Annexes to COM(2022)101 - Methods and procedure for making available own resources based on the Emissions Trading System, the Carbon Border Adjustment Mechanism and other measures - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2022)101 - Methods and procedure for making available own resources based on the Emissions Trading System, the Carbon Border Adjustment ... |
|---|---|
| document | COM(2022)101  |
| date | March 14, 2022 |
The proposal will also further embed EU policy priorities in the revenue side of the EU budget.
1.4.2.Specific objective(s)
The proposal COM(2021) 570 final seeks to introduce three new own resources:
(1) A new own resource based on the Emissions Trading System covering its extension maritime and an increased auctioning of allowances in aviation and on the new Emissions Trading System covering road transport and building;
(2) A new own resource based on a carbon border adjustment mechanism;
(3) A new own resource based on a share of profits of multinational enterprises that are reallocated to EU Member States in the context of the global agreement on international taxation (‘OECD/G20 IF Pillar 1’).
New own resources will further align the revenue side of the EU budget with the Union’s policy priorities. Firstly, emissions know no borders, hence warranting Union action, and therefore an appropriate base for EU own resources. Emissions trading and a Carbon Border Adjustment Mechanism are EU-wide instruments serving the common objective to reduce greenhouse gas emissions at the least cost, by capping emissions and providing a carbon price signal. Secondly, the global agreement on the reallocation of taxing rights will be implemented in the EU respecting the specificities of the Single Market. As a result, this too will constitute a European base for an own resource.
1.4.3.Expected result(s) and impact
Specify the effects which the proposal/initiative should have on the beneficiaries/groups targeted.
New own resources should ensure that the expenditure from the Union budget related to the repayment of the European Union Recovery Instrument will not lead to an undue reduction in programme expenditure or investment instruments under the multiannual financial framework. At the same time, they will also mitigate the increases in the gross national income-based own resource for the Member States.
1.4.4.Indicators of results and impact
Specify the indicators for monitoring implementation of the proposal/initiative.
This proposal should provide the framework for a timely and correct making available to the EU budget of revenues from emissions trading and the carbon border adjustment mechanism. It will also include the making available of the own resource based on the share of residual profits of the largest and most profitable multinational enterprises, reallocated to EU Member States.
1.5.Grounds for the proposal/initiative
1.5.1.1.5.1.Requirement(s) to be met in the short or long term including a detailed timeline for roll-out of the implementation of the initiative
The rules for making available to the EU budget should be agreed upon in time in order to ensure the timely implementation of the new Own Resources basket.
The interinsitutional agreement included a detailed timeline for the introduction of new own resources. The Commission committed to make proposals on new own resource by 2021 with a view of their introduction in 2023.
1.5.2.Added value of EU involvement
At the outset of the unprecedented COVID-19 crisis, the Commission presented an ambitious, innovative and exceptional recovery plan to set the Union on the path to a sustainable and resilient recovery. The European Union Recovery Instrument (NextGenerationEU), which was formally approved by the European Parliament and the Council on 14 December 2020, mobilises up to EUR 750 billion to address the economic and social damage brought about by the pandemic. Together with the EU’s long-term budget, the multiannual financial framework, a total of EUR 1.8 trillion are helping rebuild a post-COVID-19 Europe. New own resources will ensure the credibility and sustainability of the European Union Recovery Instrument repayment plan.
1.5.3.Lessons learned from similar experiences in the past
These proposals are connected to the amendment of the Own Resources Decision. Together they clarify the interaction between the Own Resources provisions and the legislative acts on emissions trading and the Carbon Border Adjustment Mechanism and the future legislative act on implementation of the global agreement on re-allocation of taxing rights.
1.5.4.Compatibility with the Multiannual Financial Framework and possible synergies with other appropriate instruments
These proposals are connected to the revision of the Multiannual Financial Framework Regulation with the aim of increasing the MFF ceilings for the expenditure of the Social Climate Fund and creating an automatic annual adjustment mechanism to allow for new own resources to support repayment of NextGenerationEU under the current Multiannual Financial Framework.
