Changes from plenary report to adopted text

Removed(25) Reflecting the European Green Deal as Europe’s sustainable growth strategy and the importance of tackling climate and biodiversity objectives in line with the commitments of the Interinstitutional Agreement, the Facility should contribute to the achievement of an overall target of 30 % of Union budget expenditure supporting climate objectives and 7,5 % in 2024 and 10 % in 2026 and 2027 to biodiversity objectives. At least 37 % of the non-repayable financial support, including provisioning, provided to investment projects approved under the Neighbourhood Investment Platform (NIP), one of the regional investment platforms referred to in Article 32 of Regulation (EU) 2021/947, should account to climate objectives. That amount should be calculated using the Rio markers following the obligation to report the EU’s international climate finance to the OECD, as well as other international agreements or frameworks. As early as June 2025, the EU climate coefficients, applicable across all programmes under the 2021-2027 Multi-annual Financing Framework (MFF) and set out in the Commission Staff Working Document entitled ‘Climate Mainstreaming Architecture in the 2021-2027 Multiannual Financial Framework’ (SWD(2022) 225), will also be applied to climate expenditure under the MFF’s Heading 6 (‘Neighbourhood and the world’). The Facility will align with the approach of other Heading 6 instruments, in order to ensure consistent climate reporting in the region. The Facility should support activities that fully respect the climate and environmental standards and priorities of the Union and the principle of ‘do no significant harm’ within the meaning of Article 17 of Regulation (EU) 2020/852 of the European Parliament and of the Council (6).

Removed(26) Projects are approved under the NIP after assessment by the Commission and subject to a positive opinion by the Member States in the NIP Board.

Removed(27) The Commission, in cooperation with the Member States and Moldova, should ensure the compliance, coherence, consistency and complementarity, increased transparency and accountability in the delivery of assistance, including by implementing appropriate internal control systems and anti-fraud policies. The support under the Facility should be made available under the preconditions that Moldova upholds and respects effective democratic mechanisms, including a multi-party parliamentary system, free and fair elections, independent and pluralistic media, an independent judiciary and the rule of law, and to guarantee respect for all human rights obligations, including the effective rights of persons belonging to minorities.

Removed(28) The Facility should be supported with resources from the Neighbourhood, Development and International Cooperation Instrument – Global Europe amounting to EUR 420 million and a maximum amount of EUR 1 500 million in loans for the period from 2025-2027. The amount should cover the 9% provisioning required for the loans corresponding to EUR 135 million, support provided by the Union for projects approved under the NIP, as referred to in Article 18(2), and complementary support, including support to civil society organisations and technical assistance. The non-repayable support should be financed from the envelope allocated to the Neighbourhood geographic programme under Article 6(2), point (a), of Regulation (EU) 2021/947. In order to maximise EU financial support, the 9 % provisioning required for the loans corresponding to EUR 135 million should be covered from the NDICI- Global Europe Emerging challenges and priorities cushion, in line with Articles 6(3) and 17 of Regulation (EU) 2021/947. All provisions under Regulation (EU) 2021/947 should apply unless otherwise mentioned in this Regulation. In particular, Moldova should remain eligible for NDICI regional, thematic and rapid response programmes as well as humanitarian aid. The proposed Facility is closely modelled on the Reform and Growth Facility for the Western Balkans.

Removed(29) Decisions on the release referred to in Article 19(3) for the support in the form of loans should be adopted in the period from 1 January 2025 to 30 June 2029. This final date includes the time necessary for the Commission to evaluate the successful fulfilment of the payment conditions concerned and to adopt the subsequent release decision.

Removed(30) In order to maximise the leverage of Union financial support to attract additional investment, and to ensure Union control over the expenditure, the investments supporting the Reform Agenda should be implemented through the NIP. At least 25% of the loan amount released to Moldova should be made available by Moldova to investment projects approved under the NIP. This is in addition to the non-repayable support provided by the Union for these projects.

Removed(31) The financial liability from loans under the Facility should not constitute part of the amount of the External Action Guarantee within the meaning of Article 31(4) of Regulation (EU) 2021/947 of the European Parliament and of the Council.

