This Report relates to all Instruments for Nuclear Safety Cooperation's (INSC) Annual Action Programmes (AAPs) since 2007 that are still on-going in 2010 and 2011. It also describes the developments with respect to the AAPs 2010 and 2011.

The Instrument for Nuclear Safety Cooperation (INSC 2007-2013) came into force on 1 January 2007. Its main objectives are to support the promotion of a high level of nuclear safety, radiation protection and the application of efficient and effective safeguards of nuclear material in non-EU countries, worldwide .

The present Report is limited in terms of achievements and impact due to the relatively early stage of implementation of the INSC programme. During the reporting period, only a few projects have been completed. Most projects are under preparation or currently being implemented.

As of mid 2012, some 50 projects under the 2007-2009 AAPs and a further 30 projects under the AAPs for 2010 and 2011 are at various stages of implementation. Several of these projects are split into a number of different sub-projects for separate contracting. Contracting documents are currently under preparation for most projects under the 2010 and 2011 AAPs. All of these projects are fully compliant with the objectives of the INSC Regulation.

The enhancement of the nuclear safety culture through INSC incorporates lessons learned from the TACIS Nuclear Safety programme, while properly addressing emerging needs within a mandate no longer restricted to the former Soviet Union. The INSC programme continued the actions initiated under TACIS, mainly in Eastern Europe but, progressively, cooperation was extended in geographical scope as well as in content .

Cooperation with nuclear regulators continued to grow while that with operators was scaled down and the development of responsible management of spent nuclear fuel and radioactive waste, decommissioning and site remediation gained increasing importance. Contributions to the Chernobyl Funds continued to consume a significant part of the yearly budget, but these should end in 2013.

The geographical coverage of the programme increased steadily from four countries in 2007 to some 15 countries in 2010 and 2011. Cooperation with others continued to be explored. The number of beneficiary countries was expected to reach 17 with the 2012 AAP.

The INSC implementation in 2010 and 2011 is considered to be well-targeted , the approved projects well-conceived and the projects, once contracted (only a limited number had been contracted so far), were developing well. When successfully implemented, they will contribute significantly to enhancing nuclear safety and nuclear safety culture in the beneficiary countries.

The Commission sees the discontinuation of cooperation with the Russian Federation under the INSC in the fields of nuclear regulation, improvement of operational safety and establishment of responsible management of radioactive waste, decommissioning and remediation as a disappointing development . Considering the impact also on neighbouring countries, the fact that the Russian Federation is a major exporter of nuclear technology and the mutual benefits that would result from further cooperation between the EU and the Russian Federation, the Commission will continue to seek ways for effective and mutually satisfactory cooperation with the Russian Federation on a partnership basis.

The Commission presents a report in compliance with the reporting requirement set out in Council Regulation (EURATOM) No 300/2007 establishing an Instrument for Nuclear Safety Cooperation (the INSC Regulation.) The report evaluates the implementation of the INSC Regulation taking into account the Commission's INSC Progress Report for 2007-2009 and experts’ report covering the same period. It recalls that Since 2007, the EU's nuclear safety assistance and cooperation activities have continued under the Instrument for Nuclear Safety Cooperation (INSC), with a financial reference amount of EUR million for the implementation of the Regulation over the period 2007 to 2013. Under the Annual Action Programmes 2007, 2008 and 2009, some 50 projects were approved, which are at various stages of implementation.

The largest proportion of funds was allocated to the "Promotion of an effective nuclear safety culture" and "Participation in International Funds". Expenditures on "Safeguards" fell particularly short of the indicative target.

Evaluation : the first three years of implementation of the INSC (2007 – 2009) saw the gradual transition from the actions of the TACIS Nuclear Safety programme, which had been centred on the former Soviet Union, in particular the Russian Federation and Ukraine, towards a global programme. While the TACIS programme focused on nuclear safety assistance including, in many cases, supply of equipment ('hard assistance'), the INSC objective is enhanced cooperation with a view to improving nuclear safety with a much reduced emphasis on the supply of equipment ('soft assistance'). Partners have also been encouraged to take a more prominent role in the definition, management and implementation of cooperation projects.

