Changes from plenary report to adopted text

RemovedMr Johan Van Overtveldt

RemovedChair

RemovedCommittee on Budgets

RemovedBRUSSELS

RemovedSubject: Opinion on the Regulation establishing the Ukraine Facility (COM(2023)0338 – C9-0210/2023 – 2023/0200(COD))

RemovedDear Chairs,

RemovedUnder the procedure referred to above, the Committee on Budgetary Control has been asked to submit an opinion to the Committee on Foreign Affairs and to the Committee on Budgets. At its meeting of 18 July 2023, the committee decided to send the opinion in the form of a letter. It considered the matter at its meeting of 4 September 2023 and adopted the opinion at that meeting.

RemovedThe opinion consists of the following amendments, which, in accordance with the usual treatment of opinions under Rule 56, I kindly ask you to put to the vote during the vote on the report in your committees:

RemovedCONT 1

RemovedRecital 88

RemovedIn particular, in accordance with Regulations (Euratom, EC) No 2185/96 and (EU, Euratom) No 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. OLAF should be provided with sufficient administrative capacities to conduct these investigations.

RemovedCONT 2

RemovedRecital 89

RemovedIn accordance with Regulation (EU, Euratom) 2018/1046, the necessary rights and access should be granted to the Commission, OLAF, the European Court of Auditors and, where applicable, the European Public Prosecutor’s Office (EPPO) where relevant, including from third parties involved in the implementation of Union funds. Ukraine should also use the Early Detection and Exclusion System and report irregularities in relation to the use of the funds to the Commission.

RemovedCONT 3

RemovedRecital 90

RemovedThe reinforcement of internal control systems, the fight against corruption, the promotion of transparency, good administration, (and) efficient public financial management, and verification by an independent external auditor are important reform priorities for Ukraine and should be supported by the Facility.

RemovedCONT 4

RemovedRecital 91

RemovedThe Commission should ensure that the financial interests of the Union are effectively protected under the Facility. To this end, an independent Audit Board should be set up to provide the Commission with information on possible mismanagement of funds and guarantee that the correct level of assurance is obtained through an independent external audit. Such information should be made available to OLAF and where appropriate to the relevant Ukrainian authorities. The Commission, with the assistance of the Union delegation, should be entitled to perform checks on how Ukraine implements funds along the whole project life cycle. The Audit Board should ensure regular dialogue and cooperation with the European Court of Auditors.

RemovedCONT 5

RemovedArticle 9 - Paragraph 1

RemovedThe Commission shall conclude a framework agreement with Ukraine for the implementation of the Facility setting out specific arrangements for the management, control, supervision, monitoring, evaluation, reporting and audit of funds under the Facility, as well as to prevent, detect, investigate and correct irregularities, fraud, corruption and conflicts of interest. The framework agreement shall be complemented by financing agreements in accordance with Article 10 and loan agreements in accordance with Article 21, setting out specific provisions for the management and implementation of funding under the Facility.

RemovedCONT 6

RemovedArticle 9 - Paragraph 4 (a)

Removedthe commitment of Ukraine to progress towards more efficient and effective control systems, and to strengthen the fight against money laundering, terrorism financing, tax avoidance, tax fraud or tax evasion, misuse of public funds and corruption;

RemovedCONT 7

RemovedArticle 16 - Paragraph 2 (h)

Removedan explanation of Ukraine’s system to effectively prevent, detect and correct irregularities, fraud, corruption and conflicts of interests, when using the funds provided under the Facility, and of the arrangements (that aim) to avoid double funding from the Facility and other Union programmes or donors;

RemovedCONT 8

RemovedArticle 16 - Paragraph 2 (h) new

Removedan explanation how Ukraine shall ensure an adequate level of protection of the EU financial interests by applying at least the same standards as provided for in the Financial Regulation and other related EU legislation;

RemovedCONT 9

RemovedArticle 26 Paragraph 1

RemovedUkraine shall publish data on persons and entities that receive(ing) amounts of funding exceeding the equivalent of EUR (500 000) 300 000 for the implementation of reforms and investments specified in the Ukraine Plan referred to in this Chapter. Ukraine shall update those data twice a year, in June and December.

