Explanatory Memorandum to COM(2022)362 - Provisions 2014-2020 cooperation programmes supported by European Neighbourhood Instrument and under European territorial cooperation goal, following implementation disruption - Main contents
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| dossier | COM(2022)362 - Provisions 2014-2020 cooperation programmes supported by European Neighbourhood Instrument and under European territorial ... |
|---|---|
| source | COM(2022)362  |
| date | 22-07-2022 |
1. CONTEXT OF THE PROPOSAL
• Reasons for and objectives of the proposal
This proposal provides for targeted changes to the 2014-2020 legal framework established for cooperation programmes under the European Neighbourhood Instrument (ENI) 1 in response to, firstly, Russia’s unprovoked and unjustified military aggression against Ukraine and the resulting impact on the European Union and several of its eastern regions in particular; and, secondly, the extended impact of the COVID-19 pandemic on the EU as a whole.
Firstly, as a result of the unprovoked and unjustified military aggression by Russia as well as by the involvement of Belarus in that aggression, the implementation of thirteen cross-border and two transnational cooperation programmes between nine Member States and Ukraine and the Republic of Moldova on the one hand, and Russia and Belarus on the other, are considerably disrupted for different reasons. With regard to the programmes with Ukraine, the disruption consists of the impact of the Russian invasion on the implementation of programmes and projects by actors in Ukraine. In addition, the significant flows of displaced persons both inside Ukraine and out of Ukraine into the Republic of Moldova especially has required public authorities and individuals to concentrate on humanitarian and immediate assistance actions, rather than continue with cooperation projects.
With regard to the programmes involving Russia and Belarus, the disruption is due to the necessary suspension of the Financing Agreements between the EU and Russia and Belarus in early March as a result of the Russian invasion of Ukraine. This has meant a suspension of programme and project implementation with authorities and beneficiaries from these two countries. The suspension is consistent with the prohibition on the provision of financial support to Russian public entities that the Council introduced on 8 April 2022 2 .
Secondly, the EU, and several of its eastern regions in particular, are continuing to deal with a significant flow of displaced persons from Ukraine. It is therefore logical and necessary to extend the range of flexible measures already introduced for cohesion policy programmes, including for cross-border cooperation programmes between Member States, to the programmes cooperating directly with Ukraine and the Republic of Moldova to enable them to address this extraordinary situation.
Thirdly, the duration of the COVID-19 pandemic has been longer than could have been expected. The direct and indirect impacts of the pandemic persist in all Member States, requiring prolonged public support for the recovery of the most impacted territorial areas and economic sectors. This has led to very high pressure on the budgets of Member States, thus requiring further exceptional measures to be applied in these circumstances.
The two packages of measures under the Coronavirus Response Investment Initiative (CRII) and CRII+ approved by Regulations (EU) 2020/460 3 and (EU) 2020/558 4 respectively in spring 2020 introduced a number of significant changes that enabled a more effective response and provided exceptional additional flexibility to respond to the unprecedented situation. These measures were made applicable also to ENI cooperation programmes through targeted amendments to the ENI-CBC Regulation 5 .
Consequently, support from the Funds should be mobilised speedily to alleviate the burden on national budgets. It is therefore necessary, as a temporary and exceptional measure and without prejudice to the rules that should apply under regular circumstances, to extend to the five ENI cross-border programmes with the Republic of Moldova and Ukraine for the accounting years starting from 1 July 2021, 1 July 2022 and 1 July 2023 respectively the possibility to increase the co-financing from the EU budget from 90% to 100%, resulting in no further need of national co-financing.
• Consistency with existing policy provisions in the policy area
The proposal is consistent with the overall legal framework established for the ENI and establishes targeted provisions replacing certain provisions in Commission Implementing Regulation (EU) No 897/2014 6 , which cannot be amended anymore since the underlying Regulation (EU) No 232/2014 is no longer in force since 31 December 2020. The proposal also complements the preceding amendments to Implementing Regulation (EU) No 897/2014 under Commission Implementing Regulation (EU) 2020/879 7 . Finally, it introduces provisions which are inspired by some of the provisions under Regulation (EU) 2022/562 8 , thus ensuring consistency of approach across cross-border programmes supported by different instruments.
The proposal is also consistent with the overall legal framework established for transnational cooperation under Regulation (EU) No 1299/2013 9 and is limited to targeted and exceptional derogations thereof.
• Consistency with other Union policies
The proposal is limited to targeted and exceptional adaptations of the existing legal framework created by Implementing Regulation (EU) No 897/2014 and Regulation (EU) No 1299/2013 and maintains consistency with other Union policies.
2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY
• Legal basis
The proposal is based on Articles 178, 209(1) and 212(2) of the Treaty on the Functioning of the European Union.
Articles 209(1) and 212(2) TFEU are the legal basis for ENI, while Article 178 TFEU is the legal basis for European territorial cooperation.
• Subsidiarity (for non-exclusive competence)
The proposal aims to facilitate the use of ENI and cohesion policy resources by Member States and regions to support measures to address migratory challenges as a result of the military aggression by Russia, allow for a derogation from the normal co-financing rules currently applicable in order to allow for the necessary flexibility to mobilise existing investment resources to address the direct and indirect effects stemming from the Russian invasion of Ukraine and the unprecedented public health crisis in the context of the COVID-19 pandemic and facilitate legal certainty for other aspects which programme authorities have to face.
• Proportionality
The proposal is an exceptional and targeted change not going beyond what is necessary to achieve the objective of facilitating the use of ENI and cohesion policy resources to support measures to address migratory challenges as a result of the military aggression by Russia and the resulting programme implementation disruption.