Cooperation with new partner countries initially concentrated on strengthening regulatory authorities, but progressively cooperation is being extended to the development of management of spent nuclear fuel and radioactive waste, decommissioning, site remediation and, to a lesser extent, to the improvement of operational safety.

The cooperation with the International Atomic Energy Agency (IAEA) was stepped up for a number of reasons, including the need to improve coordination, to avoid duplication of efforts, to jointly establish priorities and to support the IAEA's implementation of projects in areas where this improves the effectiveness of implementation due to the IAEA's international standing and particular expertise.

The suspension of cooperation with the Russian Federation on new nuclear safety projects, due to the fact that Russia was not prepared to conclude Financing Agreements with the Commission, gives cause for concern. Limited cooperation has continued under ongoing TACIS projects and the Commission has continued to explore possible ways to solve the current impasse with Russian authorities.

The cooperation with Armenia has continued, despite the EU's firm position that the Armenian nuclear power plant, which operates a ‘first generation’ reactor, should be shut down as soon as possible. All specific safety cooperation actions need to continue to be reviewed against the agreed strategic framework for the implementation of the INSC programme.

The long delay observed between the definition of new cooperation projects and their eventual implementation is a serious problem , particularly when engaging in cooperation with new partner countries. These delays result from the steps required from identification of a project until its contracting. Typically, the process starts with an exploratory mission by the Commission services, followed by an expert mission to develop 'action fiches' which provide a broad definition of potential projects. The subsequent approval process includes an InterService Consultation, an opinion by the INSC Committee followed by the adoption of the Commission Decision. Tendering and contracting can then only really start after the conclusion of a Financing Agreement with the partner country, which can cause additional delay. In some cases, the initial phase of the cooperation was somewhat shortened, as in the case of Brazil, where a high degree of inter-institutional preparedness allowed rapid progress on establishing the 'action fiches'. However the process remains lengthy.

Activities in nuclear safeguards during 2007-2009 have been significantly less than projected under the Indicative Programme for the period (0.25% Vs 14% of the Programme). The Commission will take this into account in the formulation of the Indicative Programme for 2012-2013 and future Action Programmes.

Conclusions : the evaluation of the implementation of the INSC programme by the Commission leads to the following main conclusions:

the projects were established in line with the strategic documents of the Instrument of Nuclear Safety Cooperation (INSC); the INSC continued the nuclear safety cooperation initiated under TACIS and gradually expanded it to new partner countries. However, further cooperation with the Russian Federation was suspended while searching a solution to its objections concerning the conclusion of a Financing Agreement; the enhancement of the nuclear safety culture through INSC incorporated lessons learned from the TACIS Nuclear Safety programme, while addressing emerging needs within a mandate no longer restricted to the region of the former Soviet Union; the time to start implementing projects following their identification is currently two to three years due to lengthy decisional and contracting processes and generally heavy administrative procedures. The Commission will need to review if and how it may be possible to reduce projects' implementation cycle by adjusting operational and implementation practices; the Commission concurs with the independent evaluation finding that the INSC implementation was well targeted and the projects well conceived. When successfully implemented the projects are expected to contribute significantly to enhance nuclear safety and nuclear safety culture. The INSC projects with focus on exchange of know-how and practices were found to be particularly appreciated by partners in target countries; for countries that do not have nor plan to have a nuclear power programme, the INSC is also helping to build the required nuclear safety regulatory infrastructure particularly related to the management of nuclear waste; for countries planning to implement nuclear power programmes, the INSC is helping to build the required nuclear safety regulatory infrastructure while for countries with established nuclear power programmes, which lacked nuclear safety resources due to underfunding or isolation, it focuses on capacity building and improving nuclear safety culture.

Overall, the INSC programme has become a well established vehicle for nuclear safety cooperation worldwide.

The Commission considers that the concerns which were raised in respect of the implementation of the INSC Regulation, and how they might be mitigated, can be addressed within the existing provisions of the Regulation and that there is no need for a new legislative proposal.

