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EU INSTITUTIONS AND PROCEDURES

an overview of the competences and procedures of the EU institutions (with reference to relevant Treaty articles, in effect on 1 November 2005

I. INSTITUTIONS I. . T!E EUROPEAN PAR"IAMENT Article 189 The European !arliament, which shall consist of representatives of the peoples of the "tates brou#ht to#ether in the $ommunity, shall e%ercise the powers conferred upon it by this Treaty& The number of 'embers of the European !arliament shall not e%ceed ()5& Article 190 1& The representatives in the European !arliament of the peoples of the "tates brou#ht to#ether in the $ommunity shall be elected by direct universal suffra#e& 2& The number of representatives elected in each 'ember "tate shall be as follows* +el#ium $-ech .epublic /enmar0 1ermany Estonia 1reece "pain 4rance 5reland 5taly $yprus 7atvia 7ithuania 7u%embour# 8un#ary 'alta Netherlands 9ustria 2, 2, 1, 22 3 2, 5, () 16 () 3 2 16 3 2, 5 2( 1) 1

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!oland 5, !ortu#al 2, "lovenia ( "lova0ia 1, 4inland 1, "weden 12 United :in#dom () .omania 65 +ul#aria 1)

5n the event of amendments to this para#raph, the number of representatives elected in each 'ember "tate must ensure appropriate representation of the peoples of the "tates brou#ht to#ether in the $ommunity& 6& .epresentatives shall be elected for a term of five years& ,& The European !arliament shall draw up a proposal for elections by direct universal suffra#e in accordance with a uniform procedure in all 'ember "tates or in accordance with principles common to all 'ember "tates& The $ouncil shall, actin# unanimously after obtainin# the assent of the European !arliament, which shall act by a ma;ority of its component members, lay down the appropriate provisions, which it shall recommend to 'ember "tates for adoption in accordance with their respective constitutional re<uirements& 5& The European !arliament, after see0in# an opinion from the $ommission and with the approval of the $ouncil actin# by a <ualified ma;ority, shall lay down the re#ulations and #eneral conditions #overnin# the performance of the duties of its 'embers& 9ll rules or conditions relatin# to the ta%ation of 'embers or former 'embers shall re<uire unanimity within the $ouncil& Article 191 !olitical parties at European level are important as a factor for inte#ration within the Union& They contribute to formin# a European awareness and to e%pressin# the political will of the citi-ens of the Union& The $ouncil, actin# in accordance with the procedure referred to in 9rticle 251, shall lay down the re#ulations #overnin# political parties at European level and in particular the rules re#ardin# their fundin#& Article 192 5n so far as provided in this Treaty, the European !arliament shall participate in the process leadin# up to the adoption of $ommunity acts by e%ercisin# its powers under the procedures laid down in 9rticles 251 and 252 and by #ivin# its assent or deliverin# advisory opinions&