1.5.5.Assessment of the different available financing options, including scope for redeployment
Not applicable.
1.6.Duration and financial impact
◻ Proposal/initiative of limited duration
–◻ Proposal/initiative in effect from [DD/MM]YYYY to [DD/MM]YYYY
–◻ Financial impact from YYYY to YYYY
☑ Proposal/initiative of unlimited duration
–Implementation with a start-up period from 1/1/2021 to 31/12/2022,
–followed by full-scale operation from 1/1/2023.
1.7.Management mode(s) planned
☑ Direct management by the Commission
–☑ by its departments, including by its staff in the Union delegations;
–◻ by the executive agencies
◻ Shared management with the Member States
◻ Indirect management by entrusting budget implementation tasks to:
–◻ third countries or the bodies they have designated;
–◻ international organisations and their agencies (to be specified);
–◻the EIB and the European Investment Fund;
–◻ bodies referred to in Articles 208 and 209 of the Financial Regulation;
–◻ public law bodies;
–◻ bodies governed by private law with a public service mission to the extent that they provide adequate financial guarantees;
–◻ bodies governed by the private law of a Member State that are entrusted with the implementation of a public-private partnership and that provide adequate financial guarantees;
–◻ persons entrusted with the implementation of specific actions in the CFSP pursuant to Title V of the TEU, and identified in the relevant basic act.
–If more than one management mode is indicated, please provide details in the ‘Comments’ section.
Comments
Not applicable
2. MANAGEMENT MEASURES
2.1.Monitoring and reporting rules
Specify frequency and conditions.
The provisions for the monitoring and reporting in relation to making available own resource as based on emissions trading, the carbon border adjustment mechanism and a contribution based on residual profits of the largest and most profitable multinational enterprises, reallocated to EU Member States can be found in the proposal COM(2022) ….. for a Council Regulation amending Regulation (EU, Euratom) No 2021/768 of 30 April 2021 as regards implementing measures for new own resources of the European Union.
2.2.Management and control system
2.2.1.Risk(s) identified
The main potential risks include: the incorrect establishment of the new own resources, the incorrect entry in the accounts, the late making available of the resource, and accounting errors.
2.2.2.Information concerning the internal control system set up
Control methods are envisaged in the proposal which also includes specific provisions concerning control and supervision and relevant reporting requirements.
2.2.3.Estimate of the costs and benefits of the controls and assessment of the expected level of risk of error
The financial interests of the Union should be protected through proportionate measures, including the prevention, detection and investigation of irregularities, the recovery of funds lost, wrongly paid or incorrectly used and, where appropriate, administrative and financial penalties implemented by the national authorities and by the European Commission Services.
2.3.Measures to prevent fraud and irregularities
Specify existing or envisaged prevention and protection measures.
Provisions on control and supervision for the calculation on the new own resources are included in COM(2022) ….. for a Council Regulation amending Regulation (EU, Euratom) No 2021/768 of 30 April 2021 as regards implementing measures for new own resources of the European Union and relevant sectorial legislation for each of the new proposed own resources
3. ESTIMATED FINANCIAL IMPACT OF THE PROPOSAL/INITIATIVE
3.1.Heading(s) of the multiannual financial framework and expenditure budget line(s) affected
·Existing budget lines
In order of multiannual financial framework headings and budget lines.