The Commission presents its first report in compliance with the reporting requirement set out in Council Regulation (EURATOM) No 300/2007 establishing an Instrument for Nuclear Safety Cooperation (the INSC Regulation.) The INSC programme continued the nuclear safety cooperation initiated under TACIS with the former Soviet Union, but it had its geographical coverage extended to become global. The report provides information on the implementation of the Annual Action

Programmes for the first three years of INSC, 2007, 2008 and 2009, including projects approved until the end of 2009 and their state of implementation by mid

2010. Initial difficulties in the transitory phase from TACIS to INSC, due primarily to delays in getting partner countries to sign Financing Agreements under the new format, have meanwhile been largely overcome, with the exception of Russia. As in 2007, the Russian Federation was not prepared to sign the Financing Agreement, the Commission decided to reallocate the funds envisaged for Russia (EUR 17.2 million) to other activities. The reallocation of funds was concluded before the end of 2009, when the procedural timeframe would have expired. The funds were used for Ukrainian and Armenian projects and an additional contribution to the Chernobyl Shelter Fund (EUR 10.7million) in anticipation of the next pledge.

The main developments on nuclear safety cooperation and assistance provided under the INSC over the period 2007-2009 were as follows.

Ukraine : targeted support was provided to the regulator and the operator. A major achievement was the evaluation of the nuclear safety of the Ukrainian nuclear power plants (NPPs) under a joint project with the IAEA. The evaluation provided valuable information on the status of the plants, as well as the situation of nuclear waste management and the nuclear regulator in Ukraine and demonstrated the significant improvements in nuclear safety in the recent years.

Russia : projects initiated under TACIS continued under the INSC, but no new projects have been possible since a suitable cooperation framework could not be agreed. Discussions are ongoing to resume cooperation activities with a reduced scope.

Armenia : important projects have been launched concerning the Medzamor Nuclear Power Plant to address urgent safety issues while the plant is operating. However the Commission continues to maintain the position that the plant cannot be upgraded to modern nuclear safety standards and therefore it should be closed down as soon as is practical. Projects provided training of personnel, assistance to the nuclear regulator and development of a waste management strategy in preparation for future decommissioning.

Belarus and Georgia : cooperation continued with relatively small projects. However, for Belarus discussions took place to step-up the cooperation with the regulator in order to improve its capabilities in anticipation of the construction of a nuclear power plant in the country. The Programme was extended to new countries in three regions as follows:

Countries covered by the European Neighbourhood Policy : projects were launched in Egypt , Jordan and Morocco mainly to support the regulatory authorities.

South-East Asia : projects were initiated in the Philippines and Vietnam .

Latin America : projects were launched with the nuclear regulator and the operator in Brazil . Contacts were also established with Mexico and Argentina .

Another important element of the Programme was the extended cooperation with the IAEA to support thematic technical activities at country or regional level. These included, inter alia, development of safety culture, capacity building of regulators, waste management, research reactors safety and seismic safety. This element of the programme will remain very important in the coming years.

Significant financial support was provided to the Chernobyl Shelter Fund and the Nuclear Safety Account , managed by the EBRD on behalf of the donor countries. A G8 NSSG (Nuclear Safety and Security Group) – EBRD Contact Group was created to closely follow-up the Chernobyl projects. This group is chaired by the Commission.

The EU Results-Oriented Monitoring Programme for European Neighbourhood and Partnership Countries presented the following main conclusions on the INSC

nuclear safety projects:

the projects continue to be designed in line with the strategic documents of the Instrument of Nuclear Safety Cooperation (INSC). The relevance is assessed as highly appropriate and compatible with the IAEA 2007 Fundamental Safety Principles; the enhancement of the nuclear safety culture through INSC duly incorporates lessons learned from the Tacis Nuclear Safety programme, while properly addressing emerging needs within a mandate no longer restricted to the region of the former Soviet Union; the transition to INSC did not cause an interruption in the cooperation with Armenia and Ukraine, while for implementing INSC projects in the Russian Federation, a special basis is only now being established; the new initiative to enhance the regulatory oversight through INSC projects is appropriate; INSC projects with focus on exchange of know-how and practices are appreciated by partners in target countries.

