Annexes to COM(2018)323 - Interinstitutional Agreement on budgetary discipline, on cooperation in budgetary matters and on sound financial management

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dossier COM(2018)323 - Interinstitutional Agreement on budgetary discipline, on cooperation in budgetary matters and on sound financial management.
document COM(2018)323 EN
date December 16, 2020
Agreement between the Representatives of the Governments of the Member States of the European Union, meeting within the Council, on the financing of European Union aid under the multiannual financial framework for the period 2014 to 2020, in accordance with the ACP-EU Partnership Agreement, and on the allocation of financial assistance for the Overseas Countries and Territories to which Part Four of the Treaty on the Functioning of the European Union applies (OJ L 210, 6.8.2013, p. 1) and the preceding Internal Agreements.


ANNEX I

INTERINSTITUTIONAL COOPERATION DURING THE BUDGETARY PROCEDURE

Part A.   Calendar of the budgetary procedure

1.The Institutions shall agree a pragmatic calendar each year in due time before the start of the budgetary procedure on the basis of present practice.

2.In order to ensure that the European Parliament and the Council are able to exercise their budgetary prerogatives in an effective manner, budgetary positions, transfers or other notifications entailing the activation of deadlines shall be submitted taking due account of any recess periods, the dates of which those institutions have informed each other in due time through their respective services.

Part B.   Priorities for the budgetary procedure

3.In due time before the Commission adopts the draft budget, a trilogue shall be convened to discuss the possible priorities for the budget of the coming financial year and any questions arising from the implementation of the budget of the current financial year, on the basis of the information provided by the Commission in accordance with point 37.

Part C.   Establishment of the draft budget and updating of estimates

4.The institutions, other than the Commission, are invited to adopt their statement of estimates before the end of March.

5.The Commission shall, each year, present a draft budget showing the Union's actual financing requirements.

It shall take into account:

(a)forecasts provided by the Member States in relation to the Structural Funds;

(b)the capacity for utilising appropriations, while endeavouring to maintain a strict relationship between appropriations for commitments and appropriations for payments;

(c)possibilities for starting up new policies through pilot projects, new preparatory actions or both, or for continuing multiannual actions which are coming to an end, after assessing whether it is possible to secure a basic act, within the meaning of the Financial Regulation (definition of a basic act, necessity of a basic act for implementation and exceptions);

(d)the need to ensure that any change in expenditure in relation to the previous year is in accordance with the constraints of budgetary discipline.

6.The Institutions shall, as far as possible, avoid entering items in the budget involving insignificant amounts of expenditure on operations.

7.The European Parliament and the Council also undertake to bear in mind the assessment of the possibilities for implementing the budget made by the Commission in its drafts and in connection with the implementation of the budget for the current financial year.

8.In the interests of sound financial management and owing to the effect of major changes in the titles and chapters of the budget nomenclature on the management reporting responsibilities of Commission departments, the European Parliament and the Council undertake to discuss any major changes with the Commission during the conciliation.

9.In the interest of loyal and sound institutional cooperation, the European Parliament and the Council commit to maintaining regular and active contacts at all levels, through their respective negotiators, throughout the whole budgetary procedure and, in particular, during the whole conciliation period with a view to reaching an agreement. The European Parliament and the Council undertake to ensure the timely and constant mutual exchange of relevant information and documents at both formal and informal levels, as well as to hold technical or informal meetings as needed, during the conciliation period, in cooperation with the Commission. The Commission shall ensure timely and equal access to information and documents for the European Parliament and for the Council.

10.Until such time as the Conciliation Committee is convened, the Commission may, if necessary, submit letters of amendment to the draft budget in accordance with Article 314(2) TFEU, including a letter of amendment updating, in particular expenditure estimates for agriculture. The Commission shall submit information on updates to the European Parliament and to the Council for their consideration as soon as it is available. It shall supply the European Parliament and the Council with all the duly justified reasons they may require.