• Choice of the instrument
A Regulation is the appropriate instrument to facilitate the use of ENI and cohesion policy resources to support measures to address migratory challenges as a result of the military aggression by Russia, to extend the possibility of 100% co-financing needed to address these unprecedented circumstances and to give the necessary legal certainty.
3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS
• Ex-post evaluations/fitness checks of existing legislation
• Stakeholder consultations
The proposal follows high level exchanges with Member States and the programme authorities. A public consultation is not required given that there is no need for an impact assessment.
• Collection and use of expertise
• Impact assessment
An impact assessment has been carried out to prepare the proposal for Regulation (EU) No 232/2014. These current targeted changes to respond to critical situations do not require a separate impact assessment.
• Regulatory fitness and simplification
• Fundamental rights
4. BUDGETARY IMPLICATIONS
The proposal only concerns ENI-CBC programmes from the 2014-2020 period and does not modify existing budgetary commitments. It will facilitate an acceleration of programme implementation and alleviate the burden on beneficiaries and national budgets in the countries most impacted by the war (Ukraine, the Republic of Moldova and the Member States participating in cross-border cooperation with them). Given that the financial implementation of ENI-CBC programmes is made through pre-financing payments of up to 100% of the committed EU (ENI and ERDF) funds and that most of the pre-financing has been already paid by the Commission to the programmes, the proposed measure will not impact payment appropriations in either 2022 or in 2023, as 2023 is the last year of eligibility of expenditure for projects.
The proposed modification does not require changes in the Multiannual Financial Framework annual ceilings for commitments and payments as per Annex I to Council Regulation (EU, Euratom) 2020/2093, and does not imply changes to the overall payment needs over the 2022-2024 period.
The proposed modification does not entail additional administrative expenditure for the Commission.
5. OTHER ELEMENTS
• Implementation plans and monitoring, evaluation and reporting arrangements
The implementation of the measures will be monitored and reported upon in the framework of the general reporting mechanisms established in Regulations (EU) No 232/2014 and (EU) No 1303/2013.
• Explanatory documents (for directives)
• Detailed explanation of the specific provisions of the proposal
It is proposed to lay down targeted provisions replacing certain provisions of Regulation (EU) No 897/2014 and derogating from certain provisions of Regulation (EU) No 1299/2013 where a newly defined situation of programme implementation disruption is in existence, as follows:
·The different types of programme implementation disruption are defined (Article 2);
·In order to apply a 100% co-financing for ENI-CBC programmes, the option of waiving any need for co-financing (Article 12 of Implementing Regulation (EU) No 897/2014) and a simplified procedure (Article 16 of Implementing Regulation (EU) No 897/2014) are set out in Articles 3 and 4;
·In order to apply retroactive eligibility to the start of the Russian invasion (Article 48 of Implementing Regulation (EU) No 897/2014) for projects addressing migratory challenges in ENI-CBC programmes, such eligibility is fixed as of 24 February 2022 in Article 5;
·In order to speed up the necessary changes to projects already approved (Article 26(3), point (e), of Regulation (EU) No 897/2014) and in the middle of their implementation, including large infrastructure projects (Article 38 i of Implementing Regulation (EU) No 897/2014), the appropriate actions by the programme managing authorities are set out in Article 6;
·In order to offer more flexibility to the verifications to be carried out by the managing authority (Article 26(5) and (6) of Implementing Regulation (EU) No 897/2014), certain regulatory obligations notably in relation to on-the spot checks are reduced in Article 7;
·The genuine cross-border impact of projects (Articles 39 and 45 of Implementing Regulation (EU) No 897/2014) being a key requirement for these programmes, flexibility is established in Articles 8 and 9 with regard to the remaining project partners in Member States who implemented their part of the joint projects correctly and in good faith;
·In order to also give flexibility to lead beneficiaries with regard to their regulatory obligations towards the programme authorities on behalf of the whole project partnership (Article 46 of Regulation (EU) No 897/2014), the necessary adaptions are set up in Article 10;
·In order to speed up the selection and granting for new projects, the procedure to confirm projects under direct award (Article 41 of Implementing Regulation (EU) No 897/2014) is simplified in Article 11;
·In order to simplify financial transfers and to enable direct transfers without payments passing via lead beneficiaries (Article 63 of Implementing Regulation (EU) No 897/2014), the necessary adaptations are set out in Article 12;
·In order to change the method to convert into euro as chosen at the beginning of programme implementation (Article 67 of Implementing Regulation (EU) No 897/2014) and to adapt it to the unenvisaged fluctuations of exchange rates, an option to be able to choose again the point in time of the conversion is introduced in Article 13;
·Due to programme implementation disruption, the system of the normal recovery chain, off-sets and repayments (Articles 74 to 76 of Implementing Regulation (EU) No 897/2014) may be interrupted or impossible to implement. The necessary adaptations to the regulatory steps to be carried out by managing authorities are established in Article 14;
·Two transnational cooperation programmes covered by Regulation (EU) No 1299/2013 involve cooperation with Ukraine and the Republic of Moldova (“the Danube Transnational Programme”), and Russia and Belarus (“the Interreg Baltic Sea Region Programme”) and amendments to the relevant cohesion policy provisions as a consequence of the Russian invasion of Ukraine are required to enable these programmes to function effectively. Most of the adaptations introduced under Articles 3 to 14 can only apply by derogating from the respective provisions of Regulation (EU) No 1299/2013. The necessary adaptations for these two programmes are therefore established in Article 15;
These targeted measures should enter into force so as to take effect as soon as possible (Article 16).