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The European !arliament may, actin# by a ma;ority of its 'embers, re<uest the $ommission to submit any appropriate proposal on matters on which it considers that a $ommunity act is re<uired for the purpose of implementin# this Treaty& Article 193 5n the course of its duties, the European !arliament may, at the re<uest of a <uarter of its 'embers, set up a temporary $ommittee of 5n<uiry to investi#ate, without pre;udice to the powers conferred by this Treaty on other institutions or bodies, alle#ed contraventions or maladministration in the implementation of $ommunity law, e%cept where the alle#ed facts are bein# e%amined before a court and while the case is still sub;ect to le#al proceedin#s& The temporary $ommittee of 5n<uiry shall cease to e%ist on the submission of its report& The detailed provisions #overnin# the e%ercise of the ri#ht of in<uiry shall be determined by common accord of the European !arliament, the $ouncil and the $ommission& Article 194 9ny citi-en of the Union, and any natural or le#al person residin# or havin# its re#istered office in a 'ember "tate, shall have the ri#ht to address, individually or in association with other citi-ens or persons, a petition to the European !arliament on a matter which comes within the $ommunity=s fields of activity and which affects him, her or it directly& Article 195 1& The European !arliament shall appoint an >mbudsman empowered to receive complaints from any citi-en of the Union or any natural or le#al person residin# or havin# its re#istered office in a 'ember "tate concernin# instances of maladministration in the activities of the $ommunity institutions or bodies, with the e%ception of the $ourt of ?ustice and the $ourt of 4irst 5nstance actin# in their ;udicial role& 5n accordance with his duties, the >mbudsman shall conduct in<uiries for which he finds #rounds, either on his own initiative or on the basis of complaints submitted to him direct or throu#h a 'ember of the European !arliament, e%cept where the alle#ed facts are or have been the sub;ect of le#al proceedin#s& @here the >mbudsman establishes an instance of maladministration, he shall refer the matter to the institution concerned, which shall have a period of three months in which to inform him of its views& The >mbudsman shall then forward a report to the European !arliament and the institution concerned& The person lod#in# the complaint shall be informed of the outcome of such in<uiries& The >mbudsman shall submit an annual report to the European !arliament on the outcome of his in<uiries& 2& The >mbudsman shall be appointed after each election of the European !arliament for the duration of its term of office& The >mbudsman shall be eli#ible for reappointment& The >mbudsman may be dismissed by the $ourt of ?ustice at the re<uest of the European !arliament if he no lon#er fulfils the conditions re<uired for the performance of his duties or if he is #uilty of serious misconduct&

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6& The >mbudsman shall be completely independent in the performance of his duties& 5n the performance of those duties he shall neither see0 nor ta0e instructions from any body& The >mbudsman may not, durin# his term of office, en#a#e in any other occupation, whether #ainful or not& ,& The European !arliament shall, after see0in# an opinion from the $ommission and with the approval of the $ouncil actin# by a <ualified ma;ority, lay down the re#ulations and #eneral conditions #overnin# the performance of the >mbudsman=s duties& Article 196 The European !arliament shall hold an annual session& 5t shall meet, without re<uirin# to be convened, on the second Tuesday in 'arch& The European !arliament may meet in e%traordinary session at the re<uest of a ma;ority of its 'embers or at the re<uest of the $ouncil or of the $ommission& Article 197 The European !arliament shall elect its !resident and its officers from amon# its 'embers& 'embers of the $ommission may attend all meetin#s and shall, at their re<uest, be heard on behalf of the $ommission& The $ommission shall reply orally or in writin# to <uestions put to it by the European !arliament or by its 'embers& The $ouncil shall be heard by the European !arliament in accordance with the conditions laid down by the $ouncil in its .ules of !rocedure& Article 198 "ave as otherwise provided in this Treaty, the European !arliament shall act by an absolute ma;ority of the votes cast& The .ules of !rocedure shall determine the <uorum& Article 199 The European !arliament shall adopt its .ules of !rocedure, actin# by a ma;ority of its 'embers& The proceedin#s of the European !arliament shall be published in the manner laid down in its .ules of !rocedure& Article 200 The European !arliament shall discuss in open session the annual #eneral report submitted to it by the $ommission& Article 201

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5f a motion of censure on the activities of the $ommission is tabled before it, the European !arliament shall not vote thereon until at least three days after the motion has been tabled and only by open vote& 5f the motion of censure is carried by a twoAthirds ma;ority of the votes cast, representin# a ma;ority of the 'embers of the European !arliament, the 'embers of the $ommission shall resi#n as a body& They shall continue to deal with current business until they are replaced in accordance with 9rticle 21,& 5n this case, the term of office of the 'embers of the $ommission appointed to replace them shall e%pire on the date on which the term of office of the 'embers of the $ommission obli#ed to resi#n as a body would have e%pired& I.#. T!E COUNCI" Article 202 To ensure that the ob;ectives set out in this Treaty are attained the $ouncil shall, in accordance with the provisions of this Treaty* A A A ensure coordination of the #eneral economic policies of the 'ember "tates, have power to ta0e decisions, confer on the $ommission, in the acts which the $ouncil adopts, powers for the implementation of the rules which the $ouncil lays down& The $ouncil may impose certain re<uirements in respect of the e%ercise of these powers& The $ouncil may also reserve the ri#ht, in specific cases, to e%ercise directly implementin# powers itself& The procedures referred to above must be consonant with principles and rules to be laid down in advance by the $ouncil, actin# unanimously on a proposal from the $ommission and after obtainin# the opinion of the European !arliament&

