amounts recoverable under retrocession and the gross amount of claims; this ratio may in no case be less than 50%. Upon application, with supporting evidence, by the reinsurance undertaking to the competent authority of the home Member State and with agreement of that authority, amounts recoverable from special purpose vehicles referred to in Article 46 of this Directive may also be deducted as retrocession.

With the approval of the competent authorities, statistical methods may be used to allocate claims, provisions and recoveries.

5.  If the required solvency margin as calculated in paragraphs 2, 3 and 4 is lower than the required solvency margin of the year before, the required solvency margin shall be at least equal to the required solvency margin of the year before multiplied by the ratio of the amount of the technical provisions for claims outstanding at the end of the last financial year and the amount of the technical provisions for claims outstanding at the beginning of the last financial year. In these calculations technical provisions shall be calculated net of retrocession but the ratio may in no case be higher than 1.

6.  The fractions applicable to the portions referred to in the sixth subparagraph of paragraph 3 and the sixth subparagraph of paragraph 4 shall each be reduced to a third in the case of reinsurance of health insurance practised on a similar technical basis to that of life assurance, if

   a) the premiums paid are calculated on the basis of sickness tables according to the mathematical method applied in insurance;
   b) a provision is set up for increasing age;
   c) an additional premium is collected in order to set up a safety margin of an appropriate amount;
   d) the insurance undertaking may cancel the contract before the end of the third year of insurance at the latest;
   e) the contract provides for the possibility of increasing premiums or reducing payments even for current contracts.

Article 38

Required solvency margin for life reassurance activities

1.  The required solvency margin for life reassurance activities shall be determined in accordance with Article 37 of this Directive.

2.  Notwithstanding paragraph 1, the home Member State may provide that for reinsurance classes of assurance business covered by Article 2(1)(a) of Directive 2002/83/EC linked to investment funds or participating contracts and for the operations referred to in Article 2(1)(b), 2(2)(b), (c), (d) and (e) of Directive 2002/83/EC, the required solvency margin is to be determined in accordance with Article 28 of Directive 2002/83/EC.

Article 39

Required solvency margin for a reinsurance undertaking conducting simultaneously non-life and life reinsurance

1.  The home Member State shall require that every reinsurance undertaking conducting both non-life reinsurance and life reinsurance business shall have an available solvency margin to cover the total sum of required solvency margins in respect of both non-life and life reinsurance activities which shall be determined in accordance with Articles 37 and 38 respectively.

2.  If the available solvency margin does not reach the level required in paragraph 1, the competent authorities shall apply the measures provided for in Articles 42 and 43.

Section 3 – Guarantee fund

Article 40

Amount of the guarantee fund

1.  One third of the required solvency margin as specified in Articles 37 to 39 shall constitute the guarantee fund. This fund shall consist of the items listed in Article 36(1) to (3) and, with the agreement of the competent authority of the home Member State, (4)(c).

2.  The guarantee fund may not be less than a minimum of EUR 3 000 000.

Any Member State may provide that as regards captive reinsurance undertakings, the minimum guarantee fund be not less than EUR 1 000 000.

Article 41

Review of the amount of the guarantee fund

1.  The amounts in euro as laid down in Article 40(2) shall be reviewed annually as from ...(26) in order to take account of changes in the European index of consumer prices comprising all Member States as published by Eurostat.

The amounts shall be adapted automatically by increasing the base amount in euro by the percentage change in that index over the period between the entry into force of this Directive and the review date and rounded up to a multiple of EUR 100 000.

If the percentage change since the last adaptation is less than 5%, no adaptation shall take place.

2.  The Commission shall inform annually the European Parliament and the Council of the review and the adapted amounts referred to in paragraph 1.

Chapter 4 – Reinsurance undertakings in difficulty or in an irregular situation and withdrawal of authorisation

Article 42

Reinsurance undertakings in difficulty

1.  If a reinsurance undertaking does not comply with Article 32, the competent authority of its home Member State may prohibit the free disposal of its assets after having communicated its intention to the competent authorities of the host Member States.

2.  For the purposes of restoring the financial situation of a reinsurance undertaking the solvency margin of which has fallen below the minimum required under Articles 37, 38 and 39, the competent authority of the home Member State shall require that a plan for the restoration of a sound financial situation be submitted for its approval.

In exceptional circumstances, if the competent authority is of the opinion that the financial situation of the reinsurance undertaking will deteriorate further, it may also restrict or prohibit the free disposal of the reinsurance undertaking's assets. It shall inform the authorities of other Member States within the territories of which the reinsurance undertaking carries on business of any measures it has taken and the latter shall, at the request of the former, take the same measures.

3.  If the solvency margin falls below the guarantee fund as defined in Article 40, the competent authority of the home Member State shall require the reinsurance undertaking to submit a short-term finance scheme for its approval.

It may also restrict or prohibit the free disposal of the reinsurance undertaking's assets. It shall inform the authorities of all other Member States and the latter shall, at the request of the former, take the same measures.

4.  Each Member State shall take the measures necessary to be able, in accordance with its national law, to prohibit the free disposal of assets located within its territory at the request, in the cases provided for in paragraphs 1, 2 and 3, of the reinsurance undertaking's home Member State, which shall designate the assets to be covered by such measures.

Article 43

Financial recovery plan

1.  Member States shall ensure that the competent authorities have the power to require a financial recovery plan for those reinsurance undertakings where competent authorities consider that their obligations arising out of reinsurance contracts are threatened.

2.  The financial recovery plan must, as a minimum, include particulars or proof concerning for the next three financial years:

   a) estimates of management expenses, in particular current general expenses and commissions;
   b) a plan setting out detailed estimates of income and expenditure in respect of reinsurance acceptances and reinsurance cessions;
   c) a forecast balance sheet;
   d) estimates of the financial resources intended to cover underwriting liabilities and the required solvency margin;
   e) the overall retrocession policy.

3.  Where the financial position of the reinsurance undertaking is deteriorating and the contractual obligations of the reinsurance undertaking are threatened, Member States shall ensure that the competent authorities have the power to oblige reinsurance undertakings to have a higher required solvency margin, in order to ensure that the reinsurance undertaking is able to fulfil the solvency requirements in the near future. The level of this higher required solvency margin shall be based on a financial recovery plan referred to in paragraph 1.

4.  Member States shall ensure that the competent authorities have the power to revalue downwards all elements eligible for the available solvency margin, in particular, where there has been a significant change in the market value of these elements since the end of the last financial year.

5.  Member States shall ensure that the competent authorities have the power to decrease the reduction, based on retrocession, to the solvency margin as determined in accordance with Articles 37, 38 and 39 where:

   a) the nature or quality of retrocession contracts has changed significantly since the last financial year;
   b) there is no or a limited risk transfer under the retrocession contracts.

6.  If the competent authorities have required a financial recovery plan for the reinsurance undertaking in accordance with paragraph 1, they shall refrain from issuing a certificate in accordance with Article 18, as long as they consider that its obligations arising out of reinsurance contracts are threatened within the meaning of paragraph 1.

Article 44

Withdrawal of authorisation

1.  Authorisation granted to a reinsurance undertaking by the competent authority of its home Member State may be withdrawn by that authority if that undertaking:

   a) does not make use of that authorisation within 12 months, expressly renounces it or ceases to carry on business for more than 6 months, unless the Member State concerned has made provision for authorisation to lapse in such cases;
   b) no longer fulfils the conditions for admission;
   c) has been unable, within the time allowed, to take the measures specified in the restoration plan or finance scheme referred to in Article 42;
   d) fails seriously in its obligations under the regulations to which it is subject.

In the event of the withdrawal or lapse of authorisation, the competent authority of the home Member State shall notify the competent authorities of the other Member States accordingly, and they shall take appropriate measures to prevent the reinsurance undertaking from commencing new operations within their territories, under either the right of establishment or the freedom to provide services.

2.  Any decision to withdraw an authorisation shall be supported by precise reasons and communicated to the reinsurance undertaking in question.

TITLE IV

PROVISIONS RELATING TO FINITE REINSURANCE AND SPECIAL PURPOSE VEHICLES

Article 45

Finite Reinsurance

1.  The home Member State may lay down specific provisions concerning the pursuit of finite reinsurance activities regarding:

   - mandatory conditions for inclusion in all contracts issued;
   - sound administrative and accounting procedures, adequate internal control mechanisms and risk management requirements;
   - accounting, prudential and statistical information requirements;
   - the establishment of technical provisions to ensure that they are adequate, reliable and objective;
   - investment of assets covering technical provisions in order to ensure that they take account of the type of business carried on by the reinsurance undertaking, in particular the nature, the amount and the duration of the expected claims payments, in such a way as to secure sufficiency, liquidity, security, profitability and matching of its assets;
   - rules relating to available solvency margin, required solvency margin and the minimum guarantee fund that the reinsurance undertaking shall maintain in respect of finite reinsurance activities.

2.  In the interests of transparency, Member States shall communicate the text of all measures laid down by their national law for the purposes of paragraph 1 to the Commission without delay.

Article 46

Special Purpose Vehicles (SPVs) that assume risks from insurance or reinsurance undertakings

1.  Where a Member State decides to allow the establishment within its territory of special purpose vehicles within the meaning of this Directive, it shall require prior official authorisation thereof.

2.  The Member State where the special purpose vehicle is established shall lay down the conditions under which the activities of such an undertaking shall be carried on. In particular, that Member State shall lay down rules regarding:

   - scope of authorisation; mandatory conditions for inclusion in all contracts issued;
   - good repute and appropriate professional qualifications of persons running the special purpose vehicle;
   - fit and proper requirements for shareholders or members having a qualifying holding in the special purpose vehicle;
   - sound administrative and accounting procedures, adequate internal control mechanisms and risk management requirements;
   - accounting, prudential and statistical information requirements;
   - rules relating to solvency requirements of special purpose vehicles.

3.  In the interests of transparency, Member States shall communicate the text of all measures laid down by their national law for the purposes of paragraph 2, to the Commission without delay.

TITLE V

PROVISIONS RELATING TO RIGHT OF ESTABLISHMENT AND FREEDOM TO PROVIDE SERVICES

Article 47

Reinsurance undertakings not complying with the legal provisions

1.  If the competent authorities of the host Member State establish that a reinsurance undertaking with a branch or carrying on business under the freedom to provide services within its territory is not complying with the legal provisions applicable to it in that State, they shall require the reinsurance undertaking concerned to remedy that irregular situation. At the same time, they shall refer those findings to the competent authority of the home Member State.

If, despite the measures taken by the competent authority of the home Member State or because such measures prove inadequate, the reinsurance undertaking persists in infringing the legal provisions applicable to it in the host Member State, the latter may, after informing the competent authority of the home Member State, take appropriate measures to prevent or penalize further infringements, including in so far as is strictly necessary, preventing that reinsurance undertaking from continuing to conclude new reinsurance contracts within its territory. Member States shall ensure that within their territories it is possible to serve the legal documents necessary for such measures on reinsurance undertakings.

2.  Any measure adopted under paragraph 1 involving penalties or restrictions on the conduct of reinsurance business must be properly reasoned and communicated to the reinsurance undertaking concerned.

Article 48

Winding-up

In the event of a reinsurance undertaking's being wound up, commitments arising out of contracts underwritten through a branch or under the freedom to provide services shall be met in the same way as those arising out of that undertaking's other reinsurance contracts.

TITLE VI

REINSURANCE UNDERTAKINGS WHOSE HEAD OFFICES ARE OUTSIDE THE COMMUNITY AND CONDUCTING REINSURANCE ACTIVITIES IN THE COMMUNITY

Article 49

Principle and conditions for conducting reinsurance business

A Member State shall not apply to reinsurance undertakings having their registered offices outside the Community and commencing or carrying out reinsurance activities in its territory, provisions which result in a more favourable treatment than that accorded to reinsurance undertakings having their head office in that Member State.

Article 50

Agreements with third countries

1.  The Commission may submit proposals to the Council for the negotiation of agreements with one or more third countries regarding the means of exercising supervision over:

   a) reinsurance undertakings which have their head offices situated in a third country, and conduct reinsurance business in the Community,
   b) reinsurance undertakings which have their head offices in the Community and conduct reinsurance business in the territory of a third country.

2.  The agreements referred to in paragraph 1 shall in particular seek to ensure under conditions of equivalence of prudential regulation, effective market access for reinsurance undertakings in the territory of each contracting party and provide for mutual recognition of supervisory rules and practices on reinsurance. They shall also seek that:

   a) the competent authorities of the Member States are able to obtain the information necessary for the supervision or reinsurance undertakings situated in the Community and conduct business in the territory of third countries concerned,
   b) the competent authorities of third countries are able to obtain the information necessary for the supervision of reinsurance undertakings the head offices of which are situated within their territories and conduct business in the Community.

3.  Without prejudice to Articles 300(1) and (2) of the Treaty establishing the European Community, the Commission, shall, with the assistance of the European Insurance and Occupational Pensions Committee examine the outcome of the negotiations referred to in paragraph 1 and the resulting situation.

TITLE VII

SUBSIDIARIES OF PARENT UNDERTAKINGS GOVERNED BY THE LAWS OF A THIRD COUNTRY AND ACQUISITIONS OF HOLDINGS BY SUCH PARENT UNDERTAKINGS

Article 51

Information from Member States to the Commission

The competent authorities of the Member States shall inform the Commission and the competent authorities of the other Member States:

   a) of any authorisation of a direct or indirect subsidiary, one or more parent undertakings of which are governed by the laws of a third country.
   b) whenever such a parent undertaking acquires a holding in a Community reinsurance undertaking which would turn the latter into its subsidiary.

When authorisation as referred to in point (a) is granted to the direct or indirect subsidiary of one or more parent undertakings governed by the law of third countries, the structure of the group shall be specified in the notification which the competent authorities shall address to the Commission.

Article 52

Third country treatment of Community Reinsurance undertakings

1.  Member States shall inform the Commission of any general difficulties encountered by their reinsurance undertakings in establishing themselves and operating in a third country or carrying on activities to a third country.

2.  Periodically, the Commission shall draw up a report examining the treatment accorded to Community reinsurance undertakings in third countries, in the terms referred to in paragraph 3, as regards the establishment of Community reinsurance undertakings in third countries, the acquisition of holdings in third-country reinsurance undertakings, the carrying on of reinsurance activities by such established undertakings and the cross-border provision of reinsurance activities from the Community to third countries. The Commission shall submit those reports to the Council, together with any appropriate proposals or recommendations.

3.  Whenever it appears to the Commission, either on the basis of the reports referred to in paragraph 2 or on the basis of other information, that a third country is not granting Community reinsurance undertakings effective market access, the Commission may submit recommendations to the Council for the appropriate mandate for negotiation with a view to obtaining improved market access for Community reinsurance undertakings.

4.  Measures taken under this Article shall comply with the Community's obligations under any international agreements, in particular in the World Trade Organisation.

TITLE VIII

OTHER PROVISIONS

Article 53

Right to apply to the courts

Member States shall ensure that decisions taken in respect of a reinsurance undertaking under laws, regulations and administrative provisions implementing this Directive are subject to the right to apply to the courts.

Article 54

Co-operation between the Member States and the Commission

1.  Member States shall cooperate with each other for the purpose of facilitating the supervision of reinsurance within the Community and the application of this Directive.

2.  The Commission and the competent authorities of the Member States shall collaborate closely for the purpose of facilitating the supervision of reinsurance within the Community and of examining any difficulties which may arise in the application of this Directive.

Article 55

Committee procedure

1.  The Commission shall be assisted by the European Insurance and Occupational Pensions Committee.

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

The period laid down in Article 5(6) of Decision 1999/468/EC shall be three months.

3.  The Committee shall adopt its rules of procedure.

Article 56

Implementing measures

The following implementing measures to this Directive shall be adopted in accordance with the procedure referred to in Article 55(2):

   a) extension of the legal forms provided for in Annex I to this Directive,
   b) clarification of the items constituting the solvency margin listed in Article 36 to take account of the creation of new financial instruments,
   c) enhancement up to 50% the premiums or claims amounts used for the calculation of the required solvency margin provided for in Article 37(3) and (4), in classes other than 11, 12 and 13 listed in point A of the Annex to Directive 73/239/EEC, for specific reinsurance activities or contract types, to take account of the specificities of these activities or contracts,
   d) alteration of the minimum guarantee fund provided for in Article 40(2) to take account of economic and financial developments,
   e) clarification of the definitions in Article 2 in order to ensure uniform application of this Directive throughout the Community.

TITLE IX

AMENDMENTS TO EXISTING DIRECTIVES

Article 57

Amendments to Directive 73/239/EEC

Directive 73/239/EEC is amended as follows:

(1)  In Article 12a, paragraphs 1 and 2 are replaced by the following:

"

1.  The competent authorities of the other Member State involved shall be consulted prior to the granting of an authorisation to a non-life insurance undertaking, which is:

   a) a subsidiary of an insurance or reinsurance undertaking authorised in another Member State; or
   b) a subsidiary of the parent undertaking of an insurance or reinsurance undertaking authorised in another Member State; or
   c) controlled by the same person, whether natural or legal, who controls an insurance or reinsurance undertaking authorised in another Member State.

2.  The competent authority of a Member State involved responsible for the supervision of credit institutions or investment firms shall be consulted prior to the granting of an authorisation to a non-life insurance undertaking which is:

   a) a subsidiary of a credit institution or investment firm authorised in the Community; or
   b) a subsidiary of the parent undertaking of a credit institution or investment firm authorised in the Community; or
   c) controlled by the same person, whether natural or legal, who controls a credit institution or investment firm authorised in the Community.

"

(2)  In Article 13(2), the following third subparagraph is added:

"

The home Member State of the insurance undertaking shall not refuse a reinsurance contract concluded by the insurance undertaking with a reinsurance undertaking authorised in accordance with Directive 200./../EC of the European Parliament and of the Council* [reinsurance Directive] or an insurance undertaking authorised in accordance with this Directive or Directive 2002/83/EC of the European Parliament and of the Council** on the grounds directly related to the financial soundness of the reinsurance undertaking or the insurance undertaking.

__________________

* OJ L…

** OJ L 345, 19.12.2002, p. 1. Directive as last amended by Directive 2005/1/EC.

"

(3)  In Article 15, paragraphs 2 and 3 are replaced by the following:

"

2.  The home Member State shall require every insurance undertaking to cover the technical provisions and the equalisation reserve referred to in Article 15 a by matching assets in accordance with Article 6 of Directive 88/357/EEC. In respect of risks situation within the European Community, those assets must be localised within the Community. Member States shall not require insurance undertakings to localise their assets in any particular Member State. The home Member State may, however, allow the rules on the localisation of assets to be relaxed.

3.  Member States shall not retain or introduce for the establishment of technical provisions a system of gross reserving which requires pledging of assets to cover unearned premiums and outstanding claims provisions by the reinsurer, when the reinsurer is a reinsurance undertaking authorised in accordance with Directive 200./../EC [reinsurance Directive] or an insurance undertaking or an insurance undertaking authorised in accordance with this Directive or Directive 2002/83/EC.

When the home Member State allows any technical provisions to be covered by claims against a reinsurer who is neither a reinsurance undertaking authorised in accordance with Directive 200./../EC [reinsurance Directive] nor an insurance undertaking authorised in accordance with this Directive or Directive 2002/83/EC, it shall set the conditions for accepting such claims.

"

(4)  Article 16(2) is amended as follows:

(a) point (b) is replaced by the following:

"
   b) reserves (statutory and free reserves) not corresponding to underwriting liabilities or classified as equalisation reserves;
"

(  b) the introductory wording and point (a) of the fourth subparagraph are replaced by the following:

"

The available solvency margin shall also be reduced by the following items:

  a) participations which the insurance undertaking holds in

__________________________
* OJ L 330, 5.12.1998, p. 1. Directive as last amended by Directive 2005/1/EC.
** OJ L 126, 26.5.2000, p. 1. Directive as last amended by Directive 2005/1/EC.
*** OJ L 141, 11.6.1993, p. 27. Directive as last amended by Directive 2002/87/EC.
**** OJ L 141, 11.6.1993, p. 1. Directive as last amended by Directive 2005/1/EC.
   - insurance undertakings within the meaning of Article 6 of this Directive, Article 4 of Directive 2002/83/EC, or Article 1(b) of Directive 98/78/EC of the European Parliament and of the Council*,
   - reinsurance undertakings within the meaning of Article 3 of Directive 200./..EC [reinsurance Directive] or non-member-country reinsurance undertakings within the meaning of Article 1(l) of Directive 98/78/EC,
   - insurance holding companies within the meaning of Article 1(i) of Directive 98/78/EC,
   - credit institutions and financial institutions within the meaning of Article 1(1) and (5) of Directive 2000/12/EC of the European Parliament and of the Council**,
   - investment firms and financial institutions within the meaning of Article 1(2) of Council Directive 93/22/EEC*** and of Article 2(4) and (7) of Council Directive 93/6/EEC****.

"

(5)  Article 16a is amended as follows:

   a) in paragraph 3, the seventh subparagraph is replaced by the following:"
The sum so obtained shall be multiplied by the ratio existing in respect of the sum of the last three financial years between the amount of claims remaining to be borne by the undertaking after deduction of amounts recoverable under reinsurance and the gross amount of claims; this ratio may in no case be less than 50%. Upon application, with supporting evidence, by the insurance undertaking to the competent authority of the home Member State and with the agreement of that authority, amounts recoverable from special purpose vehicles referred to in Article 46 of Directive 200./.../EC [reinsurance Directive] may be deducted as retrocession."
   b) in paragraph 4, the seventh subparagraph is replaced by the following:"
The sum so obtained shall be multiplied by the ratio existing in respect of the sum of the last three financial years between the amount of claims remaining to be borne by the undertaking after deduction of amounts recoverable under reinsurance and the gross amount of claims; this ratio may in no case be less than 50%. Upon application, with supporting evidence, by the insurance undertaking to the competent authority of the home Member State and with the agreement of that authority, amounts recoverable from special purpose vehicles referred to in Article 46 of Directive 200./.../EC [reinsurance Directive] may be deducted as retrocession."

(6)  The following Article 17b is inserted:

"

Article 17b

1.  Each Member State shall require that an insurance undertaking whose head office is situated within its territory and which conducts reinsurance activities establishes, in respect of its entire business, a minimum guarantee fund in accordance with Article 40 of Directive 200./../EC [reinsurance directive], where one of the following conditions is met:

   a) the reinsurance premiums collected exceed 10% of its total premium;
   b) the reinsurance premiums collected exceed EUR 50 000 000;
   c) the technical provisions resulting from its reinsurance acceptances exceed 10% of its total technical provisions.

2.  Each Member State may choose to apply to such insurance undertakings as are referred to in paragraph 1 and whose head office is situated within its territory the provisions of Article 34 of Directive 200./../EC [reinsurance directive] in respect of their reinsurance acceptance activities, where one of the conditions laid down in paragraph 1 is met.

In that case, the relevant Member State shall require that all assets employed by the insurance undertaking to cover the technical provisions corresponding to its reinsurance acceptances shall be ring-fenced, managed and organised separately from the  direct insurance activities of the insurance undertaking, without any possibility of transfer. In such a case, and only as far as their reinsurance acceptance activities are concerned, insurance undertakings shall not be subject to Articles 20 to 22 of Directive 92/49/EEC and Annex I to Directive 88/357/EEC.

Each Member State shall ensure that their competent authorities verify the separation provided for in the preceding subparagraph.

3.  If the Commission decides, pursuant to Article 56(c) of Directive 200./../EC [reinsurance Directive] to enhance the amounts used for the calculation of the required solvency margin provided for in Article 37(3) and (4) of that Directive, each Member State shall apply to such insurance undertakings as are referred to in paragraph 1 the provisions of Articles 35 to 39 of that Directive in respect of their reinsurance acceptance activities.

"

(7)  In Article 20a, paragraph 4 is replaced by the following:

"

4.  Member States shall ensure that the competent authorities have the power to decrease the reduction, based on reinsurance, to the solvency margin as determined in accordance with Article 16a where:

a)   the nature or quality of reinsurance contracts has changed significantly since the last financial year;

b)   there is no, or a limited, risk transfer under the reinsurance contracts.

"

Article 58

Amendments to Directive 92/49/EEC

Directive 92/49/EEC is amended as follows:

(1)  In Article 15, paragraph 1a is replaced by the following:

"

1a. If the acquirer of the holdings referred to in paragraph 1 is an insurance undertaking, a reinsurance undertaking, a credit institution or an investment firm authorised in another Member State, or the parent undertaking of such an entity, or a natural or legal person controlling such an entity, and if, as a result of that acquisition, the undertaking in which the acquirer proposes to hold a holding would become a subsidiary or subject to the control of the acquirer, the assessment of the acquisition must be subject to the prior consultation referred to in Article 12a of Directive 73/239/EEC

"

(2)  In Article 16, paragraphs 4, 5 and 5a are replaced by the following:

"

4.  Competent authorities receiving confidential information under paragraph 1 or 2 may use it only in the course of their duties:

   - to check that the conditions governing the taking up of the business of insurance are met and to facilitate monitoring of the conduct of such business, especially with regard to the monitoring of technical provisions, solvency margins, administrative and accounting procedures and internal control mechanisms,
   - to impose sanctions,
   - in administrative appeals against decisions of the competent authorities, or
   - in court proceedings initiated under Article 53 or under special provisions provided for in this Directive and other Directives adopted in the field of insurance undertakings and reinsurance undertakings.

5.  Paragraphs 1 and 4 shall not preclude the exchange of information within a Member State, where there are two or more competent authorities in the same Member State, or, between Member States, between competent authorities and:

in the discharge of their supervisory functions, and the disclosure, to bodies which administer compulsory winding-up proceedings or guarantee funds, of information necessary to the performance of their duties. The information received by these authorities, bodies and persons shall be subject to the obligation of professional secrecy laid down in paragraph 1.

5a. Notwithstanding paragraphs 1 to 4, Member States may authorise exchanges of information between the competent authorities and:

   - authorities responsible for the official supervision of credit institutions and other financial organisations and the authorities responsible for the supervision of financial markets,
   - bodies involved in the liquidation and bankruptcy of insurance undertakings, reinsurance undertakings and in other similar procedures, and
   - persons responsible for carrying out statutory audits of the accounts of insurance undertakings, reinsurance undertakings and other financial institutions,
   - the authorities responsible for overseeing the bodies involved in the liquidation and bankruptcy of assurance undertakings, reinsurance undertakings and other similar procedures, or
   - the authorities responsible for overseeing the persons charged with carrying out statutory audits of the accounts of insurance undertakings, reinsurance undertakings, credit institutions, investment firms and other financial institutions, or
   - independent actuaries of insurance undertakings or reinsurance undertakings carrying out legal supervision of those undertakings and the bodies responsible for overseeing such actuaries.

Member States which have recourse to the option provided for in the first subparagraph shall require at least that the following conditions are met:

   - this information shall be for the purpose of carrying out the overseeing or legal supervision referred to in the first subparagraph,
   - information received in this context shall be subject to the conditions of professional secrecy imposed in paragraph 1,
   - where the information originates in another Member State, it may not be disclosed without the express agreement of the competent authorities which have disclosed it and, where appropriate, solely for the purposes for which those authorities gave their agreement.

Member States shall communicate to the Commission and to the other Member States the names of the authorities, persons and bodies which may receive information pursuant to this paragraph.

"

(3)  Article 21(1) is amended as follows:

a)   the introduction is replaced by the following:

"

1.  The home Member State may not authorise insurance undertakings to cover their technical provisions and equalisation reserves with any assets other than those in the following categories:

"

b)   point (f) of point (B) is replaced by the following:

"

f)   debts owed by reinsurers, including reinsurers" shares of technical provisions, and by the special purpose vehicles referred to in Article 46 of Directive 200./../EC of the European Parliament and of the Council* [reinsurance Directive].

________________

* OJ L ....

"

c)   the third subparagraph is replaced by the following:

"

The inclusion of any asset or category of assets listed in the first subparagraph shall not mean that all these assets should automatically be accepted as cover for technical provisions. The home Member State shall lay down more detailed rules setting the conditions for the use of acceptable assets.

"

(4)  In Article 22(1), the introduction is replaced by the following:

"

1.  As regard the assets covering technical provisions and equalisation reserves, the home Member State shall require every insurance undertaking to invest no more than:

"

Article 59

Amendments to Directive 2002/83/EC

Directive 2002/83/EC is amended as follows

(1)  In Article 1 (1), the following point (s) is added:

"

_____________

* OJ L…

   s) "reinsurance undertaking" shall mean a reinsurance undertaking within the meaning of Article 2 point (c) of Directive 200./../EC of the European Parliament and of the Council* [reinsurance Directive].
"

(2)  The following Article 9a is inserted:

"

Article 9a

Prior consultation with the competent authorities of other Member States

1.  The competent authorities of the other Member State involved shall be consulted prior to the granting of an authorisation to a life assurance undertaking, which is:

   a) a subsidiary of an insurance or reinsurance undertaking authorised in another Member State; or
   b) a subsidiary of the parent undertaking of an insurance or reinsurance undertaking authorised in another Member State; or
   c) controlled by the same person, whether natural or legal, who controls an insurance or reinsurance undertaking authorised in another Member State.