| Heading of multiannual financial framework | Budget line | Type of expenditure | Contribution | |||
| Number | Diff./Non-diff. 26 | from EFTA countries 27 | from candidate countries 28 | from third countries | within the meaning of Article 21(2)(b) of the Financial Regulation | |
| 7 | 20 01 02 01 | Non-diff. | NO | NO | NO | NO |
3.2. Estimated financial impact of the proposal on appropriations
3.2.1Summary of estimated impact on operational appropriations
–☑ The proposal/initiative does not require the use of operational appropriations
–◻ The proposal/initiative requires the use of operational appropriations, as explained below:
Heading of multiannual financial framework | 7 | ‘Administrative expenditure’ |
EUR million (to three decimal places)
| Year 2023 | Year 2024 | Year 2025 | Year 2026 | Year 2027 | TOTAL | |||
| DG: BUDG | ||||||||
| • Human resources | 0,157 | 0,471 | 0,628 | 0,785 | 1,57 | 3,611 | ||
| • Other administrative expenditure | ||||||||
| TOTAL DG BUDG | Appropriations | 0,157 | 0,471 | 0,628 | 0,785 | 1,57 | 3,611 |
| Year 2023 | Year 2024 | Year 2025 | Year 2026 | Year 2027 | TOTAL | |||
| DG: CLIMA | ||||||||
| • Human resources | 0,157 | 0,157 | 0,157 | 0,157 | 0,157 | 0,785 | ||
| • Other administrative expenditure | ||||||||
| TOTAL DG CLIMA | Appropriations | 0,157 | 0,157 | 0,157 | 0,157 | 0,157 | 0,785 |
| Year 2023 | Year 2024 | Year 2025 | Year 2026 | Year 2027 | TOTAL | |||
| DG: TAXUD | ||||||||
| • Human resources | 0 | 0,043 | 0,043 | 0,043 | 0,043 | 0,17 | ||
| • Other administrative expenditure | ||||||||
| TOTAL DG TAXUD | Appropriations | 0 | 0,043 | 0,043 | 0,043 | 0,043 | 0,17 |
| TOTAL appropriations under HEADING 7 of the multiannual financial framework | (Total commitments = Total payments) | 0,314 | 0,672 | 0,829 | 0,986 | 1,177 | 4,572 |
EUR million (to three decimal places)
| Year 2023 | Year 2024 | Year 2025 | Year 2026 | Year 2027 | TOTAL | |||
| TOTAL appropriations under HEADINGS 1 to 7 of the multiannual financial framework | Commitments | 0,314 | 0,672 | 0,829 | 0,986 | 1,177 | 4,572 | |
| Payments | 0,314 | 0,672 | 0,829 | 0,986 | 1,177 | 4,572 |
3.2.2Summary of estimated impact on administrative appropriations
–◻ The proposal/initiative does not require the use of appropriations of an administrative nature
–☑ The proposal/initiative requires the use of appropriations of an administrative nature, as explained below:
EUR million (to three decimal places)
| Year 2023 | Year 2024 | Year 2025 | Year 2026 | Year 2027 | TOTAL |
| HEADING 7 of the multiannual financial framework | ||||||
| Human resources | 0,314 | 0,672 | 0,829 | 0,986 | 1,177 | 4,572 |
| Other administrative expenditure | ||||||
| Subtotal HEADING 7 of the multiannual financial framework | 0,314 | 0,672 | 0,829 | 0,986 | 1,177 | 4,572 |
| Outside HEADING 7 29 of the multiannual financial framework | ||||||
| Human resources | ||||||
| Other expenditure of an administrative nature | ||||||
| Subtotal outside HEADING 7 of the multiannual financial framework |
| TOTAL | 0,314 | 0,672 | 0,829 | 0,986 | 1,177 | 4,572 |
The appropriations required for human resources and other expenditure of an administrative nature will be met by appropriations from the DG that are already assigned to management of the action and/or have been redeployed within the DG, together if necessary with any additional allocation which may be granted to the managing DG under the annual allocation procedure and in the light of budgetary constraints.
3.2.2.1Estimated requirements of human resources
–◻ The proposal/initiative does not require the use of human resources.