Article 203 The $ouncil shall consist of a representative of each 'ember "tate at ministerial level, authorised to commit the #overnment of that 'ember "tate& The office of !resident shall be held in turn by each 'ember "tate in the $ouncil for a term of si% months in the order decided by the $ouncil actin# unanimously& Article 204 The $ouncil shall meet when convened by its !resident on his own initiative or at the re<uest of one of its 'embers or of the $ommission& Article 205 1& "ave as otherwise provided in this Treaty, the $ouncil shall act by a ma;ority of its 'embers& 2& @here the $ouncil is re<uired to act by a <ualified ma;ority, the votes of its members shall be wei#hted as follows*

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+el#ium 12 $-ech .epublic 12 /enmar0 ( 1ermany 22 Estonia , 1reece 12 "pain 2( 4rance 22 5reland ( 5taly 22 $yprus , 7atvia , 7ithuania ( 7u%embour# , 8un#ary 12 'alta 6 Netherlands 16 9ustria 10 !oland 2( !ortu#al 12 "lovenia , "lova0ia ( 4inland ( "weden 10 United :in#dom 22 .omania 1, +ul#aria 10 9cts of the $ouncil shall re<uire for their adoption at least 255 votes in favour cast by a ma;ority of the members where this Treaty re<uires them to be adopted on a proposal from the $ommission& 5n other cases, for their adoption acts of the $ouncil shall re<uire at least 255 votes in favour ((6&21B , cast by at least twoAthirds of the members& 6& 9bstentions by 'embers present in person or represented shall not prevent the adoption by the $ouncil of acts which re<uire unanimity& ,& @hen a decision is to be adopted by the $ouncil by a <ualified ma;ority, a member of the $ouncil may re<uest verification that the 'ember "tates constitutin# the <ualified ma;ority represent at least 32 B of the total population of the Union& 5f that condition is shown not to have been met, the decision in <uestion shall not be adopted& Article 206

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@here a vote is ta0en, any 'ember of the $ouncil may also act on behalf of not more than one other member& Article 207 1& 9 committee consistin# of the !ermanent .epresentatives of the 'ember "tates shall be responsible for preparin# the wor0 of the $ouncil and for carryin# out the tas0s assi#ned to it by the $ouncil& The $ommittee may adopt procedural decisions in cases provided for in the $ouncil=s .ules of !rocedure& 2& The $ouncil shall be assisted by a 1eneral "ecretariat, under the responsibility of a "ecretaryA1eneral, 8i#h .epresentative for the common forei#n and security policy, who shall be assisted by a /eputy "ecretaryA1eneral responsible for the runnin# of the 1eneral "ecretariat& The "ecretaryA1eneral and the /eputy "ecretaryA1eneral shall be appointed by the $ouncil actin# by a <ualified ma;ority& The $ouncil shall decide on the or#anisation of the 1eneral "ecretariat& 6& The $ouncil shall adopt its .ules of !rocedure& 4or the purpose of applyin# 9rticle 255(6 , the $ouncil shall elaborate in these .ules the conditions under which the public shall have access to $ouncil documents& 4or the purpose of this para#raph, the $ouncil shall define the cases in which it is to be re#arded as actin# in its le#islative capacity, with a view to allowin# #reater access to documents in those cases, while at the same time preservin# the effectiveness of its decisionAma0in# process& 5n any event, when the $ouncil acts in its le#islative capacity, the results of votes and e%planations of vote as well as statements in the minutes shall be made public& Article 208 The $ouncil may re<uest the $ommission to underta0e any studies the $ouncil considers desirable for the attainment of the common ob;ectives, and to submit to it any appropriate proposals& Article 209 The $ouncil shall, after receivin# an opinion from the $ommission, determine the rules #overnin# the committees provided for in this Treaty& Article 210 The $ouncil shall, actin# by a <ualified ma;ority, determine the salaries, allowances and pensions of the !resident and 'embers of the $ommission, and of the !resident, ?ud#es, 9dvocatesA1eneral and .e#istrar of the $ourt of ?ustice and of the 'embers and .e#istrar of the $ourt of 4irst 5nstance& 5t shall also, a#ain by a <ualified ma;ority, determine any payment to be made instead of remuneration& I.$. T!E COMMISSION Article 211 (

