(Codecision procedure: first reading)

The European Parliament,

–   having regard to the Commission proposal to the European Parliament and the Council (COM(2005)0108)(1),

–   having regard to Article 251(2), Article 159(3) and Article 181a(2) of the EC Treaty, pursuant to which the Commission submitted the proposal to Parliament (C6-0093/2005),

–   having regard to its resolution of 5 September 2002 on floods in Europe(2),

–   having regard to its resolution of 8 September 2005 on natural disasters (fires and floods) in Europe this summer(3),

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

–   having regard to the report of the Committee on Regional Development and the opinions of the Committee on Budgets and the Committee on the Environment, Public Health and Food Safety(A6-0123/2006),

1.  Approves the Commission proposal as amended;

2.  Points out that the appropriations indicated in the legislative proposal beyond 2006 are subject to the decision on the next multi-annual financial framework;

3.  Calls on the Commission, once the next financial framework is adopted, to present, if appropriate, a proposal to adjust the financial reference amount of the programme;

4.  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;

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

(1) Not yet published in OJ. (2) OJ C 272E, 13.11.2003, p.471. (3) Texts Adopted, P6_TA(2005)0334.

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular the third paragraph of Article 159 and the second paragraph of Article 181a thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Economic and Social Committee(1),

Having consulted the Committee of the Regions,

Acting in accordance with the procedure laid down in Article 251(2),

Whereas:

(1)  A "disaster" is any major destructive event that occasions serious harm to the population and the environment, such as a flood, fire or drought. In the event of major disasters or crisis situations, the Community should show its solidarity with the Member States, and above all with the population concerned, by promptly providing specific financial assistance to contribute to a rapid return to normal living conditions in the affected regions and by contributing to financial compensation for the direct victims, without becoming a substitute for the competent public and private authorities.

(2)  The European Union Solidarity Fund (hereinafter "the Fund") enables the Community to intervene in the event of major disasters or crisis situations. It should thus make a substantial contribution to more effective and targeted Community action in areas in which the public expect the Community to act. It is therefore important to ensure that the Fund's financial resources match its field of application, so that in all circumstances the Community can meet public expectations in an enlarged and further enlarging European Union. This means on the one hand that the field of application should not be overstretched, and on the other hand that the Community should be able to mobilise sufficient funds for clearly defined fields of application, even in years of particularly acute crisis.

(3)  The Community should also show solidarity with the countries negotiating their accession to the European Union.

(4)  Major environmental, industrial and technological disasters, including river and marine pollution and radiological threats, may be caused by people or accidentally or be the consequence of natural events which have immediate, devastating effects, such as floods and forest fires, or long-term effects, such as droughts and frosts, as well as from acts of terrorism. Existing economic and social cohesion instruments are able to finance risk-prevention measures and the repair of damaged infrastructure. The Fund established by Council Regulation (EC) No 2012/2002(3) enables the Community to help in mobilising emergency services to meet the immediate needs of the persons directly affected and contribute to the short-term restoration of damaged key infrastructure so that economic activity can resume in the disaster-stricken regions. That Fund is however mainly intended for disasters resulting from natural causes, and provision should also be made to allow the Community to intervene in the event of crisis situations having a non-natural origin and for which responsibility cannot be sufficiently identified.

(5)  The objective of the action to be taken is to complement the efforts of the States concerned in such cases where the effects of a disaster or crisis situation are of such gravity that those States cannot tackle the situation with their own means alone. Since this objective cannot be sufficiently achieved by the Member States and can therefore, by reason of the scale 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 Regulation does not go beyond what is necessary in order to achieve those objectives.

(6)  The Solidarity Fund should be financed independently of the financial framework with a maximum amount to be mobilised only when deemed necessary. In order to provide adequate financing, the Fund should be included in the flexibility reserve up to a maximum of EUR 7 billion.

(7)  In line with the principle of subsidiarity, action under this Regulation should be confined to major disasters. These should be defined depending on the field. In cases of terrorist attack, the Community should react to events even where the material damage does not reach the threshold for mobilisation of the Fund but the consequences of the attack are so serious that Community solidarity becomes imperative. Consideration should be given to the specific situation of remote and isolated regions, such as the insular and outermost regions, in the context of a reinforced partnership.

(8)  Experience acquired in the first years following the establishment of the previous Fund has highlighted the difficulty of applying it to slowly-evolving disasters. This Regulation therefore needs to include a clear definition of the time from which a request is eligible. It is also necessary, as a matter of urgency, to adapt the eligibility rules to the characteristics, intensity and duration of the event at the root of the problem, in particular by ensuring financial coverage for the specific measures adopted to tackle disasters of this type.