Part D.   Budgetary procedure before the conciliation procedure

11.A trilogue shall be convened in due time before the Council's reading, to allow the Institutions to exchange their views on the draft budget.

12.In order for the Commission to be able to assess in due time the executability of amendments, envisaged by the European Parliament and by the Council, which create new preparatory actions or pilot projects or which prolong existing ones, the European Parliament and the Council shall inform the Commission of their intentions in that regard, so that a first discussion may already take place at that trilogue.

13.A trilogue may be convened before the votes in plenary of the European Parliament.

Part E.   Conciliation procedure

14.If the European Parliament adopts amendments to the Council's position, the President of the Council shall, during the same plenary sitting, take note of the differences in the position of the two institutions and give his/her agreement for the President of the European Parliament to convene the Conciliation Committee immediately. The letter convening the Conciliation Committee shall be sent at the latest on the first working day of the week following the end of the parliamentary part-session during which the plenary vote was delivered, and the conciliation period shall start on the following day. The 21-day period shall be calculated in accordance with Regulation (EEC, Euratom) No 1182/71 of the Council (1).

15.If the Council cannot agree on all the amendments adopted by the European Parliament, it should confirm its position by letter sent before the first meeting foreseen during the conciliation period. In such case, the Conciliation Committee shall proceed in accordance with the conditions laid down in the following points.

16.The Conciliation Committee shall be chaired jointly by representatives of the European Parliament and of the Council. Meetings of the Conciliation Committee shall be chaired by the co-chair from the institution hosting the meeting. Each institution, in accordance with its own rules of procedure, shall designate its participants for each meeting and set out its mandate for the negotiations. The European Parliament and the Council shall be represented at an appropriate level in the Conciliation Committee, such that each delegation can commit politically its respective institution, and that actual progress towards the final agreement may be made.

17.In accordance with the second subparagraph of Article 314(5) TFEU, the Commission shall take part in the Conciliation Committee's proceedings and shall take all the necessary initiatives with a view to reconciling the positions of the European Parliament and of the Council.

18.Trilogues shall take place throughout the conciliation procedure, at different levels of representation, with the aim of resolving outstanding issues and preparing the ground for an agreement to be reached in the Conciliation Committee.

19.Meetings of the Conciliation Committee and trilogues shall be held alternately at the premises of the European Parliament and of the Council, with a view to an equal sharing of facilities, including interpretation facilities.

20.The dates of the meetings of the Conciliation Committee and the trilogues shall be set in advance by agreement of the Institutions.

21.A common set of documents ("input documents") comparing the various steps of the budgetary procedure shall be made available to the Conciliation Committee (2). Those documents shall include "line by line" figures, totals by MFF headings and a consolidated document with figures and remarks for all budget lines deemed technically "open". Without prejudice to the final decision of the Conciliation Committee, a specific document shall list all budget lines deemed technically closed (3). Those documents shall be classified by budgetary nomenclature.

Other documents shall also be attached to the input documents for the Conciliation Committee, including a letter of executability from the Commission on the Council's position and the European Parliament's amendments, and any letters from other institutions concerning the Council's position or the European Parliament's amendments.

22.With a view to reaching agreement by the end of the conciliation period, trilogues shall:
(a)define the scope of the negotiations on the budgetary issues to be addressed;

(b)endorse the list of the budget lines deemed technically closed, subject to the final agreement on the entire budget of the financial year;

(c)discuss issues identified under point (a) with a view to reaching possible agreements to be endorsed by the Conciliation Committee;

(d)address thematic issues, including by headings of the MFF.

Tentative conclusions shall be drawn jointly during or immediately after each trilogue, and, simultaneously, the agenda of the following meeting shall be agreed. Those conclusions shall be registered by the institution hosting the trilogue and shall be deemed provisionally approved after 24 hours, without prejudice to the final decision of the Conciliation Committee.