Removed(32) Horizontal financial rules adopted by the European Parliament and the Council on the basis of Article 322 of the Treaty on the Functioning of the European Union (TFEU) should apply to this Regulation. Those rules are laid down in Regulation (EU, Euratom) 2024/2509 and determine in particular the procedure for establishing and implementing the budget in direct and indirect management through grants, procurement, financial assistance, blending operations and the reimbursement of external experts, and provide for checks on the responsibility of financial actors.

Removed(33) Restrictions on eligibility in award procedures under the Facility should be provided for, where appropriate, given the specific nature of the activity or when the activity affects security or public order.

Removed(34) In order to ensure the efficient implementation of the Facility, including the facilitation of Moldova’ integration in European value chains, all supplies and materials financed and procured under this Facility should originate from Member States, Moldova, candidate countries and contracting parties to the Agreement on the European Economic Area and countries which provide a level of support to Moldova comparable to the one provided by the Union, taking into account the size of their economy, and for which reciprocal access to external assistance in Moldova is established by the Commission, unless the supplies and materials cannot be sourced under reasonable conditions in any of those countries.

Removed(35) A Facility Agreement should be concluded with Moldova to set up the principles of the financial cooperation between the Union and Moldova, and to specify the necessary mechanisms related to the control, supervision, monitoring, evaluation, reporting and audit of Union funding under the Facility, rules on taxes, duties and charges and measures to prevent, detect, investigate and correct irregularities, fraud, corruption and conflicts of interest. Consequently, a loan agreement should also be concluded with Moldova setting out specific provisions for the management and implementation of funding provided in the forms of loans. Both the Facility Agreement and the loan agreement should be transmitted without delay, simultaneously to the European Parliament and to the Council ▌.

Removed(36) The Facility Agreement should provide the obligation for Moldova to ensure the collection of, and access to data in compliance with Union data protection principles and with applicable data protection rules, adequate data on persons and entities receiving funding, including beneficial ownership information, for the implementation of Reform Agenda.

Removed(37) The implementation of the Facility should be underpinned by a coherent and prioritised set of targeted reforms and investment-related priorities in Moldova (the ‘Reform Agenda’), providing a framework for boosting inclusive sustainable socio-economic growth, clearly articulated and aligned with Union accession requirements and the fundamentals of the enlargement process. The Reform Agenda will serve as an overarching framework to achieve the objectives of the Facility. The Reform Agenda should be prepared in close consultation with relevant stakeholders, including Moldova’s parliament, local and regional authorities, social partners and civil society organisations and their input should be reflected, in accordance with the national legal framework. Disbursement of Union support should be conditional on compliance with the payment conditions and on measurable progress in the implementation of reforms set out in the Reform Agenda assessed and formally approved by the Commission. The release of funds should be structured accordingly, reflecting the objectives of the Facility.

Removed(38) The Reform Agenda should include targeted reform measures and priority investment areas, along with payment conditions in the form of measurable qualitative and quantitative steps that indicate satisfactory progress or completion of those measures, and a timetable for the implementation of those measures. The Reform Agenda should also include a preliminary list of planned investment projects intended for implementation under NIP. Those steps should be planned to be implemented for no later than 31 December 2027, although it should be possible for the overall completion of the measures, to which such steps refer, to extend beyond 2027 but not later than 31 December 2028. The Reform Agenda should include an explanation of Moldova’s system to effectively prevent, detect and correct irregularities, corruption, including high-level corruption, fraud and conflicts of interest, when using the funds provided under the Facility, and the arrangements to avoid double funding from the Facility and other Union programmes as well as other donors.

Removed(39) The Reform Agenda should include an explanation on how the measures are expected to contribute to the climate and environmental objectives and the principle of ‘do no significant harm’, and the digital transformation.

Removed(40) Measures under the Reform Agenda should contribute to improving an efficient public financial management and control system, money laundering, tax avoidance, tax evasion, fraud and organised crime and to an effective system of State aid control, with the aim of ensuring fair conditions for all undertakings.