RemovedCONT 10

RemovedArticle 32 - Paragraph 4

RemovedAssistance under this Chapter shall support the creation and strengthening of Ukrainian authorities responsible for ensuring appropriate use of funds, audit and effective fight against mismanagement of public funding, in particular fraud, corruption, conflict of interests and irregularities incurred in relation to any amount spent to achieve the objectives of the Facility.

RemovedCONT 11

RemovedArticle 33 - Paragraph 2 (b)

Removedto take appropriate measures to prevent, detect and correct fraud, corruption, conflicts of interests and irregularities affecting the financial interests of the Union, to detect and avoid double funding and to take legal actions to recover funds that have been misappropriated, including in relation to any measure for the implementation of reforms and investment projects under the Ukraine Plan;

RemovedCONT 12

RemovedArticle 33 - Paragraph 2 (c)

Removedto accompany a request for payment as set out in Chapter III by a declaration that the funds were used in accordance with the principle of sound financial management and for their intended purpose and managed appropriately in particular in accordance with Ukrainian rules complemented by international standards, on prevention, detection and correction of irregularities, fraud, corruption and conflicts of interests, accompanied by a declaration of assurance by the Ukrainian authorities;

RemovedCONT 13

RemovedArticle 33 - Paragraph 2 (c) new

Removedto use the Early Detection and Exclusion System;

RemovedCONT 14

RemovedArticle 33 - Paragraph 2 (e) new

Removedto provide a similar level of access to information and authority to carry out on-the-spot controls as the Commission and the Court of Auditors to the independent external auditor appointed by the Audit Board;

RemovedCONT 15

RemovedArticle 33 - Paragraph 3

RemovedThe Commission shall (strive to) make available to Ukraine an integrated and interoperable information and monitoring system including a single data-mining and risk-scoring tool to access and analyse the relevant data, including the data listed in paragraph 2(d). Where such a system is available, Ukraine shall use and feed the relevant data into the system, including with support referred to under Chapter V. Data shall be inserted in English to allow the Commission and other audit authorities to fulfil their duties without undue delay. The system shall allow for downloads in a machine-readable format.

RemovedCONT 16

RemovedArticle 34 - Paragraph 3 a new

Removedthe Audit Board shall appoint an independent external auditor that provides an annual statement of assurance on the declarations by the Ukrainian authorities that accompany a request for payment. It shall also approve the annual work plan of the independent external auditor;

RemovedCONT 17

RemovedArticle 34 - Paragraph 3 b new

Removedthe Audit Board shall decide on recommendations to the Commission and the Ukrainian authorities on amounts to be recovered following the findings of the independent external auditor, and inform the Commission and the Ukrainian authorities of these recommendations;

RemovedCONT 18

RemovedArticle 34 - Paragraph 7

RemovedFor that purpose, the Audit Board shall regularly report to the Commission, and the relevant committees of the Council and Parliament, and transmit to the Commission without delay any information it obtains or is made aware of, on any identified cases of, or serious concerns in relation to, mismanagement of public funding incurred in relation with any amount spent to achieve the objectives of the Facility, including its performance.

RemovedIn addition, the Audit Board shall adopt recommendations to Ukraine on all cases where in its views competent Ukrainian authorities have not taken the necessary steps to prevent, detect and correct fraud, corruption, conflict of interests and irregularities that have affected or seriously risk affecting the sound financial management of the expenditure financed under the Facility and in all cases where it identifies weaknesses affecting the design and functioning of the control system put in place by Ukrainian authorities. A summary of the recommendation shall be published by the Audit Board. Ukraine shall implement such recommendations, or provide a justification on why it has not done so. The information provided by the Ukrainian authorities on the recommendations shall also be published by the Audit Board.

RemovedThe reports of, and information from, the Audit Board shall also be sent to OLAF and may be shared with the relevant Ukrainian authorities, especially in case they need to take steps to prevent, detect and correct fraud, corruption, conflict of interests and irregularities.