2.  The competent authority of a Member State involved responsible for the supervision of credit institutions or investment firms shall be consulted prior to the granting of an authorisation to a life assurance undertaking which is:

   a) a subsidiary of a credit institution or investment firm authorised in the Community; or
   b) a subsidiary of the parent undertaking of a credit institution or investment firm authorised in the Community; or
   c) controlled by the same person, whether natural or legal, who controls a credit institution or investment firm authorised in the Community.

3.  The relevant competent authorities referred to in paragraphs 1 and 2 shall in particular consult each other when assessing the suitability of the shareholders and the reputation and experience of directors involved in the management of another entity of the same group. They shall inform each other of any information regarding the suitability of shareholders and the reputation and experience of directors which is of relevance to the other competent authorities involved for the granting of an authorisation as well as for the ongoing assessment of compliance with operating conditions.

"

(3)  In Article 10(2), the following second subparagraph is added:

"

The home Member State of the insurance undertaking shall not refuse a reinsurance contract concluded by the insurance undertaking with a reinsurance undertaking authorised in accordance with Directive 200./../EC [reinsurance Directive] or an insurance undertaking authorised in accordance with Directive 73/239/EEC or this Directive on the grounds directly related to the financial soundness of the reinsurance undertaking or the insurance undertaking.

"

(4)  In Article 15, the following paragraph (1a) is inserted:

"

1a. If the acquirer of the holdings referred to in paragraph 1 is an insurance undertaking, a reinsurance undertaking, a credit institution or an investment firm authorised in another Member State, or the parent undertaking of such an entity, or a natural or legal person controlling such an entity, and if, as a result of that acquisition, the undertaking in which the acquirer proposes to hold a holding would become a subsidiary or subject to the control of the acquirer, the assessment of the acquisition must be subject to the prior consultation referred to in Article 9a.

"

(5)  Article 16 is amended as follows:

a)   paragraphs 4, 5 and 6 are replaced by the following:

"

4.  Competent authorities receiving confidential information under paragraphs 1 or 2 may use it only in the course of their duties:

   - to check that the conditions governing the taking-up of the business of assurance are met and to facilitate monitoring of the conduct of such business, especially with regard to the monitoring of technical provisions, solvency margins, administrative and accounting procedures and internal control mechanisms, or
   - to impose sanctions, or
   - in administrative appeals against decisions of the competent authority, or
   - in court proceedings initiated pursuant to Article 67 or under special provisions provided for in this Directive and other directives adopted in the field of assurance undertakings and reinsurance undertakings.

5.  Paragraphs 1 and 4 shall not preclude the exchange of information within a Member State, where there are two or more competent authorities in the same Member State, or, between Member States, between competent authorities and:

in the discharge of their supervisory functions, and the disclosure, to bodies which administer (compulsory) winding-up proceedings or guarantee funds, of information necessary to the performance of their duties. The information received by these authorities, bodies and persons shall be subject to the obligation of professional secrecy laid down in paragraph 1.

   - authorities responsible for the official supervision of credit institutions and other financial organisations and the authorities responsible for the supervision of financial markets,
   - bodies involved in the liquidation and bankruptcy of assurance undertakings, reinsurance undertakings and in other similar procedures, and
   - persons responsible for carrying out statutory audits of the accounts of assurance undertakings, reinsurance undertakings and other financial institutions,

6.  Notwithstanding paragraphs 1 to 4, Member States may authorise exchanges of information between the competent authorities and:

   - the authorities responsible for overseeing the bodies involved in the liquidation and bankruptcy of assurance undertakings, reinsurance undertakings and other similar procedures, or
   - the authorities responsible for overseeing the persons charged with carrying out statutory audits of the accounts of insurance undertakings, reinsurance undertakings, credit institutions, investment firms and other financial institutions, or
   - independent actuaries of insurance undertakings and reinsurance undertakings carrying out legal supervision of those undertakings and the bodies responsible for overseeing such actuaries.

Member States which have recourse to the option provided for in the first subparagraph shall require at least that the following conditions are met:

   - this information shall be for the purpose of carrying out the overseeing or legal supervision referred to in the first subparagraph,
   - information received in this context shall be subject to the conditions of professional secrecy imposed in paragraph 1,
   - where the information originates in another Member State, it may not be disclosed without the express agreement of the competent authorities which have disclosed it and, where appropriate, solely for the purposes for which those authorities gave their agreement.

Member States shall communicate to the Commission and to the other Member States the names of the authorities, persons and bodies which may receive information pursuant to this paragraph.

"

b)   paragraph 8 is replaced by the following:

"

information intended for the performance of their task, nor shall it prevent such authorities or bodies from communicating to the competent authorities such information as they may need for the purposes of paragraph 4. Information received in this context shall be subject to the conditions of professional secrecy imposed in this Article.

Paragraphs 1 to 7 shall not prevent a competent authority from transmitting

   - to central banks and other bodies with a similar function in their capacity as monetary authorities,
   - where appropriate, to other public authorities responsible for overseeing payment systems

"

(6)  Article 20(4) is replaced by the following:

"

4.  Member States shall not retain or introduce for the establishment of technical provisions a system of gross reserving which requires pledging of assets to cover unearned premiums and outstanding claims provisions by the reinsurer, authorised in accordance with Directive 200./../EC [reinsurance Directive] when the reinsurer is a reinsurance undertaking or an insurance undertaking authorised in accordance with Directives 73/239/EEC or this Directive.

When the home Member State allows any technical provisions to be covered by claims against a reinsurer who is neither a reinsurance undertaking authorised in accordance with Directive 200./../EC [reinsurance Directive] nor an insurance undertaking authorised in accordance with Directives 73/239/EEC or this Directive, it shall set the conditions for accepting such claims.

"

(7)  Article 23 is amended as follows:

a)   in paragraph 1(B), point (f) is replaced by the following:

"

f)   debts owed by reinsurers, including reinsurers" shares of technical provisions, and by special purpose vehicles referred to in Article 46 of Directive 200./../EC [reinsurance Directive];

"

b)   in paragraph 3, the first subparagraph is replaced by the following:

"

3.  The inclusion of any asset or category of assets listed in paragraph 1 shall not mean that all these assets should automatically be accepted as cover for technical provisions. The home Member State shall lay down more detailed rules setting the conditions for the use of acceptable assets.

"

(8)  In Article 27(2), the following second, third, fourth, fifth, sixth and seventh subparagraphs are added:

"

The available solvency margin shall also be reduced by the following items:

  a) participations which the assurance undertaking holds, in:
   - insurance undertakings within the meaning of Article 4 of this Directive, Article 6 of Directive 73/239/EEC, or Article 1(b) of Directive 98/78/EC of the European Parliament and of the Council*,
   - reinsurance undertakings within the meaning of Article 3 of Directive 200./../EC [reinsurance Directive] or a non-member-country reinsurance undertakings within the meaning of Article 1(l) of Directive 98/78/EC,
   - insurance holding companies within the meaning of Article 1(i) of Directive 98/78/EC,
   - credit institutions and financial institutions within the meaning of Article 1(1) and (5) of Directive 2000/12/EC,
   - investment firms and financial institutions within the meaning of Article 1(2) of Directive 93/22/EEC and of Articles 2(4) and 2(7) of Council Directive 93/6/EEC**;
  b) each of the following items which the assurance undertaking holds in respect of the entities defined in point (a) in which it holds a participation:
   - instruments referred to in paragraph 3,
   - instruments referred to in Article 16(3) of Directive 73/239/EEC,
   - subordinated claims and instruments referred to in Article 35 and Article 36(3) of Directive 2000/12/EC.

Where shares in another credit institution, investment firm, financial institution, insurance or reinsurance undertaking or insurance holding company are held temporarily for the purposes of a financial assistance operation designed to reorganise and save that entity, the competent authority may waive the provisions on deduction referred to in points (a) and (b) of the third subparagraph.

As an alternative to the deduction of the items referred to in (a) and (b) of the third subparagraph which the insurance undertaking holds in credit institutions, investment firms and financial institutions, Member States may allow their insurance undertakings to apply mutatis mutandis methods 1, 2, or 3 of Annex I to Directive 2002/87/EC of the European Parliament and of the Council***. Method 1 (Accounting consolidation) shall only be applied if the competent authority is confident about the level of integrated management and internal control regarding the entities which would be included in the scope of consolidation. The method chosen shall be applied in a consistent manner over time.

Member States may provide that, for the calculation of the solvency margin as provided for by this Directive, insurance undertakings subject to supplementary supervision in accordance with Directive 98/78/EC or to supplementary supervision in accordance with Directive 2002/87/EC, need not deduct the items referred to in (a) and (b) of the third subparagraph which are held in credit institutions, investment firms, financial institutions, insurance or reinsurance undertakings or insurance holding companies which are included in the supplementary supervision.

For the purposes of the deduction of participations referred to in this paragraph, participation shall mean a participation within the meaning of Article 1(g) of Directive 98/78/EC.

__________________________

* OJ L 330, 5.12.1998, p. 1. Directive as last amended by Directive 2005/1/EC.

** OJ L 141, 11.6.1993, p. 1. Directive as last amended by Directive 2005/1/EC.

*** OJ L 35, 11.2.2003, p. 1. Directive as amended by Directive 2005/1/EC.

"

(9)  Article 28 is amended as follows:

a)   point (a) is replaced by the following:

"

a 4% fraction of the mathematical provisions relating to direct business and reinsurance acceptances gross of reinsurance cessions shall be multiplied by the ratio, for the last financial year, of the mathematical provisions net of reinsurance cessions to the gross total mathematical provisions. That ratio may in no case be less than 85%; upon application, with supporting evidence, by the insurance undertaking to the competent authority of the home Member State and with agreement of that authority, amounts recoverable from the special purpose vehicles referred to in Article 46 of Directive 200./.../EC [reinsurance Directive] may be deducted as retrocession.

   a) first result:
"

b)   point (b), first subparagraph is replaced by the following:

"

for policies on which the capital at risk is not a negative figure, a 0.3% fraction of such capital underwritten by the assurance undertaking shall be multiplied by the ratio, for the last financial year, of the total capital at risk retained as the undertaking's liability after reinsurance cessions and retrocessions to the total capital at risk gross of reinsurance; that ratio may in no case be less than 50%. Upon application, with supporting evidence, by the insurance undertaking to the competent authority of the home Member State and with agreement of that authority, amounts recoverable from the special purpose vehicles referred to in Article 46 of Directive 200./.../EC [reinsurance Directive] may be deducted as retrocession.

   b) second result:
"

(10)  The following Article 28a is inserted:

"

Article 28a

Solvency margin for assurance undertakings conducting reinsurance activities

1.  Each Member State shall apply to insurance undertakings whose head office is situated within its territory the provisions of Articles 35 to 39 of Directive 200./../EC [reinsurance Directive] in respect of their reinsurance acceptances activities, where one of the following conditions is met:

   a) the reinsurance premiums collected exceed 10% of their total premium;
   b) the reinsurance premiums collected exceed EUR 50 000 000;
   c) the technical provisions resulting from their reinsurance acceptances exceed 10% of their total technical provisions.

2.  Each Member State may choose to apply to assurance undertakings referred to in paragraph 1 and whose head office is situated within its territory the provisions of Article 34 of Directive 200./../EC [reinsurance Directive] in respect of their reinsurance acceptance activities, where one of the conditions laid down in paragraph 1 is met.

In that case, the respective Member State shall require that all assets employed by the assurance undertaking to cover the technical provisions corresponding to its reinsurance acceptances shall be ring-fenced, managed and organised separately from the direct assurance activities of the assurance undertaking, without any possibility of transfer. In such case, and only as far as their reinsurance acceptance activities are concerned, assurance undertakings shall not be subject to Articles 22 to 26.

Each Member State shall ensure that their competent authorities verify the separation provided for in the second subparagraph.

"

(11)  Article 37(4) is replaced by the following:

"

4.  Member States shall ensure that the competent authorities have the power to decrease the reduction, based on reinsurance, to the solvency margin as determined in accordance with Article 28 where:

   a) the nature or quality of reinsurance contracts has changed significantly since the last financial year;
   b) there is no, or a limited, risk transfer under the reinsurance contracts.

"

Article 60

Amendments to Directive 98/78/EC

Directive 98/78/EC is amended as follows:

(1)  The title is replaced by the following:

Directive 98/78/EC of the European Parliament and of the Council of 27 October 1998 on the supplementary supervision of insurance and reinsurance undertakings in an insurance or reinsurance group.

(2)  Article 1 is amended as follows:


____________________
* OJ L …
** OJ L 35, 11.2.2003, p. 1. Directive as amended by Directive 2005/1/EC.
   (a) The points (c), (i), (j) and (k) are replaced by the following:"
   c) reinsurance undertaking means an undertaking, which has received official authorisation in accordance with Article 3 of Directive 200./../EC of the European Parliament and of the Council* [reinsurance Directive];
   i) "insurance holding company" means a parent undertaking, the main business of which is to acquire and hold participations in subsidiary undertakings, where those subsidiary undertakings are exclusively or mainly insurance undertakings, reinsurance undertakings or non-member-country insurance undertakings or non-member-country reinsurance undertakings, at least one of such subsidiary undertakings being an insurance undertaking, or a reinsurance undertaking and which is not a mixed financial holding company within the meaning of Directive 2002/87/EC of the European Parliament and of the Council**;
   j) "mixed-activity insurance holding company' means a parent undertaking, other than an insurance undertaking, a non-member country insurance undertaking, a reinsurance undertaking, a non-member country reinsurance undertaking, an insurance holding company or a mixed financial holding company within the meaning of Directive 2002/87/EC, which includes at least one insurance undertaking or a reinsurance undertaking among its subsidiary undertakings;
   k) "competent authorities" means the national authorities which are empowered by law or regulation to supervise insurance undertakings or reinsurance undertakings.
"

(b)  The following point (l) is added:

"
   l) "non-member-country reinsurance undertaking" means an undertaking which would require authorisation in accordance with Article 3 of Directive 200./../EC [reinsurance Directive] if it had its registered office in the Community;
"

(3)  Articles 2, 3 and 4 are replaced by the following:

"

Article 2

Cases of application of supplementary supervision of insurance undertakings and reinsurance undertakings

1.  In addition to the provisions of Directives 73/239/EEC, 2002/83/EC of the European Parliament and of the Council* and 200./…/EC [reinsurance Directive], which lay down the rules for the supervision of insurance undertakings and reinsurance undertakings, Member States shall provide supervision of any insurance undertaking or any reinsurance undertaking, which is a participating undertaking in at least one insurance undertaking, reinsurance undertaking, non-member-country insurance undertaking or a non-member country reinsurance undertaking, shall be supplemented in the manner prescribed in Articles 5, 6, 8 and 9.

2.  Every insurance undertaking or reinsurance undertaking the parent undertaking of which is an insurance holding company, a non-member-country insurance or a non-member-country reinsurance undertaking shall be subject to supplementary supervision in the manner prescribed in Articles 5(2), 6, 8 and 10.

3.  Every insurance undertaking or reinsurance undertaking the parent undertaking of which is a mixed-activity insurance holding company shall be subject to supplementary supervision in the manner prescribed in Articles 5(2), 6 and 8.

Article 3

Scope of supplementary supervision

1.  The exercise of supplementary supervision in accordance with Article 2 shall in no way imply that the competent authorities are required to play a supervisory role in relation to the non-member-country insurance undertaking, the non-member-country reinsurance undertaking, insurance holding company or mixed-activity insurance holding company taken individually.

2.  The supplementary supervision shall take into account the following undertakings referred to in Articles 5, 6, 8, 9 and 10:

   - related undertakings of the insurance undertaking or of the reinsurance undertaking,
   - participating undertakings in the insurance undertaking or in the reinsurance undertaking,
   - related undertakings of a participating undertaking in the insurance undertaking or in the reinsurance undertaking.

3.  Member States may decide not to take into account in the supplementary supervision referred to in Article 2 undertakings having their registered office in a non-member country where there are legal impediments to the transfer of the necessary information, without prejudice to the provisions of Annex I, point 2.5, and of Annex II, point 4.

Furthermore, the competent authorities responsible for exercising supplementary supervision may in the cases listed below decide on a case-by-case basis not to take an undertaking into account in the supplementary supervision referred to in Article 2:

   - if the undertaking which should be included is of negligible interest with respect to the objectives of the supplementary supervision of insurance undertakings or reinsurance undertakings;
   - if the inclusion of the financial situation of the undertaking would be inappropriate or misleading with respect to the objectives of the supplementary supervision of insurance undertakings or reinsurance undertakings.

Article 4

Competent authorities for exercising supplementary supervision

1.  Supplementary supervision shall be exercised by the competent authorities of the Member State in which the insurance undertaking or the reinsurance undertaking has received official authorisation under Article 6 of Directive 73/239/EEC or Article 4 of Directive 2002/83/EC or Article 3 of Directive 200./../EC [reinsurance Directive].

2.  Where insurance undertakings or reinsurance undertakings authorised in two or more Member States have as their parent undertaking the same insurance holding company, non-member-country insurance undertaking, non-member-country reinsurance undertaking or mixed-activity insurance holding company, the competent authorities of the Member States concerned may reach agreement as to which of them will be responsible for exercising supplementary supervision.

3.  Where a Member State has more than one competent authority for the prudential supervision of insurance undertakings and reinsurance undertakings, such Member State shall take the requisite measures to organise coordination between those authorities.

______________________

* OJ L 345, 19.12.2002, p.1. Directive as last amended by Directive 2005/1/EC.

"

(4)  In Article 5, paragraph 1 is replaced by the following:

"

1.  Member States shall prescribe that the competent authorities shall require that every insurance undertaking or reinsurance undertaking subject to supplementary supervision shall have adequate internal control mechanisms in place for the production of any data and information relevant for the purposes of such supplementary supervision.

"

(5)  Articles 6, 7 and 8 are replaced by the following:

"

Article 6

Access to information

1.  Member States shall provide that their competent authorities responsible for exercising supplementary supervision shall have access to any information which would be relevant for the purpose of supervision of an insurance undertaking or a reinsurance undertaking subject to such supplementary supervision. The competent authorities may address themselves directly to the relevant undertakings referred to in Article 3(2) to obtain the necessary information only if such information has been requested from the insurance undertaking or the reinsurance undertaking and has not been supplied by it.

2.  Member States shall provide that their competent authorities may carry out within their territory, themselves or through the intermediary of persons whom they appoint for that purpose, on-the-spot verification of the information referred to in paragraph 1 at:

   - the insurance undertaking subject to supplementary supervision,
   - the reinsurance undertaking subject to supplementary supervision,
   - subsidiary undertakings of that insurance undertaking,
   - subsidiary undertakings of that reinsurance undertaking,
   - parent undertakings of that insurance undertaking,
   - parent undertakings of that reinsurance undertaking,
   - subsidiary undertakings of a parent undertaking of that insurance undertaking.
   - subsidiary undertakings of a parent undertaking of that reinsurance undertaking.

3.  Where, in applying this Article, the competent authorities of one Member State wish in specific cases to verify important information concerning an undertaking situated in another Member State which is a related insurance undertaking, a related reinsurance undertaking, a subsidiary undertaking, a parent undertaking or a subsidiary of a parent undertaking of the insurance undertaking or of the reinsurance undertaking subject to supplementary supervision, they must ask the competent authorities of that other Member State to have that verification carried out. The authorities which receive such a request must act on it within the limits of their jurisdiction by carrying out the verification themselves, by allowing the authorities making the request to carry it out or by allowing an auditor or expert to carry it out.

The competent authority which made the request may, if it so wishes, participate in the verification when it does not carry out the verification itself.

Article 7

Cooperation between competent authorities

1.  Where insurance undertakings or reinsurance undertakings established in different Member States are directly or indirectly related or have a common participating undertaking, the competent authorities of each Member State shall communicate to one another on request all relevant information which may allow or facilitate the exercise of supervision pursuant to this Directive and shall communicate on their own initiative any information which appears to them to be essential for the other competent authorities.

2.  Where an insurance undertaking or a reinsurance undertaking and either a credit institution as defined in Directive 2000/12/EC of the European Parliament and of the Council* or an investment firm as defined in Directive 93/22/EEC, or both, are directly or indirectly related or have a common participating undertaking, the competent authorities and the authorities with public responsibility for the supervision of those other undertakings shall cooperate closely. Without prejudice to their respective responsibilities, those authorities shall provide one another with any information likely to simplify their task, in particular within the framework of this Directive.

3.  Information received pursuant to this Directive and, in particular, any exchange of information between competent authorities which is provided for in this Directive shall be subject to the obligation of professional secrecy defined in Article 16 of Directive 92/49/EEC and Article 16 of Directive 2002/83/EC and Articles 24 to 30 of Directive 200./../EC [reinsurance Directive].

Article 8

Intra-group transactions

1.  Member States shall provide that the competent authorities exercise general supervision over transactions between:

  a) an insurance undertaking or a reinsurance undertaking and:
   i) a related undertaking of the insurance undertaking or of the reinsurance undertaking;
   ii) a participating undertaking in the insurance undertaking or in the reinsurance undertaking;
   iii) a related undertaking of a participating undertaking in the insurance undertaking or in the reinsurance undertaking;
  b) an insurance undertaking or a reinsurance undertakings and a natural person who holds a participation in:
   i) the insurance undertaking, the reinsurance undertaking or any of its related undertakings;
   ii) a participating undertaking in the insurance undertaking or in the reinsurance undertaking;
   iii) a related undertaking of a participating undertaking in the insurance undertaking or in the reinsurance undertaking;

These transactions concern in particular:

   - loans,
   - guarantees and off-balance-sheet transactions,
   - elements eligible for the solvency margin,
   - investments,
   - reinsurance and retrocession operations,
   - agreements to share costs.

2.  Member States shall require insurance undertakings and reinsurance undertakings to have in place adequate risk management processes and internal control mechanisms, including sound reporting and accounting procedures, in order to identify, measure, monitor and control transactions as provided for in paragraph 1 appropriately. Member States shall also require at least annual reporting by insurance undertakings and reinsurance undertakings to the competent authorities of significant transactions. These processes and mechanisms shall be subject to overview by the competent authorities.

If, on the basis of this information, it appears that the solvency of the insurance undertaking or the reinsurance undertaking is, or may be, jeopardised, the competent authority shall take appropriate measures at the level of the insurance undertaking or of the reinsurance undertaking.

_________________________

* OJ L 126, 26.5.2000, p. 1. Directive as last amended by Directive 2005/1/EC.

"

(6)  In Article 9, paragraph 3 is replaced by the following:

"

3.  If the calculation referred to in paragraph 1 demonstrates that the adjusted solvency is negative, the competent authorities shall take appropriate measures at the level of the insurance undertaking or the reinsurance undertaking in question.

"

(7)  Article 10 is amended as follows:

a)   the title is replaced by the following:

"

Insurance holding companies, non-member-country insurance undertakings and non-member-country reinsurance undertakings

"

b)   paragraphs 2 and 3 are replaced by the following:

"

2.  In the case referred to in Article 2(2), the calculation shall include all related undertakings of the insurance holding company, the non-member-country insurance undertaking or the non-member-country reinsurance undertaking, in the manner provided for in Annex II.

3.  If, on the basis of this calculation, the competent authorities conclude that the solvency of a subsidiary insurance undertaking or a reinsurance undertaking of the insurance holding company, the non-member-country insurance undertaking or the non-member-country reinsurance undertaking is, or may be, jeopardised, they shall take appropriate measures at the level of that insurance undertaking or reinsurance undertaking.

"

(8)  Article 10a is amended as follows:

a)   in paragraph 1, point (b) is replaced by the following:

"
   b) reinsurance undertakings which have, as participating undertakings, undertakings within the meaning of Article 2 which have their head office situated in a third country;
   c) non-member country insurance undertakings or non-member country reinsurance undertakings which have, as participating undertakings, undertakings within the meaning of Article 2 which have their head office in the Community.
"

b)   paragraph 2 is replaced by the following:

"

2.  The agreements referred to in paragraph 1 shall in particular seek to ensure both:

   a) that the competent authorities of the Member States are able to obtain the information necessary for the supplementary supervision of insurance undertakings and reinsurance undertakings which have their head office in the Community and which have subsidiaries or hold participations in undertakings outside the Community; and
   b) that the competent authorities of third countries are able to obtain the information necessary for the supplementary supervision of insurance undertakings and reinsurance undertakings which have their head office in their territories and which have subsidiaries or hold participations in undertakings in one or more Member States.

"

(9)  Annexes I and II are replaced by the text set out in Annex II to this Directive.

TITLE X

TRANSITIONAL AND FINAL PROVISIONS

Article 61

Right acquired by existing reinsurance undertakings

1.  Reinsurance undertakings subject to this Directive which were authorised or entitled to conduct reinsurance business in accordance with the provisions of the Member States in which they have their head offices before the date of entry into force of this Directive shall be deemed to be authorised in accordance with Article 3.

However, they shall be obliged to comply with the provisions of this Directive concerning the carrying on of the business of reinsurance and with the requirements set out in Articles 6(a), (c), (d), Articles 7, 8 and 12 and Articles 32 to 41 as from the date of implementation of the laws, regulations and administrative provisions necessary to comply with this Directive referred to in Article 64(1).

2.  Member States may allow reinsurance undertakings referred to in paragraph 1 which at the date of entry into force of this Directive do not comply with Articles 6(a), 7, 8 and Articles 32 to 40 a period until .....(27) in order to comply with such requirements.

Article 62

Reinsurance undertakings closing their activity

1.  Reinsurance undertakings which by …(28)* have ceased to conduct new reinsurance contracts and exclusively administer their existing portfolio in order to terminate their activity shall not be subject to this Directive.

2.  Member States shall draw up the list of the reinsurance undertakings concerned and they shall communicate that list to all the other Member States.

Article 63

Transitional period for Articles 57(3) and 59(6)

A Member State may postpone the application of the provisions of Article 57(3) of the present Directive amending Article 15(3) of Directive 73/239/EEC and of the provision in Article 59(6) of this Directive amending Article 20(4) of Directive 2002/83/EC, until ...(29).

Article 64

Transposition

1.  Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by ...(30)*. They shall forthwith communicate to the Commission the texts of those provisions.

When Member States adopt those provisions, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. Member States shall determine how such reference is to be made.

2.  Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.

Article 65

Entry into force

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

Article 66

Addressees

This Directive is addressed to the Member States.

Done at ...............,

For the European Parliament For the Council

The President President

ANNEX I

Form of reinsurance undertakings:

   - in the case of the Kingdom of Belgium: 'société anonyme/naamloze vennootschap', 'société en commandite par actions/commanditaire vennootschap op aandelen', 'association d'assurance mutuelle/onderlinge verzekeringsvereniging', 'société coopérative/coöperatieve vennootschap';
   - in the case of the Czech Republic: 'akciová společnost';
   - in the case of the Kingdom of Denmark: 'aktieselskaber', 'gensidige selskaber';
   - in the case of the Federal Republic of Germany: 'Aktiengesellschaft', 'Versicherungsverein auf Gegenseitigkeit', 'Öffentlich-rechtliches Wettbewerbsversicherungsunternehmen';
   - in the case of the Republic of Estonia: 'aktsiaselts';
   - in the case of the Hellenic Republic: 'ανώνυμη εταιρία', 'αλληλασφαλιστικός συνεταιρισμός';
   - in the case of the Kingdom of Spain: 'sociedad anónima';
   - in the case of the French Republic: 'société anonyme', 'société d'assurance mutuelle', 'institution de prévoyance régie par le code de la sécurité sociale', 'institution de prévoyance régie par le code rural' and 'mutuelles régies par le code de la mutualité';
   - in the case of Ireland: incorporated companies limited by shares or by guarantee or unlimited;
   - in the case of the Italian Republic: 'società per azioni';
   - in the case of the Republic of Cyprus: 'Εταιρεία Περιορισμένης Ευθύνης με μετοχές' ή 'Εταιρεία Περιορισμένης Ευθύνης με εγγύηση;
   - in the case of the Repulic of Latvia: 'akciju sabiedrība', 'sabiedrība ar ierobežotu atbildību';
   - in the case of the Republic of Lithuania: 'akcinė bendrovė', 'uždaroji akcinė bendrovė';
   - in the case of the Grand Duchy of Luxembourg: 'société anonyme', 'société en commandite par actions', 'association d'assurances mutuelles', 'société coopérative';
   - in the case of the Republic of Hungary: 'biztosító részvénytársaság', 'biztosító szövetkezet', 'harmadik országbeli biztosító magyarországi fióktelepe';
   - in the case of the Republic of Malta: 'limited liability company';
   - in the case of the Kingdom of the Netherlands: 'naamloze vennootschap', 'onderlinge waarborgmaatschappij';
   - in the case of the Republic of Austria: 'Aktiengesellschaft', 'Versicherungsverein auf Gegenseitigkeit';
   - in the case of the Republic of Poland: 'spółka akcyjna', 'towarzystwo ubezpieczeń wzajemnych';
   - in the case of the Portuguese Republic: 'sociedade anónima', 'mútua de seguros';
   - in the case of the Republic of Slovenia: 'delniška družba';
   - in the case of the Slovak Republic: 'akciová spoločnost';
   - in the case of the Republic of Finland: 'keskinäinen vakuutusyhtiö/ömsesidigt försäkringsbolag', 'vakuutusosake-yhtiö/försäkringsaktiebolag', 'vakuutusyhdistys/försäkrings-förening';
   - in the case of Kingdom of Sweden: 'försäkringsaktiebolag', 'ömsesidigt försäkringsbolag';
   - in the case of the United Kingdom: incorporated companies limited by shares or by guarantee or unlimited societies registered under the Industrial and Provident Societies Acts, societies registered or incorporated under the Friendly Societies Act, 'the association of underwriters known as Lloyd's'.