Projects in the other regions covered so far by the INSC (Latin America and South East Asia) are not sufficiently advanced to draw meaningful conclusions about their implementation.

PURPOSE: to establish an “Instrument for Nuclear Safety Co-operation” with third countries, 2007-2013.

PROPOSED ACT: Council Regulation (Euratom) No 300/2007 establishing an Instrument for Nuclear Safety and Co-operation.

BACKGROUND: this Regulation has been adopted within the context of the recently approved financial perspectives, 2007 -2013 . The EU is a major provider of economic, financial, technical, humanitarian and macro-economic assistance to third countries. To make this external aid more effective a new planning and provision framework for external assistance has been devised. This new framework applies to the present Regulation. The other recently approved Instruments to whom the new framework applies are:

- An Instrument for Pre-Accession

- The European Neighbourhood and Partnership Instrument

- An Instrument for development co-operation

- An Instrument for Stability

- An Instrument for the promotion of democracy and human rights world-wide

- An Instrument for co-operation with industrialised and other high income countries and territories

The present Regulation is a complementary instrument aimed at supporting the promotion of nuclear safety, radiation protection and the application of efficient and effective safeguards of nuclear material in third countries. The origins of an EU policy towards offering assistance in nuclear safety to third countries can be traced back to the 1986 Chernobyl accident, which highlighted the global importance of nuclear safety.

It was originally intended that nuclear safety and co-operation would form part of the general Instrument for Stability. For judicial reasons, and for reasons related to the Inter-Institutional Agreement on the Financial Perspective (2007-2013), it was decided, however, to award nuclear safety and security assistance a separate Instrument.

CONTENT: the purpose of this Regulation is to set up an Instrument on Nuclear Safety and Co-operation, the main objective of which is to promote a high level of nuclear safety, radiation protection and the application of efficient and effective safeguards relating to nuclear material in third countries, through financial assistance. To realise these objectives the Instrument has been awarded a EUR 524 000 000 million budget covering the period 2007 - 2013.

The Nuclear Safety Co-operation Instrument will support the following actions:

- The promotion of an effective culture of nuclear safety . Support will be given to regulatory bodies, technical support organisations and licensing activities; the safe transport, treatment and disposal of spent nuclear fuel and radioactive waste; and the development of strategies for decommissioning existing installations and remediation of former nuclear sites.

- The promotion of effective regulatory frameworks : Support will also be given to procedures and systems that ensure adequate protection against ionising radiations from radioactive materials. Particular attention will be given to high activity radioactive sources and their safe disposal.

- The establishment of effective arrangements for the prevention of accidents with radiological consequences : Support will also be given to the mitigation of such consequences should they occur and for emergency-planning, preparedness and responses, civil protection and rehabilitation measures.

- The promotion of international cooperation : Support will be given within the framework of relevant international organisation, most notably the IAWA.

Implementation and other provisions : Community assistance will be based on multi-annual strategy papers and indicative programmes. The strategy papers, drawn up by the Commission in accordance with strict procedures, will be reviewed mid-term or whenever necessary. The indicative programmes will be revised when necessary taking account of any review of the relevant strategy papers. In addition the Commission will be responsible for adopting action programmes drawn up on the basis of both the strategy papers and the indicative programmes. The Commission may, in the event of unforeseen and urgent needs or circumstances, adopt special measures not provided for in the strategy paper and indicative programmes. Where the cost of the special measures exceeds EUR 5 million, the Commission may adopt them in accordance with specified procedures.