–☑ The proposal/initiative requires the use of human resources, as explained below:
Estimate to be expressed in full time equivalent units
| Year 2023 | Year 2024 | Year 2025 | Year 2026 | Year 2027 | ||
| • Establishment plan posts (officials and temporary staff) | ||||||
| 20 01 02 01 (Headquarters and Commission’s Representation Offices) | 2 | 4 | 5 | 6 | 11 | |
| 20 01 02 03 (Delegations) | ||||||
| 01 01 01 01 (Indirect research) | ||||||
| 01 01 01 11 (Direct research) | ||||||
| Other budget lines (specify) | ||||||
| • External staff (in Full Time Equivalent unit: FTE) 30 | ||||||
| 20 02 01 (AC, END, INT from the ‘global envelope’) | 0,5 | 0,5 | 0,5 | 0,5 | ||
| 20 02 03 (AC, AL, END, INT and JPD in the delegations) | ||||||
| XX 01 xx yy zz 31 | - at Headquarters | |||||
| - in Delegations | ||||||
| 01 01 01 02 (AC, END, INT - Indirect research) | ||||||
| 01 01 01 12 (AC, END, INT - Direct research) | ||||||
| Other budget lines (specify) | ||||||
| TOTAL | 2 | 4,5 | 5,5 | 6,5 | 11,5 |
XX is the policy area or budget title concerned.
The human resources required will be met by staff from the DG who are already assigned to management of the action and/or have been redeployed within the DG, together if necessary with any additional allocation which may be granted to the managing DG under the annual allocation procedure and in the light of budgetary constraints.
Description of tasks to be carried out:
| Officials and temporary staff | The new own resources require additional staff for the purpose of forecast, inspection and budgeting in DG BUDG, and an additional post for DG CLIMA implementation and preparation. |
| External staff | For the purpose of control, additional staff is also needed in DG TAXUD. |
3.2.3.Compatibility with the current multiannual financial framework
The proposal/initiative:
–☑ can be fully financed through redeployment within the relevant heading of the Multiannual Financial Framework (MFF).
–◻ requires use of the unallocated margin under the relevant heading of the MFF and/or use of the special instruments as defined in the MFF Regulation.
–◻ requires a revision of the MFF. Third-party contributions
3.3.Estimated impact on revenue
–◻ The proposal/initiative has no financial impact on revenue.
–☑ The proposal/initiative has the following financial impact:
–☑ on own resources
–◻ on other revenue
–please indicate, if the revenue is assigned to expenditure lines ◻
EUR billion (2018 prices)
| Budget revenue line: | Appropriations available for the current financial year | Impact of the proposal/initiative 32 | ||||
| Year 2023 | Year 2024 | Year 2025 | Year 2026 | Year 2027 | ||
| ETS based Own Resource | 4.2 | 3.0 | 3.6 | 13.1 | 14.4 | |
| CBAM based Own Resource | - | - | - | - | - | |
| OECD/G20 Pillar One based Own Resource | - | - | 2.5-4.0 | 2.5-4.0 |
For assigned revenue, specify the budget expenditure line(s) affected.
Not applicable.
Other remarks (e.g. method/formula used for calculating the impact on revenue or any other information).
No own resources might have an impact on the GNI contribution. Calculations are consistent with the sectoral impact assessments, when applicable.
(1) Council Decision (EU, Euratom) 2020/2053 of 14 December 2020 on the system of own resources of the European Union and repealing Decision 2014/335/EU, Euratom (OJ L 424, 15.12.2020, p. 1-10)
(2) COM(2021) 570.
(3) Council Regulation (EU, Euratom) No 609/2014 of 26 May 2014 on the methods and procedure for making available the traditional, VAT and GNI-based own resources and on the measures to meet cash requirements, (OJ L 168, 7.6.2014, p. 39-52).
(4) Council Regulation (EU, Euratom) 2021/770 of 30 April 2021 on the calculation of the own resource based on plastic packaging waste that is not recycled, on the methods and procedure for making available that own resource, on the measures to meet cash requirements, and on certain aspects of the own resource based on gross national income (OJ L 165, 11.5.2021, p 15-24).
(5) Council Regulation (EU, Euratom) 2021/768 of 30 April 2021 laying down implementing measures for the system of own resources of the European Union
(6) ‘The Council, acting on a proposal from the Commission and after consulting the European Parliament and the Court of Auditors, shall determine the methods and procedure whereby the budget revenue provided under the arrangements relating to the Union's own resources shall be made available to the Commission, and determine the measures to be applied, if need be, to meet cash requirements.’