ANNEX II

Annexes I and II to Directive 98/78/EC are replaced by the following

"

"Annex I

CALCULATION OF THE ADJUSTED SOLVENCY OF INSURANCE UNDERTAKINGS AND REINSURANCE UNDERTAKINGS

1.  CHOICE OF CALCULATION METHOD AND GENERAL PRINCIPLES

A.  Member States shall provide that the calculation of the adjusted solvency of insurance undertakings and reinsurance undertakings referred to in Article 2(1) shall be carried out according to one of the methods described in point 3. A Member State may, however, provide for the competent authorities to authorise or impose the application of a method set out in point 3 other than that chosen by the Member State.

B.  Proportionality

The calculation of the adjusted solvency of an insurance undertaking or a reinsurance undertaking shall take account of the proportional share held by the participating undertaking in its related undertakings.

"Proportional share" means either, where method 1 or method 2 described in point 3 is used, the proportion of the subscribed capital that is held, directly or indirectly, by the participating undertaking or, where method 3 described in point 3 is used, the percentages used for the establishment of the consolidated accounts.

However, whichever method is used, when the related undertaking is a subsidiary undertaking and has a solvency deficit, the total solvency deficit of the subsidiary has to be taken into account.

However, where, in the opinion of the competent authorities, the responsibility of the parent undertaking owning a share of the capital is limited strictly and unambiguously to that share of the capital, such competent authorities may give permission for the solvency deficit of the subsidiary undertaking to be taken into account on a proportional basis.

Where there are no capital ties between some of the undertakings in an insurance group or a reinsurance group, the competent authority shall determine which proportional share will have to be taken account of.

C.  Elimination of double use of solvency margin elements

C.1.  General treatment of solvency margin elements

Regardless of the method used for the calculation of the adjusted solvency of an insurance undertaking or a reinsurance undertaking, the double use of elements eligible for the solvency margin among the different insurance undertakings or reinsurance undertakings taken into account in that calculation must be eliminated.

For this purpose, when calculating the adjusted solvency of an insurance undertaking or a reinsurance undertaking and where the methods described in point 3 do not provide for it, the following amounts shall be eliminated:

   - the value of any asset of that insurance undertaking or reinsurance undertaking which represents the financing of elements eligible for the solvency margin of one of its related insurance undertakings or related reinsurance undertakings,
   - the value of any asset of a related insurance undertaking or a related reinsurance undertaking of that insurance undertaking or reinsurance undertaking which represents the financing of elements eligible for the solvency margin of that insurance undertaking or reinsurance undertaking
   - the value of any asset of a related insurance undertaking or related reinsurance undertaking of that insurance undertaking or reinsurance undertaking which represents the financing of elements eligible for the solvency margin of any other related insurance undertaking or related reinsurance undertaking of that insurance undertaking or reinsurance undertaking

C.2.  Treatment of certain elements

may only be included in the calculation in so far as they are eligible for covering the solvency margin requirement of that related undertaking. However, any subscribed but not paid-up capital which represents a potential obligation on the part of the participating undertaking shall be entirely excluded from the calculation.

Without prejudice to the provisions of section C.1:

   - profit reserves and future profits arising in a related life assurance undertaking [or a related life reinsurance undertaking] of the insurance undertaking or reinsurance undertaking for which the adjusted solvency is calculated, and
   - any subscribed but not paid-up capital of a related insurance undertaking or a related reinsurance undertaking of the insurance undertaking or of reinsurance undertaking for which the adjusted solvency is calculated,

Any subscribed but not paid-up capital of the participating insurance undertaking or the participating reinsurance undertaking which represents a potential obligation on the part of a related insurance undertaking or of a related reinsurance undertaking shall also be excluded from the calculation.

Any subscribed but not paid-up capital of a related insurance undertaking or a reinsurance undertaking which represents a potential obligation on the part of another related insurance undertaking of the same participating insurance undertaking or reinsurance undertaking shall be excluded from the calculation.

C.3.  Transferability

If the competent authorities consider that certain elements eligible for the solvency margin of a related insurance undertaking or a related reinsurance undertaking other than those referred to in section C.2 cannot effectively be made available to cover the solvency margin requirement of the participating insurance undertaking or the participating reinsurance undertaking for which the adjusted solvency is calculated, those elements may be included in the calculation only in so far as they are eligible for covering the solvency margin requirement of the related undertaking.

C.4.  The sum of the elements referred to in sections C.2 and C.3 may not exceed the solvency margin requirement of the related insurance undertaking or the related reinsurance undertaking

D.  Elimination of the intra-group creation of capital

When calculating adjusted solvency, no account shall be taken of any element eligible for the solvency margin arising out of reciprocal financing between the insurance undertaking or the reinsurance undertaking and:

   - a related undertaking,
   - a participating undertaking,
   - another related undertaking of any of its participating undertakings.

Furthermore, no account shall be taken of any element eligible for the solvency margin of a related insurance undertaking or a related reinsurance undertaking of the insurance undertaking or reinsurance undertaking for which the adjusted solvency is calculated when the element in question arises out of reciprocal financing with any other related undertaking of that insurance undertaking or reinsurance undertaking.

In particular, reciprocal financing exists when an insurance undertaking or a reinsurance undertaking, or any of its related undertakings, holds shares in, or makes loans to, another undertaking which, directly or indirectly, holds an element eligible for the solvency margin of the first undertakings.

E.  The competent authorities shall ensure that the adjusted solvency is calculated with the same frequency as that laid down by Directives 73/239/EEC, 2002/83/EC and 200./../EC [reinsurance Directive] for calculating the solvency margin of insurance undertakings or reinsurance undertaking The value of the assets and liabilities shall be assessed according to the relevant provisions of Directives 73/239/EEC, 2002/83/EC, 200./../EC [reinsurance Directive] and 91/674/EEC.

2.  APPLICATION OF THE CALCULATION METHODS

2.1.  Related insurance undertakings and related reinsurance undertakings. The adjusted solvency calculation shall be carried out in accordance with the general principles and methods set out in this Annex.

In the case of all methods, where the insurance undertaking or reinsurance undertaking has more than one related insurance undertaking or related reinsurance undertaking the adjusted solvency calculation shall be carried out by integrating each of these related insurance undertakings or related reinsurance undertakings.

In cases of successive participations (for example, where an insurance undertaking or a reinsurance undertaking is a participating undertaking in another insurance undertaking or reinsurance undertaking which is also a participating undertaking in an insurance undertaking or a reinsurance undertaking), the adjusted solvency calculation shall be carried out at the level of each participating insurance undertaking or reinsurance undertaking which has at least one related insurance undertaking or one related reinsurance undertaking Member States may waive calculation of the adjusted solvency of an insurance undertaking or a reinsurance undertaking:

   - if the undertaking is a related undertaking of another insurance undertaking or a reinsurance undertaking authorised in the same Member State, and that related undertaking is taken into account in the calculation of the adjusted solvency of the participating insurance undertaking or reinsurance undertaking, or
   - if the insurance undertaking or the reinsurance undertaking is a related undertaking of an insurance holding company which has its registered office in the same Member State as the insurance undertaking or the reinsurance undertaking, and both the holding insurance company and the related insurance undertaking or the related reinsurance undertaking are taken into account in the calculation carried out.

Member States may also waive calculation of the adjusted solvency of an insurance undertaking or reinsurance undertaking if it is a related insurance undertaking or a related reinsurance undertaking of another insurance undertaking, a reinsurance undertaking or an insurance holding company which has its registered office in another Member State, and if the competent authorities of the Member States concerned have agreed to grant exercise of the supplementary supervision to the competent authority of the latter Member State.

In each case, the waiver may be granted only if the competent authorities are satisfied that the elements eligible for the solvency margins of the insurance undertakings or the reinsurance undertakings included in the calculation are adequately distributed between those undertakings.

Member States may provide that where the related insurance undertaking or the related reinsurance undertaking has its registered office in a Member State other than that of the insurance undertaking or the reinsurance undertaking for which the adjusted solvency calculation is carried out, the calculation shall take account, in respect of the related undertaking, of the solvency situation as assessed by the competent authorities of that other Member State.

2.2.  Intermediate insurance holding companies

When calculating the adjusted solvency of an insurance undertaking or a reinsurance undertaking which holds a participation in an (related) insurance undertaking, a related reinsurance undertaking, or a non-member country insurance undertaking or a non-member country reinsurance undertaking, through an insurance holding company, the situation of the intermediate insurance holding company is taken into account. For the sole purpose of this calculation, to be undertaken in accordance with the general principles and methods described in this Annex, this insurance holding company shall be treated as if it were an insurance undertaking or reinsurance undertaking subject to a zero solvency requirement and were subject to the same conditions as are laid down in Article 16 of Directive 73/239/EEC, in Article 27 of Directive 2002/83/EC or in Article 36 of Directive 200./../EC [reinsurance Directive] in respect of elements eligible for the solvency margin.

2.3.  Related non-member country insurance undertakings and related non-member country reinsurance undertakings

When calculating the adjusted solvency of an insurance undertaking or a reinsurance undertaking which is a participating undertaking in a non-member-country insurance undertaking or in a non-member country reinsurance undertaking, the latter shall be treated solely for the purposes of the calculation, by analogy with a related insurance undertaking or a related reinsurance undertaking, by applying the general principles and methods described in this Annex.

However, where the non-member-country in which that undertaking has its registered office makes it subject to authorisation and imposes on it a solvency requirement at least comparable to that laid down in Directives 73/239/EEC, 2002/83/EC or 200./../EC [reinsurance Directive], taking into account the elements of cover of that requirement, Member States may provide that the calculation shall take into account, as regards that undertaking, the solvency requirement and the elements eligible to satisfy that requirement as laid down by the non-member country in question.

2.4.  Related credit institutions, investment firms and financial institutions

When calculating the adjusted solvency of an insurance undertaking or reinsurance undertaking which is a participating undertaking in a credit institution, investment firm or financial institution, the rules laid down in Article 16 of Directive 73/239/EEC, in Article 27 of Directive 2002/83/EC and in Article 36 of Directive 200./../EC [reinsurance Directive] on the deduction of such participations shall apply mutatis mutandis, as well as the provisions on the ability of Member States under certain conditions to allow alternative methods and to allow such participations not to be deducted.

2.5.  Non-availability of the necessary information

Where information necessary for calculating the adjusted solvency of an insurance undertaking or reinsurance undertaking, concerning a related undertaking with its registered office in a Member State or a non-member country, is not available to the competent authorities, for whatever reason, the book value of that undertaking in the participating insurance undertaking or reinsurance undertaking shall be deducted from the elements eligible for the adjusted solvency margin. In that case, the unrealised gains connected with such participation shall not be allowed as an element eligible for the adjusted solvency margin.

3.  CALCULATION METHODS

Method 1: Deduction and aggregation method

The adjusted solvency situation of the participating insurance undertaking or the participating reinsurance undertaking is the difference between:

  i) the sum of:

and
   a) the elements eligible for the solvency margin of the participating insurance undertaking or the participating reinsurance undertaking, and
   b) the proportional share of the participating insurance undertaking or the participating reinsurance undertaking in the elements eligible for the solvency margin of the related insurance undertaking or the related reinsurance undertaking
  ii) the sum of:
   a) the book value in the participating insurance undertaking or the participating reinsurance undertaking of the related insurance undertaking or the related reinsurance undertaking, and
   b) the solvency requirement of the participating insurance undertaking or the participating reinsurance undertaking, and
   c) the proportional share of the solvency requirement of the related insurance undertaking or the related reinsurance undertaking.

Where the participation in the related insurance undertaking or the related reinsurance undertaking consists, wholly or in part, of an indirect ownership, then item (ii)(a) shall incorporate the value of such indirect ownership, taking into account the relevant successive interests; and items (i)(b) and (ii)(c) shall include the corresponding proportional shares of the elements eligible for the solvency margin of the related insurance undertaking or the related reinsurance undertaking.

Method 2: Requirement deduction method

and

The adjusted solvency of the participating insurance undertaking or the participating reinsurance undertaking is the difference between:

   i) the sum of the elements eligible for the solvency margin of the participating insurance undertaking or the participating reinsurance undertaking
  ii) the sum of:
   a) the solvency requirement of the participating insurance undertaking or the participating reinsurance undertaking, and
   b) the proportional share of the solvency requirement of the related insurance undertaking or the related reinsurance undertaking.

When valuing the elements eligible for the solvency margin, participations within the meaning of this Directive are valued by the equity method, in accordance with the option set out in Article 59(2)(b) of Directive 78/660/EEC.

Method 3: Accounting consolidation-based method

The calculation of the adjusted solvency of the participating insurance undertaking or the participating reinsurance undertaking shall be carried out on the basis of the consolidated accounts. The adjusted solvency of the participating insurance undertaking or the participating reinsurance undertaking is the difference between:

the elements eligible for the solvency margin calculated on the basis of consolidated data, and

   a) either the sum of the solvency requirement of the participating insurance undertaking or the participating reinsurance undertaking and of the proportional shares of the solvency requirements of the related insurance undertakings or the related reinsurance undertaking, based on the percentages used for the establishment of the consolidated accounts,
   b) or the solvency requirement calculated on the basis of consolidated data.

The provisions of Directives 73/239/EEC, 2002/83/EC, 200./..EC [reinsurance Directive]and 91/674/EEC shall apply for the calculation of the elements eligible for the solvency margin and of the solvency requirement based on consolidated data.

.Annex II

SUPPLEMENTARY SUPERVISION FOR INSURANCE UNDERTAKINGS AND REINSURANCE UNDERTAKINGS THAT ARE SUBSIDIARIES OF AN INSURANCE HOLDING COMPANY, A NON-MEMBER-COUNTRY INSURANCE UNDERTAKING OR A NON-MEMBER COUNTRY REINSURANCE UNDERTAKING

1.  In the case of two or more insurance undertakings or reinsurance undertakings referred to in Article 2(2) which are the subsidiaries of an insurance holding company, a non-member-country insurance undertaking or a non-member-country reinsurance undertaking and which are established in different Member States, the competent authorities shall ensure that the method described in this Annex is applied in a consistent manner.

The competent authorities shall exercise the supplementary supervision with the same frequency as that laid down by Directives 73/239/EEC, 2002/83/EC and 200./../EC [reinsurance Directive] for calculating the solvency margin of insurance undertakings and reinsurance undertakings.

2.  Member States may waive the calculation provided for in this Annex with regard to an insurance undertaking or a reinsurance undertaking:

   - if that insurance undertaking or reinsurance undertaking is a related undertaking of another insurance undertaking or reinsurance undertaking and if it is taken into account in the calculation provided for in this Annex carried out for that other undertaking,
   - if that insurance undertaking or reinsurance undertaking and one or more other insurance undertakings or reinsurance undertakings authorised in the same Member State have as their parent undertaking the same insurance holding company, non-member-country insurance undertaking, or non-member-country reinsurance undertaking and the insurance undertaking or reinsurance undertaking is taken into account in the calculation provided for in this Annex carried out for one of these other undertakings,
   - if that insurance undertaking or reinsurance undertaking and one or more other insurance undertakings or reinsurance undertakings authorised in other Member States have as their parent undertaking the same insurance holding company, non-member-country insurance undertaking or non-member-country reinsurance undertaking, and an agreement granting exercise of the supplementary supervision covered by this Annex to the supervisory authority of another Member State has been concluded in accordance with Article 4(2).

In the case of successive participations (for example: an insurance holding company or a non-member-country insurance or reinsurance undertaking, which is itself owned by another insurance holding company or a non-member-country insurance or reinsurance undertaking), Member States may apply the calculations provided for in this Annex only at the level of the ultimate parent undertaking of the insurance undertaking or reinsurance undertaking which is an insurance holding company, a non-member-country insurance undertaking or a non-member-country reinsurance undertaking.

3.  The competent authorities shall ensure that calculations analogous to those described in Annex I are carried out at the level of the insurance holding company, non-member-country insurance undertaking or non-member-country reinsurance undertaking.

The analogy shall consist in applying the general principles and methods described in Annex I at the level of the insurance holding company, non-member-country insurance undertaking or non-member-country reinsurance undertaking.

and is subject to the same conditions as laid down in Article 16 of Directive 73/239/EEC in Article 27 of Directive 2002/83/EC and in Article 36 of Directive 200./../EC [reinsurance Directive] as regards the elements eligible for the solvency margin.

For the sole purpose of this calculation, the parent undertaking shall be treated as if it were an insurance undertaking or reinsurance undertaking subject to:

   - a zero solvency requirement where it is an insurance holding company,
   - a solvency requirement determined according to the principles of section 2.3 of Annex I, where it is a non-member-country insurance undertaking or a non-member country-reinsurance undertaking,

4.  Non-availability of the necessary information

Where information necessary for the calculation provided for in this Annex, concerning a related undertaking with its registered office in a Member State or a non-member country, is not available to the competent authorities, for whatever reason, the book value of that undertaking in the participating undertaking shall be deducted from the elements eligible for the calculation provided for in this Annex. In that case, the unrealised gains connected with such participation shall not be allowed as an element eligible for the calculation."

"

(1) Not yet published in OJ.
(2) OJ C 120, 20.5.2005, p. 1.
(3) OJ C
(4) Position of the European Parliament of 7 June 2005.
(5) OJ L 228, 16.8.1973, p. 3. Directive as last amended by Directive 2005/1/EC (OJ L 79, 24.3.2005, p. 9).
(6) OJ L 228, 11.8.1992, p. 1. Directive as last amended by Directive 2005/1/EC.
(7) OJ L 345, 19.12.2002, p. 1. Directive as last amended by Directive 2005/1/EC.
(8) OJ 56, 4.4.1964, p. 878.
(9) OJ L 330, 5.12.1998, p. 1. Directive as last amended by Directive 2005/1/EC.
(10) OJ L 35, 11.2.2003, p. 1. Directive as amended by Directive 2005/1/EC.
(11) OJ L 374, 31.12.1991, p. 7. Directive as amended by Directive 2003/51/EC of the European Parliament and of the Council (OJ L 178, 17.7.2003, p. 16).
(12) OJ L 3, 7.1.2004, p. 34. See also Council Directive 91/675/EEC (OJ L 374, 31.12.1991, p. 32), as last amended by Directive 2005/1/EC.
(13) OJ L 184, 17.7.1999, p. 23. .
(14) OJ C 321, 31.12.2003, p. 1.
(15) Seventh Council Directive 83/349/EEC of 13 June 1983 based on the Article 54(3)(g) of the Treaty on consolidated accounts (OJ L 193, 18.7.1983, p. 1). Directive as last amended by Directive 2003/51/EC of the European Parliament and of the Council (OJ L 178, 17.7.2003, p. 16).
(16) OJ L 126, 26.5.2000, p. 1. Directive as last amended by Directive 2005/1/EC.
(17) OJ L 145, 30.4.2004, p. 1.
(18) OJ L 235, 23.9.2003, p. 10.
(19) Directive 2001/34/EC of the European Parliament and of the Council of 28 May 2001 on the admission of securities to official stock exchange listing and on information to be published on those securities (OJ L 184, 6.7.2001, p. 1). Directive as last amended by Directive 2005/1/EC.
(20) Council Regulation (EC) No 2157/2001 of 8 October 2001 on the Statute for a European company (SE) (OJ L 294, 10.11.2001, p.1). Regulation as amended by Regulation (EC) No 885/2004 (OJ L 168, 1.5.2004, p. 1).
(21) Eight Council Directive 84/253/EEC of 10 April 1984 based on Article 54(3)(g) of the Treaty on the approval of persons responsible for carrying out the statutory audits of accounting documents (OJ L 126, 12.5.1984, p. 20).
(22) Fourth Council Directive 78/660/EEC of 25 July 1978 based on Article 54(3)(g) of the Treaty on the annual accounts of certain types of companies (OJ L 222, 14.8.1978, p. 11). Directive as last amended by Directive 2003/51/EC.
(23) Council Directive 85/611/EEC of 20 December 1985 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) (OJ L 375, 31.12.1985, p. 3). Directive as last amended by Directive 2005/1/EC.
(24) OJ L 141, 11.6.1993, p. 27. Directive as last amended by Directive 2002/87/EC of the European Parliament and of the Council (OJ L 35, 11.2.2003, p. 1).
(25) OJ L 141, 11.6.1993, p. 1. Directive as last amended by Directive 2005/1/EC.
(26)* Date of implementation laid down in Article 64(1).
(27)* 36 months after the date of entry into force of this Directive.
(28)** 24 months after the date of entry into force of this Directive.
(29)* 36 months after the date of entry into force of this Directive.
(30)** 24 months after the date of entry into force of this Directive.


EAFRD support for rural development *
PDF 443kWORD 243k
European Parliament legislative resolution on the proposal for a Council regulation on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) (COM(2004)0490 – C6-0181/2004 – 2004/0161(CNS))
P6_TA(2005)0215A6-0145/2005

(Consultation procedure)

The European Parliament,

–   having regard to the Commission proposal to the Council (COM(2004)0490)(1),

–   having regard to Article 37 of the EC Treaty, pursuant to which the Council consulted Parliament (C6-0181/2004),

–   having regard to Rule 51 of its Rules of Procedure,

–   having regard to the opinion of the European Economic and Social Committee (CESE 251/05),

–   having regard to the report of the Committee on Agriculture and Rural Development and the opinions of the Committee on Budgets and the Committee on Regional Development (A6-0145/2005),