(9)  Major disasters, particularly those which are of a natural origin, often affect more than one country. Where a major disaster has struck an eligible State, assistance may also be granted to an eligible neighbouring country affected by the same disaster.

(10)  Community aid should be complementary to the efforts of the States concerned and be used to cover a share of the public expenditure committed to dealing with the most essential emergency operations resulting from a major disaster.

(11)  In line with the principle of subsidiarity, Community aid should only be granted upon the application of an affected State. The Commission should ensure equitable treatment of requests presented by the States.

(12)  Applicant States may have an immediate need for financial assistance to help cover expenditure relating to the most urgent steps and rescue operations. Where an applicant State so requests, advance funding should therefore be made upon receipt of that application, subject to budgetary availability.

(13)  Prudent financial management is required to ensure that the Community can be in a position to respond where a succession of disasters occurs within a relatively short period.

(14)  It is appropriate to allow a rapid decision to be taken to commit specific financial resources and mobilise them as quickly as possible. Administrative procedures should be adjusted accordingly and confined to the minimum absolutely necessary. To this end, the Interinstitutional Agreement between the European Parliament, the Council and the Commission of 17 May 2006 on Budgetary Discipline and Sound Financial Management provides for the financing of the Fund(4).

(15)  The mechanisms for payment and use of grants made under this Regulation should reflect the urgency of the situation. Therefore a realistic deadline should be laid down for the use of any financial assistance awarded.

(16)  A State which benefits from assistance should involve, in accordance with its specific constitutional, institutional, legal or financial context, regional or local authorities in the conclusion and application of the implementation agreements. The beneficiary State should nevertheless remain responsible for the implementation of the assistance and for the management and control of the operations supported by Community financing in accordance with Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities(5) (hereinafter "the Financial Regulation").

(17)  An operation funded under this Regulation should not receive financial assistance from other Community financial instruments. Where, in relation to an operation, financial assistance is provided from Community or international instruments relating to the compensation of specific damages, that operation should not, for the same purpose, benefit from assistance under this Regulation.

(18)  Community action should not relieve of their responsibility third parties who, under the "polluter pays" principle, are liable in the first instance for the damage caused by them, or discourage preventive measures at both Member State and Community level, or be a substitute for public or private insurance provision.

(19)  Maximum transparency is required in implementing the Community's financial assistance as well as proper monitoring of the use of resources.

(20)  Provision should be made for beneficiary States to justify the use made of any assistance received.

(21)  In exceptional cases and depending on the availability of financial resources for solidarity action under this Regulation in the year in which a disaster occurs, provision should be made for supplementary grants under the financial appropriations for the following year.

(22)  It is necessary to provide that the competent Community bodies are able to carry out their obligations regarding financial control.

(23)  Assistance for expenditure which is subsequently recovered from third parties, or assistance which is not used in accordance with this Regulation or which was received in excess of the final valuation of the damages, should be recovered.

(24)  Technical assistance for solidarity action under this Regulation should be provided for in order to improve the ability of Member States to present the Commission and any other relevant body with a duly completed application for assistance and the Commission's ability to assess applications made to it.

(25)  Regulation (EC) No 2012/2002 should be repealed with effect from the date of entry into force of this Regulation. Its provisions should, however, continue to be applicable to any application made before that date,

HAVE ADOPTED THIS REGULATION:

Article 1

Subject-matter and scope

1.  A European Union Solidarity Fund, hereinafter "the Fund", is established to enable the Community to respond to major disasters or crisis situations affecting Member States or regions thereof, or candidate countries involved in accession negotiations with the European Union, hereinafter "eligible States".

2.  A candidate country involved in accession negotiations with the European Union may only be awarded assistance from the Fund where a major disaster affects a cross-border land or sea area lying between that country and a Member State.

3.  This Regulation lays down rules concerning operations of the Fund in relation to the following:

Article 2

Major disasters

For the purposes of this Regulation, a disaster or crisis situation shall be considered to be major where it results, in at least one eligible State, in direct damage, the amount of which is estimated as being in excess of EUR 1 billion in 2007 prices or in excess of 0,5% of the gross national income of the State concerned.

However, even if those quantitative criteria are not met, the Commission may in exceptional and duly justified circumstances, recognise that a major disaster or crisis situation has occurred on a specific part of the territory of an eligible State. In such a case the Commission shall take all necessary measures under the Fund.

Special consideration shall be given to remote or isolated regions, such as the insular and outermost regions defined in Article 299(2) of the Treaty.

Article 3

Solidarity operations

1.  At the request of an eligible State, the Commission may award financial assistance from the Fund in the form of a grant, if a major disaster or crisis situation occurs on the territory of that State.

At the request of an eligible State which shares a border with the State referred to in the first subparagraph and which has been affected by the same major disaster or crisis situation, the Commission may also grant assistance from the Fund to that State.