23.The conclusions of trilogues and a document for possible endorsement shall be available to the Conciliation Committee at its meetings, together with the budget lines in respect of which an agreement has been tentatively reached during the trilogues.

24.The joint text provided for in Article 314(5) TFEU shall be established by the secretariats of the European Parliament and of the Council with the assistance of the Commission. It shall consist of a letter of transmission addressed by the chairs of the two delegations to the Presidents of the European Parliament and of the Council, containing the date of the agreement at the Conciliation Committee, and annexes which shall include:
(a)line by line figures for all budget items and summary figures by MFF headings;

(b)a consolidated document, indicating the figures and final text of all lines that have been amended during the conciliation procedure;

(c)the list of the lines not amended with regard to the draft budget or the Council's position on it.

The Conciliation Committee may also approve conclusions and possible joint statements in relation to the budget.

25.The joint text shall be translated into the official languages of the institutions of the Union (by the services of the European Parliament) and shall be submitted for approval of the European Parliament and of the Council within a period of 14 days from the date of the agreement on the joint text referred to point 24.

The budget shall be subject to legal-linguistic revision after the adoption of the joint text by integrating the annexes of the joint text with the budget lines not amended during the conciliation procedure.

26.The institution hosting the meeting (trilogue or conciliation) shall provide interpretation facilities with a full linguistic regime applicable to the Conciliation Committee meetings and an ad hoc linguistic regime for the trilogues.

The institution hosting the meeting shall provide for the copying and distribution of room documents.

The services of the Institutions shall cooperate in the encoding of the results of the negotiations in order to finalise the joint text.

Part F.   Amending budgets

General principles

27.Bearing in mind that amending budgets are frequently focused on specific and sometimes urgent issues, the Institutions agree on the following principles to ensure appropriate interinstitutional cooperation for a smooth and swift decision-making process for amending budgets while avoiding, insofar as possible, having to convene a conciliation meeting for amending budgets.

28.As far as possible, the Institutions shall endeavour to limit the number of amending budgets.

Calendar

29.The Commission shall inform the European Parliament and the Council in advance of the possible dates of adoption of draft amending budgets, without prejudice to the final date of adoption.

30.The European Parliament and the Council, each in accordance with its internal rules of procedure, shall endeavour to examine the draft amending budget proposed by the Commission at an early opportunity after its adoption by the Commission.

31.In order to speed up the procedure, the European Parliament and the Council shall ensure that their respective calendars of work are coordinated as far as possible in order to enable proceedings to be conducted in a coherent and convergent way. They shall therefore seek as soon as possible to establish an indicative timetable for the various stages leading to the final adoption of the amending budget.

The European Parliament and the Council shall take into account the relative urgency of the amending budget and the need to approve it in due time to be effective during the financial year concerned.

Cooperation during the readings

32.The Institutions shall cooperate in good faith throughout the procedure, clearing the way, as far as possible, for the adoption of amending budgets at an early stage of the procedure.

Where appropriate, and when there is a potential divergence, the European Parliament or the Council, before each takes its final position on the amending budget, or the Commission at any time, may propose that a specific trilogue be convened to discuss the divergences and to try to reach a compromise.

33.All draft amending budgets proposed by the Commission and not yet finally approved shall be entered systematically on the agenda of trilogues planned for the annual budgetary procedure. The Commission shall present the draft amending budgets and the European Parliament and the Council shall, as far as possible, make known their respective positions ahead of the trilogue.

34.If a compromise is reached during a trilogue, the European Parliament and the Council undertake to consider the results of the trilogue when deliberating on the amending budget in accordance with the TFEU and their rules of procedure.

Cooperation after the readings

35.If the European Parliament approves the position of the Council without amendments, the amending budget shall be adopted in accordance with the TFEU.