Eligibility: The following will be eligible for funding under the terms of this Instrument:

- partner countries and regions and their institutions;

- decentralised bodies in the partner countries, such as regions, departments, provinces and municipalities;

- joint bodies set up by the partner countries and regions and the Community;

- international organisations, including regional organisation, UN bodies, departments and missions, international financial institutions and development banks;

- the Community’s Joint Research Centre and EU agencies;

- Member States’ bodies, partner countries and regions and any other third countries including, public bodies, local authorities or administration and consortia, companies, firms and other private organisation and businesses, financial institutions that grant, promote and finance private investment in partner countries and regions; non-state actors; and natural persons.

Types of measures: Community financing may take the form of:

- projects and programmes;

- sectoral support;

- contributions to guarantee funds;

- debt-relief programmes in exceptional cases, under an internationally agreed debt relief programme;

- grants to cover operating costs;

- funding for twinning programmes between public institutions, national public bodies or private law entities with a public service mission of a Member State and those of partner country/region;

- contributions to international funds to attract joint financing from a number of donors; and

- human and material resources required for the effective administration and supervision of projects and programmes by partner countries and regions;

Activities eligible for funding under Council Regulation (EC) No 1257/96 concerning humanitarian aid will not be funded under this Regulation nor will, in principle, funding be given to paying taxes, custom duties or other fiscal charges.

Community financing may cover expenditure associated with preparation, follow up, monitoring, auditing and evaluation activities. Measures financed under this Regulation will be eligible for co-financing from: the Member States; other donor countries; international and regional organisations; companies, firms and private organisations and other non-state actors; and partner countries and regions in receipt of funding.

The legal form of Community financing will include financing agreements, grant agreements, procurement contracts and employment contracts. Special provisions have been put in place to protect the financial interests of the Community as have rules on participation and origin.

Evaluation: The Commission will regularly evaluate the results of policies and programmes in order to ascertain whether objectives have been met and how effective the programmes are. Provisions have been put in place requiring the Commission to report regularly to the Council and European Parliament on the implementation of the Regulation.

REPEAL:

- Regulation (EC, Euratom) no 99/2000;

- Decision 98/381/EC, Euratom;

- Decision 2001/824/EC, Euratom.

The repealed instruments will continue to apply for legal acts and commitments implementing the budget years preceding 2007.

APPLY FROM: 1 January 2007 – 31 December 2013.

ENTRY INTO FORCE: 11 April 2007.

The European Parliament adopted a resolution drafted by Esko Seppänen (GUE/NGL, Finland) and made some amendments to the proposal:

- the Community might finance measures to support efficient implementation in cases which result in a nuclear safety level corresponding to the technological, regulatory and operational state of the art in the Union, taking into consideration the latest scientific and technological developments. Parliament also introduced a reference to the polluter pays principle;

- the programme may fund the promotion of effective regulatory frameworks, procedures and systems to ensure adequate protection against ionising radiations from radioactive materials, in particular from high activity radioactive sources, and the safe disposal of such materials, the financial liability for which must continue to be borne solely by the operator ;

- Parliament inserted accident prevention and the mitigation of consequences as objectives of the programme;

- the JRC will be eligible for funding;

- debt-relief will be exceptionally funded pursuant to an internationally agreed debt relief programme;

- the Commission evaluation should be done with the help of independent experts;

- the financial reference amount for implementation of the Regulation for the period 2007-2013 is EUR 524 million . Annual appropriations shall be authorised by the two budget authorities within the limits of the financial perspectives;

- the Commission must report every two years after the first evaluation report;

- Community financing shall in principle not be used for paying taxes, customs duties or other fiscal charges in beneficiary countries.

Following the adoption of the Interinstitutional Agreement (IIA) of 17 May 2006 on the financial perspectives 2007-2013, and in accordance with the European Parliament, it has been decided to split the initial procedure aiming to establish a Stability Instrument in third countries into 2 separate instruments each with its own new legal basis (refer to the “ Legal context ” in the summary of 12 May 2006):

the 1st shall include all the principal measures laid down in the Commission’s initial proposal on the Stability Instrument (please refer to procedure reference COD/2004/0223 ) excluding the provisions concerning nuclear safety; the 2nd shall concentrate specifically on nuclear safety in third countries and, in particular, on the costs relating to nuclear safety actions in third countries.

