PURPOSE: to increase the co-financing rate of the External Borders Fund for certain Member States experiencing serious difficulties with respect to their financial stability.

LEGSLATIVE ACT: Decision No 259/2013/EU of the European Parliament and of the Council amending Decision No 574/2007/EC with a view to increasing the co-financing rate of the External Borders Fund for certain Member States experiencing or threatened with serious difficulties with respect to their financial stability

BACKGROUND: Decision No 574/2007/EC establishes the External Borders Fund for the period 2007 to 2013 as part of the General programme ‘Solidarity and Management of Migration Flows’ and provides for different Union co-financing rates for actions supported by the Fund.

The unprecedented global financial crisis and economic downturn have seriously damaged economic growth and financial stability, provoking a marked deterioration in financial, economic and social conditions in several Member States. Some are experiencing serious difficulties or are threatened with such difficulties, particularly with respect to their financial and economic stability, leading to deterioration in their deficit and debt positions and threatening economic growth heightened by the international economic and financial environment.

In this context, ensuring the smooth implementation of programmes adopted under the four Funds established as part of the General Programme on ‘Solidarity and Management of Migration Flows’ is of particular importance as a means of injecting funds into the economy.

These Funds are also key tools for helping Member States to address important challenges in the area of migration, asylum and external borders such as the development of a comprehensive Union immigration policy to enhance the competitiveness and social cohesion of the Union and the creation of a Common European Asylum System.

Accordingly, in order to improve the availability of funding for the Member States in the area of migration, asylum and external borders and to implement their annual programmes under the Funds, it is necessary to amend the Union co-financing rate under the Funds for Member States experiencing serious difficulties with respect to their financial stability.

It should be noted that this Decision is closely linked to another text regarding a similar amendment of the three Funds established under the General programme ‘Solidarity and Management of Migration Flows’.

CONTENT: this Decision contains provisions that allow an increase in the Union co-financing rate under the Funds, by an amount corresponding to twenty percentage points above the co-financing rates previously applicable, for Member States experiencing serious difficulties with respect to their financial stability.

The aim is to ensure that Member States benefiting from a financial support mechanism (or any other member state which may be concerned by such assistance in the future) continue to implement on the ground the programmes adopted under the funds, which are part of the General Programme on Solidarity and Management of Migration Flows.

Procedure: any Member State seeking to benefit from the increased co-financing rate should provide the Commission with a written statement together with its draft annual programme or draft revised annual programme. In its statement, the Member State concerned should provide a reference to the relevant Council Decision or to any other relevant decision that makes it eligible to benefit from the increased Union co-financing rate.

Financial assistance by the EU may be increased by 20 percentage points provided that the Member State meets one of the requisite conditions:

• medium-term financial assistance is made available to it in accordance with Council Regulation (EC) No 332/2002 establishing a facility providing medium-term financial assistance for Member States' balances of payments;
• financial assistance is made available to it in accordance with Council Regulation (EU) No 407/2010 establishing a European financial stabilisation mechanism or financial assistance is made available to it by other euro area Member States;
• financial assistance is made available to it in accordance with the intergovernmental agreement reached establishing the European Financial Stability Facility or the Treaty establishing the European Stability Mechanism.

Territorial provisions: the Decision contains a series of territorial provisions establishing the rules for association with the Decision for Iceland, Norway, Switzerland and Liechtenstein. Denmark must decide within a period of six month whether it will implement it in its national law. The United Kingdom and Ireland will not take part in the Decision.

ENTRY INTO FORCE: 23/03/2013.

The European Parliament adopted by 595 votes to 23, with 37 abstentions, a legislative resolution on the proposal for a decision of the European Parliament and of the Council amending Decision No 574/2007/EC with a view to increasing the co-financing rate of the External Borders Fund for certain Member States experiencing or threatened with serious difficulties with respect to their financial stability.

Parliament adopted its position at first reading, taking over the Commission proposal.

The Committee on Civil Liberties, Justice and Home Affairs adopted the report by Nils TORVALDS (ALDE, FI) on the proposal for a decision of the European Parliament and of the Council amending Decision No 574/2007/EC with a view to increasing the co-financing rate of the External Borders Fund for certain Member States experiencing or threatened with serious difficulties with respect to their financial stability.

To recall, the Commission proposal aims to offer the possibility to increase the the co-financing rates for Member States benefiting from a financial support mechanism. The proposal aims to enable increasing the Union co-financing rate by twenty percentage points and thereby decrease the co-financing needs for the part of the Member States in question.