36.If the European Parliament adopts amendments by a majority of its component members, point (c) of Article 314(4) TFEU shall apply. However, before the Conciliation Committee meets, a trilogue shall be called:
(a)if an agreement is reached during that trilogue and subject to the agreement of the European Parliament and of the Council on the results of the trilogue, the conciliation shall be closed by an exchange of letters without a meeting of the Conciliation Committee;

(b)if no agreement is reached during that trilogue, the Conciliation Committee shall meet and organise its work in accordance with the circumstances, with a view to completing the decision-making process as much as possible before the 21-day deadline laid down in Article 314(5) TFEU. The Conciliation Committee may conclude by an exchange of letters.

Part G.   Budget implementation, payments and reste à liquider (RAL)

37.Given the need to ensure an orderly progression of the total appropriations for payments in relation to the appropriations for commitments so as to avoid any abnormal shift of RAL from one year to another, the Institutions agree to monitor closely the payment forecasts and the level of the RAL so as to mitigate the risk of hampering the implementation of Union programmes because of a lack of payment appropriations at the end of the MFF.

In order to ensure a manageable level and profile for the payments in all headings, de-commitment rules shall be applied strictly in all headings, in particular the rules for automatic de-commitments.

In the course of the budgetary procedure, the Institutions shall meet regularly with a view to jointly assessing the state of play and the outlook for budgetary implementation in the current and future financial years. That assessment shall take the form of dedicated interinstitutional meetings at the appropriate level, before which the Commission shall provide the detailed state of play, broken down by fund and Member State, on payment implementation, on transfers, on reimbursement claims received and revised forecasts, including long-term forecasts, where applicable. In particular, in order to ensure that the Union can fulfil all its financial obligations stemming from existing and future commitments in the period 2021-2027 in accordance with Article 323 TFEU, the European Parliament and the Council shall analyse and discuss the Commission's estimates as to the required level of payment appropriations.

Part H.   Cooperation as regards the European Union Recovery Instrument (4)

38.For the sole purpose of addressing the consequences of the COVID-19 crisis, the Commission will be empowered to borrow funds on capital markets on behalf of the Union up to EUR 750 000 million in 2018 prices, of which up to EUR 390 000 million in 2018 prices may be used for expenditure and up to EUR 360 000 million in 2018 prices may be used for providing loans in accordance with Article 5(1) of the Own Resources Decision. As provided for in the EURI Regulation, the amount to be used for expenditure constitutes external assigned revenue for the purposes of Article 21(5) of the Financial Regulation.

39.The Institutions agree that the role of the European Parliament and of the Council, where acting in their capacity of budgetary authority, needs to be enhanced in relation to the external assigned revenue under the European Union Recovery Instrument, with a view to ensuring a proper oversight of and involvement in the use of such revenue, within the limits set out in the EURI Regulation and, as appropriate, in the relevant sectoral legislation. The Institutions also agree on the need to ensure full transparency and visibility of all funds under the European Union Recovery Instrument.

External assigned revenue under the European Union Recovery Instrument

40.Given the need to ensure an appropriate involvement of the European Parliament and of the Council in the governance of external assigned revenue under the European Union Recovery Instrument, the Institutions agree on the procedure set out in points 41 to 46.

41.The Commission will provide detailed information with its draft estimates in the context of the budgetary procedure. Such information shall include detailed estimates of commitment appropriations and payment appropriations as well as of legal commitments, broken down by heading and by programme that receives assigned revenue under the EURI Regulation. The Commission will provide any additional relevant information requested by the European Parliament or by the Council. The Commission will attach to the draft budget a document compiling all relevant information concerning the European Union Recovery Instrument, including summary tables aggregating budget appropriations and assigned revenue under the European Union Recovery Instrument. That document will be part of the annex to the general budget of the Union on external assigned revenue provided for in point 44.

42.The Commission will present regular updates of the information referred to in point 41 throughout the financial year and at least ahead of each dedicated meeting as referred to in point 45. The Commission will make the relevant information available to the European Parliament and to the Council in time to allow meaningful discussions and deliberations on corresponding planning documents, including before the Commission adopts relevant decisions.