Removed(41) The Reform Agenda should contain a description of such systems as well as specific steps related to Chapter 32 in order to support Moldova in bringing its audit and controls requirements in line with Union standards. In the event that a request for the release of funds includes a step related to Chapter 32, referred to in Article 19(2), the Commission may not adopt a decision authorizing the release of funds unless it assesses such step positively.

Removed(42) The Facility Agreement should also include indicators for assessing progress towards the achievement of general and specific objectives of the Facility set out in this Regulation. Those indicators should be based on internationally agreed indicators. Indicators should also, to the extent possible, be coherent with the key performance indicators included in Commission Implementing Decision approving the Reform Agendas for the Western Balkans under Regulation (EU) 2024/1449 and in the EFSD+ Results Measurement Framework. The indicators should be relevant, accepted, credible, easy, and robust.

Removed(43) The Commission should assess the Reform Agenda based on the list of criteria set out in this Regulation. In order to ensure uniform conditions for the implementation of this Regulation, implementing powers should be conferred on the Commission to approve the Reform Agenda. The Commission will duly take into account Council decision 2010/427/EU (11) and the role of the European External Action Service (EEAS), where appropriate.

Removed(44) The work programme within the meaning of Article 110(2) of Regulation (EU, Euratom) 2024/2509 adopted in accordance with the relevant provisions of Regulation (EU) 2021/947 should cover the amounts funded from the envelope allocated to the Neighbourhood geographic programme under Article 6(2), point (a), of Regulation (EU) 2021/947.

Removed(45) Given the need for flexibility in the implementation of the Facility, it should be possible for Moldova to make a reasoned request to the Commission to amend the implementing decision, where the Reform Agenda, including relevant payment conditions, is no longer achievable, either partially or totally, because of objective circumstances. Moldova should be able to make a reasoned request to amend the Reform Agenda, including by proposing addenda, where relevant. The Commission should be able to amend the implementing decision.

Removed(46) The Facility Agreement should provide the obligation for Moldova to ensure the collection of, and access to data in compliance with Union data protection principles and with applicable data protection rules, adequate data on persons and entities receiving funding, including beneficial ownership information, for the implementation of the Reform Agenda. Financial support for the Reform Agenda should be possible in the form of a loan. In the context of Moldova’s financing needs, it is appropriate to organise the financial assistance under the diversified funding strategy provided for in Article 224of Regulation (EU, Euratom) 2024/2509 and established as a single funding method therein, which is expected to enhance the liquidity of Union bonds and the attractiveness and cost-effectiveness of Union issuance.

Removed(47) It is appropriate to provide loans to Moldova on highly concessional terms with a maximum duration of 40 years and to not start the repayment of the principal before 2034.

Removed(48) Considering that the financial risks associated with the support to Moldova in the form of loans under the Facility is comparable to the financial risks associated with lending operations under Regulation (EU) 2021/947, provisioning for the financial liability from loans under this Regulation should be constituted at the rate of 9 %, in line with Article 214 of Regulation (EU, Euratom) 2024/2509 and the funding of the provisioning should be sourced from the emerging challenges and priorities cushion under Article 6(3) of Regulation (EU) 2021/947.

Removed(49) In order to ensure that Moldova disposes of start-up funding for the implementation of the first reforms, it should have access to up to 20 % of the total amount provided for in this Facility, after deduction of complementary support, including support to civil society organisations and technical assistance, and provisioning for loans, in the form of a pre-financing, subject to availability of funding and to the respect of the preconditions for support under the Facility.

Removed(50) It is important to guarantee both flexibility and programmability in providing Union support to Moldova. Moldova should submit on a six-monthly basis a duly justified request for the release of funds at the latest two months after the timeline for the planned fulfilment of steps, set in the Commission Implementing Decision approving the Reform Agenda. For that purpose, funds under the Facility should be released according to a fixed semi-annual schedule, subject to availability of funding, on the basis of a request for the release of funds submitted by Moldova and following verification by the Commission of the satisfactory fulfilment of both the general conditions related to macro-financial stability, sound public financial management, transparency and oversight of the budget and the relevant payment conditions. Where a payment condition is not fulfilled as per the indicative timeline set in the decision approving the Reform Agenda, the Commission could withhold in whole or in part the release of funds corresponding to that condition, following a methodology on partial payments. The release of the corresponding withheld funds could take place during the next window for the release of funds and up to twelve months after the original deadline set out in the indicative timeline, provided that the payment conditions have been fulfilled. In the first year of implementation, that deadline should be extended to 24 months from the initial negative assessment.