RemovedCONT 19

RemovedArticle 34 - Paragraph 10

RemovedThe functioning of the Audit Board shall be funded under Chapter V, including the funding for the appointed independent external auditor.

RemovedYours sincerely,

RemovedMonika Hohlmeier

Removed28.8.2023

RemovedLETTER OF THE COMMITTEE ON AGRICULTURE AND RURAL DEVELOPMENT

RemovedMr David McAllister,

RemovedChair

RemovedCommittee on Foreign Affairs

RemovedMr Johan Van Overtveldt

RemovedChair

RemovedCommittee on Budgets

RemovedIPOL-COM-AGRI D(2023) 30046

RemovedSubject: Opinion on the proposal for a Regulation of the European Parliament and of the Council on establishing the Ukraine Facility (2023/0200 (COD))

RemovedDear Chairs,

RemovedUnder the procedure referred to above, the Committee on Agriculture and Rural development (AGRI) has decided to submit an opinion under Rule 56 to your committees.

RemovedAGRI Coordinators, by written procedure, agreed on XX, on a basic proposal. This was put to vote on XX in Committee AGRI with the following outcome:

RemovedMembers took note that this regulation directly affects the agricultural sector and rural development of Ukraine and indirectly affects the global agri-food chains, as Ukraine is one of the world’s top agricultural producers and exporters and plays a critical role in providing food commodities such as grains and oilseeds to the global market. These products are Ukraine’s most important exports, accounting for 41 percent of the country’s overall exports. In addition, more than 55 percent of Ukraine’s land area is arable land. Agriculture provides employment for 14 percent of Ukraine’s population. It is thus clear, that Ukraine’s recovery and reconstruction cannot be successful without a competitive and productive agriculture sector and dynamic rural development.

RemovedTherefore, AGRI committee wishes to make the following recommendations as regards the proposed Facility:

Removed• Ukraine Plan

RemovedThe Plan underpinning the new Facility that will be elaborated by the Ukrainian Government must include an adequate part on agriculture and rural development, outlining needs and requirements in order to deliver the crucial contribution of this sector to the recovery of the Ukrainian economy and society.

Removed• Content of the Plan

RemovedThe Plan must include sector-specific conditionality’s and a timeline, which are essential requirements to protect the financial interests of the Union, to provide clarity for public and private investments decisions as well as to ensure that the part on agriculture benefits the whole Ukrainian society and global food security. They must take into consideration the requirements of the National Strategic Plans as part of the Common Agriculture Policy (CAP) in order to allow for consistency with EU policies with a view to European integration of Ukraine. When assessing the Plan, the Commission must take proper account of its impact on the European agricultural sector and on EU farmers and not lead to their disadvantage.

Removed• Governance

RemovedWhere appropriate and possible, the Plan needs to correspond to the existing Governance structures in the CAP such as Management authorities and Paying Agencies in order to ensure that the appropriate methodology and processes are put into place with a view to EU integration.

Removed• Standards

RemovedIn line with the objectives of the Facility, the Plan must support the convergence towards EU standards notably in agriculture and food sector such as environmental and social requirements, geographical indications, food, feed and plant and phyto-sanitary safety as well as animal health and welfare requirements. Furthermore, it is crucial to ensure that Ukraine fully respect the EU social and environmental standards of production.

Removed• Support

RemovedThe Plan must also cover technical assistance and potential twinning arrangements, which are crucial for the agriculture sector to re-establish its full production capacity under the continuing difficult circumstances.

Removed• Reforms

RemovedFinally, again in line with the stated objectives of the Facility, the plan must refer to the relevant structural and legislative reforms necessary for EU integration and eventual accession, including in the agricultural and food sector. In this context, the transition towards a green, digital and inclusive economy that is progressively aligned with EU rules and standards will also demand an active contribution from the agriculture sector.

RemovedAs AGRI committee Chair, I would like to ask the AFET and BUDG committees to take due account of this opinion in the form of a letter in its reports on the proposed regulation to establish the Ukraine Facility.

RemovedYours sincerely,

RemovedNorbert Lins