1.  Approves the Commission proposal as amended;

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

3.  Calls on the Council to notify Parliament if it intends to depart from the text approved by Parliament;

4.  Asks the Council to consult Parliament again if it intends to amend the Commission proposal substantially;

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

Text proposed by the Commission   Amendments by Parliament
Amendment 1
Recital 3
(3)  The reform of the CAP in June 2003 and April 2004 introduced major changes likely to have a significant impact on the economy across the whole rural territory of the Community in terms of agricultural production patterns, land management methods, employment and the wider social and economic conditions in rural areas.
(3)  The reform of the CAP in June 2003 and April 2004 introduced major changes likely to have a significant impact on the economy across the whole rural territory of the Community in terms of the structural development of agriculture, regional distribution and intensity of production, as well as agricultural production patterns, land management methods, employment and the wider social and economic conditions in rural areas.
Amendment 2
Recital 3 a (new)
(3a) In the coming years, the European food and agriculture sector will become increasingly liberalised, and will have to be able to compete in the global marketplace. EU common policies should provide opportunities for improved competitiveness through innovation.
Amendment 3
Recital 3 b (new)
(3b) Increased competitiveness in the food and agricultural sector in rural areas will require the development of European quality labels that reflect food safety, documentation of production processes (traceability), animal welfare, environment and working conditions.
Amendment 4
Recital 5
(5)  The Community may take measures in accordance with the principle of subsidiarity as provided for in Article 5 of the Treaty. Since the goal of rural development cannot be achieved adequately by the Member States given the links between it and the other instruments of the Common Agricultural Policy, the extent of the disparities between rural areas and the limits on the financial resources of the Member States in an enlarged Union, it can be better achieved at Community level through the multiannual guarantee of Community finance and by concentrating it on its priorities. According to the principle of proportionality as stated in Article 5 of the Treaty, the present Regulation does not exceed what is necessary to achieve this goal.
(5)  The Community may take measures in accordance with the principle of subsidiarity as provided for in Article 5 of the Treaty. Since the goal of rural development cannot be achieved adequately by the Member States given the links between it and the other instruments of the common agricultural policy, the extent of the disparities between rural areas and the limits on the financial resources of the Member States in an enlarged Union, it can be better achieved at Community level through the multiannual guarantee of Community finance and by concentrating it on its priorities. The European Union must ensure that this Regulation is made financially viable through the allocation of sufficient funding to enable both old and new rural-development activities to be funded. According to the principle of proportionality as stated in Article 5 of the Treaty, the present Regulation does not exceed what is necessary to achieve this goal.
Amendment 5
Recital 6
(6)  The activities of the European Agricultural Fund for Rural Development, hereinafter called the "Fund", and the operations to which it contributes must be consistent and compatible with the other Community policies and comply with all Community legislation.
(6)  The activities of the European Agricultural Fund for Rural Development, hereinafter called the "Fund", and the operations to which it contributes must be consistent and compatible with cohesion policy in rural areas and the other Community policies and comply with all Community legislation.
Amendment 6
Recital 7
(7)  In its action in favour of rural development the Community takes care to encourage the elimination of disparities and the promotion of equality between women and men in accordance with Articles 2 and 3 of the Treaty.
(7)  In its action in favour of rural development the Community takes care to encourage the elimination of disparities and the promotion of non-discrimination and equality between women and men in accordance with Articles 2 and 3 of the Treaty.
Amendment 7
Recital 11
(11)  To ensure the sustainable development of rural areas it is necessary to focus on a limited number of core priority objectives at Community level relating to agricultural and forestry competitiveness, land management and environment, and quality of life and diversification of activities in those areas.
(11)  To ensure the sustainable development of rural areas it is necessary to focus on a limited number of core priority objectives at Community level relating to agricultural and forestry competitiveness, land management and environment, and quality of life and diversification of activities in those areas, taking into account, however, the diversity of situations within the EU, ranging from remote rural areas suffering from depopulation and decline to peri-urban areas under increasing pressure from urban centres.
Amendment 8
Recital 16
(16)  The granting of specific benefits to young farmers may facilitate both their initial establishment and the structural adjustment of their holdings after their initial setting up. The setting-up measure should be streamlined by granting a single premium and made conditional on the establishment of a business plan ensuring the development of young farmers" activities.
(16)  The granting of specific benefits to young farmers may facilitate both their initial establishment and the structural adjustment of their holdings after their initial setting up. The setting-up measure should be conditional upon the presentation of a suitable business plan as an instrument to ensure over time the development of the activity of the new undertaking. In order to facilitate the starting-up and development of the new undertaking this business plan should be backed up by appropriate incentives, by means of an integrated package of measures concerning the various axes of intervention.
Amendment 9
Recital 23
(23)  Improvements in the processing and marketing of primary agricultural and forestry production should be encouraged by means of support for investments aimed at improving efficiency in the processing and marketing sector, promoting the processing of agricultural and forestry production for renewable energy, introducing new technologies, opening new market opportunities for agricultural and forestry products, putting emphasis on quality, improving performance in the environmental protection, occupational safety, hygiene and animal welfare fields, as appropriate, by targeting small and micro-enterprises which are better placed to add value to local products, while simplifying the conditions for investment aid as compared with those laid down in Council Regulation (EC) No 1257/1999.
(23)  Improvements in the processing and marketing of primary agricultural and forestry production should be encouraged by means of support for investments aimed at improving efficiency in the processing and marketing sector, promoting the processing of agricultural and forestry production for renewable energy, introducing new technologies, opening new market opportunities for agricultural and forestry products, putting emphasis on quality, improving performance in the environmental protection, occupational safety, hygiene and animal welfare fields, by supporting micro-enterprises, small and medium-sized enterprises and collective producer entities, which are better placed to add value to local products, while simplifying the conditions for investment aid as compared with those laid down in Council Regulation (EC) No 1257/1999.
Amendment 10
Recital 32
(32)  Natural handicap payments in mountain areas and payments in other areas with handicaps should contribute, through continued use of agricultural land, to maintaining the countryside, and the maintenance and promotion of sustainable farming systems. Objective parameters for fixing the level of payments should be laid down in order to ensure the efficiency of this support scheme and ensure that its objectives are achieved.
(32)  Natural handicap payments in mountain areas and payments in other areas with handicaps should contribute, through continued use of agricultural land, to maintaining the countryside, and the maintenance and promotion of sustainable farming systems. Objective parameters for fixing the level of payments should be laid down in order to ensure the efficiency of this support scheme and ensure that its objectives are achieved. While maintaining the requisite continuity in the demarcation of areas with handicaps, in future the basic concept should focus mainly on natural handicaps within a Member State. For the system of compensatory payments, Member States should be called upon to develop systems which differentiate objectively. The Commission is called upon to submit a comprehensive study on how to define areas with handicaps, looking at all relevant aspects. Until then, the current definition should apply.
Amendment 11
Recital 33
(33)  Support should continue to be granted to farmers to help address specific disadvantages in the areas concerned resulting from the implementation of Council Directive 79/409/EEC of 2 April 1979 on the conservation of wild birds and Council Directive 92/43/EEC of 21 May 1992 on the conservation of natural habitats and of wild fauna and flora in order to contribute to the effective management of NATURA 2000 sites.
(33)  While support should continue to be granted to farmers and forest holders to help address specific disadvantages in the areas concerned resulting from the implementation of Council Directive 79/409/EEC of 2 April 1979 on the conservation of wild birds and Council Directive 92/43/EEC of 21 May 1992 on the conservation of natural habitats and of wild fauna and flora in order to contribute to the effective management of NATURA 2000 sites, the European Agricultural Fund for Rural Development should be only a secondary source of such funding. In addition to other European funds, the primary sources of funding are, above all, the national and regional budgets.
Amendment 12
Recital 34
(34)  Agri-environmental payments should continue to play a prominent role in supporting the sustainable development of rural areas and in responding to society's increasing demand for environmental services. They should further encourage farmers to serve society as a whole by introducing or continuing to apply agricultural production methods compatible with the protection and improvement of the environment, the landscape and its features, natural resources, the soil and genetic diversity. In accordance with the polluter-pays principle these payments should cover only those commitments going beyond the relevant mandatory standards.
(34)  Agri-environmental payments should continue to play a prominent role in supporting the sustainable development of rural areas and in responding to society's increasing demand for environmental services. They should further encourage farmers to serve society as a whole by introducing or continuing to apply agricultural production methods compatible with the protection and improvement of the environment, the landscape and its features, natural resources, the soil and genetic diversity. In accordance with the polluter-pays principle these payments should cover only those commitments going beyond the relevant mandatory standards, with provision for effective support elements in addition to compensation for the effects on costs and profits.
Amendment 13
Recital 45
(45)  There is a need to accompany changes in rural areas by helping them to diversify farming activities towards non-agricultural activities and develop non-agricultural sectors, promote employment, improve basic services and carry out investments making rural areas more attractive in order to reverse trends towards economic and social decline and depopulation of the countryside. An effort to enhance the human potential in this respect is also necessary.
(45)  There is a need to accompany changes in rural areas by helping them to diversify farming activities towards non-agricultural activities and develop non-agricultural sectors, promote employment, improve basic services and carry out investments making rural areas more attractive in order to reverse trends towards economic and social decline and depopulation of the countryside. An effort to enhance the human potential in this respect is also necessary. Rural development measures, particularly those under priority axis III, should be implemented in addition to existing policies and thereby create specific synergies in rural areas.
Amendment 14
Recital 50
(50)  Given the importance of the LEADER approach, a substantial share of the contribution of the Fund should be earmarked for this priority.
(50)  Given the importance of the LEADER approach, an adequate share of the contribution of the Fund should be earmarked for this priority.
Amendment 15
Recital 56
(56)  Over and above these amounts the Member States must take account of the amounts generated by modulation as provided for in Article 12(2) of Regulation (EC) No …/… [on the financing of the CAP].
(56)  Over and above these amounts the Member States must take account of the amounts generated by modulation as provided for in Article 12(2) of Regulation (EC) No …/… [on the financing of the CAP], which amounts, given that they originate in the first pillar, should be used to provide direct support for the common agricultural policy in farming and forestry, in particular by increasing aid to the farmers that receive least.
Amendment 16
Recital 58
(58)  The rate of the Fund's contribution to rural development programming should be set in relation to public expenditure in the Member States, taking account of the importance of the priority for land management and environment, the situation in the regions covered by the Convergence Objective, the priority given to the LEADER approach, the outermost regions referred to in Article 299 of the Treaty and the islands covered by Council Regulation (EEC) No 2019/93 of 19 July 1993 introducing specific measures for the smaller Aegean islands concerning certain agricultural products7.
(58)  The rate of the Fund's contribution to rural development programming should be set in relation to public expenditure in the Member States, taking account of the importance of the priority for land management and environment, the situation in the regions covered by the Convergence Objective, the importance given to the LEADER approach, the outermost regions referred to in Article 299 of the Treaty and the islands covered by Council Regulation (EEC) No 2019/93 of 19 July 1993 introducing specific measures for the smaller Aegean islands concerning certain agricultural products7.
Amendment 17
Recital 66
(66)  The Community reserve for the LEADER approach should be allocated taking the performance of the programmes in this respect into account. The criteria for its allocation should be laid down accordingly.
deleted
Amendment 18
Article 3
The Fund contributes to the promotion of sustainable rural development throughout the Community in a complementary manner to the market and income support policies of the Common Agricultural Policy, to Cohesion policy and to the Common Fisheries Policy.
With specific reference to Article 33(1) of the Treaty, and placing particular emphasis on the objectives of the common agricultural policy, the Fund contributes to the promotion of sustainable rural territory development throughout the Community and to the prevention of depopulation of rural areas in a complementary manner to the market and income support policies of the Common Agricultural Policy, to Cohesion Policy, to policies on social inclusion, non-discrimination and promotion of equal opportunities and to the Common Fisheries Policy.
Amendment 19
Article 4, paragraph 1, point (a)
(a) improving the competitiveness of agriculture and forestry by means of support for restructuring;
(a) improving the competitiveness of agriculture and forestry by means of support for development and restructuring, innovation, training and professional qualifications;
Amendment 20
Article 4, paragraph 1, point (b)
(b) improving the environment and the countryside by means of support for land management;
(b) improving the environment, the countryside and farming of the land by means of support for sustainable land management;
Amendment 21
Article 4, paragraph 1, point (c)
(c) improving the quality of life in rural areas and encouraging diversification of economic activity.
(c) improving the quality of life in and the cultural development of rural areas and encouraging the development and the diversification of economic activity.
Amendment 22
Article 4, paragraph 1, point (c a) (new)
(ca) improving the supply to the local and regional population of farm products produced in their area;
Amendment 23
Article 4, paragraph 1, point (c b) (new)
(cb) increasing the contribution to sustainable energy supply and climate protection.
Amendment 24
Article 5, paragraph 1
1.  The Fund shall complement national, regional and local actions contributing to the priorities of the Community.
1.  The Fund shall complement national, regional and local actions without prejudice to the implementation of corresponding national development programmes contributing to the priorities of the Community.
Amendment 25
Article 5, paragraph 2
2.  The Commission and the Member States shall ensure that the assistance from the Fund and the Member States is consistent with the activities, policies and priorities of the Community. The assistance of the Fund must be consistent with the objectives of Economic and Social Cohesion and those of the European Fisheries Fund in particular.
2.  The Commission and the Member States shall ensure that the assistance from the Fund and the Member States is consistent with the activities, policies and priorities of the Community. The assistance of the Fund must be consistent with the objectives of Economic, Social and Territorial Cohesion and those of the European Fisheries Fund and environment policy in particular.
Amendment 26
Article 5, paragraph 4
4.  There shall also be consistency with the measures financed by the European Agricultural Guarantee Fund.
4.  There shall also be consistency with the measures financed by the European Agricultural Guarantee Fund , which must be clearly distinguished from the financing measures put in place by other structural funds.
Amendment 27
Article 6, paragraph 1, point (b)
(b) the economic and social partners;
(b) the bodies representing the economic and social partners and rural organisations involved in this sector;
Amendment 28
Article 6, paragraph 3
3.  The partnership shall be involved in the preparation and monitoring of the national strategy plan and in the preparation, implementation, monitoring and evaluation of the rural development programmes. The Member States shall involve all appropriate partners at the various programming stages, due regard being had to the time limit set for each step.
3.  The partnership shall be involved in the preparation and monitoring of the national strategy plan and in the preparation, implementation, monitoring and evaluation of the rural development programmes. The Member States shall involve all appropriate partners at the various programming stages. In programme planning, therefore, care must be taken to allow enough time to consult the various partners and ensure genuine participation.
Amendment 29
Article 7
The Member States shall be responsible for implementing the rural development programmes at the appropriate territorial level, according to their own institutional arrangements. This responsibility shall be carried out in accordance with this Regulation.
The Member States shall be responsible for implementing the rural development programmes at the appropriate territorial level, according to their own institutional arrangements and the rules on subsidiarity as set out in the Treaty establishing a Constitution for Europe. This responsibility shall be carried out in accordance with this Regulation.
Amendment 30
Article 8, paragraph 1
The Member States and Commission shall promote equality between men and women at all the various stages of programme implementation.
The Member States and Commission shall promote equality between men and women and non-discrimination on the grounds listed in Article 13 of the Treaty at all the various stages of programme implementation.
Amendment 31
Article 8, paragraph 2
This includes the stages of conception, implementation, monitoring and evaluation.
This includes the stages of conception, implementation, monitoring and evaluation, with gender mainstreaming being a fundamental yardstick for the assessment of programme eligibility.
Amendment 32
Article 8, paragraph 2 a (new)
The Member States shall devise measures to facilitate access by women to joint ownership of farms and to the aid provided for in this Regulation.
Amendment 33
Article 8 a (new)
Article 8a
Specific aid to small and micro-enterprises
Member States and the Commission shall support small and micro-enterprises on account of their special importance to employment and the environment in rural areas. In view of the special socioeconomic importance of the enterprises, each Member State shall adopt criteria for financial support which afford these enterprises privileged access to rural development funding.
Amendment 34
Article 9, paragraph 1, subparagraph 1
1.  The Council adopts at Community level strategic guidelines for rural development for the programming period from 1 January 2007 to 31 December 2013 in the light of the policy priorities set at Community level.
1.  The Council adopts at Community level strategic guidelines for rural development and particularly for the attainment of the objectives referred to in Article 4 for the programming period from 1 January 2007 to 31 December 2013 in the light of the policy priorities set at Community level.
Amendment 35
Article 9, paragraph 1, subparagraph 2
These guidelines shall set at Community level the strategic priorities for rural development for the programming period with a view to implementing each of the priority headings laid down in this Regulation.
These guidelines shall set at Community level strategic priorities for rural development for the programming period. Without prejudice to Member States" exclusive powers pursuant to the principle of subsidiarity, Member States shall take account of those guidelines in their national strategy plans as referred to in Article 11.
Amendment 36
Article 11, paragraph 3, point (e)
(e) the means to ensure coordination with the other CAP instruments and with Cohesion policy;
(e) the means to ensure coordination between the CAP, including the two pillars 1a and 1b, on the one hand and cohesion, territorial convergence, regional competitivity and employment policies, on the other;
Amendment 37
Article 11, paragraph 3, point (g a) (new)
(ga) an outline of how the plan contributes to social inclusion and non-discrimination.
Amendment 38
Article 11 a, paragraph 2
2.  Each Member State shall send the Commission its national strategic plan before submitting its rural development programmes.
2.  Each Member State shall send the Commission its national strategic plan before or when submitting its rural development programmes. If a Member State has only one rural development programme, the national strategy may be included as a separate chapter.
Amendment 39
Article 12, title and paragraph 1
Annual summary report by Member State
1.  For the first time in 2008 and no later than 1 October each year, each Member State shall submit to the Commission a summary report setting out the progress made in implementing its strategy and objectives and their contribution to the achievement of the Community strategic guidelines for rural development.
Summary report by Member State
1.  No later than 1 October 2010, each Member State shall submit to the Commission a summary report setting out the progress made in implementing its strategy and objectives and their contribution to the achievement of the Community strategic guidelines for rural development. After the conclusion of the programming period, each Member State shall submit a summary report on the programming period 2007-2013.
Amendment 40
Article 13, title and paragraph 1
Annual Commission report
1.  For the first time in 2009 and at the start of each year, the Commission shall present an annual report summarising the main developments, trends and challenges relating to the implementation of the national strategy plans and the Community strategic guidelines.
Commission report
1.  After the submission of the reports of the Member States, the Commission shall present a report in 2011 summarising the main developments, trends and challenges relating to the implementation of the national strategy plans and the Community strategic guidelines.
This report shall be based on the Commission's analysis and appraisal of the Member States" annual summary reports referred to in Article 12 and any other available information. It shall indicate the measures taken or to be taken by the Member States and Commission in order to provide an appropriate follow-up to the report's conclusions.
This report shall be based on the Commission's analysis and appraisal of the Member States" summary reports referred to in Article 12 and any other available information. It shall indicate the measures taken or to be taken by the Member States and Commission in order to provide an appropriate follow-up to the report's conclusions.
Amendment 41
Article 13, paragraph 2
2.  The annual Commission report shall be sent to the Council, Parliament, the European Economic and Social Committee and the Committee of the Regions.
2.  The Commission report shall be sent to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions.
Amendment 42
Article 14, paragraph 2
2.  A Member State may submit either a single programme for its entire territory or a programme for each region.
2.  A Member State may submit either a national programme or regional programmes or a combination of the two types of programme.
Amendment 43
Article 16
The Community financial contribution to each of the three objectives referred to in Article 4 shall cover at least 15% of the Fund's total contribution to the programme for priority axis I and III referred to in Sections I and III respectively under Chapter I of Title IV and 25% of the Fund's total contribution to the programme for the priority axis II referred to in Section II of Chapter I.
The Community financial contribution to each of the five objectives referred to in Article 4 shall cover at least 10 % of the Fund's total contribution to the programme for priority axis I referred to in Section I under Chapter I of Title IV, 20 % of the Fund's total contribution to the programme for the priority axis II referred to in Section II of Chapter I and 8 % of the Fund's total contribution to the programme for priority axis III referred to in Section III of Chapter I.
Amendment 44
Article 18, paragraph 1
1.  The rural development programmes shall be re-examined and, if appropriate, adapted for the remainder of the period at the Member State's or Commission's initiative, following Monitoring Committee approval. The purpose of these revisions shall be to take account of the outcome of evaluations and the Commission's annual reports, particularly with a view to strengthening or adapting the way in which the Community priorities are taken into account. The rural development programmes shall be revised, when applicable, following allocation of the LEADER reserve referred to in Article 92.
1.  The rural development programmes shall be re-examined and, if appropriate, adapted for the remainder of the period at the Member State's or Commission's initiative, following Monitoring Committee approval. The purpose of these revisions shall be to take account of the outcome of evaluations and the Commission's annual reports, particularly with a view to strengthening or adapting the way in which the Community priorities are taken into account.
Amendment 45
Article 19, point (a) (v a) (new)
(va) technical support for farmers and forest holders;
Amendment 46
Article 19, point (b) (i)
(i) farm modernisation,
(i) farm modernisation, extending to the smallest holdings,
Amendment 47
Article 19, point (b) (v a) (new)
(va) experimental development;
Amendment 48
Article 19, point (c) (i)
(i) helping farmers to adapt to demanding standards based on Community legislation,
(i) helping farmers to adapt to demanding standards based on Community legislation with a view to optimum food safety,
Amendment 130
Article 19, point (c) (ii)
(ii) supporting farmers who participate in food quality schemes,
(ii) supporting farmers and producer groups who participate in food quality schemes, e.g. in the framework of Council Regulation (EEC) No 2081/92 of 14 July 1992 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs1,
___________
1 OJ L 208, 24.7.1992, p. 1.
Amendment 50
Article 19, point (c) (iii a) (new)
(iiia) supporting initiatives such as local farmers" markets and quality food local procurement schemes;
Amendment 51
Article 19, point (d) (i)
(i) supporting semi-subsistence farms undergoing restructuring,
(i) supporting semi-subsistence farms, undergoing restructuring, operating in rural, peri-urban and urban areas,
Amendment 52
Article 21, paragraph 1, introductory part
1.  Support provided for in Article 19 (a)(ii), shall be granted to persons who:
1.  Support provided for in Article 19(a)(ii) shall be mandatory for the Member States and the regions and shall be granted to persons who:
Amendment 53
Article 21, paragraph 1, point (c)
(c) submit a business plan for the development of their farming activities.
(c) submit an appropriate business plan for the development of their farming activities. The progress made with the business plan shall be verified over the three years following establishment.
Amendment 54
Article 21, paragraph 2
2.  The support shall be granted in the form of a single premium up to the maximum amount laid down in Annex I.
2.  The support shall be granted in the form of a single premium and/or an interest subsidy on loans up to a maximum capitalised value of EUR 55 000.
Amendment 55
Article 21, paragraph 2 a (new)
2a. With a view to supporting implementation of the business plan referred to in paragraph 1(c), it is necessary to ensure an integrated package of measures contributing to the establishment and development of the new enterprise. This package shall include one or more intervention measures pursuant to Title IV, permitting the financing of further operations relating to one or more axes.
Amendment 56
Article 21, paragraph 2 b (new)
2b. Measures to help young farmers set up in business shall feature in all national and regional rural-development programmes.
Amendment 57
Article 21, paragraph 2 c (new)
2c. Young farmers supported under this Article  may be given a period not exceeding five years, after they have set up, in which to comply with the conditions laid down in Community standards or by minimum requirements in connection with farm modernisation aid, payments intended to compensate for the natural handicaps of mountain areas and payments for other areas with handicaps, as well as agrienvironment and animal welfare payments.
Amendment 58
Article 23, paragraph 1, point (b a) (new)
(ba) to help potential future farmers and forest owners to meet costs arising from the preparation of the business plan for the development of their farming activities.
Amendment 59
Article 25, paragraph 1, point (a)
(a) improve the overall performance of the farm, and
(a) improve the overall economic and environmental performance of the farm, and
Amendment 60
Article 25, paragraph 1, point (a a) (new)
(aa) create jobs, and
Amendment 61
Article 26, title
Improvement of the economic value of forests
Improvement of the economic, ecological and social value of forests
Amendment 62
Article 26, paragraph 1
1.  Investment support provided for in Article 19 (b)(ii) shall be granted for forests owned by private owners or their associations or by municipalities or their associations. This limitation does not apply to the subtropical forests and to the wooded areas of the territories of Açores, Madeira and French Oversea Departments.
1.  Investment support provided for in Article 19(b)(ii) shall be granted for forests owned by private owners or their associations or by municipalities or their associations. This limitation does not apply to the tropical or subtropical forests and to the wooded areas of the territories of Azores, Madeira and French Overseas Departments and of the European Union's outermost regions. Investment support shall also be granted for the establishment and structural reinforcement of forest owner organisations so as to support members in the sustainable and more efficient management of their forests.
Amendment 63
Article 26, paragraph 2
2.  Investments shall be based on forest management plans.
2.  Investments shall be based on forest management plans for forest holdings of a size greater than that to be set by the Member States in their programmes.
Amendment 64
Article 27, paragraph 1, point (a)
(a) improve the overall performance of the enterprise;
(a) improve the overall economic and environmental performance of the enterprise;
Amendment 65
Article 27, paragraph 2, subparagraph 1
2.  Support under paragraph 1 shall be limited to micro and small enterprises within the meaning of Commission recommendation 2003/361/EC. In the case of forestry production, support shall be limited to micro-enterprises.
2.  Support under paragraph 1 shall be granted to micro, small and medium-sized enterprises within the meaning of Commission recommendation 2003/361/EC, and to any collective producer entity. In the case of forestry production, support shall be limited to micro- and small enterprises and associations of micro- and small enterprises.
Amendment 66
Article 28
Support provided for in Article 19 (b)(iv), may cover notably operations related to access to farm and forest land, energy supply and water management.
Support provided for in Article 19(b)(iv) may cover notably operations related to land reparcelling, taking into account the importance of landscape protection, access to farm and forest land, energy supply and water management, and funding and equipment for public centres providing technical support for the agri-food sector.
Amendment 131
Article 30, paragraph 1, point (b)
(b) be for Community food quality schemes or for those recognised by the Member States which comply with precise criteria to be defined in accordance with the procedure referred to in Article 95(2); schemes whose sole purpose is to provide a higher level of control of respect of obligatory standards under Community or national law shall not be eligible for support,
(b) be for Community food quality schemes, e.g. in the framework of Regulation (EEC) No 2081/92, or for those recognised by the Member States which comply with precise criteria to be defined in accordance with the procedure referred to in Article 95(2); schemes whose sole purpose is to provide a higher level of control of respect of obligatory standards under Community or national law shall not be eligible for support,
Amendment 67
Article 31, paragraph 1 a (new)
The support may include information and promotion activities for:
(a) co-operation, information transfer or networking between farmers, processors or other market actors in the agro-food chain;
(b) transfer of know-how and best practices between farmers, processors or other market actors in the agro-food chain.
Amendment 68
Title IV, Chapter I, Section 2, title
PRIORITY AXIS 2:
LAND MANAGEMENT
PRIORITY AXIS 2:
IMPROVING THE ENVIRONMENT AND THE COUNTRYSIDE
Amendment 69
Article 34, point (a) (iv)
(iv) agri-environment and animal welfare payments,
(iv) agri-environment and animal welfare payments and measures to conserve and exploit agricultural genetic diversity "on farm",
Amendment 70
Article 34, point (a) (iv a) (new)
(iva) promotion of organic farming,
Amendment 71
Article 34, point (b) (v)
(v) forest-environment payments,
(v) forest-environment payments and measures to exploit and conserve genetic diversity used for forestry purposes,
Amendment 72
Article 35, paragraph 4
4.  Payments shall be degressive above a threshold level of area per holding to be defined in the programme.
4.  Taking into account the relevant objectives, payments shall be degressive above a threshold level of area per holding to be defined in the programme.
Amendment 73
Article 36, paragraph 1
Support provided for in Article 34 (a)(iii), shall be granted annually and per hectare of Utilised Agricultural Area to farmers in order to compensate for costs incurred and income foregone resulting from disadvantages in the areas concerned related to the implementation of Directives 79/409/EEC and 92/43/EEC.
Support provided for in Article 34 (a)(iii), shall be granted annually and per hectare of Utilised Agricultural Area to farmers in order to compensate for costs incurred and income foregone resulting from disadvantages in the areas concerned related to the implementation of Directives 79/409/EEC, 92/43/EEC and 2000/60/EC.
Amendment 74
Article 36, paragraph 2
Support shall be limited to the maxima laid down in Annex I.
Support shall be limited to the maxima laid down in Annex I. The amount of the support should be set, for the long term, at EUR 200 per ha per annum, and an extension of the period of validity should be possible.
Amendment 75
Article 37, paragraph 3, subparagraph 1
3.  Agri-environment and welfare payments cover only those commitments going beyond the relevant mandatory standards established pursuant to Articles.4 and 5 and Annexes III and IV of Council Regulation (EC) No 1782/2003 and other relevant mandatory requirements established by national legislation and identified in the programme. Additionally, farmers and other land managers undertaking agri-environment commitments shall respect minimum requirements for fertiliser and plant protection product use to be identified in the programme.
3.  Agri-environment and welfare payments cover only those commitments going beyond the relevant mandatory standards established pursuant to Articles.4 and 5 and Annexes III and IV of Council Regulation (EC) No 1782/2003 and other relevant mandatory requirements established by national legislation and identified in the programme.
Amendment 76
Article 37, paragraph 3, subparagraph 2
These commitments shall be undertaken for five years. Where necessary and justified, a longer period shall be determined according to the procedure referred to in Article 95(2) for particular types of commitments.
These commitments shall be undertaken for five years, as a rule. Where necessary and justified, a longer period of up to seven years shall be determined for particular types of commitments. In special, justified cases, a period of less than five years shall also be possible.
Amendment 77
Article 37, paragraph 4, subparagraph 1
4.  The payments shall be granted annually and shall cover additional costs and income foregone resulting from the commitment given; where necessary, they may cover also transaction cost.
4.  The payments shall be granted annually. They shall incorporate an incentive component of 20 % to cover additional costs and income foregone resulting from the commitment given.
Amendment 78
Article 37, paragraph 4, subparagraph 2
Where appropriate, the beneficiaries are selected on the basis of calls for tender, applying criteria of economic, environmental and animal welfare efficiency.
Where appropriate, the beneficiaries are selected on the basis of calls for tender, applying criteria of economic, environmental and animal health and welfare efficiency.
Amendment 79
Article 38, point (b)
(b) on-farm investments which enhance the public amenity value of the NATURA 2000 area concerned.
(b) investments which enhance the public amenity value of the NATURA 2000 area concerned and of other areas which are important for purposes of nature conservation.
Amendment 80
Article 41, paragraph 3
3.  Christmas trees and fast-growing species for short-term cultivation shall be excluded from support.
3.  Christmas trees, invasive or alien species, and fast-growing species for short-term cultivation shall be excluded from support.
Amendment 81
Article 43, paragraph 1
Support provided for in Article 31 (b)(iv), shall be granted annually and per hectare of forest to private forest owners or associations thereof in order to compensate for costs incurred resulting from the restrictions on the use of forests and other wooded land related to the implementation of Directives 79/409/EEC and 92/43/EEC in the area concerned.
Support provided for in Article 31(b)(iv), shall be granted annually and as a flat-rate amount per hectare of forest to private forest owners or associations thereof in connection with specific projects in order to compensate for costs incurred and loss of income resulting from the restrictions on the use of forests and other wooded land related to the implementation of Directives 79/409/EEC and 92/43/EEC in the area concerned.
Amendment 82
Article 44, paragraph 2, subparagraph 1
2.  The payments shall cover additional costs resulting from the commitment given. They shall be calculated on the basis of real costs.
2.  The payments shall be calculated on the basis of the conventional assessment procedure.
Amendment 83
Article 46, point (b)
(b) which enhance the public amenity value of the area concerned.
(b) which enhance or preserve the public amenity value of the area concerned.
Amendment 84
Article 47, paragraph 1
1.  Member States shall designate the areas eligible for payments provided for in Article 34 (a)(i), (ii) and (iii) as well as (b)(i), (iii), (iv) and (vi) of that Article, taking into account the provisions of paragraphs 2, 3, 4 and 5 of this Article.
1.  Member States shall, in accordance with their institutional structures, designate the areas eligible for payments provided for in Article 34(a)(i), (ii) and (iii) as well as (b)(i), (iii), (iv) and (vi) of that Article, taking into account the provisions of paragraphs 2, 3, 4 and 5 of this Article. For first afforestation areas: where specific legislation provides for an approval procedure, areas shall not be designated.
Amendment 85
Article 47, paragraph 2, subparagraph 1, point (a)
(a) to the existence, because of altitude, of very difficult climatic conditions, the effect of which is substantially to shorten the growing season;
(a) to the existence, because of altitude or northern location, of very difficult climatic conditions, the effect of which is substantially to shorten the growing season;
Amendment 86
Article 47, paragraph 2, subparagraph 1, point (b a) (new)
(ba) to the presence of a small or dwindling population largely dependent on the agricultural sector and unlikely to remain should it contract any more rapidly, undermining the social, economic and environmental sustainability of the regions affected.
Amendment 87
Article 47, paragraph 2, subparagraph 1, point (b b) (new)
(bb) to their inclusion among mountain and less-favoured areas designated for "phasing out" of assistance.
Amendment 88
Article 47, paragraph 2, subparagraph 2
Areas north of the 62nd parallel and certain adjacent areas shall be regarded as mountain areas..
Areas north of the 60th parallel and certain adjacent areas shall be regarded as mountain areas.
Amendment 89
Article 47, paragraph 3, subparagraph 1, point (b a) (new)
(ba) characterised by the presence of a small or dwindling population largely dependent on agriculture and unlikely to remain should it contract any more rapidly, undermining the social, economic and environmental sustainability of the regions affected,
Amendment 90
Article 47, paragraph 3, subparagraph 1, point (b b) (new)
(bb) included among the mountain and less-favoured areas designated for "phasing out" of assistance,
Amendment 91
Article 47, paragraph 3, subparagraph 3
As concerns areas affected by specific handicaps referred to in point (b) of the first subparagraph, their total extent shall not exceed 10% of the area of the Member State concerned.
deleted
Amendment 92
Article 47, paragraph 3, subparagraph 4
The Member States shall delimitate those areas in the programmes according to specific provisions to be defined in accordance with the procedure referred to in Article 95(2).
In the programmes, the Member States shall confirm or modify the existing delimitation of those areas according to specific provisions to be defined in accordance with the procedure referred to in Article 95(2).
Amendment 93
Article 47, paragraph 5, subparagraph 1
5.  Areas apt for afforestation for environmental reasons such as protection against erosion or extension of forest resources contributing to climate change mitigation, shall be eligible for payments provided for in Article 34 (b) (i) and (iii).
5.  Areas apt for afforestation for environmental reasons and to protect against erosion shall be eligible for payments provided for in Article 34 (b) (i) and (iii). Extension of forest resources contributing to climate change mitigation shall not be eligible for payments.
Amendment 94
Article 49, point (a) (i)
(i) diversification into non-agricultural activities.
(i) diversification into non-agricultural activities, including on-farm activities,
Amendment 95
Article 49, point (a) (i a) (new)
(ia) diversification of the income of those working in agriculture by promoting local processing, direct marketing and the establishment of products with designations of geographical origin and special quality marks,
Amendment 96
Article 49, point (a) (ii)
(ii) support for the creation and development of micro-enterprises with a view to promoting entrepreneurship and developing the economic fabric,
(ii) support for the creation, business restart, takeover and development of micro-enterprises and small enterprises - including family enterprises - with a view to promoting entrepreneurship and developing the economic fabric,
Amendment 97
Article 49, point (a) (iii)
iii) encouragement of tourism activities,
iii) encouragement of sustainable tourism activities,
Amendment 98
Article 49, point (a) (iv)
(iv) the protection, upgrading and management of the natural heritage, so contributing to sustainable economic development.
(iv) the protection, upgrading and management of the rural heritage (natural, historical or cultural).
Amendment 99
Article 49, point (a) (iv a) (new)
(iva) support for and promotion of women's activities in rural areas.
Amendment 100
Article 49, point (b) (ii)
(ii) village renovation and development; conservation and upgrading of the rural heritage.
(ii) village renovation and development; conservation and upgrading of the rural heritage, landscape conservation and nature conservation;
Amendment 101
Article 49, point (c)
(c)  A vocational training measure for economic actors operating in the fields covered by priority axis 3.
deleted
Amendment 102
Article 50
The aid beneficiary referred to in Article 49(a) (i) may be either the farmer, his or her spouse, or one of their children.
The aid beneficiary referred to in Article 49(a) (i) may be either the farmer, his or her spouse, or one of their children, as well as other persons whose income is directly dependent on agriculture, i.e. those employed the whole year round either in agriculture or in sectors upstream or downstream of it.
Amendment 103
Article 50 a (new)
Article 50a
Aid for marketing measures
The aid beneficiary referred to in Article 49(a)(i)a may be either the farmer, his or her spouse, or one of their children.
Amendment 104
Article 51, title
Support for business creation and development
Support for business creation, takeover and development
Amendment 105
Article 52, point (c a) (new)
(ca) the creation and modernisation of small-scale rural-tourism infrastructure.
Amendment 106
Article 53
The support referred to in Article 49(a)(iv) covers environmental awareness actions, tourism improvements and the drawing-up of protection and management plans relating to NATURA 2000 sites and other places of high natural value.
The support referred to in Article 49(a)(iv) covers environmental awareness actions and tourism improvements.
Amendment 107
Article 56
Vocational trainingSupport under Article 49(c), shall not include courses of instruction or training which form part of normal education programmes or systems at secondary or higher levels.
deleted
Amendment 108
Article 60, point (a)
(a) area-based programmes intended for well-identified sub-regional rural territories;
(a) area-based programmes intended for regional agricultural territories including less-favoured and mountain areas and regions designated for 'phasing-out' of assistance;
Amendment 109
Article 67, paragraph 2, subparagraph 1
2.  At the initiative of the Member States, for each rural development programme, the Fund may finance preparation, management, monitoring, evaluation, information and control activities of programme assistance.
2.  At the initiative of the Member States, for each rural development programme and for the National Strategic Plan, the Fund may finance preparation, management, monitoring, evaluation, information and control activities of programme assistance.
Amendment 110
Article 67, paragraph 2, subparagraph 2
Up to 4% of the total amount for each programme may be devoted to these measures.
Up to 2 % of the total amount for each programme may be devoted to these measures.
Amendment 111
Article 67, paragraph 2, subparagraph 3
Within the limit set in the above subparagraph, each programme shall reserve an amount for establishing and operating the national rural network referred to in Article 69.
Within the limit set in the above subparagraph, each programme shall reserve an amount for establishing and operating the national rural network referred to in Article 69 and for technical assistance in respect of the National Strategic Plan.
Amendment 112
Article 68, paragraph 1
A European Network for Rural Development for the networking of national networks, organisations and administrations active in the field of rural development at Community level shall be put in place in accordance with Article 67(1).
A European Network for Rural Development for the networking of national networks, representative economic and social organisations and administrations active in the field of rural development at Community level shall be put in place without delay in accordance with Article 67(1).
Amendment 113
Article 69, paragraph 1
1.  Each Member State shall establish a national rural network, which gathers together all the organisations and administrations involved in rural development.
1.  Each Member State shall establish without delay a national rural network, which gathers together all the representative economic and social organisations and administrations involved in rural development.
Amendment 114
Article 70, paragraph 1
1.  The resources available for commitment from the Fund for the period 2007 to 2013 shall be EUR 88.75 billion at 2004 prices. The annual breakdown is shown in Annex II. Of these resources, at least EUR 31.3 billion at 2004 prices shall be concentrated in regions eligible for the Convergence Objective.
1.  The resources available for commitment from the Fund for the period 2007 to 2013 shall be EUR 95.75 billion at 2004 prices. This amount shall be conditional upon its compatibility with the financial perspective for the period commencing 2007 and shall be adjusted where appropriate. The annual breakdown is shown in Annex II. Of these resources, at least EUR 31.3 billion at 2004 prices shall be concentrated in regions eligible for the Convergence Objective.
Amendment 115
Article 70, paragraph 2
2. 3% of the resources referred to in paragraph 1, for an amount of EUR 2.66 billion at 2004 prices, shall be allocated to the reserve provided for in Article 92.
deleted
Amendment 116
Article 70, paragraph 4 a (new)
4a. The amounts required to pay compensation for nature conservation measures under NATURA 2000 shall be added to the rural development budget.
Amendment 117
Article 70, paragraph 5, subparagraph 1, introductory part
5.  The Commission shall make an initial annual indicative breakdown by Member State of the amounts indicated in paragraph 1, after deduction of the amounts referred to in paragraphs 2 and 3, based on objective criteria and taking into account:
5.  The Commission shall make an initial annual indicative breakdown by Member State of the amounts indicated in paragraph 1, after deduction of the amounts referred to in paragraph 3, based on objective criteria and taking into account:
Amendment 118
Article 70, paragraph 5, subparagraph 2
The Commission shall review in 2011 the annual allocations for the years 2012 and 2013 in order to distribute the amount referred to in paragraph 2.
deleted
Amendment 119
Article 70, paragraph 6
6.  In addition to the amounts indicated in paragraph 5, the Member States shall take into account for the purpose of programming the amounts resulting from modulation as provided for in Article 12(2) of Regulation (EC) No…/…[financing of the CAP].
6.  In addition to the amounts indicated in paragraph 5, the Member States shall take into account for the purpose of programming the amounts resulting from modulation as provided for in Article 12(2) of Regulation (EC) No…/…[financing of the CAP]. These amounts shall be used for projects under priority axes I and II, from which the payments for NATURA 2000 should be excluded.
Amendment 120
Article 71, paragraph 1
1.  The Decision adopting a rural development programme shall fix the maximum contribution from the Fund for each priority heading. The decision shall clearly identify, where necessary, the appropriations allocated to the regions eligible for the Convergence Objective.
1.  The Decision adopting a rural development programme shall fix the maximum contribution from the Fund for each priority heading. The decision shall clearly identify, where necessary, the appropriations allocated to the regions eligible for the Convergence Objective, including the statistical and natural effect regions.
Amendment 121
Article 71, paragraph 4
4.  Notwithstanding the ceilings set out in paragraph 3, the Fund contribution may be increased by five percentage points for the programmes of the outermost regions and the smaller islands of Aegean Sea.
4.  Notwithstanding the ceilings set out in paragraph 3, the Fund contribution shall be increased to 85 % of subsidisable public expenditure for the programmes of the outermost regions and the smaller islands of the Aegean Sea.
Amendment 122
Article 71, paragraph 6, subparagraph 2
An operation may qualify for a Fund contribution only under one rural development programme at a time. It may be financed under only one priority axis of the rural development programme.
An operation may qualify for a Fund contribution only under one rural development programme at a time.
Amendment 123
Article 72, paragraph 3, subparagraph 2, point (c)
(c) the purchase of land costing more than 10% of all the eligible expenditure on the operation concerned.
(c) the purchase of land costing more than 10 % of all the eligible expenditure on the operation unless a higher percentage is set in the programme approved by the Commission.
Amendment 124
Article 76, introductory part and point (a)
For each rural development programme the Member State shall designate :
For each rural development programme the Member State shall, in accordance with its institutional structure, designate:
(a) the managing authority, being a public or private national, regional or local body designated by the Member State, or the Member State itself when it carries out that task, to manage a programme;
(a) the managing authority, being a public or private national, regional or local body designated by the Member State in accordance with its institutional structure, or the Member State itself when it carries out that task, to manage a programme;
Amendment 125
Article 77, paragraph 1, point (a)
(a) ensuring that operations are selected for funding in accordance with the criteria applicable to the rural development programme and that they comply, for the whole period of their execution, with applicable Community and national rules and Community policies;
(a) ensuring that operations are selected for funding in accordance with the criteria applicable to the rural development programme and that they comply, for the whole period of their execution, with applicable Community and national rules and Community policies. These Community and national rules should be applicable without delay, should not be over-stringent and should allow a degree of flexibility which does not contravene the general guidelines for this Community policy;
Amendment 126
Article 92
Article 92
Community reserve for the LEADER priority axis
1.  The amount allocated to the reserve referred to in Article 70(2) shall be used to support implementation of the LEADER approach in programmes.
deleted
2.  Implementation of the LEADER approach shall be evaluated on the basis of objective criteria including:
(a) the priority given to the LEADER approach,
(b) the territorial coverage of the LEADER approach,
(c) the stage reached in implementing the LEADER priority axis,
(d) the leverage effect on private capital,
(e)the results of mid-term evaluations.
Amendment 127
Article 95, paragraph 1
1.  The Commission shall be assisted by a Rural Development Committee (hereinafter: the "Committee").
1.  The Commission shall be assisted by a Rural Development and Forestry Committee (hereinafter: the "Committee").
Amendment 128
Article 98, paragraph 2
2.  Council Directives and Decisions laying down and amending the lists of less-favoured areas referred to in Article 21(2) of Regulation (EC) No 950/97 are repealed.
deleted
Amendment 129
Annex I, Article 35, paragraph 3, rows 2 and 3
Maximum natural handicap payment
250 Per hectare of UAA
Maximum handicap payment for mountain areas and for areas with other handicaps
250 Per hectare of UAA
Maximum payment for areas with other handicaps
150 Per hectare of UAA