Removed(51) By way of derogation from Article 116(2) and (5) of the Financial Regulation, it is appropriate to set the payment deadline for contributions to state budgets starting from the date of the communication of the decision authorising the disbursement to Moldova and to exclude the payment of default interest by the Commission to Moldova.

Removed(52) The Commission should provide▌ the European Parliament in the framework of the discharge procedure with detailed information about the implementation of the Union budget under the Facility, in particular as regards audits carried out, including weaknesses identified and corrective measures taken, and as regards projects approved under NIP, including where applicable the amount of Moldova’s co-financing as well as other sources of contributions including from other Union financing instruments.

Removed(53) In the framework of the Union’s restrictive measures, adopted on the basis of Article 29 TEU and Article 215 TFEU, no funds or economic resources may be made available, directly or indirectly, to or for the benefit of designated legal persons, entities or bodies. Such designated entities, and entities owned or controlled by them, therefore should not be supported by the Facility.

Removed(54) In the interest of transparency and accountability, Moldova should publish data on final recipients receiving amounts of funding exceeding the equivalent of EUR 50 000 cumulatively during the implementation of reforms and investments under this Facility.

Removed(55) In accordance with Regulation (EU, Euratom) 2024/2509, Regulation (EU, Euratom) 883/2013 of the European Parliament and of the Council (13) and Council Regulations (EC, Euratom) No 2988/95 (14), (Euratom, EC) No 2185/96 (15) and (EU) 2017/1939 (16), the financial interests of the Union are to be protected by means of proportionate measures, including measures relating to the prevention, detection, correction and investigation of irregularities, fraud, corruption, conflicts of interest, double funding, to the recovery of funds lost, wrongly paid or incorrectly used.

Removed(56) In particular, in accordance with regulations (Euratom, EC) No 2185/96 and (EU, Euratom) 883/2013, the European Anti-Fraud Office (OLAF) should be in a position to carry out administrative investigations, including on-the-spot checks and inspections, with a view to establishing whether there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union.

Removed(57) In accordance with Article 129 of Regulation (EU, Euratom) 2024/2509, the necessary rights and access should be granted to the Commission, OLAF, the Court of Auditors and, where applicable the European Public Prosecutor’s Office (EPPO), including by third parties involved in the implementation of Union funds.

Removed(58) The Commission should ensure that the financial interests of the Union are effectively protected under the Facility. Considering the long track record of financial assistance provided to Moldova also under indirect management and taking into account its gradual alignment with the Unions internal control standards and practices, the Commission should rely to a great extent on the operation of Moldova’s internal control and fraud prevention systems. In particular, the Commission and OLAF and, where applicable, the EPPO should be informed of all suspected cases of irregularities, fraud, corruption and conflicts of interest affecting the implementation of funds under the Facility without delay.

Removed(59) Furthermore, Moldova should report the irregularities including fraud which have been the subject of a primary administrative or judicial finding, without delay, to the Commission and keep it informed of the progress of administrative and legal proceedings. With the objective of alignment to good practices in Member States, this reporting should be done by electronic means, using the Irregularity Management System, established by the Commission.

Removed(60) Moldova should establish a monitoring system feeding into a semi-annual report on the fulfilment of its Reform Agenda’s payment conditions accompanying the semi-annual request for the release of funds. Moldova should collect and provide access to data and information allowing the prevention, detection and correction of irregularities, fraud, corruption and conflicts of interest, in relation to the measures supported by the Facility.

Removed(61) The Commission should ensure that clear monitoring and independent evaluation mechanisms are in place in order to provide effective accountability and transparency in implementing the Union budget, and to ensure effective assessment of progress towards the achievement of the objectives of this Regulation.