For more details on the financial implications of the split procedure, please refer to the financial statement of COD/2004/0233 and the financial statement contained in this procedure.

PURPOSE: to establish an Instrument for Nuclear Safety and Security Assistance.

PROPOSED ACT: Council Regulation.

LEGAL CONTEXT: at first, this proposal included a general measure to establish a Stability Instrument (please refer to COD/2004/0223 ). However, it has now been split into two following the Interinstitutional Agreement on the financial perspectives 2007-2013. Its legal basis is Article 203 of the Treaty establishing the European Atomic Energy Community (contrary to the revised Stability Instrument which comes under the remit of development cooperation).

CONTENT: the Chernobyl accident in 1986 highlighted the global importance of nuclear safety. In order to fulfil the objective of the Treaty to create the conditions of safety necessary to eliminate hazards to the life and health of the public, the European Atomic Energy Community should be able to support nuclear safety in third countries.

The proposed Regulation sets out the financial, economic and technical assistance which shall be complementary to any assistance that is provided by the European Community under the Humanitarian Aid instrument, the Pre-accession instrument, the European Neighbourhood and Partnership instrument, the Development Cooperation and Economic Cooperation instrument, and the instrument for Stability. In pursuit of these objectives the following measures shall be supported:

a) the promotion of an effective nuclear safety culture at all levels, in particular through:

- continuous support for regulatory bodies, technical support organisations, and the reinforcement of the regulatory framework,

- on-site and external assistance programmes,

- improving the safety aspects of the design, operation and maintenance of existing nuclear power plants or other existing nuclear installations so that high safety levels can be achieved,

- support to the safe transport, treatment and disposal of nuclear fuel and radioactive waste,

- and the development and implementation of strategies for decommissioning existing installations and the remediation of former nuclear sites;

b) the promotion of effective regulatory frameworks, procedures and systems to ensure adequate protection against ionising radiations from radioactive materials, in particular from high activity radioactive sources, and their safe disposal;

c) the establishment of the necessary regulatory framework and methodologies for the implementation of nuclear safeguards , including for the proper accounting and control of fissile materials at State and operators level;

d) the establishment of effective arrangements for, emergency-planning, preparedness and response, civil protection and rehabilitation measures ;

e) measures to promote international cooperation (including in the framework of relevant international organisations, notably IAEA) in the above fields, including the implementation and monitoring of international Conventions and Treaties, exchange of information and training and research;

Community assistance under this Regulation shall be implemented on the basis of multiannual strategy papers and indicative programmes. Such multi-annual strategy papers, covering one or more countries, shall constitute the general basis for the implementation of assistance and shall be established for a period of up to 7 years. They shall set out the Community’s strategy for the provision of assistance under this Regulation, having regard to the needs of the countries concerned, the Community’s priorities, the international situation and the activities of the main partners.

Exceptionally, for instance in cases where an action programme has not yet been adopted, the Commission, may, on the basis of the strategy papers and indicative programmes, adopt measures not provided for in an action programme under the same procedures as apply to action programmes.

Community financing may take the following forms : projects and programmes; sectoral or general budget support, where the partner country’s arrangements for managing public fund are sufficiently transparent, reliable and effective, and where proper sectoral or macro-economic policies have been put in place by the partner country and approved by its main donors, including international financial institutions where applicable; sectoral support; sectoral and general import-support programmes; funds made available to the European Investment Bank or other financial intermediaries on the basis of Commission programmes, with a view to providing loans (to support investment and development of the private sector, for example), risk capital (in the form of subordinated or conditional loans) or other temporary minority holdings in business capital, and contributions to guarantee funds; debt-relief programmes; grants to fund measures; grants to cover operating costs; funding for twinning programmes between public institutions, national public bodies or private-law entities with a public-service mission of a Member State and those of a partner country or region; contributions to international funds, in particular those managed by international or regional organisations; contributions to national funds set up by partner countries and regions to attract joint financing from a number of donors, or contributions to funds set up by one or more donors for the purpose of the joint implementation of operations; human and material resources required for effective administration and supervision of projects and programmes by partner countries and regions.