(1) Not yet published in OJ.


Exchange of information and intelligence (serious offences, including terrorism) *
PDF 345kWORD 112k
European Parliament legislative resolution on the initiative by the Kingdom of Sweden with a view to the adoption of a Council Framework Decision on simplifying the exchange of information and intelligence between law enforcement authorities of the Member States of the European Union, in particular as regards serious offences, including terrorist acts (10215/2004 – C6-0153/2004 – 2004/0812(CNS))
P6_TA(2005)0216A6-0162/2005

(Consultation procedure)

The European Parliament,

–   having regard to the initiative by the Kingdom of Sweden (10215/2004)(1),

–   having regard to Article 34(2)(b) of the Treaty on European Union,

–   having regard to Article 39(1) of the Treaty on European Union, pursuant to which the Council consulted Parliament (C6-0153/2004),

–   having regard to Rules 93 and 51 of its Rules of Procedure,

–   having regard to the report of the Committee on Civil Liberties, Justice and Home Affairs (A6-0162/2005),

1.  Approves the initiative by the Kingdom of Sweden as amended;

2.  Calls on the Council to alter the text accordingly;

3.  Calls on the Council to notify Parliament if it intends to depart from the text approved by Parliament;

4.  Asks the Council to consult Parliament again if it intends to amend the initiative by the Kingdom of Sweden substantially;

5.  Instructs its President to forward its position to the Council, the Commission and the Government of the Kingdom of Sweden.

Text proposed by the Kingdom of Sweden   Amendments by Parliament
Amendment 24
RECITAL 1
(1)  One of the Union's core objectives is to provide its citizens with a high level of security within an area of freedom, security and justice.
(1)  One of the Union's core objectives is to provide its citizens with a high level of security within an area of freedom, security and justice whilst respecting their integrity.
Amendment 1
Recital 6
(6)  Currently, effective and expeditious exchange of information and intelligence between law enforcement authorities is seriously hampered by formal procedures, administrative structures and legal obstacles laid down in Member States" legislation; such a state of affairs is unacceptable to the citizens of the European Union which call for greater security and more efficient law enforcement while protecting human rights.
(6)  Currently, effective and expeditious exchange of information and intelligence between law enforcement authorities is seriously hampered by formal procedures, administrative structures and legal obstacles laid down in Member States" legislation; such a state of affairs must be weighed against the need for greater security and more efficient law enforcement while protecting human rights, with particular regard to Article 8 of the European Convention on Human Rights and Articles 7 and 8 of the Charter of Fundamental Rights.
Amendment 2
Recital 8 a (new)
(8a) It is necessary to establish a high degree of confidence between law enforcement authorities of the Member States and with Europol and Eurojust, a lack of which has so far hindered an efficient exchange of information and intelligence, inter alia by:
- establishing common standards for data protection in the third pillar under the authority of an independent joint supervisory body;
- providing police forces with a handbook of good practices that sets out in a simple and practical manner their data protection responsibilities and duties;
- establishing minimum standards for criminal and procedural law;
- giving the Court of Justice general jurisdiction in the third pillar;
- ensuring full parliamentary scrutiny.
Amendment 3
Recital 9 a (new)
(9a) This Framework Decision applies mutatis mutandis the same level of data protection as provided for under the first pillar by Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data and sets up a joint personal data protection supervisory authority under the third pillar which should carry out its tasks completely independently and which, taking that specific role into account, should advise the European institutions and contribute, in particular, to the uniform application of the national rules adopted pursuant to this Framework Decision.
_______________________________
OJ L 281, 23.11.1995, p. 31.
Amendment 4
Recital 12
(12)  The personal data processed in the context of the implementation of this Framework Decision will be protected in accordance with the principles of the Council of Europe Convention of 28 January 1981 for the protection of individuals with regards to the automatic processing of personal data.
(12)  The personal data processed in the context of the implementation of this Framework Decision will be protected in accordance with the European Union's common standards of personal data protection, under the supervision of the joint personal data protection supervisory authority in the area of police and judicial cooperation in criminal matters.
Amendment 5
Article 1, paragraph 1
1.  The purpose of this Framework Decision is to establish the rules under which Member States" law enforcement authorities effectively and expeditiously can exchange existing information and intelligence for the purpose of conducting crime investigations or crime intelligence operations and in particular as regards serious offences, including terrorist acts. It shall not affect more favourable provisions in national law, bilateral or multilateral agreements or arrangements between the Member States or between Member States and third countries and shall be without prejudice to instruments of the European Union on mutual legal assistance or mutual recognition of decisions regarding criminal matters.
1.  The purpose of this Framework Decision is to establish the rules under which Member States" law enforcement authorities effectively and expeditiously can exchange existing information and intelligence for the purpose of conducting crime investigations or crime intelligence operations and in particular as regards serious offences, including terrorist acts. It shall not affect more favourable provisions in national law, bilateral or multilateral agreements or arrangements between the Member States or between Member States and third countries and shall be without prejudice to instruments of the European Union on mutual legal assistance or mutual recognition of decisions regarding criminal matters and to the provisions and instruments relating to the provision of information and intelligence to Europol and Eurojust.
Amendment 6
Article 3
Exchange of information and intelligence under this Framework Decision may take place concerning offences punishable by the law of the requesting Member State by a custodial sentence or a detention order for a maximum period of at least 12 months. Member States may agree on a bilateral basis to make the procedures applicable under this Framework Decision applicable on a broader basis.
Exchange of information and intelligence under this Framework Decision may take place concerning offences punishable by the law of the requesting Member State by a custodial sentence or a detention order for a maximum period of at least 12 months and concerning all the offences referred to in Articles 1 to 3 of Council Framework Decision 2002/475/JHA of 13 June 2002 on combating terrorism1. Member States may agree on a bilateral basis to make the procedures applicable under this Framework Decision applicable on a broader basis.
___________________________________________
1 OJ L 164, 22.6.2002, p. 3.
Amendment 7
Article 4, paragraph 2
2.  Member States shall ensure that conditions not stricter than those applicable at national level for providing and requesting information and intelligence are applied for providing information and intelligence to competent law enforcement authorities of other Member States.
2.  Member States shall ensure that conditions corresponding to those applicable at national level for providing and requesting information and intelligence are applied for providing information and intelligence to competent law enforcement authorities of other Member States.
Amendment 8
Article 4, paragraph 3 a (new)
3a. Member States shall ensure that the information or intelligence provided to the competent law enforcement authorities of the other Member States pursuant to paragraph 1 is also provided to Europol and Eurojust if the exchange relates to an offence or criminal activity falling within the remit of Europol or Eurojust.
Amendment 9
Article 4 a, paragraph 1
1.  Information and intelligence shall be provided without delay and to the furthest possible extent within the timeframe requested. If information or intelligence cannot be provided within the requested timeframe, the competent law enforcement authority having received a request for information or intelligence shall indicate the timeframe within which it can be provided. Such an indication shall be made immediately.
1.  Each Member State shall ensure that any relevant information or intelligence is immediately provided to the competent law enforcement authorities of the other Member States which request it.
Amendment 10
Article 4 a, paragraph 1 a (new)
1a. If information or intelligence cannot be provided immediately, the competent law enforcement authority having received a request for information or intelligence shall indicate immediately the timeframe within which it can be provided.
Amendment 11
Article 4 a, paragraph 2, introductory part
2.  Member States shall ensure that they have procedures in place so that they may respond within at most 12 hours to requests for information and intelligence where the requesting State indicates that it is carrying out a crime investigation or a criminal intelligence operation as regards the following offences, as defined by the law of the requesting State:
2.  Member States shall ensure that they have procedures in place so that they may respond within at most 12 hours, or, in the case of information or intelligence which requires formalities or prior contacts with other authorities, 48 hours if the matter is urgent and otherwise 10 working days, to requests for information and intelligence where the requesting State indicates that it is carrying out a crime investigation or a criminal intelligence operation as regards the following offences, as defined by the law of the requesting State:
Amendment 12
Article 4 a, paragraph 2 a (new)
2a. The time-limits laid down in paragraph 2 shall run from the time when the requested competent law enforcement authority receives the request for information or intelligence.
Amendment 13
Article 5, paragraph 1
1.  Information and intelligence may be requested for the purpose of detection, prevention or investigation of an offence or a criminal activity involving the offences referred to in Article 3 where there are reasons to believe that relevant information and intelligence is available in another Member States.
1.  Information and intelligence may be requested for the purpose of detection, prevention or investigation of an offence or a criminal activity involving the offences referred to in Article 3 where there are reasons to believe that relevant information and intelligence is available in another Member State, and access to them is in accordance with the proportionality principle according to data protection experts within the European Union.
Amendment 14
Article 5, paragraph 3 a (new)
3a. The State providing the information shall have the right, on certain grounds relating to human rights or national law, to refuse to provide information in the light of Article 8 of the European Convention on Human Rights and Articles 7 and 8 of the Charter of Fundamental Rights, and where justified in terms of respect for the integrity of natural persons or the protection of business secrets.
Amendment 15
Article 9, paragraph 1
1.  Each Member State shall ensure that the established rules and standards on data protection provided for when using the communication channels referred to in Article 7(1) are applied also within the procedure on exchange of information and intelligence provided for by this Framework Decision.
1.  Each Member State, in compliance with the principles set out in Articles 9a and 9b, shall ensure that the established rules and standards on data protection provided for when using the communication channels referred to in Article 7(1) are applied also within the procedure on exchange of information and intelligence provided for by this Framework Decision.
Amendment 16
Article 9, paragraphs 2, 3 and 4
2.  Each Member State shall ensure that where a communication channel referred to in Article 7(2) is used, the equivalent standards of data protection as referred to in paragraph 1, are applied within the simplified procedure for exchange of information and intelligence provided for by this Framework Decision.
deleted
3.  Information and intelligence, including personal data, provided under this Framework Decision may be used by the competent law enforcement authorities of the Member State to which it has been provided for the purpose of:
a)proceedings to which this Framework Decision applies;
b) other law enforcement proceedings directly related to the one referred to under a);
c) for preventing an immediate and serious threat to public security;
d) for any other purpose including prosecution or administrative proceedings only with the explicit prior consent of the competent law enforcement authority having provided the information or intelligence.
4.  When providing information and intelligence in accordance with this Framework Decision, the providing competent law enforcement authority may pursuant to its national law impose conditions on the use of information and intelligence by the receiving competent law enforcement authority. Conditions may also be imposed on reporting the result of the criminal investigation or criminal intelligence operation within which the exchange of information and intelligence has taken place. The receiving competent law enforcement authority shall be bound by such conditions.
Amendment 17
Article 9, paragraph 2 a (new)
2a. Information and intelligence provided in accordance with this Framework Decision may not be used to prosecute any offence other than that for which it was obtained. Surplus information may not be used at all for prosecution.
Amendment 18
Article 9 a (new)
Article 9a
Principles governing the collection and processing of data
1.  Information and intelligence, including personal data, exchanged or provided pursuant to this Framework Decision must:
(a) be accurate, appropriate and relevant to the purposes for which it is collected and subsequently processed;
(b) be collected and processed for the exclusive purpose of carrying out legal tasks.
Data relating to aspects of private life and data relating to individuals not under suspicion may only be collected in cases of absolute necessity and subject to compliance with strict conditions.
2.  The integrity and confidentiality of data provided pursuant to this Framework Decision shall be guaranteed at all stages of their exchange and processing.
Information sources shall be protected.
Amendment 19
Article 9 b (new)
Article 9b
Right of access to data of the person concerned
The person concerned by the data collected must:
(a) be informed of the existence of the data relating to them, except where there is a major obstacle thereto;
(b) have a cost-free right of access to the data concerning them and the right to rectify inaccurate data, except where such access is likely to be prejudicial to public security or public order or to the rights and freedoms of third parties, or to hamper inquiries that are under way;
(c) where there is misuse of the data having regard to this Article, have a right to object cost-free with a view to redressing the legal situation and, where applicable, to obtaining compensation if the principles set out in this Article have not been adhered to.
Amendment 20
Article 9 c (new)
Article 9c
Joint personal data protection supervisory authority
1.  A joint personal data protection supervisory authority shall be set up, hereinafter referred to as the "authority".
The authority shall be advisory in nature and independent.
2.  The authority shall be made up of a representative of the supervisory authority or authorities designated by each Member State, a representative of the authority or authorities set up for the institutions, the European Data Protection Supervisor and the Community bodies and a representative of the Commission.
Each member of the authority shall be designated by the institution, authority or authorities he or she represents. Where a Member State has designated more than one supervisory authority, the latter shall appoint a joint representative. The same procedure shall apply for the authorities set up for the Community institutions and bodies.
3.  The authority shall reach its decisions by a simple majority of the representatives of the supervisory authorities.
4.  The authority shall elect its chairman. The chairman's term of office shall be two years. This term of office shall be renewable.
5.  The authority shall be assisted by the Secretariat for the joint supervisory data-protection bodies set up by Council Decision 2000/641/JHA of 17 October 2000.
The Secretariat shall be transferred to the Commission as soon as possible.
_____________________________
OJ L 271, 24.10.2000, p. 1.
Amendment 21
Article 9 d (new)
Article 9d
Remit of the joint personal data protection supervisory authority
1.  The remit of the authority shall be:
(a) to examine any matter relating to the implementation of the national provisions adopted in application of this Framework Decision;
(b) to deliver to the Commission an opinion on the level of protection in the European Union;
(c) to advise on any proposed change to this Framework Decision, any proposal for additional or specific measures to safeguard the rights and freedoms of natural persons with regard to the processing of personal data, and any other proposal for European legislation with implications for these rights and freedoms;
(d) to deliver an opinion on codes of conduct drawn up at European level.
2.  If the authority ascertains the existence of disparities between the laws and practices of the Member States likely to prejudice the equivalence of protection of persons in respect of personal data processing in the European Union, it shall inform the Commission.
3.  The authority may issue recommendations on its own initiative on any matter relating to protection of persons in respect of the processing of personal data under the third pillar.
4.  The opinions and recommendations of the authority shall be forwarded to the Commission.
Amendment 22
Article 11, point (c)
(c) in case the requested information and intelligence is clearly disproportionate or irrelevant with regard to the purposes for which it has been requested.
(c) in case the requested information and intelligence is disproportionate or irrelevant with regard to the purposes for which it has been requested.
Amendment 25
Article 11, paragraph 1a (new)
A competent law enforcement authority may also refuse to provide information where it has reason to believe that the state requesting the information might use that information for the prosecution of offences other than that stated in the request. The information received may only be used for the prosecution of the crime for which it is requested.
Amendment 23
Article 11 a (new)
Article 11a
Competence of the Court of Justice
Each Member State shall accept the jurisdiction of the Court of Justice of the European Communities to give preliminary rulings on the validity and interpretation of this Framework Decision in accordance with Article 35(2) of the Treaty on European Union.

(1) OJ C 281, 18.11.2004, p. 5.