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5n order to ensure the proper functionin# and development of the common mar0et, the $ommission shall* A A A A ensure that the provisions of this Treaty and the measures ta0en by the institutions pursuant thereto are applied, formulate recommendations or deliver opinions on matters dealt with in this Treaty, if it e%pressly so provides or if the $ommission considers it necessary, have its own power of decision and participate in the shapin# of measures ta0en by the $ouncil and by the European !arliament in the manner provided for in this Treaty, e%ercise the powers conferred on it by the $ouncil for the implementation of the rules laid down by the latter&

Article 212 The $ommission shall publish annually, not later than one month before the openin# of the session of the European !arliament, a #eneral report on the activities of the $ommunity& Article 2131 1& The 'embers of the $ommission shall be chosen on the #rounds of their #eneral competence and their independence shall be beyond doubt& The $ommission shall include one national of each of the 'ember "tates& The number of 'embers of the $ommission may be altered by the $ouncil, actin# unanimously&

@hen the Union consists of 2( 'ember "tates, 9rticle 216(1 of the Treaty establishin# the European $ommunity shall be replaced by the followin#* C1& The 'embers of the $ommission shall be chosen on the #rounds of their #eneral competence and their independence shall be beyond doubt& The number of 'embers of the $ommission shall be less than the number of 'ember "tates& The 'embers of the $ommission shall be chosen accordin# to a rotation system based on the principle of e<uality, the implementin# arran#ements for which shall be adopted by the $ouncil, actin# unanimously& The number of 'embers of the $ommission shall be set by the $ouncil, actin# unanimously&D This amendment shall apply as from the date on which the first $ommission followin# the date of accession of the 2(th 'ember "tate of the Union ta0es up its duties& The $ouncil, actin# unanimously after si#nin# the treaty of accession of the 2(th 'ember "tate of the Union, shall adopt* E the number of 'embers of the $ommission, E the implementin# arran#ements for a rotation system based on the principle of e<uality containin# all the criteria and rules necessary for determinin# the composition of successive colle#es automatically on the basis of the followin# principles* (a 'ember "tates shall be treated on a strictly e<ual footin# as re#ards determination of the se<uence of, and the time spent by, their nationals as 'embers of the $ommissionF conse<uently, the difference between the total number of terms of office held by nationals of any #iven pair of 'ember "tates may never be more than oneF (b sub;ect to point (a , each successive colle#e shall be so composed as to reflect satisfactorily the demo#raphic and #eo#raphical ran#e of all the 'ember "tates of the Union&