43.The Institutions will meet regularly in the context of the budgetary procedure with a view to jointly assessing the implementation of external assigned revenue under the European Union Recovery Instrument, in particular the state of play and outlook and to discuss the annual estimates provided with the respective draft budgets and their distribution, with due regard to the limitations and conditions set out in the EURI Regulation and, as appropriate, in relevant sectoral legislation.

44.The European Parliament and the Council will attach to the general budget of the Union in the form of an annex a document setting out all the budget lines that receive assigned revenue under the European Union Recovery Instrument. Moreover, they will use the budget structure for accommodating the assigned revenue under the European Union Recovery Instrument, and in particular the budgetary remarks, to exercise due control over the use of that revenue. In accordance with Article 22 of the Financial Regulation, the European Parliament and the Council will include in the statement of expenditure remarks, including general remarks, showing which budget lines may receive the appropriations corresponding to the revenue assigned on the basis of the EURI Regulation and indicating relevant amounts. The Commission, in exercising its responsibility for implementing the assigned revenue, undertakes to take due account of such remarks.

45.The Institutions agree to organise dedicated interinstitutional meetings at the appropriate level with a view to assessing the state of play and outlook for external assigned revenue under the European Union Recovery Instrument. Those meetings will take place at least three times in a financial year soon before or after the budgetary trilogues. Furthermore, the Institutions shall meet on an ad hoc basis if one institution provides a reasoned request. The European Parliament and the Council may at any time present written observations concerning the implementation of external assigned revenue. The Commission undertakes to take due account of any remarks and suggestions made by the European Parliament and by the Council. Those meetings may address significant deviations in European Union Recovery Instrument expenditure, in line with point 46.

46.The Commission shall provide detailed information about any deviation from its initial forecasts prior to a dedicated interinstitutional meeting as referred to in point 45 and on an ad hoc basis in case of a significant deviation. A deviation from forecasted European Union Recovery Instrument expenditure is significant if the expenditure deviates from the forecast for a given financial year and for a given programme by more than 10 %. In case of significant deviations from initial forecasts, the Institutions will discuss the matter, if either the European Parliament or the Council requests to do so within two weeks after notice of such a significant deviation. The Institutions will jointly assess the matter with a view to finding common ground within three weeks of the request for a meeting. The Commission will take utmost account of any comments received. The Commission undertakes not to take any decision until the deliberations have been concluded or the period of three weeks has expired. In the latter case, the Commission shall duly justify its decision. In the event of urgency, the Institutions may agree to shorten the deadlines by one week.

Loans provided under the European Union Recovery Instrument

47.In order to ensure full information as well as transparency and visibility as regards the loan component of the European Union Recovery Instrument, the Commission will provide detailed information about loans provided to Member States under the European Union Recovery Instrument together with its draft estimates, while paying particular attention to sensitive information, which is protected.

48.Information about loans under the European Union Recovery Instrument will be shown in the budget in accordance with the requirements in point (d) of Article 52(1) of the Financial Regulation and will also include the annex referred to in point (iii) of that point.


(1) Regulation (EEC, Euratom) No 1182/71 of the Council of 3 June 1971 determining the rules applicable to periods, dates and time limits (OJ L 124, 8.6.1971, p. 1).

(2) The various steps include: the budget of the current financial year (including adopted amending budgets); the initial draft budget; the Council's position on the draft budget; the European Parliament's amendments to the Council's position and the letters of amendment presented by the Commission (if not yet fully approved by the Institutions).

(3) A budget line deemed technically closed is a line for which there is no disagreement between the European Parliament and the Council, and for which no letter of amendment has been presented.