Information exchange and cooperation on terrorist offences *
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European Parliament legislative resolution on the proposal for a Council decision on the exchange of information and cooperation concerning terrorist offences (15599/2004 – C6-0007/2004 – 2004/0069(CNS))
P6_TA(2005)0217A6-0160/2005

(Consultation procedure)

The European Parliament,

–   having regard to the Council text (15599/2004),

–   having regard to the Commission proposal to the Council (COM(2004)0221)(1),

–   having regard to Article 34(2)(c) of the Treaty on European Union,

–   having regard to Article 39(1) of the Treaty on European Union, pursuant to which the Council consulted Parliament (C6-0007/2004),

–   having regard to Rules 93 and 51 of its Rules of Procedure,

–   having regard to the report of the Committee on Civil Liberties, Justice and Home Affairs and the opinions of the Committee on Foreign Affairs and the Committee on Legal Affairs (A6-0160/2005),

1.  Approves the Council text as amended;

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

3.  Calls on the Council to notify Parliament if it intends to depart from the text approved by Parliament;

4.  Asks the Council to consult Parliament again if it intends to amend substantially the text submitted for consultation;

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

Text proposed by the Council   Amendments by Parliament
Amendment 1
Recital 3 a (new)
(3a) It is necessary to establish a high degree of confidence between law enforcement authorities of the Member States and with Europol and Eurojust, a lack of which has so far hindered an efficient exchange of information, inter alia by:
- establishing common standards for data protection in the third pillar under the authority of an independent joint supervisory body;
- providing police forces with a handbook of good practices that sets out in a simple and practical manner their data protection responsibilities and duties;
- establishing minimum standards for criminal and procedural law;
- giving the Court of Justice general jurisdiction in the third pillar;
- ensuring full parliamentary scrutiny.
Amendment 2
Recital 5
(5)  The objectives of the proposed action cannot be satisfactorily attained by the Member States acting alone and can therefore, given the need for reciprocity, be better attained by the Union, which may accordingly act in accordance with the subsidiarity principle. In accordance with the principle of proportionality, this Framework Decision does not go beyond what is necessary to attain those objectives.
(5)  The objectives of the proposed action cannot be satisfactorily attained by the Member States acting alone and can therefore, given the need for reciprocity, be better attained by closer cooperation between Member States and by the Union, which may accordingly act in accordance with the subsidiarity principle. In accordance with the principle of proportionality, this Framework Decision does not go beyond what is necessary to attain those objectives.
Amendment 3
Recital 5 b (new)
(5b) This Decision applies mutatis mutandis the same level of data protection as provided for under the first pillar by Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data and sets up a joint personal data protection supervisory authority under the third pillar which should carry out its tasks completely independently and which, taking that specific role into account, should advise the European institutions and contribute, in particular, to the uniform application of the national rules adopted pursuant to this Decision.
_______________________________
OJ L 281, 23.11.1995, p. 31.
Amendment 4
Recital 5 c (new)
(5c) Member States are determined to take further steps towards the rapid ratification of all international conventions and protocols relevant to the fight against terrorism, including the protocols amending the Europol Convention, and are committed to further promote the process of universal ratification by third countries of the relevant international instruments related to the fight against terrorism and the provision by those countries of aid and technical assistance in their implementation.
Amendment 5
Article 1 a, heading (new)
Article 1a
Exchange of information concerning terrorist offences between police services or other law enforcement authorities
Amendment 6
Article 1 a, paragraph 1 (new)
1.  Each Member State shall ensure that any relevant information held by its police services or other law enforcement authorities in connection with terrorist offences or which is accessible to them without the use of coercive means can be provided to the police services or other competent law enforcement authorities of other Member States in accordance with this Decision.
Amendment 7
Article 1 a, paragraph 2 (new)
2.  Each Member State shall ensure that conditions not stricter than those applicable at national level for providing and requesting information are applied for providing information to the police services or other competent law enforcement authorities of other Member States.
Amendment 8
Article 1 a, paragraph 3 (new)
3.  The information shall be provided on request by a police service or other competent law enforcement authority, in accordance with national law, within the framework of an investigation into terrorist offences.
Amendment 9
Article 2, heading
Exchanges of information concerning terrorist offences
Provision of information concerning terrorist offences to Europol and Eurojust
Amendment 12
Article 2, paragraph 4, point (da) (new)
(da) information about convictions for terrorist offences and the specific circumstances surrounding those offences; if convictions at first instance are overturned on appeal, the requested Member State shall provide the modified information to the requesting Member State without delay;
Amendment 13
Article 2, paragraph 4, point (db) (new)
(db) the sentences handed down and relevant information about their execution;
Amendment 14
Article 2, paragraph 4, point (dc) (new)
(dc) disqualifications incurred as a result of the conviction;
Amendment 15
Article 2, paragraph 4, point (dd) (new)
(dd) previous criminal record;
Amendment 16
Article 2, paragraph 4 a, point (c)
(c) information about final convictions for terrorist offences and the specific circumstances surrounding these offences;
(c) information about convictions for terrorist offences and the specific circumstances surrounding these offences; if convictions at first instance are overturned on appeal, the requested Member State shall provide the modified information to the requesting Member State without delay;
Amendment 17
Article 2, paragraph 4 a, point (ca) (new)
(ca) the sentences handed down and relevant information about their execution;
Amendment 18
Article 2, paragraph 4 a, point (cb) (new)
(cb) disqualifications incurred as a result of the conviction;
Amendment 19
Article 2, paragraph 4 a, point (cc) (new)
(cc) previous criminal record;
Amendment 20
Article 2 a (new)
Article 2a
Review and deletion of information concerning terrorist offences
1.  Europol and Eurojust shall carry out a review every three years to determine whether the information provided pursuant to Article 2 is up to date.
2.  Europol and Eurojust shall delete information provided pursuant to Article 2 after three years, provided that the information in question does not relate to ongoing investigations.
3.  In exceptional cases, the time-limit laid down in paragraph 2 may be extended. Europol and Eurojust shall ensure that they have established an appropriate procedure to consider such exceptional cases.
Amendment 21
Article 3 a (new)
Article 3a
Competence of the Court of Justice
Each Member State shall accept the jurisdiction of the Court of Justice of the European Communities to give preliminary rulings on the validity and interpretation of this Decision in accordance with Article 35(2) of the Treaty on European Union.
Amendment 22
Article 4
Each Member State shall take the necessary measures to ensure that requests from other Member States for mutual legal assistance and recognition and enforcement of judgements in connection with terrorist offences are dealt with as a matter of urgency and shall be given priority.
Each Member State shall take the necessary measures to ensure that any relevant information contained in a document, file, item of information, object or any other item of evidence which has been seized or confiscated during criminal investigations or criminal proceedings in connection with terrorist offences is made immediately accessible or immediately forwarded to the authorities of other Member States concerned, in accordance with national law and the relevant international legal instruments, if the information in question is regarded as essential to the opening of an investigation in those Member States or if investigations or prosecutions in connection with terrorist offences are in progress in those countries.
(Article 2(5) hereby falls)
Amendment 23
Article 4, paragraph 1 a (new)
If information cannot be provided immediately, the competent authority shall indicate immediately the timeframe within which it can be provided, which must not exceed 12 hours or, in the case of information which requires formalities or prior contacts with other authorities, 48 hours if the matter is urgent and otherwise 10 working days.
Amendment 24
Article 4, paragraph 1 b (new)
The time-limits laid down in paragraph 1a shall run from the time when the competent authority of the requested Member State receives the request for information.
Amendment 25
Article 4 a (new)
Article 4 a
Spontaneous exchange of information
Without prejudice to the application of Articles 2 and 3, the police services or other competent law enforcement authorities shall, without being so requested, provide information to the police services or other competent law enforcement authorities of other Member States concerned if there are serious factual reasons to believe that the information in question could assist in the prevention, investigation or detection of offences or criminal activities which are linked to a terrorist offence.
The provision of information pursuant to paragraph 1 shall be limited to what is deemed relevant and necessary for the successful prevention, investigation or detection of the offence or criminal activity in question.
The police services or other competent law enforcement authorities in question shall be informed of the clearly substantiated serious factual reasons for initiating the spontaneous exchange of information pursuant to paragraph 1.
Amendment 26
Article 4 b (new)
Article 4b
Withholding of information
The police services or the competent law enforcement authorities may refuse to provide information only if they show that there are serious factual reasons to assume that:
(a) the provision of the information would harm essential national security interests of the requested Member State;
(b) the provision of the information might jeopardise the success of a current investigation;
(c) the requested information is clearly disproportionate or irrelevant with regard to the purposes for which it has been requested.
Amendment 27
Article 4 c (new)
Article 4c
Principles governing the collection and processing of data
1.  Information, including personal data, exchanged or provided pursuant to this Decision must:
(a) be accurate, appropriate and relevant to the purposes for which it is collected and subsequently processed;
(b) be collected and processed for the exclusive purpose of carrying out legal tasks.
Data relating to aspects of private life and data relating to individuals not under suspicion may only be collected in cases of absolute necessity and subject to compliance with strict conditions.
2.  The integrity and confidentiality of data provided pursuant to this Decision shall be guaranteed at all stages of their exchange and processing.
Information sources shall be protected.
Amendment 28
Article 4 d (new)
Article 4d
Right of access to data of the person concerned
The person concerned by the data collected must:
(a) be informed of the existence of the data relating to them, except where there is a major obstacle thereto;
(b) have a cost-free right of access to the data concerning them and the right to rectify inaccurate data, except where such access is likely to be prejudicial to public security or public order or to the rights and freedoms of third parties, or to hamper inquiries that are under way;
(c) where there is misuse of the data having regard to this Article, have a right to object cost-free with a view to redressing the legal situation and, where applicable, to obtaining compensation if the principles set out in this Article have not been adhered to.
Amendment 29
Article 4 e (new)
Article 4e
Joint personal data protection supervisory authority
1.  A joint personal data protection supervisory authority shall be set up, hereinafter referred to as the "authority".
The authority shall be advisory in nature and independent.
2.  The authority shall be made up of a representative of the supervisory authority or authorities designated by each Member State, a representative of the authority or authorities set up by the institutions, the European Data Protection Supervisor and the Community bodies and a representative of the Commission.
Each member of the authority shall be designated by the institution, authority or authorities her or she represents. Where a Member State has designated more than one supervisory authority, the latter shall appoint a joint representative. The same procedure shall apply for the authorities set up for the Community institutions and bodies.
3.  The authority shall reach its decisions by a simple majority of the representatives of the supervisory authorities.
4.  The authority shall elect its chairman. The chairman's term of office shall be two years. This term of office shall be renewable.
5.  The authority shall be assisted by the Secretariat for the joint supervisory data-protection bodies set up by Council Decision 2000/641/JHA of 17 October 2000
The Secretariat shall be transferred to the Commission as soon as possible.
___________________________
OJ L 271, 24.10.2000, p. 1.
Amendment 30
Article 4 f (new)
Article 4d
Remit of the joint personal data protection supervisory authority
1.  The remit of the authority shall be:
(a) to examine any matter relating to the implementation of the national provisions adopted in application of this Decision;
(b) to deliver to the Commission an opinion on the level of protection in the European Union;
(c) to advise on any proposed change to this Decision, any proposal for additional or specific measures to safeguard the rights and freedoms of natural persons with regard to the processing of personal data, and any other proposal for European legislation with implications for these rights and freedoms;
(d) to deliver an opinion on codes of conduct drawn up at European level.
2.  If the authority ascertains the existence of disparities between the laws and practices of the Member States likely to prejudice the equivalence of protection of persons in respect of personal data processing in the European Union, it shall inform the Commission.
3.  The authority may issue recommendations on its own initiative on any matter relating to protection of persons in respect of the processing of personal data under the third pillar.
4.  The opinions and recommendations of the authority shall be forwarded to the Commission.
5.  In connection with the performance of its tasks, the authority shall have a power of investigation and an effective power of intervention which enable it, where appropriate, to take any measure required to correct, to temporarily or definitively ban the processing of or to delete any item of information collected if the manner in which that item was collected constitutes a breach of Articles 9a and 9b.
6.  Any person may submit to the authority a request concerning the protection of his or her rights and freedoms as regards the processing of personal data.
The person concerned shall be informed of the action taken on his or her request.
7.  The Commission shall inform the authority of the action it has taken on its opinions and recommendations. With that aim in view, it shall draw up a report which shall also be forwarded to the European Parliament and to the Council. The report shall be published.
8.  The authority shall draw up an annual report on the state of protection of natural persons as regards the processing of personal data under the third pillar and shall forward that report to the European Parliament, to the Council and to the Commission. The report shall be published.
Amendment 31
Article 4g (new)
Article 4g
Reports by Europol and Eurojust
Europol and Eurojust shall submit an annual report to the European Parliament and the Council.

(1) Not yet published in OJ.


Protection of the Communities' financial interests and the fight against fraud
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European Parliament resolution on the protection of the financial interests of the Communities and the fight against fraud (2004/2198(INI))
P6_TA(2005)0218A6-0151/2005

The European Parliament,

-   having regard to its resolutions on previous annual reports of the Commission and of the European Anti-Fraud Office (OLAF),

-   having regard to the Commission's annual report on the protection of the financial interests of the Communities and fight against fraud (COM(2004)0573), including the annexes (SEC(2004)1058, SEC(2004)1059),

-   having regard to the communication from the Commission entitled 'Protecting the Communities' financial interests, Fight against Fraud, Action Plan for 2004-2005' (COM(2004)0544),

-   having regard to the activity report of OLAF for the year ending June 2004(1),

-   having regard to the activity report of the OLAF Supervisory Committee for the period between June 2003 and July 2004(2),

-   having regard to the annual report of the European Court of Auditors concerning the financial year 2003(3),

-   having regard to Article 276(3) and Article 280(5) of the EC Treaty,

-   having regard to Rule 45 of its Rules of Procedure,

-   having regard to the report of the Committee on Budgetary Control and the opinions of the Committee on Agriculture and Rural Development and the Committee on Regional Development (A6-0151/2005),

Scale of the irregularities and cases of fraud reported

1.  Notes that in 2003, in the areas of own resources, agricultural expenditure and structural actions, irregularities and cases of fraud totalling some EUR 922 million were reported by the Member States; the figures forwarded to Brussels by the Member States can be broken down as follows:

   - own resources: EUR 269.9 million (2002: EUR 341.9 million),
   - EAGGF Guarantee Section: EUR 169.7 million (2002: EUR 198.1 million),
   - structural actions: EUR 482.2 million (2002: EUR 614.1 million);

2.  Notes that the total loss reported in 2002 was EUR 1.15 billion and was thus higher than in 2003; points out that the importance of such year-on-year fluctuations should not be overestimated and that they may be affected by a wide variety of factors;

3.  Notes, however, that taken over a longer period the trend in the area of the EAGGF is clearly downward, whereas in the area of the Structural Funds a substantial increase has been seen; in the year 2000, for example, the loss reported in the area of the EAGGF still totalled EUR 474.6 million, whereas the loss in the area of the Structural Funds in the same year totalled no more than EUR 114.3 million; since then, the proportions of the fraud statistics accounted for by the two areas have almost been reversed;

4.  Invites the Member States to take appropriate measures to improve systems for the control and management of the structural funds and to ensure both that the risk of fraud is reduced significantly and that the provisions of Regulation (EC) No 1681/94(4) are applied fully, particularly with regard to the procedure for timely, clear and full notification;

5.  Notes that during the period covered by the report OLAF registered 637 new cases and that the financial impact of all cases still under investigation on 30 June 2004 was put at EUR 1.37 billion;

6.  Notes, further, that the loss to the budget resulting from all cases in respect of which OLAF had initiated follow-up measures at the end of the period covered by its report (July 2003-June 2004) totalled EUR 1.76 billion(5);

7.  Notes that at the end of the period covered by the OLAF report 55 investigations were under way in the new Member States and accession countries; most of those investigations were concentrated in the external aid, cigarette and agriculture sectors; emphasises, in that connection, the valuable role played by the Anti-Fraud Coordination Service;

8.  Regrets the fact that the reports submitted by the Commission and OLAF have hitherto not been sufficiently comparable and welcomes the intention to harmonise the reporting periods;

Recovery of amounts paid in excess or in error

9.  Points out that in the areas of own resources, agricultural expenditure and structural actions a total of EUR 3 billion from 2003 and earlier financial years needs to be recovered(6);

10.  Argues in favour of simplifying definitions of types of fraud and methods of detection; calls on the Commission and OLAF to agree on a division of labour in the agricultural sector, following which OLAF will, in future, be responsible for investigations, whereas DG AGRI will be responsible for recoveries;

11.  Draws attention, further, to the European Court of Auditors' Special Report No 3/2004 on recovery of irregular payments under the Common Agricultural Policy(7): according to that report, between 1971 and September 2004 irregularities involving a total of EUR 3.1 billion were reported in the sector; of that sum, EUR 626 million (20.2%) has been recovered from recipients and EUR 156 million (5%) and EUR 144 million (4.6%) has had to be paid by the EAGGF and the Member States respectively; accordingly, there should still be EUR 2.2 billion (70%) to be recovered;

12.  Emphasises that the Member States bear primary responsibility for the prompt and efficient recovery of lost budget appropriations; regrets the fact that hitherto the Member States have failed to discharge this responsibility adequately and, in particular, have been sloppy in carrying out their reporting duties vis-à-vis the Commission;

13.  Welcomes the work of the 'Recovery' Task Force set up to deal with sums outstanding in the agricultural sector, which is due to settle some 4000 cases by March 2005; in that connection, welcomes the European Court of Auditors' Special Report No 3/2004 on recovery of irregular payments under the Common Agricultural Policy;

14.  Welcomes the progress made in the meantime by the 'Recovery' Task Force; for example, it has established that, of the total of EUR 2.18 billion, EUR 812 million is blocked as a result of ongoing legal proceedings and EUR 247 million is regarded by the Member States as irrecoverable (e.g. as a result of bankruptcies); these figures imply that, as things stand, a sum of EUR 1.12 billion needs to be recovered;

15.  Welcomes the fact that detailed consideration of individual cases has further reduced the sum to be recovered from EUR 1.12 billion to EUR 765 million (e.g. by avoiding the duplication of reports);

16.  Notes that, on the basis of the analysis drawn up by the Task Force, of the stated figure of EUR 765 million, EUR 115 million should be recovered from the EAGGF, as against EUR 650 million from the Member States; the Member States have already been informed of this state of affairs by letter;

17.  Criticises the fact that it is often those countries whose reported irregularities represent the greatest loss to the budget (2003: Spain EUR 112 367 457, Italy EUR 16 896 556, and France EUR 12 221 826) which also have the lowest recovery rates (2003: Spain 4.9%, Italy 13.9%, and France 15.6%); in the case of export refunds, Spain accounted for almost 50% of the total loss (2003: EUR 8 694 350 out of a total of EUR 17 514 557), but recovered only 9.3%;

18.  Hopes that the task force set up in 2003 to examine pre-1999 cases will make it possible to recover a proportion of the arrears;

19.  Draws attention, once again, to the case-law of the Court of Justice of the European Communities(8), which, in a judgment delivered as long ago as 11 October 1990 (Case C-34/89, Italian Republic v Commission)(9), warned the Member States to observe their general duty of care;

20.  Takes the view that the non-recovery of irregular payments within four years (by means of administrative measures) or eight years (through the courts) represents a serious breach of the duty of care; the country concerned should then be required to settle the debt itself; in this way, Member States could be encouraged to take responsibility at an early stage and adopt a proactive approach to remedying errors; a procedure of this kind would also facilitate the work of the Commission, which is accountable to Parliament; welcomes, therefore, the Commission proposals along these lines(10);

21.  Welcomes, further, the Commission's intention to improve the 'black list' system; calls on the Commission to examine all possible ways of developing this instrument into an effective means of combating fraud and, if appropriate, extending its scope beyond the agricultural sphere; Germany, France, Austria, the Netherlands, Spain and the United Kingdom are already making use of this possibility;

22.  Reiterates its call on the Commission to report on the inadequacies of the "blacklist" system (Council Regulation (EC) No 1469/95 of 22 June 1995 on measures to be taken with regard to certain beneficiaries of operations financed by the Guarantee Section of the EAGGF(11));

23.  Calls for discussions to be embarked on, on the basis of that report, either to make significant changes to that system or to replace it by a more effective instrument;

24.  Expresses concern at the fact that a number of Member States, in particular Germany, France and Spain, are failing in their duty to report irregularities within the time-limits set; 90% of cases are reported to the Commission only within two years, which reduces the prospects for recovering sums paid in error;

25.  Points out that the most recent OLAF activity report reveals that investigators have put the total loss to the budget resulting from all the cases dealt with by OLAF over the last five years at EUR 5.34 billion; notes that, of that sum, roughly EUR 100 million has been recovered; this represents only 1.87% of the estimated total loss; looks to OLAF to draw up an analysis of the causes of this paltry recovery rate in respect of cases it handles;

Fraud involving adulterated butter

26.  Points out that the financial loss to the Community resulting from the Italburro case (adulterated butter) brought to light in 1999 is put at over EUR 100 million and is concerned that, to date, less than 10% of the estimated EUR 100 million loss has been recovered by the Member States concerned (Belgium, Germany and France); this could represent a serious breach of the Member States' duty of care;

27.  Criticises the fact that the true nature of the possible health risks resulting from the butter adulteration scandal has still not been established; points out, further, that the adulteration was essentially discovered coincidentally, in the course of investigations into Mafia murders, and that clearly no routine checks are carried out with a view to preventing products from being manipulated in this way; looks to the Commission to put forward proposals as to how the health risks resulting from the adulteration of foodstuffs can be curbed effectively;

28.  Calls on the Commission, therefore, to submit, by 31 October 2005 at the latest, a report on the stage reached in the criminal law proceedings and recovery procedures and the possible health risks stemming from the butter adulteration, a report which should also contain proposals for effective ways of curbing the health risks resulting from the adulteration of foodstuffs; points out that, when the case came to light in the year 2000, the Member States refused to disclose those findings to the Commission;

29.  Notes with amazement that the German authorities have issued a recovery order for only EUR 141 737 against the firms concerned, which have now challenged that order, and that five years after the case came to light the Belgian and French public prosecutor's offices have not yet opened criminal proceedings;

Measures to combat cigarette smuggling

30.  Points out that in 2003, according to estimates drawn up by the Member States, cigarette smuggling cost the EU some EUR 200 million in own resources and that the total loss is in all probability very much greater;

31.  Warmly welcomes, in this context, the agreement on combating cigarette smuggling concluded between the Commission (together with Belgium, Germany, Greece, Spain, France, Italy, Luxembourg, the Netherlands, Portugal and Finland) and Philip Morris International (PMI); in that connection, applauds the successful way in which the Commission has cooperated with OLAF and welcomes the decisive operational support provided by OLAF's Task Force on combating cigarette smuggling; the agreement provides for measures to prevent cigarette smuggling in the long term and seeks to settle the disputes between the Community and the undertaking; in addition, over a 12-year period PMI will pay a sum of roughly US $1 250 000 000 to the Community and the Member States; calls on the Member States and the Commission to use these payments to fund measures to prevent and combat cigarette smuggling, including anti-counterfeiting activities; calls on the Commission to make proposals on the use of a substantial part of these revenues, and if necessary to present a preliminary draft amending budget and proposals for a legal basis;

32.  Welcomes the fact that Ireland, Malta and Austria, have also joined the agreement; calls on all the remaining Member States to join the agreement; calls on the Commission to seek to conclude similar agreements with other cigarette manufacturers; Member States themselves should refrain from negotiating their own agreements with manufacturers, given that the Commission has greater freedom to negotiate;

33.  Warns that rising duties on cigarettes may prompt consumers to change their behaviour (e.g. by switching to cheap products) and that high tobacco tax rates offer an additional incentive for criminal actions (e.g. smuggling or counterfeiting);

34.  Notes that illegal small-scale trading (above all in counterfeit cigarettes) is on the increase and is very difficult to combat;

35.  Points out that the routes used by cigarette smugglers may equally well be used by people smuggling drugs and other items or substances;

36.  Warns that the difference in cigarette prices between the old and new Member States makes smuggling attractive, particularly as, although transitional arrangements in the form of quantitative restrictions have been laid down to govern imports of tobacco products by private individuals travelling from the new to the old Member States, persons and vehicles are now subject only to spot checks;

37.  Regards it as essential, therefore, that administrative assistance procedures and exchanges of information among the competent authorities in the Member States and worldwide should be further improved; in addition, staff shortages in customs investigating services should be remedied and customs offices should be provided with more mobile units, arrangements which the Member States could finance using monies obtained under the agreement with PMI;

38.  Notes with regret that Member State agencies do not pass on to OLAF the information they obtain concerning counterfeit cigarettes and smuggling activities via key smuggling centres (e.g. south-east Asia); calls on the Member States to examine, on the basis of Article 280 of the Treaty, how such information can be made accessible to OLAF on the basis of administrative cooperation; asks the Court of Auditors for a prompt opinion on the proposal for improvements to administrative cooperation between OLAF and the Member States; asks it to examine, in that connection, whether it might be helpful to set up OLAF branch offices to monitor key smuggling centres;

39.  Points out that the experience gained thus far with JCOs (Joint Customs Operations) has clearly illustrated the advantages of more effective cooperation between the services of the Member States; urges that this cooperation should be placed on a more permanent footing, in the form of standing task force groups, and that Europol should be more closely involved in the fight against this form of international organised crime;

40.  Calls furthermore on the Commission to consider extending the terms of reference of the EU agency for the management of operational cooperation at external borders to include the sphere of customs investigations;

Cooperation with Switzerland

41.  Welcomes the conclusion of the Agreement between the European Community and its Member States, of the one part, and the Swiss Confederation, of the other part, to counter fraud(12); congratulates all those, including OLAF, who were involved in drawing up the Agreement; the provisions of that Agreement cover many of the aspects dealt with in the Second Protocol to the Agreement on the protection of the Communities' financial interests, in particular those governing administrative assistance, searches, seizures, and recovery; expresses its incomprehension at the fact that this protocol, which dates from 1997, has still not been ratified by three of the old Member States, namely Italy, Luxembourg and Austria;

42.  Calls on the Czech Republic, Cyprus, Latvia, Hungary, Malta, Poland and Slovenia to follow the lead given by Estonia (3 February 2005), Lithuania (28 May 2004) and Slovakia (30 September 2004) and ratify the above-mentioned protocol promptly;

43.  Urges, in that connection, the prompt adoption of the Commission proposal for a European Parliament and Council regulation on mutual administrative assistance for the protection of the financial interests of the Community against fraud and any other illegal activities(13);

Delegation to private firms of missions of the European public service

44.  Points out that, in response to various affairs in which private Commission contractors, in some cases with the knowledge and approval of the officials responsible, had misappropriated funds and manipulated contract award procedures (ECHO affair, MED affair), as long ago as late 1998 the following provision was incorporated into the Financial Regulation: 'The Commission and other institutions may not, under any form or upon any basis whatsoever, delegate to outside entities or organisations tasks of implementing the budget which may give rise to missions on the part of the European public service, especially where powers to enter into public contracts are involved'(14);

45.  Regards it as unacceptable that in November 1999 the Commission should nevertheless have adopted rules governing service, supply and works contracts in the context of cooperation to assist third countries which authorised the use of so-called procurement agencies, which then organised tender procedures, signed contracts and made payments to final recipients;

46.  Looks to the Commission to submit, by 1 September 2005, a list of all the contracts concluded since 2000 with such procurement agencies; that list should also contain details of the duration of the contracts, the award procedures and the level of the payments involved;

Priorities and prospects for OLAF's work

47.  Points out that the subsidiarity principle also applies to OLAF, i.e. the requirement to concentrate on those areas in which the services of the Member States have no competence or are failing to make adequate efforts;

48.  Emphasises once again, against this background, and setting aside action by OLAF, in keeping with the subsidiarity principle, in other operational sectors, the priority which must be given to investigations within the institutions and in connection with expenditure directly administered by the Commission;

49.  Points out that Article III-274 of the Treaty establishing a Constitution for Europe stipulates that a European Public Prosecutor's Office from Eurojust may be established in order to combat crimes affecting the financial interests of the Union;

50.  Emphasises that this prospect must be taken into account in the debate on the further development of OLAF; expects the Commission and the Council to submit, before 31 December 2005, concrete proposals concerning OLAF's future role with respect to the European Public Prosecutor and Eurojust;

OLAF investigations and the protection of fundamental freedoms

51.  Draws attention to Recital 10 of Regulation (EC) No 1073/1999 of the European Parliament and of the Council of 25 May 1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF)(15) ("the OLAF Regulation"), which states that OLAF investigations must be conducted with full respect for human rights and fundamental freedoms;

52.  Calls on the Commission and OLAF fully to respect the freedom of the press as guaranteed by law in the Member States and by Article 10 of the European Convention on Human Rights and the relevant case-law of the European Court of Human Rights on the protection of journalists' sources;

53.  Notes with concern the view expressed by the OLAF Supervisory Committee that OLAF's current, self-imposed procedural rules governing investigations (OLAF Manual) may not be sufficient to safeguard the rights of persons under investigation by OLAF and that the admissibility as evidence of the findings of investigations may be called into question; calls on the Commission, therefore, as part of the forthcoming OLAF reform to put forward corresponding legislative proposals which dispel these doubts and guarantee both legal certainty and legal protection;

OLAF and the Ombudsman

54.  Emphasises the importance of the work of the Court of Justice in enforcing and interpreting Community law and by virtue of its judicial functions under Article 255 of the Treaty, and of the work of the Ombudsman in identifying and dealing with cases of maladministration in the work of the Community institutions or bodies;

55.  Notes the statement made by the OLAF Director-General on 8 March 2005 to the effect that in procedure 2485/2004/GG OLAF is unable to comply with the draft recommendation issued by the Ombudsman and concede that in its submissions to the Ombudsman in connection with his investigations of complaint 1840/2002/GG it made inaccurate and misleading statements to him;

56.  Looks to the Commission, in the light of the Ombudsman's special report of 12 May 2005 and Parliament's as yet unissued response to that report, to take whatever steps are required, if appropriate, to call those responsible to account and restore OLAF's credibility;

Procedure for appointing the Director-General of OLAF

57.  Welcomes the Commission's decision to fill the post of Director-General of OLAF following a public call for applications in the Official Journal, so that a genuine and credible selection process can take place with a view to endowing the Director-General with a valid mandate and sufficient credibility;

58.  Notes the Commission's decision, taken at its 1691st meeting on 22 February 2005, to give the current Director-General responsibility for conducting routine business until the new appointment is made;

59.  Takes the view that the Commission would have been better advised to appoint, by agreement with Parliament and the Council, an interim Director whose freedom of action would not have been restricted; is of the opinion that provisions for appointing an interim Director must be added to the OLAF regulation;

60.  Points out that in paragraph 55 of its resolution of 4 December 2003 on the Commission report on the evaluation of the activities of the European Anti-Fraud Office (OLAF)(16) it called for the post of OLAF Director-General to be advertised promptly and that responsibility for the delay which has now occurred lies solely with the Commission, which waited far too long before initiating the requisite procedures;

61.  Regards it now as particularly important that no further unnecessary delays should occur and that a decision on the new appointment should be taken as soon as possible;

62.  Emphasises that pursuant to Article 12 of the OLAF Regulation, the Commission can draw up the list of suitably qualified candidates only after the OLAF Supervisory Committee has given a favourable opinion, i.e. that the Supervisory Committee must be given the opportunity to consider and assess all the applications before, on that basis, the Commission draws up the list of suitable candidates;

63.  Emphasises that the Commission appoints the OLAF Director-General by agreement with Parliament and the Council, i.e. that a consensus must be secured; points out that this arrangement was laid down on the grounds that the far-reaching powers enjoyed by the OLAF Director-General (initiation and conclusion of investigations, forwarding of information to national judicial authorities) cover not only Members and employees of the Commission, but also Parliament, the Council and the Community's other institutions and bodies;

64.  Looks to the institutions involved to attach equal importance to neutrality, transparency and fairness when taking the decision on the appointment of the new OLAF Director-General in order to prevent any recurrence of the problems which affected the first appointment procedure(17);

Report and opinions of the Court of Auditors

65.  Expects the long-awaited special report of the Court of Auditors to be available in good time for its findings to be taken into account at the hearings of the candidates for the post of Director-General;

66.  Calls on the Court of Auditors, in its opinions on the legislative proposals which have now been submitted pursuant to Article 280 of the EC Treaty, to pay particular attention to the following questions;

   a) how can OLAF's independent investigatory role be strengthened?
   b) can the relevant provisions laying down OLAF's investigatory powers be consolidated in a single legal text?