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2& The 'embers of the $ommission shall, in the #eneral interest of the $ommunity, be completely independent in the performance of their duties& 5n the performance of these duties, they shall neither see0 nor ta0e instructions from any #overnment or from any other body& They shall refrain from any action incompatible with their duties& Each 'ember "tate underta0es to respect this principle and not to see0 to influence the 'embers of the $ommission in the performance of their tas0s& The 'embers of the $ommission may not, durin# their term of office, en#a#e in any other occupation, whether #ainful or not& @hen enterin# upon their duties they shall #ive a solemn underta0in# that, both durin# and after their term of office, they will respect the obli#ations arisin# therefrom and in particular their duty to behave with inte#rity and discretion as re#ards the acceptance, after they have ceased to hold office, of certain appointments or benefits& 5n the event of any breach of these obli#ations, the $ourt of ?ustice may, on application by the $ouncil or the $ommission, rule that the 'ember concerned be, accordin# to the circumstances, either compulsorily retired in accordance with 9rticle 213 or deprived of his ri#ht to a pension or other benefits in its stead& Article 214 1& The 'embers of the $ommission shall be appointed, in accordance with the procedure referred to in para#raph 2, for a period of five years, sub;ect, if need be, to 9rticle 201& Their term of office shall be renewable& 2& The $ouncil, meetin# in the composition of 8eads of "tate or 1overnment and actin# by a <ualified ma;ority, shall nominate the person it intends to appoint as !resident of the $ommissionF the nomination shall be approved by the European !arliament& The $ouncil, actin# by a <ualified ma;ority and by common accord with the nominee for !resident, shall adopt the list of the other persons whom it intends to appoint as 'embers of the $ommission, drawn up in accordance with the proposals made by each 'ember "tate& The !resident and the other 'embers of the $ommission thus nominated shall be sub;ect as a body to a vote of approval by the European !arliament& 9fter approval by the European !arliament, the !resident and the other 'embers of the $ommission shall be appointed by the $ouncil, actin# by a <ualified ma;ority& Article 215 9part from normal replacement, or death, the duties of a 'ember of the $ommission shall end when he resi#ns or is compulsorily retired& 9 vacancy caused by resi#nation, compulsory retirement or death shall be filled for the remainder of the 'ember=s term of office by a new 'ember appointed by the $ouncil, actin# by a <ualified ma;ority& The $ouncil may, actin# unanimously, decide that such a vacancy need not be filled& 5n the event of resi#nation, compulsory retirement or death, the !resident shall be replaced for the remainder of his term of office& The procedure laid down in 9rticle 21,(2 shall be applicable for the replacement of the !resident& 2

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"ave in the case of compulsory retirement under 9rticle 213, 'embers of the $ommission shall remain in office until they have been replaced or until the $ouncil has decided that the vacancy need not be filled, as provided for in the second para#raph of this 9rticle& Article 216 5f any 'ember of the $ommission no lon#er fulfils the conditions re<uired for the performance of his duties or if he has been #uilty of serious misconduct, the $ourt of ?ustice may, on application by the $ouncil or the $ommission, compulsorily retire him& Article 217 1& The $ommission shall wor0 under the political #uidance of its !resident, who shall decide on its internal or#anisation in order to ensure that it acts consistently, efficiently and on the basis of colle#iality& 2& The responsibilities incumbent upon the $ommission shall be structured and allocated amon# its 'embers by its !resident& The !resident may reshuffle the allocation of those responsibilities durin# the $ommission=s term of office& The 'embers of the $ommission shall carry out the duties devolved upon them by the !resident under his authority& 6& 9fter obtainin# the approval of the $olle#e, the !resident shall appoint GiceA!residents from amon# its 'embers& ,& 9 'ember of the $ommission shall resi#n if the !resident so re<uests, after obtainin# the approval of the $olle#e& Article 218 1& The $ouncil and the $ommission shall consult each other and shall settle by common accord their methods of cooperation& 2& The $ommission shall adopt its .ules of !rocedure so as to ensure that both it and its departments operate in accordance with the provisions of this Treaty& 5t shall ensure that these .ules are published& Article 219 The $ommission shall act by a ma;ority of the number of 'embers provided for in 9rticle 216& 9 meetin# of the $ommission shall be valid only if the number of 'embers laid down in its .ules of !rocedure is present& I.%. T!E COURT O& 'USTICE Article 220