Removed(62) The Commission should provide an annual report to the European Parliament and the Council on progress towards the achievement of the objectives of this Regulation.

Removed(63) The Commission should carry out an evaluation of the Facility upon its completion.

Removed(64) Moldova should support free pluralistic media that enhance and promote the understanding of Union values and the benefits and obligations of potential Union membership, while undertaking decisive actions in terms of tackling Foreign Information Manipulation and Interference. They should also ensure pro-active, clear and consistent public communication, including on the Union support. The recipients of Union funding should actively acknowledge the origin and ensure visibility of the Union funding, in line with the Communication and Visibility Manual for EU External Actions.

Removed(65) Implementation of the Facility should also be accompanied by enhanced strategic communication and public diplomacy to promote the values of the Union and highlight the added value of the Union’s support.

Removed(66) Since the objectives of this Regulation cannot be sufficiently achieved by the Member States, but can rather be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the TEU. In accordance with the principle of proportionality as set out in that Article, this Regulation does not go beyond what is necessary to achieve those objectives.

Removed(67) In order to provide funding for Moldova in due time without further delay, this Regulation should enter into force on the day following that of its publication in the Official Journal of the European Union,

RemovedHAVE ADOPTED THIS REGULATION:

RemovedGeneral Provisions

RemovedSubject matter

Removed1. This Regulation establishes the Reform and Growth Facility for Moldova for the period 2025-2027 (the ‘Facility’).

Removed2. The Regulation shall provide assistance to Moldova for the delivery of EU-related reforms, in particular inclusive and sustainable socio-economic reforms and reforms concerning fundamentals of the enlargement process, aligned with Union values, as well as investments to implement Moldova’s Reform Agenda.

Removed3. The rules set out in Regulation (EU) 2021/947 shall apply to the implementation of the Facility, unless specified otherwise in this Regulation.

RemovedDefinitions

RemovedFor the purposes of this Regulation, the following definitions apply:

Removed(1) ‘Moldova’ means the Republic of Moldova.

Removed(2) ‘Facility Agreement’ means an arrangement concluded between the Commission and Moldova laying down the principles for the financial cooperation between Moldova and the Commission under this Regulation; this arrangement constitutes a financing agreement within the meaning of Article 114(2) of Regulation (EU, Euratom) 2024/2509 ;

Removed(3) ‘enlargement policy framework’ means the overall policy framework for the implementation of this Regulation as defined by the European Council and the Council, and includes the revised enlargement methodology, agreements that establish a legally binding relationship with Moldova, the negotiating frameworks governing accession negotiations with candidates, where applicable, as well as resolutions of the European Parliament, relevant communications from the Commission, including, where applicable, on the rule of law, and joint communications from the Commission and the High Representative of the Union for Foreign Affairs and Security Policy

Removed(4) ‘loan agreement’ means an agreement concluded between the Union and Moldova laying down the terms of the loan support under the Facility;

Removed(5) ‘Reform Agenda’ means a comprehensive, coherent and prioritised set of targeted reforms and priority investment areas in Moldova, including payment conditions that indicate satisfactory progress or completion of related measures, and an indicative timetable for their implementation;

Removed(6) ‘measures’ means reforms and investments as set out in the Reform Agenda under Chapter III;

Removed(7) ‘payment conditions’ means conditions for the release of funds that take the form of observable and measurable qualitative or quantitative steps to be implemented by Moldova, as set out in the Reform Agenda under Chapter III;

Removed(8) ‘blending operation’ means an operation supported by the Union budget that combines non-repayable forms of support from the Union budget with repayable forms of support from development or other public financial institutions, including export credit agencies, or from commercial finance institutions and investors;

Removed(9) ‘final recipient’ means a person or entity receiving funding under the Facility; for the part of the funding that is made available as financial assistance, final recipient will be the treasury of Moldova; for the part of the funding that is made available through the Neighbourhood Investment Platform, final recipient will be the contractor or sub-contractor implementing the investment project;