Follow-up to remarks and calls from previous years

67.  Calls on OLAF to resume the dialogue, which began in November 2004, on what information Parliament can have access to in connection with its work, with a view to finding a way of respecting Parliament's supervisory powers and, at the same time, guaranteeing the confidentiality of OLAF investigations;

68.  Notes that during the period covered by the OLAF report the Eurostat Task Force dealt with 14 cases, four external and 10 internal investigations, of which nine had not yet been completed in June 2004; five sets of findings have been forwarded to the Luxembourg and French criminal justice authorities, as appropriate; looks to the Commission and OLAF to submit a progress report by 1 October 2005 at the latest;

69.  Notes that, according to a court ruling, employment arrangements at the Commission Representation in Vienna breached current Austrian labour and social welfare law; asks what findings the OLAF investigation has brought to light and what measures the Commission has taken; asks, further, what costs the Commission has already incurred as a result of losing these labour tribunal cases and being required to pay outstanding social security contributions; asks, finally, what further costs might still be generated;

70.  Expresses its satisfaction with developments in some Member States, such as the adoption of new regulatory provisions imposing penalties in the event of irregularities;

71.  Notes that the likely misuse of funds from the Leonardo da Vinci Programme has been investigated(18) and that the relevant documents have been handed over to the Romanian criminal justice authorities;

72.  Notes that the export of live cattle to Lebanon(19) has in the past given rise to the misuse of export refunds and that Germany, France and Austria have issued recovery orders;

73.  Regrets the fact that the Commission has thus far failed to draw up a survey giving the names of the international consultancies which have worked for the Commission in the areas of direct and indirect expenditure(20); looks to the Commission to provide it with such a survey by 1 July 2005;

74.  Reminds the Commission that it has been asked to submit to Parliament a communication in which it considers how the various legal instruments governing OLAF investigations could be combined to form a joint legal framework(21);

75.  Notes with concern press reports claiming that OLAF has established that in-house mismanagement at the Commission in connection with the renovation of the Berlaymont Building has resulted in an alleged loss to the budget of up to EUR 180 million; calls on OLAF to clarify the exact position; looks to the Commission to give details by 1 September 2005 of the action it has taken on the basis of the relevant OLAF report;

76.  Is disappointed at the Commission's negative reaction to paragraph 123 in the 2002 Commission discharge resolution of 21 April 2004(22), which states "... that the Commission allows goods which have been incorrectly or falsely declared to be regarded as not being involved in the transit procedure, with the result that the guarantee cannot be reclaimed, that the papers have to be sent back to the country of entry into the EU, and that the campaign to combat fraud is impeded; ..."; calls again on the Commission to put an immediate end to this practice and to propose an appropriate amendment to the Customs Code;

77.  Is of the opinion that it is the task of the Committee on Budgetary Control to monitor the Union's expenditure and that it should be able to determine whether payments are made in accordance with the financial regulations and to set political aims; therefore recommends that the Bureau authorise that Committee to send small delegations of its members on fact-finding missions even where, in duly justified cases, those missions are required to travel outside the Union's territory;

o
o   o

78.  Instructs its President to forward this resolution to the Council, the Commission, the Court of Justice, the Court of Auditors, the OLAF Supervisory Committee and OLAF.

(1) http://europa.eu.int/comm/anti_fraud/reports/olaf/2003-2004/en2.pdf.
(2) The document was forwarded to the committee secretariat in electronic form in January 2005 and can be downloaded in French from the OLAF website.
(3) OJ C 293, 30.11.2004, p. 1.
(4) Commission Regulation (EC) No 1681/94 of 11 July 1994 concerning irregularities and the recovery of sums wrongly paid in connection with the financing of the structural policies and the organization of an information system in this field (OJ L 178, 12.7.1994, p. 43).
(5) The financial loss resulting from all the cases investigated by OLAF and its forerunner organisation is estimated at EUR 5.34 billion (see SEC(2004)1370, Annex II).
(6) OLAF's Case Management System reveals that between 1999 and 2004 EUR 100 million was recovered, a sum equivalent to 1.87% of the total loss to the budget over the same period, which is put at EUR 5.34 billion.
(7) OJ C 269, 4.11.2004, p. 1.
(8) See paragraph 22 of Parliament's resolution of 30 March 2004 on the protection of the financial interests of the Communities and fight against fraud - Annual report 2002 (OJ C 103 E, 29.4.2004, p. 435).
(9) ECR 1990, I-3603.
(10) COM(2004)0489.
(11) OJ L 145, 29.6.1995, p. 1.
(12) COM(2004)0559.
(13) COM(2004)0509.
(14) OJ L 320, 28.11.1998, p. 1; see also OJ L 248, 16.9.2002, p. 1, Articles 54(1) and 57(1).
(15) OJ L 136, 31.5.1999, p. 1.
(16) OJ C 89 E, 14.4.2004, p. 153.
(17) Emphasises that steps must be taken to avoid any repeat of the situation which arose in 1999 when doubts were expressed regarding the fairness of the procedure and a candidate withdrew his application after the Secretary-General of the Commission had praised certain other candidates ahead of the appointment procedure.
(18) See paragraphs 13 and 14 of its above-mentioned resolution of 30 March 2004.
(19) See paragraph 23 et seq. of its above-mentioned resolution of 30 March 2004.
(20) See paragraph 52 of its above-mentioned resolution of 30 March 2004.
(21) See paragraph 41 of its above-mentioned resolution of 30 March 2004.
(22) OJ L 330, 4.11.2004, p. 82.


EU action plan against terrorism
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European Parliament recommendation to the European Council and the Council on the EU anti-terrorism Action Plan (2004/2214(INI))
P6_TA(2005)0219A6-0164/2005

The European Parliament,

–   having regard to the proposal for a recommendation to the Council submitted by Antoine Duquesne on behalf of the ALDE Group on the revised EU anti-terrorism Action Plan/Work Programme (B6-0071/2004),

–   having regard to the Treaty establishing a Constitution for Europe, and in particular Articles I-3, I-2, I-9, II-62, II-63, II-64, II-67, II-82, II-107, II-108, II-109, II-110, III-257, III-261, III-271, III-272, III-273, III 274, III-275 and III-276,

–   having regard to Articles 6 and 7 and Title V of the Treaty on European Union,

–   having regard to Title VI of the Treaty on European Union and in particular Articles 29, 30, 31, 32, 34, 39 and 42,

–   having regard to the European Convention for the Protection of Human Rights and Fundamental Freedoms, signed in Rome on 4 November 1950, as amended by Protocol No. 11 and in particular Articles 3, 5, 6, 8, 9 and 10,

–   having regard to the Universal Declaration of Human Rights, signed on 10 December 1948 and in particular Articles 1, 2, 3, 5, 7, 12, 13 and 19,

–   having regard to the twelve UN anti-terrorism Conventions,

–   having regard to the Statute of Rome of the International Criminal Court adopted on 17 July 1998 by the UN Diplomatic Conference of Plenipotentiaries,

–   having regard to the action plan to combat terrorism adopted by the extraordinary European Council in Brussels on 21 September 2001,

–   having regard to the declarations of the informal meeting of Heads of State and Government in Ghent on 19 October 2001,

–   having regard to the conclusions of the European Council in Laeken on 14 and 15 December 2001,

–   having regard to the Council Decision 2002/187/JHA of 28 February 2002 setting up Eurojust with a view to reinforcing the fight against serious crime(1),

–   having regard to Council Framework Decision 2002/584/JHA of 13 June 2002 on the European arrest warrant and the surrender procedures between Member States(2),

–   having regard to Council Framework Decision 2002/475/JHA of 13 June 2002 on combating terrorism(3),

–   having regard to Council Framework Decision 2002/465/JHA of 13 June 2002 on joint investigation teams(4),

–   having regard to Council Framework Decision 2003/577/JHA of 22 July 2003 on the execution in the European Union of orders freezing property or evidence(5),

–   having regard to the conclusions of the European Council in Brussels on 25 and 26 March 2004,

–   having regard to the conclusions of the International Summit on Democracy, Terrorism and Security, organised by the Club of Madrid and held in the Spanish capital from 8 to 11 March 2005,

–   having regard to the declaration of the European Council of 25 March 2004 on combating terrorism,

–   having regard to the conclusions of the European Council in Brussels on 17 and 18 June 2004,

–   having regard to the revised EU anti-terrorism Action Plan/Roadmap adopted by the European Council at its meeting of 17 and 18 June 2004,

–   having regard to the conclusions of the European Council in Brussels on 4 and 5 November 2004,

–   having regard to the Hague Programme strengthening freedom, security and justice in the European Union(6), adopted by the European Council in Brussels on 4 and 5 November 2004,

–   having regard to the conclusions of the European Council in Brussels on 16 and 17 December 2004,

–   having regard to Rule 114(3) and Rule 94 of its Rules of Procedure,

–   having regard to the report of the Committee on Civil Liberties, Justice and Home Affairs and the opinions of the Committee on Foreign Affairs (A6-0164/2005),

A.   whereas human rights are non-negotiable, indivisible and non-transferable, and the most important task of democracy is to protect the freedom and the fundamental rights of the citizens, and whereas in the interests of the fight against terrorism, no legislation should be drawn up which may have consequences running counter to that objective,

B.   whereas effective protection and promotion of fundamental rights is the backbone of democracy in Europe and is an essential precondition to the establishment of the EU anti-terrorism Action Plan,

C.   whereas terrorism, on the other hand, attacks fundamental freedoms, leads to harmful polarisation and seeks to destroy democracy itself by violent means, creating a climate destroying people's right to live in peace and freedom,

D.   whereas terrorist acts, in whatever form, are essentially a direct attack on citizens' rights and freedoms, as set out in the Universal Declaration of Human Rights, and on democracy and the rule of law,

E.   whereas terrorism is one of the most serious threats to democracy and one of the main problems facing European citizens, and whereas it seriously undermines the freedoms protected by the Charter of Fundamental Rights of the European Union,

F.   whereas the threat of terrorism today is not limited to specific geographical areas, as terrorist organisations can use crossborder networks to carry out their acts of violence and terror, networks which are capable of having devastating effects in different countries at the same time,

G.   whereas no Member State can fight terrorism by itself, and a joint interoperational anti-terrorism policy is needed,

H.   whereas the fight against terrorism requires the use of all the instruments of the rule of law and of the European Union,

I.   whereas the EU's internal and external security policies should be complementary and coherent, and this should be reflected in the functioning of its institutions,

J.   whereas the best way of fighting terrorism and combating extremism and intolerance is to promote human rights; whereas action needs to be taken against violence as a method of resolving political, economic, social or any other conflicts must be condemned, and educational actions must be promoted in favour of non-violence,

K.   whereas the fact that different forms of terrorism coexist in Europe and throughout the world makes it essential for specific measures to be taken to combat each form effectively,

L.   whereas Europe promotes democratic principles and values, and a dynamic civil society fulfils a strategic role when it comes to countering extremist ideologies and fostering solidarity and respect for cultural diversity,

M.   whereas the anti-terrorist policy pursued by the Spanish Government in collaboration with the French Government is an example of effective cooperation in this area;

N.   whereas it is necessary to implement measures for combating terrorism, notably through the promotion of new initiatives for peacemaking and mediation in societies which are marked by conflicts and division, by adopting long-term trade, aid and investment policies that advance the fight against poverty and help strengthen democratic institutions and transparency at national and at global level through initiatives which may contribute to these goals,

O.   whereas only democracy and absolute respect for human rights and fundamental freedoms can guarantee an effective European response in the fight against terrorism,

P.   whereas the murders, torture, persecution, kidnappings and threats perpetrated by terrorists are human actions so base and reprehensible that they can in no way be justified; whereas the exclusion of their acts from any moral, causal or political consideration is a necessary means of defeating them, although this will not preclude consideration of and action regarding the context and the environment which may drive people to become terrorists,

Q.   whereas the EU has already demonstrated its solidarity with the victims of terrorism, above all through:

and whereas these measures should be extended and updated,

   the Declaration of 25 March 2004 in which the European Council declared 11 March to be the European day of the victims of terrorism;
   the adoption of Council Directive 2004/80/EC of 29 April 2004 relating to compensation to crime victims(7), including those who are the victims of terrorist acts;
   the establishment in 2004 of a pilot programme to fund projects for psychological, medical and social assistance to victims of terrorism and their families;

R.   whereas the victims of terrorism are a reference for democracy and whereas the public authorities should heed their voice and ensure that they are taken into account in the places where decisions are made to combat those who have made them unwilling protagonists,

S.   whereas the European Parliament, as representative of the peoples of the European Union, publicly and transparently reviews the effectiveness of EU measures to combat terrorism and, in this context, will seek enhanced dialogue with the national parliaments,

1.  Addresses the following recommendations to the European Council and the Council for the implementation of the abovementioned revised EU Action Plan/Roadmap to combat the terrorist threat:

   a) create a European unit responsible for assisting the victims of terrorism under the direct authority and responsibility of the European Anti-Terrorism Coordinator; this unit will be a reference point for European policy in this field and its purpose will be to take in, listen to, inform and assist victims and to promote implementation of the measures which are necessary if it is to operate successfully; each year the Commission and the European Anti-Terrorism Coordinator will provide the European Parliament with a report on their activities; Parliament will assess that report and, where appropriate, suggest any action which it thinks should be taken;
   b) enlist the support of the EU and Member States, within the framework of the UN, for the moves under way to adopt a global definition of terrorism and to reach as swift an agreement as possible on the Global Convention on International Terrorism; at the same time, terrorist crimes in the Member States should not be time-barred, thereby reflecting the reprobation of the international community, which considers them to be some of the most serious and inadmissible crimes against humanity;
   c) promote, in accordance with the spirit of the Treaty establishing a Constitution for Europe, cooperation between national authorities, public prosecutors and Eurojust in order to investigate, pursue and sentence all perpetrators of serious cross-border crimes, particularly the crime of terrorism, and their accomplices, and that the legal conditions be established to enable a European Public Prosecutor's Office to be set up to pursue those objectives;
   d) promote the transformation of Europol into a EU body under the democratic control of the European Parliament and the Council and under the jurisdiction of the Court of Justice, and create, to this end, a common legal basis for the work of Europol prior to the entry into force of the Treaty establishing a Constitution for Europe;
   e) give priority to strengthening the means for exchanging preventive information by the intelligence services of Member States among themselves and with Europol without ever contravening the principles of data protection; foster mechanisms for cooperation and information exchange between Europol and Eurojust, with the arrangements for cooperation between the two to be specified;
   f) adopt a decision, proposed by the Commission, to provide for the transfer of the European anti-terrorist coordinator to the Commission, and also for effective parliamentary control of the European coordinator's activities;
   g) require the Commission to monitor the transposition into national law and the complete and faithful implementation of all anti-terrorist legal instruments adopted by the EU, and periodically to draw up a list of Member States which have not yet incorporated such measures into national law;
   h) make, by the end of 2005, a detailed assessment be made, in consultation with the European Parliament, of the implementation of the revised anti-terrorism Action Plan/Roadmap, in order to ascertain its effectiveness and the extent to which it has been followed, with the dual aim of safeguarding collective security and individual freedom; this assessment should take account of the effectiveness and proportionality of the measures adopted, and of any new developments, and should be carried out every year;
   i) conduct a study into the design and implementation of new legal instruments with a view to more effective pursuit of the collection and distribution of sources of finance for terrorist activities processed on the margins of legally established financial bodies;
   j) require all the Member States to sign and ratify the 12 existing international anti-terrorist conventions; adopt the eight special recommendations produced by the OECD to combat the financing of terrorism; and require all third countries with which the EU maintains relations to do the same;
   k) request the Commission to identify and study best practice in the Member States and third countries in the area of anti-terrorist policies and the prevention of radicalisation, which could form the basis for the Commission's strategy;
  l) develop educational programmes with the media with a view to:
   condemning all forms of violence, especially terrorism;
   combating environments which foster and are a breeding ground for racial, religious or ideological hatred;
   m) urge the Member States, in compliance with the spirit of the Treaty establishing a Constitution for Europe and with Article 42 of the EU Treaty, to adopt a decision to ensure that acts under Article 29 of the EU Treaty to combat terrorism and crossborder crime be included in Title IV of the Treaty establishing the European Community and be subject to codecision with the European Parliament and qualified majority voting in Council, under the jurisdiction of the Court of Justice;
   n) recognise the fight against terrorism as a priority of the Union and a key part of its external action under the European Security Strategy, and recognise terrorism as a threat to democracy, the rule of law, the EU Charter of Fundamental Rights and the UN Charter;
   o) make this internal and external priority absolutely clear in all dealings with third countries;
   p) take account of the diverse nature of terrorism, the organisations involved in it and the states and non-state actors that sponsor, finance and practise it for their own purposes; the fact that terrorism is an emerging and unpredictable phenomenon with its own specific sense of time and the urgent need for the Union to develop a proactive – rather than just reactive – policy to combat it;
   q) adopt the basic tenet that no action against terrorism sponsored or practised by non-state actors externally can be truly effective if it is not backed up by real conviction and determination within the Union and supported by a well-informed general public;
   r) adopt specific measures to combat all terrorist organisations, taking into account the fact that each has its own objectives, organisational structure and modus operandi;

2.  Instructs its President to forward this recommendation to the European Council and the Council and, for information, to the Commission, the governments and national Parliaments of the Member States, the Council of Europe, and the UN and its specialised agencies.

(1) OJ L 63, 6.3.2002, p. 1.
(2) OJ L 190, 18.7.2002, p. 1.
(3) OJ L 164, 22.6.2002, p. 3.
(4) OJ L 162, 20.6.2002, p. 1.
(5) OJ L 196, 2.8.2003, p. 45.
(6) OJ C 53, 3.3.2005, p. 1.
(7) OJ L 261, 6.8.2004, p. 15.


Preventing, preparing for and responding to terrorist attacks
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European Parliament recommendation to the European Council and the Council on terrorist attacks: prevention, preparation and response (2005/2043(INI))
P6_TA(2005)0220A6-0166/2005

The European Parliament,

–   having regard to the proposal for a recommendation to the Council tabled by Alexander Nuno Alvaro on behalf of the ALDE Group, on an integrated approach at EU level to preventing, preparing for and responding to all types of terrorist attacks and dealing with their consequences (B6-0081/2005),

–   having regard to Title V of the Treaty on European Union,

–   having regard to Title VI of the Treaty on European Union, and in particular its Articles 29, 30, 31, 32, 34, 39 and 42,

–   having regard the Treaty establishing a Constitution for Europe, and in particular its Articles I-43 and III-284,

–   having regard to the twelve United Nations Conventions on fighting terrorism,

–   having regard to the Rome Statute of the International Criminal Court, adopted on 17 July 1998 by the United Nations Diplomatic Conference of Plenipotentiaries,

–   having regard to the Action Plan against terrorism adopted by the extraordinary European Council held in Brussels on 21 September 2001,

–   having regard to the declarations of the informal meeting of heads of state and government held in Ghent on 19 October 2001,

–   having regard to the conclusions of the Laeken European Council of 14 and 15 December 2001,

–   having regard to Council Decision 2002/187/JHA of 28 February 2002 setting up Eurojust with a view to reinforcing the fight against serious crime(1),

–   having regard to Council Framework Decision 2002/584/JHA of 13 June 2002 on the European arrest warrant and the surrender procedures between Member States(2),

–   having regard to Council Framework Decision 2002/475/JHA of 13 June 2002 on combating terrorism(3),

–   having regard to Council Framework Decision 2002/465/JHA of 13 June 2002 on joint investigation teams(4),

–   having regard to Council Framework Decision 2003/577/JHA of 22 July 2003 on the execution in the European Union of orders freezing property or evidence(5),

–   having regard to the Presidency Conclusions of the Brussels European Council of 25 and 26 March 2004,

–   having regard to the Declaration of the Brussels European Council of 25 March 2004 on combating terrorism,

–   having regard to the Presidency Conclusions of the Brussels European Council of 17 and 18 June 2004,

–   having regard to the EU's revised Action Plan on combating terrorism taken note of by the Council at its meeting of 17 and 18 June 2004,

–   having regard to the Presidency Conclusions of the Brussels European Council of 4 and 5 November 2004,

–   having regard to the Hague programme: strengthening freedom, security and justice in the European Union(6), adopted by that European Council,

–   having regard to the Presidency Conclusions of the Brussels European Council of 16 and 17 December 2004,

–   having regard to the Commission communications on the prevention of and the fight against terrorist financing through measures to improve the exchange of information, to strengthen transparency and enhance the traceability of financial transactions (COM(2004)0700), preparedness and consequence management in the fight against terrorism (COM(2004)0701), and critical infrastructure protection in the fight against terrorism (COM(2004)0702),

–   having regard to the Commission Communication to the Council and the European Parliament on measures to be taken to combat terrorism and other forms of serious crime, in particular to improve exchanges of information (COM(2004)0221),

–   having regard to the draft Council Framework Decision on simplifying the exchange of information and intelligence between law enforcement authorities of the Member States of the European Union, in particular as regards serious offences including terrorist acts (10215/04),

–   having regard to Rules 114(3) and 94 of its Rules of Procedure,

–   having regard to the report of the Committee on Civil Liberties, Justice and Home Affairs (A6-0166/2005),

A.   whereas the main priority for the European Union in preparing for and responding to terrorist attacks is the ability of Community institutions and of the Member States to prevent terrorist attacks,

B.   whereas in order to tackle terrorism it is not sufficient merely to have a lengthy, generic list of proposals for action,

C.   whereas the fight against terrorism, whether in response to terrorist attacks or not, must at all times include the protection of human rights and respect for fundamental freedoms, an essential element and symbol of identity of our institutions, and whereas any emergency legislation must be in accordance with respect for human rights, fundamental freedoms and data protection requirements,

D.   whereas the fight against terrorism calls for a specific strategy with regard to each terrorist organisation, for which reason the strategy of the organisation should be taken into account when new means of pursuing that fight are being devised,

E.   whereas the diffuse and unpredictable nature of terrorist organisations is always an advantage to the organisations, since no-one knows with certainty the precise scope of their activity or the extent of support they enjoy, it is essential, in order to combat them effectively, to understand the organisations themselves and the social context which nurtures and sustains them,

F.   whereas these organisations are not limited by borders or to specific geographical areas, often abuse the lack of transparency in "failed and failing states" and are capable of having devastating effects in different countries at the same time,

G.   whereas, as regards evaluating the threat to the Union, terrorism in all its manifestations is an emerging phenomenon which remains imperfectly understood in terms of its operational structures and the timing of its attacks,

H.   whereas vigorously standing for pluralism, diversity, human rights and peaceful dialogue is the best means of preventing and remedying the radicalisation and harmful social polarisation that are often part and consequence of the terrorist phenomenon,

I.   whereas prevention should be based on information, on an ongoing public debate on the terrorist threat, on a collective rejection of terrorism as a political strategy, on an analysis of the reasons used by some to justify a refusal to reject terrorism, bearing in mind that there is always a need to try to avoid causing undue alarm and misrepresenting the true nature of the threat,

J.   whereas it regards itself as the main European forum for dialogue with society and between the various EU institutions and therefore is in a position to share information regarding terrorist organisations and their modus operandi, and the Union's efforts to fight them,

K.   whereas, in order to deal with terrorism, the EU needs to define and put into practice a European political project that can be easily identified by European citizens and promotes internal and external security, not only a list of general measures,

L.   whereas a political response can only exist if there is prevention, since otherwise the reaction at European level can only be inadequate and disorganised,

M.   whereas the EU's internal and external security policies should be coherent and that coherence should be reflected in the functioning of its institutions,

1.  Adresses the following recommendations to the European Council and the Council:

  A) as regards prevention:
   a) convert the existing list of exhaustive and generic anti-terrorist initiatives into a comprehensive and coherent European political project for fighting terrorism at its roots, both in and outside the Union;
   b) support fully the current efforts and, if necessary and appropriate, create new instruments and platforms to enable and promote diagnosis and exchange of information between police forces and between intelligence services regarding terrorist organisations and their modus operandi, while respecting data protection principles;
   c) monitor the role played by financial institutions in the transfer of money in order to prevent suspicious financial flows from being used to fund terrorist activities;
   d) develop all necessary instruments for the exchange of information regarding suspected terrorists and their organisations with third countries and international organisations, while ensuring respect for privacy and data protection principles;
   e) create a forum for the exchange of information between all the European institutions, on the basis of twice-yearly meetings, aimed at furthering the exchange, in this case, not of operational information but of data on the strategy and modus operandi of terrorist organisations and the Union's efforts to fight these organisations;
   f) conduct wide-ranging preventive action based on a dialogue between cultures and religions with a view to promoting mutual awareness and understanding;
   g) give clear support to the pilot project advanced by the Parliament with a view to facilitating the exchange of information between police forces, taking Community data protection legislation into account;
   h) encourage the increasing specialisation of Europol and Eurojust in the fight against terrorism, strengthen their role in diagnosis and in the activation of the European mechanisms for the exchange of information between the European Union police authorities and the Member States and promote mutual trust in European mechanisms for the exchange of information between European Union police authorities and the Member States;
   i) ensure that the training and specialisation courses of the European Police College take due account of all forms of terrorism, given its grave implications for the Union's future;
   j) include representatives of the Parliament, with a view to ensuring their participation in non-operational information, in the twice-yearly meetings bringing together the heads of SCIFA, CATS, EUROPOL, EUROJUST, EBA, CPTF and SitCen;
   k) promote European legislation designed to provide maximum control over the diversion and stockpiling of chemical precursors which may be used in the manufacture of explosives,
  B) as regards response:
   a) further develop the protocols and measures to be applied automatically after an attack;
   b) provide the Office of the European Anti-Terrorist Coordinator with the resources it needs in order to devise and coordinate a response to a terrorist attack, thereby ensuring that the response will be as integrated and effective as possible; this response will also take into account the provision of essential care to victims and their families;
  c) give their backing to the following measures to aid the victims of terrorism:
   creation of a European Unit to Aid Victims of Terrorism based at the Commission, as a reference and contact point vis-à-vis the EU institutions;
   support for the Commission's initiative for applying the Solidarity Fund in cases of terrorist attacks and using it as an instrument for compensation;
   consolidation of the pilot project for aiding victims of terrorism by creating a permanent budget heading;
   d) support Community programmes offering protection for victims who are witnesses of terrorist acts;

2.  Instructs its President to forward this recommendation to the European Council, the Council, and, for information, the Commission, the national governments and parliaments of the Member States, the Council of Europe, and the United Nations and its specialised agencies.

(1) OJ L 63, 6.3.2002, p. 1.
(2) OJ L 190, 18.7.2002, p. 1.
(3) OJ L 164, 22.6.2002, p. 3.
(4) OJ L 162, 20.6.2002, p. 1.
(5) OJ L 196, 2.8.2003, p. 45.
(6) OJ C 53, 3.3.2005, p. 1.


