MFF, Rule of Law Conditionality and Own Resources

European Parliament resolution of 17 December 2020 on the Multiannual Financial Framework 2021-2027, the Interinstitutional Agreement, the EU Recovery Instrument and the Rule of Law Regulation (2020/2923(RSP)

The European Parliament,

–having regard to Articles 2, 14, 15, 16 and 17 of the Treaty on the European Union (TEU) as well as Articles 295, 310, 311, 312, 322 of the Treaty on the Functioning of the European Union (TFEU),

–having regard to the political agreement reached on 5 November 2020 on the Regulation of the European Parliament and of the Council on a general regime of conditionality for the protection of the Union budget (‘Rule of Law Regulation’),

–having regard to the political agreements, including the joint and unilateral declarations, reached on 10 November 2020 on the Multiannual Financial Framework 2021-2027 (‘the MFF’), the Interinstitutional Agreement between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management, as well as on new own resources, including a roadmap towards the introduction of new own resources (‘the IIA’) and the EU Recovery Instrument (‘EURI’),

–having regard to the conclusions of the European Council adopted on 21 July 2020,

–having regard to the European Parliament resolution on 23 July 2020,

–having regard to the European Parliament letter on the Rule of Law by Group leaders to Mrs Angela Merkel, Chancellor of the Federal Republic of Germany and Presidency of the Council of the EU, and to Mrs Ursula von der Leyen, President of the European Commission, of 26 August 2020,

–having regard to the European Parliament statement by the Conference of Presidents on long-term EU budget and Rule of Law of 18 November 2020,

–having regard to the conclusions of the European Council adopted on 11 December 2020,

–having regard to Rule 132(2) of its Rules of Procedure,

A.whereas the European Union is a Union of values as enshrined in Article 2 TEU;

B.whereas the COVID-19 outbreak has claimed thousands of lives in Europe and the world and has led to an unprecedented crisis with disastrous consequences for people, workers and businesses, and therefore requires an unprecedented response, especially after the second wave of COVID-19 and until the pandemic is effectively over;

C.whereas the political debate within the European Council led to the delay of the entire process thus delaying the MFF, the IIA, the EURI and Rule of Law Regulation negotiations, adoption and implementation;

D.whereas an effective Rule of Law Regulation and the introduction of new own resources were a pre-condition of the European Parliament to agree with the MFF package;

E.whereas the Union’s co-legislators have been able to reach on unprecedented agreements during 2020;

1.Welcomes the political agreements, including the joint and unilateral declarations, reached by co-legislators on 5 November 2020, on the Rule of Law Regulation and on 10 November 2020, on the MFF, the IIA and the EURI; highlights that those historical political agreements include, amongst others, the following provisions:

–An unprecedented EUR 1,8 trillion package consisting of the MFF 2021-2027 (EUR 1074 moving progressively to EUR 1085 billion), coupled with the Recovery Instrument (EUR 750 billion);

–EUR 16 billion top-up to the MFF 2021-2027 to be distributed to EU flagship programmes identified by the EP (EU4Health, Horizon Europe, Erasmus +, Integrated Border Management Fund, Frontex, InvestEU, Rights & Values, Creative Europe, Humanitarian Aid and NDICI) and to strengthen budgetary response to unforeseen events;

–A legally binding roadmap to introduce new Own Resources in the course of the next MFF in the course of the next MFF, which should be, at least, sufficient to cover the future repayment costs (principal and interests) of the EU Recovery Instrument;

–A legally binding minimum share for climate-related spending of at least 30 % of the MFF and the NGEU and for biodiversity-related spending of 7,5 % in 2024 and 10 % in 2026 onwards of the MFF;

–Elements to monitor spending on gender equality and mainstreaming;

–An enhanced role for the European Parliament as budgetary authority, in the management of the EU Recovery Instrument and the external assigned revenue, as well as in the establishment of future emergency instruments to be based on the Article 122 TFEU;

–A functioning Rule of Law conditionality;

2.Recalls the historic importance of the package and its potential with regards to secure a quick recovery from the COVID-19 pandemic and its social-economic effects and meet Union’s challenges for the next seven years, including the Green Deal, the digital transition and the protection of its values and of the money of EU taxpayers;

3.Welcomes the outcome of the European Council endorsing the abovementioned political agreements at its meeting of 10 and 11 December 2020; welcomes that the Heads of State and Government have reached an agreement to allow for the MFF, the IIA, the EURI and the Rule of Law Regulation to enter into force on 1 January 2021; welcomes that the legal texts remain unchanged;

4.Strongly regrets, however, that, due to the unanimity rule in the Council, the adoption of the entire package, including the new EU programmes for the period 2021-2027, cause unduly delay for the entire process; recalls that the content of the European Council conclusions on the Regulation on a general regime of conditionality for the protection of the Union budget is superfluous; recalls that the applicability, purpose and scope of the Rule of Law Regulation is clearly defined in the legal text of the said Regulation;

5.Recalls that in accordance with Article 15(1) TEU, the European Council shall not exercise legislative functions; considers, therefore, that any political declaration of the European Council cannot be deemed to represent an interpretation of legislation as interpretation is vested with the European Court of Justice (CJEU);

6.Recalls that the Commission and its President are elected by the European Parliament; recalls that in accordance with Article 17(1) TEU, the Commission shall ensure the application of the Treaties, and of measures adopted by the institutions pursuant to them; affirms, therefore, that the Commission shall, at any moment and in any circumstances, abide by law, dura lex sed lex;

7.Recalls that in accordance with Article 17(3) TEU, the Commission shall be completely independent;

8.Recalls that in accordance with Article 17(8) TEU, the Commission shall be responsible to the European Parliament; recalls that Parliament has several legal means at its disposal to make sure that the Commission respects its treaty obligation, including the discharge procedure, in order to assess the proper management of Union funds; stresses, furthermore, that Parliament has several legal and political means at its disposal to make sure that the law is enforced by everyone and by EU institutions in the first place; stresses that the conclusions of the European Council cannot be made binding on the Commission in applying legal acts;

9.Stresses that co-legislators have agreed that the Regulation on a general regime of conditionality for the protection of the Union budget shall apply from 1 January 2021 and will have to be applied to all commitments and payments; recalls that the applicability of this Regulation cannot be subject to adoption of any guidelines, as the text agreed is sufficiently clear, and no implementing instruments are foreseen; expects the Commission, as the guardian of the Treaties, to ensure that the Regulation is fully applicable from the date agreed by the co-legislators and recalls that annulment of the Regulation or part of it is only possible by the CJEU; affirms that if a Member State seeks the annulment of the Regulation or the parts thereof, Parliament will defend its validity before the Court and expects the Commission to intervene in support of Parliament’s position; highlights, in such case, that Parliament will ask that the Court proceed in an expedited procedure; recalls Article 265 TFEU and states its readiness to make use of it;

10.Takes the view that the need for full parliamentary involvement in the operation of Next Generation EU has to see the light; stresses that the ongoing trilogue has to provide a satisfactory outcome on this point;

11.Takes the view that the overcoming of the hurdles posed by unanimity requirement in Council regarding the adoption of the MFF and own resources decision, among other instances, shall be addressed in the upcoming Conference on the Future of Europe;

12.Instructs its President to forward this resolution to the Council, the European Council and the Commission.