On the proposal for a regulation of the European Parliament and of the Council establishing the Single Market and Customs Programme for the period… 2028-2034 and repealing Regulations (EU) 2021/444, (EU) 2021/690, (EU) 2021/785, (EU) 2021/847 and (EU) 2021/1077

for the Committee on the Internal Market and Consumer Protection on the proposal for a regulation of the European Parliament and of the Council establishing the Single Market and Customs Programme for the period 2028-2034 and repealing Regulations (EU) 2021/444, (EU) 2021/690, (EU) 2021/785, (EU) 2021/847 and (EU) 2021/1077

(COM(2025)0590 – C100198/2025 – 2025/0590(COD))

The Committee on Budgets has carried out a budgetary assessment of the proposal under Rule 58 of the Rules of Procedure and has reached the following conclusions:

The Committee on Budgets,

A.whereas the proposal brings together parts of five separate programmes existing under the current multiannual financial framework (MFF), creating therefore a single envelope in the area of the single market, customs, taxation and anti-fraud;

B.whereas in the current geopolitical context, removing barriers and reducing fragmentation is essential to unlocking new opportunities of growth across the economies of the Union and its Member States;

C.whereas the absence of indicative sub-envelopes in the single market and customs programme’s (SMCP) budgetary architecture affords the Commission a degree of discretion over spending priorities during implementation that is incompatible with the principle of sound financial management and with the prerogatives of the budgetary authority; whereas the establishment of transparent sub-allocations per programme strand is a prerequisite for effective parliamentary scrutiny and accountability;

D.whereas customs duties constitute a traditional own resource of the Union, and the effective functioning of customs authorities is therefore directly linked to the protection of the Union budget; whereas the proliferation of low-value consignments from third countries, often misclassified or undervalued, represents a direct threat to Union budget revenues, compounded by the exponential growth of e-commerce which has substantially increased the volume and complexity of customs operations without a commensurate increase in the resources allocated to customs authorities under the current MFF;

E.whereas the presence of low-cost imported goods from third countries, frequently placed on the Union market in non-compliance with Union safety, environmental, labelling and consumer protection standards, creates unfair competitive conditions for small and medium-sized enterprises (SMEs) based in the EU that bear the full cost of regulatory compliance; whereas the programme should contribute to addressing this asymmetry through strengthened market surveillance and customs enforcement at the Union’s external borders;

F.whereas the rapid growth of e-commerce has significantly increased low-value imports, creating substantial challenges for the competitive position of Union businesses and for customs and market surveillance authorities in ensuring compliance with Union standards; whereas the EU Customs Reform introduced a Union handling fee per parcel in order to tackle high e-commerce volumes, applicable from July 2026;

G.whereas the European Court of Auditors delivered its Opinion 08/2026;

H.whereas the European Economic and Social Committee delivered its Opinion INT/1104;

I.whereas the 2026 Annual Single Market and Competitiveness Report noted that only 20.6 % of single market procedures are fully available online for cross-border users, imposing an unnecessary administrative burden on citizens, entrepreneurs and businesses, in particular micro-companies and SMEs, and limiting their ability to fully benefit from the single market;

1.Considers that the programme envelope should be increased from EUR 6.2 billion (EUR 5.5 billion in 2025 prices) to EUR 6.9 billion (EUR 6.1 billion in 2025 prices), in order to deepen the single market while promoting convergence, strengthen the capacity of customs and market surveillance authorities, and protect the safety, security, and financial and economic interests of the Union and its Member States;

2.Considers that sufficient resources, including human, technical and IT resources, must be available from the outset and throughout the entire programming period of the 2028-2034 MFF to ensure an effective implementation of the SMCP, while ensuring that existing resources are used efficiently and avoiding unnecessary administrative burdens; underlines that customs authorities must be equipped with the digital tools, risk-profiling capacities and inter-agency coordination mechanisms necessary to detect and intercept non-compliant consignments at scale, including through the development and deployment of data analytics models and artificial intelligence-based risk assessment systems, as well as to ensure interoperability between national databases;

3.Stresses that the growth of e-commerce has resulted in a significant workload increase for customs authorities, which must therefore be provided with appropriate resources to carry out their functions; recalls that the new European Customs Authority Agency will be established in order to support and coordinate the work of national customs authorities; underlines that customs duties constitute a traditional own resource of the Union and that customs authorities therefore serve the interest of the Union as a whole;