Protection of critical infrastructure
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European Parliament recommendation to the European Council and to the Council on the protection of critical infrastructure in the framework of the fight against terrorism (2005/2044(INI))
P6_TA(2005)0221A6-0161/2005

The European Parliament,

–   having regard to the proposal for a recommendation to the Council by Stavros Lambrinidis on behalf of the PSE Group on protection of critical infrastructures in the framework of the fight against terrorism (B6-0085/2005),

–   having regard to the Constitutional Treaty, and in particular to Articles III-284 on civil protection and I-43, which provides that "The Union and its Member States shall act jointly in a spirit of solidarity if a Member State is the object of a terrorist attack or the victim of a natural or man-made disaster,"

–   having regard to the Declaration on solidarity against terrorism adopted by the Heads of State and Government on 25 of March 2004,

–   having regard to the "Hague Programme"(1) adopted on 5 November 2004, according to which " effective management of cross-border crises within the EU requires not only the strengthening of the current actions on civil protection and vital infrastructure but also addressing effectively the public order and security aspects of such crises … Therefore the European Council calls for the Council and the Commission to set up … an integrated EU crisis management arrangement … to be implemented at the latest by 1 July 2006. This arrangement should at least address the following issues: further assessment of Member States" capabilities, stockpiling, training, joint exercises and operational plans for civil crisis management","

–   having regard to the Commission communications:

   a) to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on Reinforcing the civil protection capacity of the European Union (COM(2004)0200), which evaluates the results so far achieved with, the weaknesses of, and possible improvements to, the European Union's civil protection capacity, notably as a first instrument on crisis intervention, founded on a voluntary basis,
   b) to the Council and the European Parliament on Prevention, preparedness and response to terrorist attacks (COM(2004)0698), which emphasises the need for an integrated Community approach that should, inter alia, focus on proper communication of authorities with the public in case of a crisis, on the role of EUROPOL in the creation of a law enforcement alert mechanism to deal with terrorism and the establishment of a European Programme for Critical Infrastructure Protection (EPCIP), on security research, and on engaging in a structured manner the relevant parts of the private sector,
   c) to the Council and the European Parliament on Preparedness and consequence management in the fight against terrorism (COM(2004)0701), which proposes to consolidate the emergency systems managed by the Commission in a secure general rapid alert system (ARGUS) linked to a Central Crisis Centre that would bring together representatives of all relevant Commission Services and would provide a permanent link between the Member States and the European Institutions,
   d) to the Council and the European Parliament on Critical Infrastructure Protection in the fight against terrorism (COM(2004)0702), which proposes an EPCIP to be established in cooperation with the Member States and the relevant parts of the private sector and which will identify the possible shortcomings and the corrective measures (legal or of other kinds) to be taken,

–   having regard to its resolution of 4 September 2003 on the effects of the summer heat wave(2), in which it called for a European Civil Protection Force to be created,

–   having regard to the relevant legal bases in the Treaties which empower the Community and the Union to define and implement policies for supporting Member State action in protecting the health, security and safety of European citizens,

–   having regard to Rule 114(3) and Rule 94 of its Rules of Procedure,

–   having regard to the report of the Committee on Civil Liberties, Justice and Home Affairs (A6-0161/2005),

A.   conscious of the continuing need of Europe's citizens to be protected against the risks linked with terrorist attacks (such as nuclear, radiological, chemical and biological, attacks in public spaces, etc.) but also with natural disasters (such as earthquakes, floods, fires, forest fires), with technological disasters (such as Seveso, maritime disasters, transport accidents), as well as with health and other crises (e.g., pandemics), in the context of an integrated European strategy, given that such events not only often have major cross-border consequences at a European level, but also make it necessary for the Member States to demonstrate solidarity with one another and for there to be in place a consistent and interoperable system of response,

B.   noting that an effective strategy should focus both on preparedness (risk and threat assessments on critical infrastructure, heightened security measures, promoting common security standards and exchange of expertise, promoting EU-wide coordination and cooperation) and on managing the consequences of attacks and disasters (exchange of know-how and experience, scenario-building and training exercises and establishment of appropriate crisis-management, rapid-alert and civil-protection mechanisms),

C.   convinced that, especially in the case of terrorism, when prevention and deterrence are undermined and attacks occur, only a well-organised and effective response system can guarantee an expeditious return to normality; only by increasing specialised skills, working closely together, pooling resources, guaranteeing risk assessment, information, training, communications and pre-emptive and post-disaster analysis, ensuring a prompt restoration to normality and, finally, by increasing funding and protecting victims with the necessary aid, can the Member States and the EU be better prepared to protect citizens when a disaster strikes within and outside the Union, with real or imminent consequences for EU citizens,

D.   noting that critical infrastructure in the EU is becoming highly interconnected and interdependent, making it more vulnerable to disruption or destruction,

E.   recognising that to protect critical infrastructure requires a consistent, cooperative partnership between the owners and operators of such infrastructure and Member State authorities; noting that analysing and managing risk in each infrastructure must be based on strict EU-set processes and standards; noting that the responsibility of managing risk within physical facilities, supply chains, information technologies and communication networks ultimately rests with the owners and operators who are in charge of the day to day running of those infrastructures; noting, however, that the EU and Member States should assist, instruct, support and monitor industry at all levels of public authority, including through financial and other incentives, as and when appropriate, to perform their obligations; noting, in this regard, that operators should be able to forward existing information to the authorities and that the latter take responsibility for analysing the information and devising appropriate security solutions in conjunction with the operators; whereas it is vital that the fundamental right to data protection is ensured at European and national levels in each individual case linked with these activities,

F.   convinced of the need to strengthen computer protection systems in cooperation with European (e.g. ENISA) and national competent authorities in the face of an ever more sophisticated threat, by making use of leading-edge information technologies,

1.  Addresses the following recommendations to the European Council and to the Council:

   a) implement in full the European Council proposal to establish an "integrated EU crisis management arrangement" as an essential element in reinforcing the links between the citizens and the EU institutions and strengthening interdependence and solidarity between the Member States;
   b) ensure that an integrated European strategy particularly addresses the threat to critical infrastructure, including computer facilities, the disruption or destruction of which would have a serious impact on the health, safety, security or economic well-being of citizens, and to establish a harmonised EU method so that Member States and operators can, through common standards and the organisations and persons in charge of security: identify critical infrastructure, analyse the vulnerability and interdependence thereof and the transboundary effects of crises and conduct the relevant threat assessments; and devise solutions to protect such infrastructure, prepare it for all hazards and provide an adequate response in the event of an attack or disaster occurring;
   c) establish, on a proposal from the Commission and subject to Parliament's approval, a European Programme for Critical Infrastructure Protection (EPCIP) which should be financed by the Member States and/or by the owners and operators, on the basis of financial or other incentives, as and where appropriate; the Member States taking part should ensure that cooperation takes place, including public-private cooperation, and that there are the data and human and logistical resources needed for the various phases of the project, to meet the requirements of proportionality and subsidiarity, with particular regard to civil rights, data protection and security requirements;
   d) take on board the fact that the EPCIP should be considered by the Member States" law enforcement agencies and those responsible for national civil protection mechanisms as complementary to national planning and awareness raising; that the success of the EPCIP should be evaluated independently and by specific standards; and that, on a proposal from the Commission, the Council should establish the EPCIP via an identifiable and achievable calendar of gradual implementation of specific and clearly defined steps and goals; and to recognise that, to be successful, a European Critical Infrastructure Early-Warning Information Network should assist in stimulating an exchange of information on shared threats and mutual vulnerability and devising appropriate measures and strategies to mitigate risk, in support of protecting critical infrastructure;
  e) take on board the fact that:
   - a European risk-analysis system should be created bearing in mind the data protection exigencies at European and national levels in cooperation with the European Data Protection Supervisor so as to ensure interoperability;
   - there should be coordination between all the relevant authorities at national, European and international level which share information, which should include the data protection authority at the respective level;
   - relevant information should be handled accurately, reliably and, if necessary, confidentially, whatever its source (military or civil intelligence, police cooperation); the appropriate parliamentary scrutiny should be ensured, through a specific inter-institutional agreement for this purpose when European internal security issues are at stake;
   - it is necessary to create within the Commission a European early-warning system for crises to interlink the existing European, national and international specialised early-warning systems for emergencies, so that all relevant information which might require action at European level can be shared effectively through a central network (ARGUS);
   - it is advisable to associate the European Committee for Standardisation (CEN) when sectoral standards do not exist or where international norms have not yet been established;
  f) ensure that the EPCIP is:
   - under continuous parliamentary scrutiny at European and national levels;
   - an essential element of future developments at continental and world level(3);
   g) improve, as a complementary measure, the functioning of the European Solidarity Fund (for intervention within the Union) and ECHO (for external interventions);
   h) take over the proposal made in its abovementioned resolution to establish a European Civil Protection Force that would be able to monitor areas at risk of natural disasters in order to prevent the occurrence of disasters with enormous losses of human life, teams from which would intervene in events such as the recent tsunami catastrophe, wearing a common insignia so as to enhance the visibility of European solidarity;
   i) strengthen social partnership by coordinating NGOs, civil society and local authorities;
   j) ensure that alerts, advisories, and information notes, issued to help public and private stakeholders protect key infrastructure systems, as well as any alerts and advisories addressed to the general public in the context of civil protection emergencies, should be tailored to be absolutely necessary and appropriate so as not to unduly disrupt the daily lives of citizens and businesses or to create unnecessary fear or insecurity in the population;
   k) ensure respect of privacy rights, so that consumers and operators can have confidence that information will be handled confidentially, accurately and reliably, and that business classified information will be properly managed and protected from unauthorised use or disclosure;
   l) ensure that a European data protection and retention framework is simultaneously devised as soon as possible with relevant rules to be strictly applied in all fields and that the protection of fundamental rights of citizens is guaranteed;
   m) ensure that training exercises to enhance the Union's civil protection and critical infrastructure protection capabilities will deal with realistic and up-to-date scenarios, drawing upon the experience and expertise of appropriate Member State specialists in civil protection and critical infrastructure protection (e.g. civil protection and critical infrastructure protection experts and scenarios from the Athens 2004 Olympic Games);

2.  Instructs its President to forward this recommendation to the European Council and to the Council and, for information, to the Commission, the governments and parliaments of the Member States, the Council of Europe, and the UN and its specialised agencies.

(1) Updated on 17 December 2004 on the specific issue of fighting terrorism.
(2) OJ C 76 E, 25.3.2004, p. 382.
(3) See the proposal for reform of the strategy on civil protection and chemical, biological, radiological and nuclear threats discussed at UN level.


Combating terrorist financing
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European Parliament recommendation to the European Council and the Council on combating the financing of terrorism (2005/2065(INI))
P6_TA(2005)0222A6-0159/2005

The European Parliament,

-   having regard to the proposal for a recommendation to the Council, presented by Stefano Zappalà on behalf of the PPE-DE Group, on preventing and combating the financing of terrorism through measures to improve exchanges of information, transparency and the traceability of financial transactions (B6-0221/2005),

-   having regard to the Declaration on Combating Terrorism adopted at the Brussels European Council of 24 and 25 March 2004,

-   having regard to the European Union's revised Action Plan on combating terrorism, which the Council took note of at its meeting of 17 and 18 June 2004,

-   having regard to the Communication from the Commission on the Prevention of and the Fight against Terrorist Financing through measures to improve the exchange of information, to strengthen transparency and enhance the traceability of financial transactions (COM(2004)0700),

-   having regard to the set of measures for the prevention and suppression of terrorism provided for in the Hague Programme, which was adopted at the European Council meeting of 4 and 5 November 2004 and supplemented by the Presidency Conclusions of the Brussels European Council of 16 and 17 December 2004, in particular those relating to the financing of terrorism,

-   having regard to the proposal for a regulation of the European Parliament and the Council on the prevention of money laundering by means of customs cooperation(1),

-   having regard to the proposal for a directive of the European Parliament and of the Council on the prevention of the use of the financial system for the purpose of money laundering, including terrorist financing (COM(2004)0448),

-   having regard to the Charter of Fundamental Rights of the European Union, in particular Articles 6, 7, 8, 10, 12, 21 and 22,

-   having regard to Rule 114(3) and Rule 94 of its Rules of Procedure,

-   having regard to the report of the Committee on Civil Liberties, Justice and Home Affairs (A6-0159/2005),

A.   whereas the measures referred to in the Hague Programme, especially those relating to the fight against money laundering and terrorist financing and the exchange of information, should be implemented within a reasonable time-frame and in such a way as to ensure data protection, in order to strengthen freedom, security and justice in the European Union,

B.   whereas the European security strategy provides for an integrated approach to the fight against terrorism, to be embodied in political, diplomatic, humanitarian, economic and financial measures and judicial and police cooperation,

C.   whereas the most conspicuous source of finance for international terrorism is the international traffic in drugs and arms,

D.   whereas money laundering carried out through credit institutions that connive at the practice or through investments in tax havens is contributing to the financing of international terrorist organisations,

E.   whereas the 'preventive war' strategy has not succeeded in undermining the international terrorist organisations or their finances,

F.   whereas the organisation, running and operational development of terrorist networks entails constantly-evolving finance-raising activities, coupled with the continual search for new and interchangeable means of raising funds and of transferring these through legal and illegal channels, such as international trading companies, offshore companies and trusts, currency couriers, money remittance systems such as hawala or the use of certain charitable organisations,

G.   whereas in most Member States charities are tax-exempt and the fiscal authorities therefore already have precise information on their accounts and financial movements,

H.   whereas in the current situation of huge volumes of financial transactions on the global market, owing to the multiplicity of financial transfers and the ever-changing nature of the economy it is very difficult and complex to identify and tackle unlawful practices in respect of those transfers, such as laundering of the illicit proceeds of tax and customs fraud, corruption, and the activities of organised crime and mafias, including trafficking in narcotics, arms and human beings, and financing through extortion, including the so-called 'revolutionary tax',

I.   whereas, bearing in mind that the volume of funds collected annually by charities amounts to hundreds of billions of dollars and that it is not easy to monitor the disbursement of funds by such organisations, the charity sector is therefore very vulnerable to abuse and there is accordingly a need for greater transparency of such legal persons,

J.   whereas, in some cases, terrorists have been able to use the proceeds of charitable fund raising, at times without the donors and even the managers and staff of those charities knowing about it; whereas, moreover, it has transpired that some not-for-profit organisations have provided cover and logistical support both for terrorist operations and for transfers of the arms used by terrorist networks,

K.   whereas in the fight against the financing of terrorism in the EU measures are needed to improve the exchange of information, strengthen judicial and police cooperation, and enhance the traceability of transactions and the transparency of the financial system and the activities of legal persons,

L.   whereas, in the fight against the financing of terrorism, the exchange of information is one effective means of stopping such financing, but exchanges of information must be governed and counterbalanced by binding data protection legislation, in compliance with Article 8 of the European Convention on Human Rights and Articles 7 and 8 of the Charter of Fundamental Rights, in order to prevent the development of a society where everything is under surveillance,

M.   whereas international terrorist organisations have woven a close web of relations with numerous criminal organisations and mafias; whereas the relationship between terrorist organisations and criminal organisations and mafias is built on common economic interests and on the financing sources themselves,

1.  Addresses the following recommendations to the European Council and the Council:

   a) adopt the third Directive on money laundering and the regulation on the prevention of money laundering by means of customs cooperation;
   b) call on the Member States to ratify the Protocol of 29 May 2000 to the European Convention on Mutual Assistance in Criminal Matters and the International Convention on the Suppression of the Financing of Terrorism of 9 December 1999, and to transpose Council Framework Decision 2002/475/JHA of 13 June 2002 on combating terrorism(2) and Council Decision 2002/187/JHA of 28 February 2002 setting up Eurojust with a view to reinforcing the fight against serious crime(3);
   c) establish cooperation and exchange structures, including at technical level, to facilitate structured exchanges of information between EU intelligence services, including Europol and Eurojust; to implement effectively the requirement to exchange complete and up-to-date information about all crimes of a terrorist nature, including participation in the activities of a terrorist group by means of financing;
   d) provide substantial financial support for the FIU.NET (Financial Intelligence Units Network) project, which aims to establish a computer network that facilitates the exchange of information between FIUs, subject to data protection requirements and particularly in respect of the methods of financing terrorist networks;
   e) urge the Member States to improve cooperation with SUSTRANS and ratify the Protocol to the Europol Convention, which will enable Europol's remit to be extended to cover all money laundering offences;
   f) implement, via the urgent adoption of suitable legislation, measures to ensure the monitoring and traceability of international banking transactions, since these are major means of payment for supplies of weapons and drugs and the proceeds may be used for terrorist ends;
   g) call on Member States to implement all the FATF (Financial Action Task Force on Money Laundering) recommendations and to adopt measures to improve the traceability of transfers of funds, the identification of clients and the implementation of surveillance obligations, while avoiding the indiscriminate use of profiling in the banking and financial context and ensuring respect for fundamental rights, especially the right to data protection;
   h) promote the adoption of international standards and adopt measures at Community level with a view to substantially reducing the opacity of the financial system and the lack of transparency of the structures for international financial transactions and transfers of funds, including international trading companies, trusts and offshore companies, not least in order to combat the existence of so-called 'tax havens', inter alia through cooperation with third countries;
   i) introduce measures to monitor transfers of funds initiated outside the official channels and prevent the use and infiltration of not-for-profit associations and charities by terrorist organisations, while also supporting the proposal for a European code of conduct and for the charitable sector which would require the publication of balance sheets and institute common rules for auditing and monitoring of accounts;
   j) call on Member States to exercise the utmost vigilance regarding possible links between terrorist circles and mafia-type criminal organisations related to money laundering connected with the financing of terrorism;
   k) activate reinforced due diligence obligations for operations involving entities or persons established in territories which do not implement the rules against money laundering;
   l) call on Member States to closely monitor financial institutions and fund transfer services in order to identify suspicious fund transfer activities in which transfers are not supported by the full name, address and account number of the (natural or legal) person requesting the transfer of funds;
   m) establish the requirement that financial institutions, and any other entities subject to obligations relating to the prevention of money laundering, urgently communicate all useful information to the competent public authorities when there is reason to suspect that certain funds might be channelled into terrorist activities or, more generally, to terrorist networks; the concept of 'suspect' should be rigorously defined, it should not be possible for criminal-law provisions relating, for example, to money laundering and terrorist activity to be used to prosecute other types of crime and such provisions ought therefore to accord with the principles in the Corpus Juris(4), and the definition of the concept of 'suspect' should be such as to meet the stated objective and be proportionate;
   n) devise systems for automatically monitoring suspect transfer transactions on account of their being larger than the average, their frequency or the specific identity and geographical location of the payers and beneficiaries, in such a way as to protect the official money transfer system from a real risk of involvement in illegal activities and above all in the financing of terrorist activities; to draw up new rules for bank payments without however losing sight of the balance to be struck between the free movement of capital and the identification of suspect funds;
   o) formulate a set of minimum standards for rules on transparency in the charity sector to ensure that banks, credit institutions, insurance and finance companies and not-for-profit organisations achieve maximum transparency in their own management, financial and accounting procedures, by exclusively using official bank accounts for fund deposits and standard and formal channels for fund transfers, by publishing balance sheets which are as comprehensive as possible and include information on the precise identity of the recipients and on the intended use of the funds, and by entrusting the monitoring of their own management procedures to independent auditors;
   p) call on banks, credit institutions, insurance and finance companies and not-for-profit organisations to work together more closely with experts in the field of international terrorism financing in order to protect themselves from any involvement whatsoever in terrorist activities in view of the genuine risk of their activities being unlawfully used for the purpose of financing terrorist networks;
   q) call on the Member States to transpose and implement forthwith measures to combat criminal activities for the financing of terrorism, especially those of the second Directive on money laundering(5) and the surveillance and identification obligations introduced by it, pending the swift adoption of the third directive on money laundering and of the regulation on the prevention of money laundering by means of customs cooperation, inter alia in order to introduce in good time the requisite changes enabling an optimisation of the fight against international terrorism;
   r) ensure the ongoing evaluation of the measures introduced to combat the international financing of terrorism, in close cooperation with the Commission and Parliament;
   s) determine whether the emergency legislation introduced by some Member States in the wake of 11 September 2001 has produced positive results in the fight against terrorism and its financing;

2.  Instructs its President to forward this recommendation to the European Council, to the Council and, for information, to the Commission, the Governments and Parliaments of the Member States, the Council of Europe, and the United Nations and its specialised agencies.

(1) OJ C 227 E, 24.9.2002, p. 574.
(2) OJ L 164, 22.6.2002, p. 3.
(3) OJ L 63, 6.3.2002, p. 1.
(4) Protection of the Community's financial interests (COM(1997)0199).
(5) Directive 2001/97/EC of the European Parliament and of the Council of 4 December 2001 amending Council Directive 91/308/EEC on prevention of the use of the financial system for the purpose of money laundering. (OJ L 344 , 28.12.2001. p. 76.).


Exchange of information and cooperation concerning terrorist offences
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European Parliament recommendation to the European Council and the Council on the exchange of information and cooperation concerning terrorist offences (2005/2046(INI))
P6_TA(2005)0223A6-0165/2005

The European Parliament,

–   having regard to the proposal for a recommendation to the Council by Antoine Duquesne on behalf of the ALDE Group on the exchange of information and intelligence, and cooperation concerning terrorist offences (B6-0128/2004),

–   having regard to the declaration on combating terrorism, adopted by the European Council on 25 March 2004,

–   having regard to Article I-51 of the Treaty establishing a Constitution for Europe, relating to the protection of personal data(1),

–   having regard to Article 8 of the Charter of Fundamental Rights of the European Union, relating to the protection of personal data,

–   having regard to Council of Europe Convention 108 for the protection of individuals with regard to automatic processing of personal data,

–   having regard to the principles laid down by Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data(2),

–   having regard to Rule 114(3) and Rule 94 of its Rules of Procedure,

–   having regard to the report of the Committee on Civil Liberties, Justice and Home Affairs (A6-0165/2005),

A.   whereas the bomb attacks which rocked the Kingdom of Spain on 11 March 2004 showed that there is still a very real terrorist threat in Europe or against European interests,

B.   whereas, following the Madrid attacks, the European Council decided at its meeting of 18 June 2004 to review the European Union's plan of action on combating terrorism as the tragic events in Spain had unfortunately demonstrated that the working method which had been used by the Union since 2001, based essentially on an empirical line of reasoning, had reached its limits and needed to be replaced with a new more proactive approach,

C.   restating firmly that all forms of terrorism, however they may be dressed up ideologically, are criminal acts and, as such, utterly unjustifiable, and that, in order to combat them effectively, a specific strategy needs to be defined which takes individual action against each separate terrorist organisation,

D.   whereas, in order to tackle this problem effectively, a modern approach is required, taking due account of the close links which may exist between the various terrorist organisations and between terrorism and large-scale organised crime, making it possible to rapidly conclude clear agreements on the exchange of information in transatlantic relations, based on effective common standards respectful of people's rights,

E.   whereas it is essential to avoid multiplying the number of legal instruments to combat terrorism, and whereas it is instead necessary to work towards the standardisation and simplification of existing instruments,

F.   whereas a systematic evaluation of the policies conducted and results obtained would make it possible to highlight shortcomings and malfunctions experienced in practice, as well as to detect those measures which have proved effective,

G.   whereas closer involvement of those working on the ground in defining action strategies and instruments would make it possible to target measures more effectively in future,

H.   whereas, in its abovementioned declaration of 25 March 2004 the European Council called both for a simplification of the exchange of information and intelligence between the law enforcement authorities of the Member States with a view to combating terrorism as effectively as possible and for Member States to ensure that optimum use be systematically made of existing EU bodies, in particular Europol and Eurojust, in order to promote cooperation in the fight against terrorism, especially by improving the flow of information supplied to Europol in relation to all aspects of terrorism,

I.   whereas it is necessary to establish a high degree of confidence between the law enforcement authorities of the Member States and with Europol and Eurojust, a lack of which has so far hindered an efficient exchange of information and intelligence; these measures must include:

   - establishing common standards for data protection under the third pillar under the authority of an independent joint supervisory body,
   - providing police forces with a handbook of good practices that sets out in a simple and practical manner their data protection responsibilities and duties,
   - establishing minimum standards for criminal and procedural law,
   - giving the Court of Justice general jurisdiction under the third pillar,
   - ensuring full parliamentary scrutiny,

J.   whereas two initiatives have been taken in response to the abovementioned declaration of 25 March 2004, one by the Commission (COM(2004)0221) and the other by the Kingdom of Sweden(3), both aimed at improving and simplifying the exchange of information concerning the fight against terrorism,

K.   whereas the objective pursued by these proposals should go hand in hand with the introduction of harmonised minimum guarantees in respect of data protection under the third pillar, in particular with regard to allowing the persons concerned access to data, in full compliance with the rights of citizens recognised by the Charter of Fundamental Rights, Article 6 of the EU Treaty and Article I-51 of the Treaty establishing a Constitution for Europe, as well as the relevant principles defined by the Hague programme,

L.   whereas the fundamental rights of citizens must be preserved in all measures to combat terrorism,

M.   whereas a prerequisite for the exchange of information and intelligence is an adequate level of data protection of at least the same level as that provided for under the first pillar,

N.   noting that, in point 9 of its abovementioned declaration of 25 March 2004, the European Council announced that "the further development of the relationship between Europol and intelligence services will also be taken forward", and whereas the gathering and sharing of intelligence are absolutely essential to the fight against terrorism since the information deriving from judicial proceedings or police investigations very often becomes available when it is too late,

O.   aware of the practical difficulties inevitably linked to the establishment of a European criminal record, but anxious to restate firmly the absolute necessity of giving genuine priority to the achievement of this objective and setting a detailed and tight schedule for this purpose,

1.  Addresses the following recommendations to the European Council and the Council:

   a) include among their priority objectives the need to draw up a common proactive policy on the fight against terrorism;
   b) for as long as we do not have a common European policy, take a more systematic and coordinated approach and seek constantly to ensure that the legislation drawn up is consistent, given that this essential consistency calls for action to be taken on the basis of a genuine policy line, based on clear concepts;
  c) base their action on three guidelines:
   - making the necessary resources and capacities available to clearly identify each of the targets to be achieved, in the clear knowledge that terrorism is not one single phenomenon but on the contrary a multi-faceted problem, which varies according to the type of acts committed, the various terrorist organisations involved and the objectives pursued;
   - making the instruments for tackling terrorism more effective by adopting a modern and realistic approach, based on an understanding of the very close links which often exist between the various terrorist organisations and between terrorism and large-scale organised crime, in particular with regard to funding aspects;
   - avoiding a large increase in the number of legal instruments to combat terrorism and seeking, instead, to standardise and simplify existing instruments, in particular by ensuring that systematic assessments are carried out to determine their degree of effectiveness, and deciding to adopt new rules only when it is established that they will represent an improvement on existing rules;
   d) seek to involve as far as possible those working on the ground in devising measures, in order to take due account and advantage of their practical experience in the new instruments;
   e) adopt, on the basis of the fundamental principles governing the exchange of information as well as the needs of law enforcement services on the ground, a handbook of good practices for police officers, providing them with an explanation in simple and practical terms of the context in which they are to act, in particular with regard to the transfer and gathering of information and data protection;
   f) urge all Member States to accept the jurisdiction of the Court of Justice to give preliminary rulings on the validity and interpretation of all legislation adopted in the framework of the exchange of information and cooperation concerning terrorist offences;
   g) establish an instrument to facilitate the transfer of intelligence, in particular as part of the introduction of an early warning system;
  h) harmonise existing rules on the protection of personal data in the instruments of the current "third pillar", bringing them together in a single instrument that guarantees the same level of data protection as provided for under the first pillar, on the basis of the following fundamental principles, reiterating in particular the principles set out in the Hague programme, failure to act upon which would seriously undermine the credibility of the Union institutions:
   - the quality and relevance of the collected data must be guaranteed;
   - data should only be collected for the purpose of carrying out legal tasks;
   - data relating to an individual's private life and data concerning individuals who are not suspects may be collected only in exceptional cases of absolute necessity and subject to strict conditions;
   - individuals should be informed of the existence of data concerning them, except in the event of a major obstacle;
   - individuals should have a right of access to data concerning them and the right to rectify inaccurate data except where such access is liable to pose a threat to security and law and order or to the rights and freedoms of third persons or where it is likely to interfere with investigations;
   - individuals should be protected against misuse of data;
   - the integrity and confidentiality of data must be guaranteed;
   - the transfer of data should be governed by common standards, providing in particular for protection of the sources of information and ensuring the confidentiality of the data at all stages of the exchange and thereafter;
   - compliance with data protection rules must be guaranteed, in particular by means of a supervisory authority;
   - everyone has the right to the restoration of legality and reparation in the event of non-compliance with the principles set out;
   i) give genuine priority to the prompt establishment of an operational register of criminal sentences and losses of rights at European level (European criminal record) and the harmonisation of the elements which constitute serious offences, since the absolute necessity of these points is regularly highlighted in the context of the fight against terrorism and organised crime,
   j) in general terms, forge ahead, even in the case of controversial or complex subjects, setting a detailed and tight schedule for the establishment and implementation of instruments so long as they are intended to constitute a genuine step forward towards combating terrorism, as in the case of the European criminal record;
   k) inform Parliament of the time-frame in respect of the elaboration of legal instruments for the registration of bank accounts and measures to improve the transparency of legal persons;

2.  Instructs its President to forward this recommendation to the European Council and the Council and, for information, to the Commission.

(1) OJ C 310, 16.12.2004, p. 36.
(2) OJ L 281, 23.11.1995, p. 31.
(3) OJ C 281, 18.11.2004, p. 5.

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