Community financing may cover expenditure associated with the preparation, follow-up, monitoring, auditing and evaluation activities directly necessary for the implementation of this Regulation and the achievement of its objectives, e.g. studies, meetings, information, awareness-raising, training and publication activities, expenditure associated with computer networks for the exchange of information and any other administrative or technical assistance expenditure that the Commission may incur for the management of the programme. It shall also cover expenditure on administrative support staff employed at Commission Delegations to manage projects funded under this Regulation.

Measures financed under this Regulation are eligible for cofinancing from the following, inter alia : Member States, and in particular their public and parastatal agencies; other donor countries and in particular their public and parastatal agencies; international and regional organisations, and in particular international and regional financial institutions; companies, firms, other private organisations and businesses, and other non-state actors and partner countries and regions in receipt of funding.

Lastly, the Commission shall be assisted by a Committee composed of the representatives of the Member States and chaired by the representative of the Commission. The Commission shall examine progress achieved in implementing the measures undertaken pursuant to this Regulation and shall submit to the European Parliament and the Council an annual report on the implementation of the assistance

Financial measures : the financial measures of the present proposal were initially included in the overall proposal on the implementation of a stability instrument (COD/2004/0223), however, the Commission decided to present a new financial statement for this measure alone : the proposed financial reference amount for implementation of this Regulation for the period 2007-2013 shall be EUR 524 million .

Repeal : this Regulation should replace Council Regulation (EC, Euratom) No 99/2000 concerning the provision of assistance to the partner States in Eastern Europe and Central Asia, Council Decision 98/381/EC, Euratom concerning the Community contribution to the European Bank for Reconstruction and Development for the Chernobyl Shelter Fund, and Council Decision 2001/824/EC, Euratom on a further contribution of the European Community to the European Bank for Reconstruction and Development for the Chernobyl Shelter Fund. Those instruments should therefore be repealed.

For a more detailed assessment of the budgetary implications of this proposal, please refer to the financial statement.

PURPOSE: to establish an Instrument for Nuclear Safety and Security Assistance.

PROPOSED ACT: Council Regulation.

LEGAL CONTEXT: at first, this proposal included a general measure to establish a Stability Instrument (please refer to COD/2004/0223 ). However, it has now been split into two following the Interinstitutional Agreement on the financial perspectives 2007-2013. Its legal basis is Article 203 of the Treaty establishing the European Atomic Energy Community (contrary to the revised Stability Instrument which comes under the remit of development cooperation).

CONTENT: the Chernobyl accident in 1986 highlighted the global importance of nuclear safety. In order to fulfil the objective of the Treaty to create the conditions of safety necessary to eliminate hazards to the life and health of the public, the European Atomic Energy Community should be able to support nuclear safety in third countries.

The proposed Regulation sets out the financial, economic and technical assistance which shall be complementary to any assistance that is provided by the European Community under the Humanitarian Aid instrument, the Pre-accession instrument, the European Neighbourhood and Partnership instrument, the Development Cooperation and Economic Cooperation instrument, and the instrument for Stability. In pursuit of these objectives the following measures shall be supported:

a) the promotion of an effective nuclear safety culture at all levels, in particular through:

- continuous support for regulatory bodies, technical support organisations, and the reinforcement of the regulatory framework,

- on-site and external assistance programmes,

- improving the safety aspects of the design, operation and maintenance of existing nuclear power plants or other existing nuclear installations so that high safety levels can be achieved,

- support to the safe transport, treatment and disposal of nuclear fuel and radioactive waste,