4.Considers that, while some degree of flexibility would enable timely adjustment to evolving spending priorities, above all in view of the on-going review of the EU’s customs code and the EU anti-fraud architecture, predictability and internal safeguards should be ensured in particular for mandatory programme functions; strongly deplores the lack of breakdown of the budget of SMCP; notes that this would give the Commission great latitude to shift and decide on spending priorities during implementation; expresses concern that the overly aggregated budgetary architecture would substantially facilitate transfers not subject to budgetary authority decisions; stresses that simplification and flexibility must not come at the expense of transparency and oversight of the budgetary authority; further regrets that the impact assessment accompanying the proposal does not sufficiently analyse how flexibility mechanisms should be prioritised or balanced across strands with differing operational needs, cost structures and implementation horizons; strongly recommends, therefore, that the basic act include indicative sub-envelopes for core programme functions, and that decision-making criteria and documentation requirements governing the use of carry-overs, external assigned revenue and cumulative funding under Articles 4 to 6 are defined;

5.Stresses, in particular, that flexibility must not jeopardise the continuity of mandatory programme functions, which require predictable long-term investment, namely customs IT systems, taxation IT systems, the Anti-Fraud Information System, the Irregularity Management System and European statistics, and underlines the importance of introducing prioritisation safeguards in the basic act to ensure that these systems are adequately protected in the context of internal reallocations during annual programming;

6.Recalls that the budgetary nomenclature must be established in line with Article 47(2) of Regulation (EU, Euratom) 2024/2509 (the Financial Regulation), which provides that each title must correspond to a policy area and each chapter, as a rule, to a programme or an activity, in line with the principles of specification, sound financial management and transparency; considers, therefore, that the basic act should include a budgetary nomenclature that adequately reflects the sub-envelopes established in the basic act, with reference amounts for specific objectives; recommends that the Committee on the Internal Market and Consumer Protection amend the proposal to include an annex defining the nomenclature of the programme; insists that the budgetary nomenclature forms an integral part of Parliament’s negotiating position and must be discussed in interinstitutional negotiations; considers, in this regard, that the revised Legislative Financial and Digital Statement (LFDS) must form part of the final political agreement;

7.Deplores the lack of a sufficiently detailed indicative budgetary nomenclature proposed in the LFDS; considers that this will hamper the budgetary authority’s ability to steer accurately policy priorities in the annual budgetary procedure; expresses concerns that the overly aggregated budgetary architecture would dramatically increase the Commission’s discretion in transferring and reallocating resources without a decision from the budgetary authority, and would severely limit parliamentary oversight; recommends, therefore, a more detailed nomenclature that properly reflects the objectives and structure of SMCP and enhances transparency, accountability and parliamentary control;

8.Insists that sufficiently detailed and sound legislation, with an appropriate level of governance, is a condition for proper budgetary decision-making and adequate parliamentary oversight during budget implementation; recommends introducing provisions to strengthen control over how the budget is mobilised and spent; considers that the so-called steering mechanism can in no way be a substitute for Parliament’s legislative and budgetary powers, and cannot be conceived without a sound governance architecture that ensures the effective exercise of such powers;

9.Believes that all substantive policy choices such as programme objectives, spending priorities, financial allocations, funding rates, eligibility, selection and award criteria, conditions, definitions and calculation methods must be determined in the basic act, with full respect for Parliament’s prerogatives as a co-legislator and one arm of the EU’s budgetary authority, and that any non-essential elements entailing policy choices that are not included in the basic act must be adopted through delegated acts, including work programmes, where appropriate;

10.Underlines that, given the diversity of activities covered by SMCP, consolidation into a single framework will require an appropriate level of governance, a coherent prioritisation system, transparent resource allocation and robust monitoring and evaluation mechanisms, thereby ensuring efficient resource use and avoiding duplication and unnecessary complexity; stresses, with a view to reducing the administrative burden, the importance of modernising and standardising digital infrastructure and ensuring the practical usability of Union-level digital tools for administrations and economic operators across all Member States, as well as for enforcement-related activities, in order to ensure that goods placed on the Union market comply with applicable Union safety, environmental and consumer protection rules;

11.Takes note of the suggested complementarity between SMCP and other programmes such as National and Regional Partnership Plans, the European Competitiveness Fund, Horizon Europe, the Connecting Europe Facility and Global Europe; highlights that while synergies and coordination between programmes are important, their governance structures must preserve their distinct objectives, legal basis and decision-making autonomy; emphasises, in this context, that SMCP should retain its specific focus on the proper functioning and enforcement of the single market and should not be driven by broader competitiveness objectives; stresses that enhanced complementarity between instruments must not come at the expense of traceability of expenditure or the prerogatives of the budgetary authority nor lead to double funding; underlines that the contribution of SMCP to operations financed jointly with other instruments must be explicitly identifiable at all stages of the budgetary cycle; stresses, in this regard, that any such contribution must be duly reflected in the programme performance statement for the SMCP programme; notes, in particular, that programmes supporting digital infrastructure, customs cooperation and product compliance databases should be coordinated with other Union instruments to maximise the effectiveness of enforcement across the single market without undermining the transparency of these financial actions and of other Union programmes; insists that the budgetary authority retain full control over how resources are combined across instruments and over the effective contribution of each programme to EU priorities, specifically through detailed budgetary nomenclature; stresses that enhanced complementarity between programmes must not lead to disproportionate complexity for beneficiaries; calls for EU funding to be clearer, more accessible and more coherent in order to facilitate uptake and maximise the impact of investments;