(7) Council Regulation (EU, Euratom) No 609/2014 of 26 May 2014 on the methods and procedure for making available the traditional, VAT and GNI-based own resources and on the measures to meet cash requirements, (OJ L 168, 7.6.2014, p. 39).
(8) Council Regulation (EU, Euratom) 2021/770 of 30 April 2021 on the calculation of the own resource based on plastic packaging waste that is not recycled, on the methods and procedure for making available that own resource, on the measures to meet cash requirements, and on certain aspects of the own resource based on gross national income, (OJ L 165, 11.5.2021, p 15).
(9) OJ C […], […], p. […].
(10) OJ C […], […], p. […].
(11) Council Decision (EU, Euratom) 2020/2053 of 14 December 2020 on the system of own resources of the European Union and repealing Decision 2014/335/EU, Euratom (OJ L 424, 15.12.2020, p.1).
(12) Proposal for a Council Decision amending Decision (EU, Euratom) 2020/2053 on the system of own resources of the European Union (OJ L […], […], p. […]).
(13) 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 and amending Council Directive 96/61/EC (OJ L 275, 25.10.2003, p. 32).
(14) Regulation (EU) [XXX] of the European Parliament and of the Council establishing a carbon border adjustment mechanism (OJ L […], […], p. […]).
(15) [Directive (EU) XXX on implementation of the global agreement on re-allocation of taxing rights].
(16) Council Regulation (EU, Euratom) No 609/2014 of 26 May 2014 on the methods and procedure for making available the traditional, VAT and GNI-based own resources and on the measures to meet cash requirements (OJ L 168, 7.6.2014, p. 39).
(17) Commission Regulation (EU) No 1031/2010 of 12 November 2010 on the timing, administration and other aspects of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and of the Council establishing a scheme for greenhouse gas emission allowances trading within the Community Text with EEA relevance, (OJ L 302, 18.11.2010, p. 1).
(18) Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission's exercise of implementing powers (OJ L 55, 28.2.2011, p. 13).
(19) 1 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 and amending Council Directive 96/61/EC (OJ L 275, p. 32).
(20) 2 Council Regulation (EU, Euratom) 2021/768 of 30 April 2021 laying down implementing measures for the system of own resources of the European Union and repealing Regulation (EU, Euratom) No 608/2014 (OJ L 165, 11.5.2021, p. 1).
(21) 3 Regulation (EU) 2018/842 of the European Parliament and of the Council of 30 May 2018 on binding annual greenhouse gas emission reductions by Member States from 2021 to 2030 contributing to climate action to meet commitments under the Paris Agreement and amending Regulation (EU) No 525/2013 (OJ L 156, 19.6.2018, p. 26).
(22) 4 Regulation (EU) 2019/516 of the European Parliament and of the Council of 19 March 2019 on the harmonisation of gross national income at market prices and repealing Council Directive 89/130/EEC, Euratom and Council Regulation (EC, Euratom) No 1287/2003 (GNI Regulation) (OJ L 91, 29.3.2019, p. 19).
(23) 5 Regulation (EU) [XXX] of the European Parliament and of the Council on the carbon border adjustment mechanism.
(24) As referred to in Article 58(2)(a) or (b) of the Financial Regulation.
(25) Interinstitutional agreement of 16 December 2020 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management, as well as on new own resources, including a roadmap for the introduction of new own resources, OJ L 433I, 22.12.2020, p. 28.
(26) Diff. = Differentiated appropriations / Non-diff. = Non-differentiated appropriations.
(27) EFTA: European Free Trade Association.
(28) Candidate countries and, where applicable, potential candidates from the Western Balkans.
(29) Technical and/or administrative assistance and expenditure in support of the implementation of EU programmes and/or actions (former ‘BA’ lines), indirect research, direct research.
(30) AC= Contract Staff; AL = Local Staff; END= Seconded National Expert; INT = agency staff; JPD= Junior Professionals in Delegations.
(31) Sub-ceiling for external staff covered by operational appropriations (former ‘BA’ lines).
(32) As regards traditional own resources (customs duties, sugar levies), the amounts indicated must be net amounts, i.e. gross amounts after deduction of 20 % for collection costs.