PURPOSE: to grant discharge to the European GNSS Agency (GSA) for the financial year 2012.

NON-LEGISLATIVE ACT: Decision 2014/619/EU of the European Parliament on discharge in respect of the implementation of the budget of the European GNSS Agency for the financial year 2012.

CONTENT: by means of this Decision, the European Parliament grants the Executive Director of the European GNSS Agency discharge in respect of the implementation of the Agency’s budget for the financial year 2012.

The Decision is in accordance with the European Parliament’s resolution of 3 April 2014 and includes a series of observations that are an integral part of the Decision on discharge (please see the summary of 3 April 2014).

Amongst the main observations made, Parliament called on the Agency to improve the transparency of its recruitment procedures .

The European Parliament adopted a decision concerning the discharge to be granted to the Executive Director of the European GNSS Agency in respect of the implementation of the Authority's budget for the financial year 2012. The vote on the discharge decision approved the closure of the accounts (in accordance with Annex VI, Article 5(1) of the Rules of Procedure of the European Parliament.

Noting that the Court of Auditors stated that it has obtained reasonable assurances that the annual accounts of the Agency for the financial year 2012 are reliable, and that the underlying transactions are legal and regular, Parliament adopted by 477 votes to 67, with 24 abstentions, a resolution containing a series of recommendations that form an integral part of the discharge decision and as well as the general recommendations that appear in the draft resolution on performance, financial management and control of EU agencies.

These recommendations are summarised as follows:

Budget and financial management : Parliament noted that budget monitoring efforts during the financial year 2012 resulted in a budget implementation rate of 100% and that the payment appropriations execution rate was 99.99%. Commitments and carryovers : Parliament noted that the carry-over of committed appropriations was relatively high for administrative expenditure at EUR 1.7 million (38%). This was partly due to events beyond the Authority's control, such as the relocation of its seat to Prague in September 2012 (EUR 400 000) and the setting-up of the Galileo Security Monitoring Centre (EUR 400 000) which necessitated the provision of certain goods and services in the last quarter of the year. Prevention and management of conflicts of interests and transparency : Parliament regretted that the Agency did not answer questionnaire on the management and prevention of conflicts of interests. It urged the Agency to report to the discharge authority on the actions it has implemented to become in line with the Court of Auditors' Special Report No 15/2012 and Parliament's recommendations that all agencies develop and implement comprehensive independence policies and procedures. Performance : Parliament requested that the Agency communicate the results and impact its work has on European citizens in an accessible way, mainly through its website.

It also made a series of observations on transfers, procurement and recruitment procedures as well as comments on internal controls.

The Committee on Budgetary Control adopted the report by Petri SARVAMAA (EPP, FI) in which it recommended the European Parliament to grant discharge to the Executive Director of the European GNSS Agency in respect of the implementation of the Authority's budget for the financial year 2012.

Noting that the Court of Auditors stated that it has obtained reasonable assurances that the annual accounts of the Agency for the financial year 2012 are reliable, and that the underlying transactions are legal and regular, Members approved the closure of the Agency’s accounts. They made, however, a number of recommendations that needed to be taken into account when the discharge is granted, in addition to the general recommendations that appear in the draft resolution on performance, financial management and control of EU agencies.

Budget and financial management : Members noted that budget monitoring efforts during the financial year 2012 resulted in a budget implementation rate of 100% and that the payment appropriations execution rate was 99.99%. Commitments and carryovers : Members noted that the carry-over of committed appropriations was relatively high for administrative expenditure at EUR 1.7 million (38%). This was partly due to events beyond the Authority's control, such as the relocation of its seat to Prague in September 2012 (EUR 400 000) and the setting-up of the Galileo Security Monitoring Centre (EUR 400 000) which necessitated the provision of certain goods and services in the last quarter of the year. Prevention and management of conflicts of interests and transparency : Members regretted that the Agency did not answer questionnaire on the management and prevention of conflicts of interests; urges the Agency to report to the discharge authority on the actions it has implemented to become in line with the Court of Auditors' Special Report No 15/2012 and Parliament's recommendations that all agencies develop and implement comprehensive independence policies and procedures, inter alia, by establishing a breach of trust mechanism and clear penalties, or by changing those already in place.