(4) Where the Commission submits a proposal for an act of the Council under Article 122 TFEU with potential appreciable budgetary implications, the procedure as set out in the joint declaration of the European Parliament, the Council and the Commission of 16 December 2020 on budgetary scrutiny of new proposals based on Article 122 TFEU with potential appreciable implications for the Union budget (OJ C 444, 22.12.2020, p. 5) is applicable.


ANNEX II

INTERINSTITUTIONAL COOPERATION ON A ROADMAP TOWARDS THE INTRODUCTION OF NEW OWN RESOURCES

Preamble

A.The Institutions are committed to sincere and transparent cooperation and the work towards the implementation of a roadmap for the introduction of new own resources over the duration of the MFF 2021-2027.

B.The Institutions recognise the importance of the context of the European Union Recovery Instrument, in which the new own resources should be introduced.

C.For the sole purpose of addressing the consequences of the COVID-19 crisis, the Commission will be empowered, under Article 5(1) of the Own Resources Decision, to borrow funds on capital markets on behalf of the Union up to EUR 750 000 million in 2018 prices, of which up to EUR 390 000 million in 2018 prices may be used for expenditure in accordance with point (b) of Article 5(1) of that Decision.

D.The repayment of the principal of such funds to be used for expenditure under the European Union Recovery Instrument and the related interest due will have to be financed by the general budget of the Union, including by sufficient proceeds from new own resources introduced after 2021. All related liabilities will be fully repaid by 31 December 2058 at the latest as provided for in the second subparagraph of Article 5(2) of the Own Resources Decision. The annual amounts payable will depend on the maturities of the bonds issued and the debt repayment strategy, while respecting the limit for the repayment of the principal of the funds referred to in the third subparagraph of that paragraph set at 7,5 % of the maximum amount to be used for expenditure referred to in point (b) of Article 5(1) of that Decision.

E.The expenditure from the Union budget related to the repayment of the European Union Recovery Instrument should not lead to an undue reduction in programme expenditure or investment instruments under the MFF. It is also desirable to mitigate the increases in the GNI-based own resource for the Member States.

F.Therefore, and in order to enhance the credibility and sustainability of the European Union Recovery Instrument repayment plan, the Institutions will work towards introducing sufficient new own resources with a view to covering an amount corresponding to the expected expenditure related to the repayment. In accordance with the principle of universality, this would not imply an earmarking or assignment of any particular own resource to cover a specific type of expenditure.

G.The Institutions acknowledge that the introduction of a basket of new own resources should support the adequate financing of Union expenditure in the MFF, while reducing the share of national GNI-based contributions in the financing of the Union's annual budget. The diversification of revenue sources in turn could facilitate the attainment of a better focus of expenditure at Union level on priority areas and on common public goods with high efficiency gains compared to national spending.

H.Therefore, new own resources should be aligned with Union policy objectives and should support Union priorities such as the European Green Deal and a Europe fit for the Digital Age, and should contribute to fair taxation and the strengthening of the fight against tax fraud and tax evasion.

I.The Institutions agree that new own resources should preferably be created in a way that allows generating "fresh money". In parallel, they aim at reducing red tape and the burden for companies, especially for small and medium-sized enterprises (SMEs), and for citizens.

J.New own resources should fulfil the criteria of simplicity, transparency, predictability and fairness. The calculation, transfer and control of the new own resources should not lead to an excessive administrative burden for Union institutions and national administrations.

K.Considering the heavy procedural requirements for the introduction of new own resources, the Institutions agree that the necessary reform of the own resources system should be achieved with a limited number of revisions of the Own Resources Decision.

L.The Institutions therefore agree to cooperate during the period 2021-2027 on the basis of the principles set out in this Annex in order to work towards the introduction of new own resources in line with the roadmap set out in Part B and with the dates set out therein.

M.The Institutions also recognise the importance of the tools for Better Law-Making set out in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making (1), in particular of the impact assessment.