- and the development and implementation of strategies for decommissioning existing installations and the remediation of former nuclear sites;

b) the promotion of effective regulatory frameworks, procedures and systems to ensure adequate protection against ionising radiations from radioactive materials, in particular from high activity radioactive sources, and their safe disposal;

c) the establishment of the necessary regulatory framework and methodologies for the implementation of nuclear safeguards , including for the proper accounting and control of fissile materials at State and operators level;

d) the establishment of effective arrangements for, emergency-planning, preparedness and response, civil protection and rehabilitation measures ;

e) measures to promote international cooperation (including in the framework of relevant international organisations, notably IAEA) in the above fields, including the implementation and monitoring of international Conventions and Treaties, exchange of information and training and research;

Community assistance under this Regulation shall be implemented on the basis of multiannual strategy papers and indicative programmes. Such multi-annual strategy papers, covering one or more countries, shall constitute the general basis for the implementation of assistance and shall be established for a period of up to 7 years. They shall set out the Community’s strategy for the provision of assistance under this Regulation, having regard to the needs of the countries concerned, the Community’s priorities, the international situation and the activities of the main partners.

Exceptionally, for instance in cases where an action programme has not yet been adopted, the Commission, may, on the basis of the strategy papers and indicative programmes, adopt measures not provided for in an action programme under the same procedures as apply to action programmes.

Community financing may take the following forms : projects and programmes; sectoral or general budget support, where the partner country’s arrangements for managing public fund are sufficiently transparent, reliable and effective, and where proper sectoral or macro-economic policies have been put in place by the partner country and approved by its main donors, including international financial institutions where applicable; sectoral support; sectoral and general import-support programmes; funds made available to the European Investment Bank or other financial intermediaries on the basis of Commission programmes, with a view to providing loans (to support investment and development of the private sector, for example), risk capital (in the form of subordinated or conditional loans) or other temporary minority holdings in business capital, and contributions to guarantee funds; debt-relief programmes; grants to fund measures; grants to cover operating costs; funding for twinning programmes between public institutions, national public bodies or private-law entities with a public-service mission of a Member State and those of a partner country or region; contributions to international funds, in particular those managed by international or regional organisations; contributions to national funds set up by partner countries and regions to attract joint financing from a number of donors, or contributions to funds set up by one or more donors for the purpose of the joint implementation of operations; human and material resources required for effective administration and supervision of projects and programmes by partner countries and regions.

Community financing may cover expenditure associated with the preparation, follow-up, monitoring, auditing and evaluation activities directly necessary for the implementation of this Regulation and the achievement of its objectives, e.g. studies, meetings, information, awareness-raising, training and publication activities, expenditure associated with computer networks for the exchange of information and any other administrative or technical assistance expenditure that the Commission may incur for the management of the programme. It shall also cover expenditure on administrative support staff employed at Commission Delegations to manage projects funded under this Regulation.

Measures financed under this Regulation are eligible for cofinancing from the following, inter alia : Member States, and in particular their public and parastatal agencies; other donor countries and in particular their public and parastatal agencies; international and regional organisations, and in particular international and regional financial institutions; companies, firms, other private organisations and businesses, and other non-state actors and partner countries and regions in receipt of funding.

Lastly, the Commission shall be assisted by a Committee composed of the representatives of the Member States and chaired by the representative of the Commission. The Commission shall examine progress achieved in implementing the measures undertaken pursuant to this Regulation and shall submit to the European Parliament and the Council an annual report on the implementation of the assistance

Financial measures : the financial measures of the present proposal were initially included in the overall proposal on the implementation of a stability instrument (COD/2004/0223), however, the Commission decided to present a new financial statement for this measure alone : the proposed financial reference amount for implementation of this Regulation for the period 2007-2013 shall be EUR 524 million .

Repeal : this Regulation should replace Council Regulation (EC, Euratom) No 99/2000 concerning the provision of assistance to the partner States in Eastern Europe and Central Asia, Council Decision 98/381/EC, Euratom concerning the Community contribution to the European Bank for Reconstruction and Development for the Chernobyl Shelter Fund, and Council Decision 2001/824/EC, Euratom on a further contribution of the European Community to the European Bank for Reconstruction and Development for the Chernobyl Shelter Fund. Those instruments should therefore be repealed.

For a more detailed assessment of the budgetary implications of this proposal, please refer to the financial statement.