2.  For any given disaster, an eligible State may receive a single grant only.

Article 4

Eligible operations

Article 5

Applications

1.  As soon as possible and no later than ten weeks after the date on which authorities were first alerted to the original damage caused by the major disaster or crisis situation, an eligible State may submit to the Commission an application for assistance from the Fund, providing all available information on at least the following:

The information provided under point (a) of the first subparagraph shall include an estimate of the amount of total direct damage caused by the disaster or crisis situation. In view of the difficulty of determining the damage occasioned by disasters whose effects are lasting and ongoing, the Commission may, at the request of the Member State affected, extend the 10-week time-limit set for applying for assistance under the Fund.

2.  The Commission shall assess, on the basis of the information referred to in paragraph 1, and of any additional information, which the Commission may have sought or otherwise obtained, whether the conditions for granting financial assistance under this Regulation are met.

Where, for the purposes of the first subparagraph, additional information is provided by the State concerned on its own initiative, that information must be received by the Commission within two months of the date of the application.

However, where, for the purposes of the first subparagraph, the Commission requests additional information from the State concerned, that information must be received by the Commission within one month of the date of the request.

Article 6

Advance funding

1.  Immediately upon receipt of an application as referred to in Article 5(1), the Commission may, subject to budgetary availability, adopt a decision granting advance funding for the most urgent eligible operations and pay the advance funding to the State concerned in a single instalment without delay.

The first subparagraph shall apply only where the application contains an explicit request for advance funding.

2.  The amount of advance funding paid pursuant to the first subparagraph of paragraph 1 shall represent up to 5% of the of the total of the estimated costs referred to in Article 5(1)(b), but shall not exceed EUR 5 million.

3.  Where advance funding is granted a repayment proviso, as referred to in the second subparagraph of Article 7(2), shall be expressly mentioned.

Article 7

Determination of financial assistance

1.  The Commission shall, on the basis of the assessment carried out pursuant to Article 5(2), determine as quickly as possible and within two weeks an appropriate amount of financial assistance, if any, to be granted within the limits of the resources available.

The amount may not exceed 50% of the total of the estimated costs referred to in Article 5(1)(b).

The accompanying budget proposals, as referred to in Article 8, shall be prepared in parallel with the determination of the appropriate amount and be presented by the Commission at the same time.

The whole procedure for presenting all necessary proposals to mobilise the Fund, in accordance with the deadlines laid down in subparagraphs 1 and 3, shall not exceed a period of 3 months after receipt of the application from the State concerned.

2.  Where, on the basis of the assessment carried out pursuant to Article 5(2), the Commission has concluded that the conditions for granting assistance under this Regulation are not met, it shall notify the State concerned accordingly as quickly as possible.

Any advance funding paid pursuant to Article 6(1) shall be repaid to the Commission within three months of the date of that notification.

Article 8

Budget procedure

1.  If the Commission has concluded that financial assistance should be granted from the Fund, it shall submit to the budgetary authority without delay the proposals needed to authorise appropriations corresponding to the amount determined in accordance with Article 7(1).

2.  Subject to the appropriations being made available by the budgetary authority, the Commission shall adopt a grant decision, taking into account any advance funding paid pursuant to Article 6(1).

Article 9

Payment and use of the grant

1.  Following adoption of the grant decision, the Commission shall, within 15 days of signature of the agreement referred to in Article 10(1), pay the grant to the beneficiary State in a single instalment.

2.  The beneficiary State shall use the grant, as well as any interest earned thereon, within 12 months of the date of signature of the agreement referred to in Article 10(1) and in any case within 18 months of the date of first damage, to finance eligible operations carried out after the date on which the disaster or crisis situation occurred.

Article 10

Implementation of the grant

1.  The Commission and the beneficiary State shall conclude, in accordance with the specific constitutional, institutional, legal or financial provisions of that State and of the Community, an implementation agreement for the grant decision.

That agreement shall specify in particular the type and location of the operations to be financed.

2.  The Commission shall ensure that the obligations under implementation agreements are the same for all beneficiary States.

3.  The beneficiary State shall select individual operations and implement the grant in accordance with this Regulation, the grant decision and the agreement.

That responsibility shall be without prejudice to the responsibility of the Commission for the implementation of the general budget of the European Communities in accordance with the provisions of the Financial Regulation applicable to shared or decentralised management.

Article 11

Financing of operations

1.  Operations funded, in whole or in part, under an implementation agreement shall not receive funding under any other Community or international instrument.

The beneficiary State shall ensure compliance with the first subparagraph.

2.  In particular, in the event of industrial and technological disasters, the "polluter pays" principle shall apply. Beneficiary States must therefore prove that they are seeking all possible compensation from third parties.