Part A.   Principles for the implementation

1.The Commission will make the necessary legislative proposals for new own resources and for potential other new own resources as referred to in point 10 in accordance with Better Law-Making principles. It will in that context take due account of suggestions made by the European Parliament and by the Council. Those legislative proposals will be accompanied by the relevant own resources implementing legislation.

2.The Institutions agree on the following guiding principles for the introduction of a basket of new own resources:
(a)raising an amount through the new own resources that is sufficient to cover the level of overall expected expenditure for the repayment of the principal and the interest of the funds borrowed to be used for expenditure referred to in point (b) of Article 5(1) of the Own Resources Decision, while respecting the principle of universality. Revenue from own resources in excess of the needs for repayment shall continue to fund the Union budget as general revenue in accordance with the principle of universality;

(b)expenditure covering the financing costs of the European Union Recovery Instrument shall aim at not reducing expenditure for Union programmes and funds;

(c)aligning the own resources with the Union priorities, such as the fight against climate change, the circular economy, Europe fit for the Digital Age and contributing to fair taxation and to the strengthening of the fight against tax fraud and tax evasion;

(d)respecting the criteria of simplicity, transparency, and fairness;

(e)ensuring stability and predictability of the revenue flow;

(f)not leading to an excessive administrative burden for Union institutions and national administrations;

(g)preferably generating additional "fresh" revenues;

(h)in parallel, aiming at reducing red tape and the burden for companies, especially for SMEs, and for citizens.

3.The European Parliament and the Council will analyse, discuss and proceed without undue delay with the legislative proposals referred to in point 1 in accordance with their internal procedures with a view to facilitating a swift decision. After the Commission has presented its proposals, members of the European Parliament and representatives of the Council will in the course of their deliberations meet in the presence of the Commission representatives in order to inform each other about the respective state of play. In addition, the Institutions will enter into a regular dialogue to take stock of progress as regards the roadmap.

Part B.   Roadmap towards the introduction of new own resources

First step: 2021

4.As a first step, a new own resource will be introduced to apply as of 1 January 2021 composed of a share of revenues from national contributions calculated on the weight of non-recycled plastic packaging waste as provided for in the Own Resources Decision. That decision is scheduled to enter into force in January 2021, subject to approval by Member States in accordance with their respective constitutional requirements.

5.The Commission will accelerate its work and, following impact assessments launched in 2020, put forward proposals on a carbon border adjustment mechanism and on a digital levy as well as an accompanying proposal to introduce new own resources on that basis by June 2021 with a view to their introduction at the latest by 1 January 2023.

6.The Commission will review the EU Emissions Trading System in spring 2021, including its possible extension to aviation and maritime. It will propose an own resource based on the EU Emissions Trading System by June 2021.

7.The Institutions agree that the carbon border adjustment mechanism and the EU Emissions Trading System are thematically interlinked and that it would therefore be warranted to discuss them in the same spirit.

Second step: 2022 and 2023

8.Following the applicable procedures under the Treaties and subject to approval by Member States in accordance with their respective constitutional requirements, these new own resources are envisaged to be introduced by 1 January 2023.

9.The Council will deliberate on these new own resources by 1 July 2022 at the latest in view of their introduction by 1 January 2023.

Third step: 2024-2026

10.The Commission will, based on impact assessments, propose additional new own resources, which could include a Financial Transaction Tax and a financial contribution linked to the corporate sector or a new common corporate tax base. The Commission shall endeavour to make a proposal by June 2024.

11.Following the applicable procedures under the Treaties and subject to approval by Member States in accordance with their respective constitutional requirements, such additional new own resources are envisaged to be introduced by 1 January 2026.

12.The Council will deliberate on these new own resources by 1 July 2025 at the latest in view of their introduction by 1 January 2026.


(1) Interinstitutional Agreement between the European Parliament, the Council of the European Union and the European Commission of 13 April 2016 on Better Law-Making (OJ L 123, 12.5.2016, p. 1).