12.Calls for the programme to support simplified procedures and practical digital tools, in particular those designed to reduce cross-border compliance costs, that enable SMEs to operate more easily across the single market and reduce the burden created by fragmentation and administrative complexity;

13.Recommends the lead committee to ensure that entities participating in actions involving the development, deployment or use of IT systems and digital tools under this programme retain full control over critical infrastructures and data to protect the financial interests of the Union; stresses the importance of relying on the use of open standards, ensuring transparency of software components, and safeguarding against strategic dependencies on third-country providers;

14.Stresses that the use of external assigned revenue under SMCP must be clearly circumscribed, fully transparent and subject to effective parliamentary scrutiny, while fully respecting the prerogatives of the budgetary authority; takes note, in that regard, of the provisions relating to additional contributions to the programme; recalls the importance of ensuring the traceability of external assigned revenue; underlines that, should the lead committee consider amending provisions relating to external assigned revenue, this should be done in coordination with the Committee on Budgets and the other committees in order to ensure a consistent approach; calls on the Commission to publish, alongside each annual work programme, a comprehensive overview of all external assigned revenue expected to be mobilised, their origin and their allocated use, and underlines that any broadening of the scope of external assigned revenue beyond that expressly provided for in the basic act must require the prior agreement of the budgetary authority;

15.Stresses that public procurement accounts for 15 % of EU GDP and that, in the light of the upcoming revision of the directives, particular focus should be given to actions that support the integration of qualitative, environmental, social and innovation-related considerations into public procurement procedures through the systematic use of the best price-quality ratio, rather than only relying on lowest-price criterion; notes that such actions can include capacity-building and guidance for contracting authorities on how to apply those criteria in the context of the award of public contracts, while safeguarding the principles of transparency, equal treatment and fair competition;

16.Recalls the proposal for a regulation on establishing a budget expenditure tracking and performance framework and other horizontal rules for the Union programmes and activities (the ‘performance regulation’), which establishes a single streamlined list for performance indicators and monitoring and evaluation provisions, some of which are relevant for SMCP; expresses concern that the highly heterogeneous activities funded under SMCP might affect the reliability of the performance indicators, and calls for clearer identification of strand-specific results and greater emphasis on results rather than outputs, while avoiding an increase in administrative burdens and ensuring the proportionality of requirements and harmonised national data-quality requirements; underlines that any change to the architecture, objectives and eligible actions under the programme will need to be appropriately reflected in Annex I of the performance regulation, as part of the process of amending and negotiating that regulation; points out that, while sectoral legislation can supplement the performance regulation, for instance as regards programme evaluations, it should remain consistent with the provisions of that regulation;

17.Calls for the programme to support the development of a fair, competitive and more coherent single market based on clear, consistent and effectively enforced rules, in order to ensure a level playing field, reduce legal fragmentation, promote fair competition and regulatory clarity, and improve access to clear and predictable cross-border rules;

18.Stresses that the programme should ensure a sufficient level of administrative capacity, digital preparedness and enforcement capability, to prevent a de facto multi-speed single market; underlines that customs, market surveillance, anti-fraud and digital implementation capacities must be supported in a balanced manner across the Union, so that all Member States can effectively enforce Union law and ensure a comparable level of protection for citizens, consumers and businesses;

19.Calls for the programme to support, where relevant, the continuity and completion of strategic projects launched under previous Union instruments, including projects started under the Recovery and Resilience Facility, in particular in the areas of digitalisation, customs, market surveillance and anti-fraud.

As part of its budgetary assessment, the Committee on Budgets also submits the following amendments to the proposal:

Amendment 1

Proposal for a regulation

Recital 33 a (new)

Amendment 2

Proposal for a regulation

Recital 37 a (new)

Amendment 3

Proposal for a regulation

Recital 37 b (new)

Amendment 4

Proposal for a regulation

Article 4 – paragraph 1

Amendment 5

Proposal for a regulation

Article 6 – Paragraph 1

The rapporteur for budgetary assessment declares under her exclusive responsibility that she did not include in her budgetary assessment input from interest representatives falling within the scope of the Interinstitutional Agreement on a mandatory transparency register, or from representatives of public authorities of third countries, including their diplomatic missions and embassies, to be listed in this Annex pursuant to Article 8 of Annex I to the Rules of Procedure.