Article 12

Compatibility with other Instruments

Operations in receipt of financial assistance from the Fund shall be compatible with the provisions of the Treaty and instruments adopted under it, with Community policies and measures and with pre-accession assistance instruments.

Article 13

Final report and closure

1.  No later than six months after the end of the period specified in Article 9(2), the beneficiary State shall present a report to the Commission on the financial execution of the grant, together with a statement justifying the expenditure and indicating any other source of funding received for the operations concerned.

The report shall detail preventive measures introduced or proposed by the beneficiary State in order to limit damage and to avoid, as far as possible, a recurrence of similar disasters.

2.  No later than six months after the Commission has received all the information required under paragraph 1, it shall wind up the financial assistance from the Fund.

Article 14

Use of the Euro

Applications, grant decisions, implementation agreements and reports under this Regulation, as well as any other related documents, shall express all amounts in Euro.

Article 15

Financial shortfall

1.  Where, at the time when a proposal is submitted under Article 8, the remaining financial resources available for that year for the Fund are not sufficient to cover the amount of financial assistance considered necessary, the Commission may propose to the European Parliament, which exercises budgetary control, that the difference be financed from the financial appropriations available for the Fund for the following two years.

2.  The total annual budgetary ceiling for the Fund in the year in which a disaster occurs and the following two years shall under all circumstances be respected.

Article 16

Financial control by Community bodies

A beneficiary State shall ensure that all financing decisions adopted pursuant to the implementation agreement provided for in Article 10, and all agreements and contracts resulting from those financing decisions provide for checks by the Commission, through the Anti-Fraud Office (OLAF), and for on-the-spot checks to be carried out by the Commission or the Court of Auditors, in accordance with the appropriate procedures.

Article 17

Publicity

A beneficiary State shall clearly inform the population directly concerned and the general public about assistance received from the Fund.

Article 18

Recovery

1.  In cases where the amount of total direct damage incurred is at least 10% less than the estimated amount quoted pursuant to Article 5(1)(b), the Commission may require the beneficiary State to reimburse a corresponding amount of the financial assistance received.

2.  Where a beneficiary State has failed to comply with Article 10(3) or Article 11(2), the Commission may require the beneficiary State to reimburse all or part of the financial assistance received.

3.  Where a beneficiary State has failed to take preventive measures after the previous major disaster and damage following from a major disaster would have been reduced or prevented had preventive measures been taken, the Commission shall require the beneficiary State to reimburse all or part of the financial assistance received.

4.  Prior to the adoption of a Decision under paragraphs 1, 2 or 3 the Commission shall conduct a suitable examination of the case and shall, in particular, allow the beneficiary State a specified period of time in which to submit its comments.

5.  Any sum received unduly and to be recovered shall be repaid to the Commission. Default interest may be charged on sums not repaid in compliance with the Financial Regulation.

Article 19

Technical assistance at the initiative of the Commission

1.  At the initiative of the Commission, subject to a ceiling of 0.20% of the financial resources available for that year, the Fund may be used to finance preparatory, monitoring, administrative and technical support, audit and inspection measures necessary to implement this Regulation.

Those actions shall be executed in accordance with Article 53(2) of the Financial Regulation and any other provisions of that Regulation and of its implementing rules applicable to this form of execution of the budget.

Those actions shall in particular include expert reports to assist the Commission in carrying out the assessment of applications pursuant to Article 5(2).

2.  Where a contribution from the Fund is foreseen to procure external services, the Commission shall adopt a decision for the measures listed in the first subparagraph of paragraph 1.

Article 20

Annual report

Before 1 July of each year, with effect from ...(6), the Commission shall present to the European Parliament and to the Council a report on the activities carried out under this Regulation in the previous year. That report shall in particular contain information relating to applications submitted, grant decisions adopted, the winding-up of financial assistance granted and the operations carried out.

Article 21

Review

The European Parliament and the Council shall review this Regulation on the basis of a proposal by the Commission by 31 December 2013 at the latest.

Article 22

Repeal

Regulation (EC) No 2012/2002 is hereby repealed.

References to the repealed Regulation shall be construed as references to this Regulation.

Article 23

Transitional provision

Regulation (EC) No 2012/2002 shall continue to apply to applications received by the Commission before the date of entry into force of the present Regulation.

Article 24

Entry into force

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

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at,

For the European Parliament For the Council

The President The President

(1) OJ C 28, 3.2.2006, p. 69. (2) Position of the European Parliament of 18 May 2006. (3) OJ L 311, 14.11.2002, p. 3. (4) OJ C 139, 14.6.2006, p. 1. (5) OJ L 248, 16.9.2002, p. 1. (6) * One year after the entry into force of this Regulation.