The committee supports the approach proposed by the Commission (and which already exists for other European Funds). The report states that the functioning management of migration flows is of great importance for the European Union as a whole. The inability of one Member State to ensure efficient management of migration flows does not only affect the country in question, it has also an impact on many other Member States as well. It is therefore in the interest of all Member States that the commitments made with regards to migration do not suffer from the economic difficulties in some Member States.

The committee calls on the European Parliament to adopt its position at first reading, taking over the Commission proposal.

PURPOSE: to increase the co-financing rate of the External Borders Fund for certain Member States experiencing serious difficulties with respect to their financial stability and amending Decision No 574/2007/EC.

PROPOSED ACT: Decision of the European Parliament and of the Council.

BACKGROUND: Decision No 574/2007/EC establishes the External Borders Fund for the period 2007 to 2013 as part of the General programme ‘Solidarity and Management of Migration Flows’ and provides for different Union co-financing rates for actions supported by the Fund.

The unprecedented global financial crisis and economic downturn have seriously damaged economic growth and financial stability, provoking a marked deterioration in financial, economic and social conditions in several Member States. Some Member States are experiencing serious difficulties or are threatened with such difficulties, particularly with respect to their financial and economic stability, leading to deterioration in their deficit and debt positions and threatening economic growth heightened by the international economic and financial environment. Ensuring the smooth implementation of programmes adopted under the four Funds established as part of the General Programme on ‘Solidarity and Management of Migration Flows’ (‘the Funds’), is of particular importance as a means of injecting funds into the economy.

To make European Union funding easier to manage in the area of migration, asylum and external borders and to improve the availability of funding for the Member States to implement their annual programmes under the Funds, it is necessary, on a temporary basis and without prejudice to the 2014-2020 programming period, to arrange for an increase in the Union co-financing rate under the Funds, by an amount corresponding to twenty percentage points above the co-financing rates currently applicable, for Member States experiencing serious difficulties with respect to their financial stability.

It should be noted that this proposal is closely linked to the proposal regarding similar amendments of the European Refugee Fund, the European Return Fund and the European Fund for the Integration of third-country nationals (please see COD/2012/0252).

LEGAL BASIS: Article 77(2) of the Treaty on the Functioning of the European Union (TFEU).

IMPACT ASSESSMENT: there was no consultation of external stakeholders. The proposal will allow the Commission to apply higher co-financing rates for the countries benefiting from one of the support mechanisms.

CONTENT: in order to ensure that Member States benefiting from a financial support mechanism continue to implement the programmes adopted under the Funds on the ground and disburse funds to projects, the proposal contains provisions that would allow the Commission to increase the Union co-financing rate for these countries, for the period during which they benefit from financial assistance provided by one of the support mechanisms under any funding instruments. This will provide additional financial resources to the Member States and will make it easier to continue implementing the programmes on the ground. The Funds’ annual national allocation pursuant to the basic acts will remain unchanged while national co-financing will be reduced accordingly. Ongoing annual programmes will need to be revised to reflect the changes resulting from the application of the increased Union co-financing rate.

The proposal makes provision for the amendment of Article 16 of Decision No 574/2007/EC to allow the Union co-financing rate applicable to the External Borders Fund programmes of the Member States concerned to be increased by 20 percentage points, provided they are benefiting from one of the support mechanisms.

Annual programme: once a decision granting financial assistance to a Member State under one of the support mechanisms has been taken, the Member State may submit to the Commission either a draft annual programme or a draft revised annual programme applying the increased Union co-financing rate.

To be entitled to apply the increased Union co-financing rate, a Member State must benefit from one of the support mechanisms at the time of submitting its draft annual programme or draft revised annual programme. These are:

• medium-term financial assistance in accordance with Council Regulation (EC) No 332/2002;
• financial assistance in accordance with Council Regulation (EU) No 407/2010 or financial assistance from other euro area Member States before the entry into force of that Regulation;
• financial assistance in accordance with the intergovernmental agreement reached  establishing the European Financial Stability Facility or the Treaty establishing the European Stability Mechanism.

However, once an action of a specific annual programme has been co-financed at the increased Union co-financing rate, it remains so until the end of the eligibility period of the related annual programme whether or not the Member State still benefits from one of the support mechanisms.

BUDGETARY IMPLICATIONS: there is no impact on commitment appropriations since no modifications are proposed to the maximum amounts of the Funds' financing provided for in the annual programmes for the programming period 2007-2013.

The proposal states that it shows the Commission's willingness to assist Member States in their efforts to deal with the financial crisis. The amendments will provide the Member States concerned with the necessary funds to support projects and economic recovery.