Members also made a series of observations on transfers, procurement and recruitment procedures as well as comments on internal controls.

Having examined the revenue and expenditure accounts for the financial year 2012 and the balance sheet at 31 December 2012 of the European GNSS Agency (GSA), as well as the Court of Auditors' report on the annual accounts of the Agency for the financial year 2012, accompanied by the Agency's replies to the Court's observations, the Council recommends the European Parliament to give a discharge to the Executive Director of the Agency in respect of the implementation of the budget for the financial year 2012.

The observations in the Court of Auditors' report in relation to the financial year 2012 call for some comments by the Council, which may be summarised as follows:

in general, the Council welcomes the Court's opinion that, in all material respects, the Agency's annual accounts present fairly its financial position as at 31 December 2012 and the results of its operations and its cash flows for the year then ended, in accordance with the provisions of the Agency's Financial Regulation and the accounting rules adopted by the Commission's accounting officer, and that the underlying transactions for that financial year are legal and regular. Carry-overs : the Council calls on the Agency to continue to improve its financial programming and monitoring of budget implementation, in order to reduce the level of commitments carried over to the minimum necessary, in line with the budgetary principle of annuality. Recruitment : furthermore, the Council welcomes the efforts already made by the Agency to improve transparency of its recruitment procedures, and encourages the Agency to closely monitor the effectiveness of the measures put in place.

PURPOSE: presentation of the EU Court of Auditors’ report on the annual accounts of the European GNSS Agency for the year 2012, together with the Agency’s reply.

CONTENT: in accordance with the tasks conferred on the Court of Auditors by the Treaty on the Functioning of the European Union, the Court presents to the European Parliament and to the Council, in the context of the discharge procedure, a Statement of Assurance as to the reliability of the annual accounts of each institution, body or agency of the EU, and the legality and regularity of the transactions underlying them, on the basis of an independent external audit.

This audit concerned, amongst others, the annual accounts of the European GNSS Agency.

In the Court’s opinion, the European GNSS Agency ’s Annual Accounts fairly present, in all material respects, its financial position as of 31 December 2012 and the results of its operations and its cash flows for the year then ended, in accordance with the provisions of its Financial Regulation and the accounting rules adopted by the Commission’s accounting officer.

The Court also considers that the transactions underlying the annual accounts of the Agency for the financial year ended 31 December 2012 are, in all material respects, legal and regular.

The report confirms that the Agency’s 2012 budget amounted to EUR 20.8 million.

The report also makes a series of observations on the budgetary and financial management of the Agency, accompanied by the latter’s response. The main observations may be summarised as follows:

The Court’s observations :

· budgetary management: the Court notes that the overall level of committed appropriations was close to 100 % for all titles. However, carry-overs of committed appropriations were relatively high for administrative expenditure at EUR 1.7 million euro (38 %). This was partly due to events beyond the Agency’s control, such as the relocation of its seat to Prague (EUR 0.4 million) and the setting-up of the Galileo Security Monitoring Centre (EUR 0.4 million);

· recruitment procedures: the Court identified weaknesses in the recruitment procedures.

The Agency’s reply :

· carry-overs: the Agency indicates that the major part of the carry-overs is related to the set up of the Galileo Security Monitoring Centres in France and UK. As this is a complex project in terms of security, IT, logistics and legal support, the Agency has decided to advance as much as possible the project preparations in 2012. In that respect, the Administrative Board approved a significant transfer of credits in order to ensure that the necessary framework contracts are in place on time. Another significant part of the carry-overs is related to the relocation of the Agency’s headquarters from Brussels to Prague in September 2012;

· recruitment: the Agency has revised the selection procedures.

Lastly, the Court of Auditors’ report contains a summary of the Agency’s activities in 2012 . This is focused on the following:

systems security (security accreditation of the systems and sites, Galileo system- specific security requirements, flight key cell activities) ; support for Public Regulated Service – PRS (Preparation of the PRS User Segment) preparation of Galileo Security Monitoring Centre – GSMC ; preparatory activities for EGNOS and Galileo exploitation ; market development actions focused on receiver manufacturers to foster Galileo penetration in consumer and professional markets ; research and development.