Decision 1998/501 - 98/501/EC, Euratom: Commission Decision of 24 July 1998 concerning certain specific transactions identified within the work on the protocol of the Excessive Deficit Procedure, for the application of Article 1 of Council Directive 89/130/EEC, Euratom on the harmonisation of the compilation of gross national product at market prices (notified under document number C(1998) 2204) - Main contents

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98/501/EC, Euratom: Commission Decision of 24 July 1998 concerning certain specific transactions identified within the work on the protocol of the Excessive Deficit Procedure, for the application of Article 1 of Council Directive 89/130/EEC, Euratom on the harmonisation of the compilation of gross national product at market prices (notified under document number C(1998) 2204) (Text with EEA relevance)

Official Journal L 225 , 12/08/1998 P. 0029 - 0032

COMMISSION DECISION of 24 July 1998 concerning certain specific transactions identified within the work on the protocol of the Excessive Deficit Procedure, for the application of Article 1 of Council Directive 89/130/EEC, Euratom on the harmonisation of the compilation of gross national product at market prices (notified under document number C(1998) 2204) (Text with EEA relevance) (98/501/EC, Euratom)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Community,

Having regard to the Treaty establishing the European Atomic Energy Community,

Having regard to Council Directive 89/130/EEC, Euratom of 13 February 1989 on the harmonisation of the compilation of gross national product at market prices (1) and, in particular, Article 1 thereof,

Whereas the definition of gross domestic product at market prices provided for in Article 2 of Council Regulation (EC) No 3605/93 of 22 November 1993 on the application of the protocol on the Excessive Deficit Procedure (2) as annexed to the Treaty establishing the European Community refers to the definition of Article 2 of Directive 89/130/EEC, Euratom;

Whereas, for the verification of the statistical data which it has to present under the protocol on the Excessive Deficit Procedure, the Commission is informed about and must assess certain specific transactions which have an impact on GDP or GNP;

Whereas, in order to apply Articles 2 and 6 of Regulation (EC) 3605/93 on the application of the protocol on the Excessive Deficit Procedure, it is therefore necessary to clarify and to complete certain rules of the ESA second edition concerning the aforementioned specific transactions, under the framework on the definition on GNPmp provided for in Article 1 of Directive 89/130/EEC, Euratom;

Whereas the measures provided for in this Decision are in accordance with the opinion of the Committee established by Article 6 of Directive 89/130/EEC, Euratom,

HAS ADOPTED THIS DECISION:

Article 1

In order to apply Article 1 of Directive 89/130/EEC, Euratom, the specific transactions which have an impact on GDP or GNP, and which have been identified before 31 December 1997, and the accounting methods which the Member States shall apply to these transactions under ESA second edition, are listed in the Annex.

Article 2

Member States shall revise their GDP and GNP estimates for the years 1994 onwards in order to take account of the accounting methods stated in Article 1.

Article 3

This Decision is addressed to the Member States.

Done at Brussels, 24 July 1998.

For the Commission

Yves-Thibault DE SILGUY

Member of the Commission

• (1) 

  OJ L 49, 21. 2. 1989, p. 26.

• (2) 

  OJ L 332, 31. 12. 1993, p. 7.

ANNEX

• I. 

  The treatment of interest in the case of deep discounted bonds and zero coupon bonds

• 1. 

  'Conventional` bonds

ESA 79 (paragraph 706) indicates the treatment of the difference between the issue price and the nominal value for bonds that can be qualified as 'conventional` (those for which this difference is small):

• - 

  for short term bonds, the difference between the issue price and the nominal value is to be regarded as interest recorded at the issuance of the bonds; this difference has therefore an impact on government deficit,

• - 

  for medium and long term bonds, the difference between the issue price and the nominal value is not to be regarded as interest but as...

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