PURPOSE: to reinforce the comparability, reliability and exhaustiveness of the GNI (Gross National Income) aggregate.

LEGISLATIVE ACT: Regulation (EU) 2019/516 of the European Parliament and of the Council 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).

CONTENT: Gross national income at market prices (GNI) constitutes the basis for calculating the largest share of own resources in the general budget of the Union. Therefore, it is necessary to further reinforce the comparability, reliability and exhaustiveness of that aggregate.

The adopted Regulation, repealing Council Regulation (EC, Euratom) No 1287/2003 (the "GNI Regulation"), is a simple update of the existing system. It provides that gross national income at market prices (GNI) and gross domestic product at market prices (GDP) are defined in accordance with the European system of accounts (ESA 2010), established by Regulation (EU) No 549/2013 .

Before 1 October each year, Member States shall provide the Commission (Eurostat), in the context of national accounting procedures, with figures for GNI aggregates and their components. Totals for GDP and its components shall be presented in accordance with the three approaches used to define and calculate GNI at market prices: the production approach, the expenditure approach and the income approach.

The Commission shall establish a formal expert group, composed of representatives of all the Member States and chaired by a representative of the Commission, to advise the Commission on, and to express its views regarding, the comparability, reliability and exhaustiveness of GNI calculations, to examine issues of implementation of this Regulation and to issue annual opinions on the appropriateness of the GNI data submitted by the Member States for own resources purposes.

The Commission may carry out GNI information visits to verify the quality of GNI aggregates and their components and to verify compliance with the ESA 2010, as well as to ensure that GNI data are comparable, reliable and exhaustive.

It shall have the power to adopt:

- delegated acts for a period of five years (renewable) as regards the list of issues to be addressed in every verification cycle;

- implementing measures to establish the structure and detailed arrangements of the inventory of the sources and methods used to produce GNI data and their components, in accordance with Annex A to Regulation (EU) No 549/2013, as well as the timetable for its updating and transmission, and the specific measures aimed at improving the comparability, reliability and exhaustiveness of Member States' GNI data based on the list of issues defined by the Commission. Before 1 January 2023, the Commission shall present to the European Parliament and the Council a report on the application of the Regulation.

ENTRY INTO FORCE: 18.4.2019.

The European Parliament adopted by 567 votes to 45, with 37 abstentions, a legislative resolution on the proposal for a regulation of the European Parliament and of the Council on the harmonisation of gross national income at market prices (GNI Regulation) repealing Council Directive 89/130/EEC, Euratom and Council Regulation (EC, Euratom) No 1287/2003.

To recap, the proposed Regulation, repealing Council Regulation (EC, Euratom) No 1287/2003 (the "GNI Regulation"), provides that gross national income at market prices (GNI) and gross domestic product at market prices (GDP) are defined in accordance with the European System of National and Regional Accounts (ESA 2010), established by Regulation (EU) No 549/2013.

The position of the European Parliament adopted at first reading under the ordinary legislative procedure has amended the Commission proposal as follows:

The amended text insists on the fact that gross national income at market prices (GNI) is the basis for calculating the largest share of own resources in the Union's general budget. Therefore, GNI data have to be reliable, exhaustive and comparable .

To ensure that GNI data are exhaustive, informal, unregistered and other activities and transactions that are not reported in statistical surveys, or to fiscal, social or other administrative authorities should also be taken into account.

For GNI verification purposes, the Commission (Eurostat) should be entitled to carry out GNI information visits in order to verify the quality of GNI aggregates and their components and to verify compliance with ESA 2010, as well as to ensure that GNI data are comparable, reliable and exhaustive.

The Commission should adopt:

- delegated acts for a period of five years (renewable) defining the list of issues to be addressed in every verification cycle in order to ensure the reliability, exhaustiveness and highest possible degree of comparability of GNI data, in line with ESA 2010;

- specific implementing measures to make GNI data more comparable, reliable and exhaustive, based on the list of issues defined by the Commission in the delegated acts.

The Committee on Economic and Monetary Affairs adopted the report by Roberto GUALTIERI (S&D, IT) n the proposal for a regulation of the European Parliament and of the Council on the harmonisation of gross national income at market prices (GNI Regulation) repealing Council Directive 89/130/EEC, Euratom and Council Regulation (EC, Euratom) No 1287/2003.

As a reminder, the proposed Regulation, repealing Council Regulation (EC, Euratom) No 1287/2003 (the 'GNI Regulation'), provides that gross national income at market prices (GNI) and gross domestic product at market prices (GDP) shall be defined in accordance with the European system of national and regional accounts (ESA 2010), set up by Regulation (EU) No 549/2013.

The committee recommended that the European Parliament’s position adopted at first reading under the ordinary legislative procedure, should amend the proposal as follows.

Members stated that GNI constitutes the basis for calculating the largest share of own resources in the budget of the Union.

For GNI to be exhaustive, it should also take into account informal, unregistered and other activities and transactions that are not reported in statistical surveys or to fiscal, social and other administrative authorities.

The Commission shall adopt delegated acts for a period of five years as regards defining the content of the inventory of sources and methods used to produce GNI data and with regard to the measures ensuring the reliability, exhaustiveness, as well as the highest possible degree of comparability, of GNI data.

PURPOSE: to reinforce comparability, reliability and exhaustiveness of GNI aggregate (gross national income).

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

ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure and on an equal footing with the Council.

BACKGROUND: gross national income (GNI) constitutes the basis for calculating the largest share of own resources in the budget of the European Union.

The new ‘own resources decision,’ Council Decision 2014/335/EU , Euratom on the system of own resources of the European Union entered into force on 1 October 2016. This Decision states that for own resources purposes, the GNI of Members States shall be defined in accordance with Regulation (EU) No 549/2013 of the European Parliament and of the Council on the European system of national and regional accounts in the European Union (ESA 2010).

In September 2014, ESA 2010 became the new standard for calculating national accounts in the EU.

In order to enhance the comparability, reliability and exhaustiveness of the GNI aggregate , the Commission considers it necessary to revise Council Regulation (EC, Euratom) No 1287/2003 on the harmonisation of income (GNI Regulation) in order to align the GNI with Regulation (EU) No 549/2013, the legal basis of which is also Article 338(1) of the TFEU, which constitutes the legal basis for European statistics.

The proposal follows on from the recommendations in the Court of Auditors' special report No 11/2013 entitled 'Getting the Gross National Income (GNI) data right' and the Commission's communication on the production method of EU statistics: a vision for the next decade.

CONTENT: the proposed Regulation, repealing Council Regulation (EC, Euratom) No 1287/2003 (the 'GNI Regulation'), is a simple update of the existing system .

It provides that gross national income at market prices (GNI) and gross domestic product at market prices (GDP) shall be defined in accordance with the European system of national and regional accounts (ESA 2010), set up by Regulation (EU) No 549/2013.

To emphasise statistical integrity when compiling and harmonising GNI, the legal basis shall be Article 338(1) TFEU .

The proposed changes to the situation under the GNI Regulation consist of adapting the GNI data reporting to ESA 2010 and introducing the European Statistical System Committee (ESSC) as the relevant comitology committee instead of the GNI Committee as part of a new ESS structure.

According to the Commission, the proposal imposes less of a burden on Member States than the current situation because without a switch to ESA 2010 for own resources, Member States could be required to produce a double set of accounts, one on ESA 2010 and one on ESA 95.