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The $ourt of ?ustice and the $ourt of 4irst 5nstance, each within its ;urisdiction, shall ensure that in the interpretation and application of this Treaty the law is observed& 5n addition, ;udicial panels may be attached to the $ourt of 4irst 5nstance under the conditions laid down in 9rticle 225a in order to e%ercise, in certain specific areas, the ;udicial competence laid down in this Treaty& Article 221 The $ourt of ?ustice shall consist of one ;ud#e per 'ember "tate& The $ourt of ?ustice shall sit in chambers or in a 1rand $hamber, in accordance with the rules laid down for that purpose in the "tatute of the $ourt of ?ustice& @hen provided for in the "tatute, the $ourt of ?ustice may also sit as a full $ourt& Article 222 The $ourt of ?ustice shall be assisted by ei#ht 9dvocatesA1eneral& "hould the $ourt of ?ustice so re<uest, the $ouncil, actin# unanimously, may increase the number of 9dvocatesA1eneral& 5t shall be the duty of the 9dvocateA1eneral, actin# with complete impartiality and independence, to ma0e, in open court, reasoned submissions on cases which, in accordance with the "tatute of the $ourt of ?ustice, re<uire his involvement& Article 223 The ?ud#es and 9dvocatesA1eneral of the $ourt of ?ustice shall be chosen from persons whose independence is beyond doubt and who possess the <ualifications re<uired for appointment to the hi#hest ;udicial offices in their respective countries or who are ;urisconsults of reco#nised competenceF they shall be appointed by common accord of the #overnments of the 'ember "tates for a term of si% years& Every three years there shall be a partial replacement of the ?ud#es and 9dvocatesA1eneral, in accordance with the conditions laid down in the "tatute of the $ourt of ?ustice& The ?ud#es shall elect the !resident of the $ourt of ?ustice from amon# their number for a term of three years& 8e may be reAelected& .etirin# ?ud#es and 9dvocatesA1eneral may be reappointed& The $ourt of ?ustice shall appoint its .e#istrar and lay down the rules #overnin# his service& The $ourt of ?ustice shall establish its .ules of !rocedure& Those .ules shall re<uire the approval of the $ouncil, actin# by a <ualified ma;ority& Article 224 The $ourt of 4irst 5nstance shall comprise at least one ;ud#e per 'ember "tate& The number of ?ud#es shall be determined by the "tatute of the $ourt of ?ustice& The "tatute may provide for the $ourt of 4irst 5nstance to be assisted by 9dvocatesA1eneral&

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The members of the $ourt of 4irst 5nstance shall be chosen from persons whose independence is beyond doubt and who possess the ability re<uired for appointment to hi#h ;udicial office& They shall be appointed by common accord of the #overnments of the 'ember "tates for a term of si% years& The membership shall be partially renewed every three years& .etirin# members shall be eli#ible for reappointment& The ?ud#es shall elect the !resident of the $ourt of 4irst 5nstance from amon# their number for a term of three years& 8e may be reAelected& The $ourt of 4irst 5nstance shall appoint its .e#istrar and lay down the rules #overnin# his service& The $ourt of 4irst 5nstance shall establish its .ules of !rocedure in a#reement with the $ourt of ?ustice& Those .ules shall re<uire the approval of the $ouncil, actin# by a <ualified ma;ority& Unless the "tatute of the $ourt of ?ustice provides otherwise, the provisions of this Treaty relatin# to the $ourt of ?ustice shall apply to the $ourt of 4irst 5nstance& Article 225 1& The $ourt of 4irst 5nstance shall have ;urisdiction to hear and determine at first instance actions or proceedin#s referred to in 9rticles 260, 262, 265, 263 and 26), with the e%ception of those assi#ned to a ;udicial panel and those reserved in the "tatute for the $ourt of ?ustice& The "tatute may provide for the $ourt of 4irst 5nstance to have ;urisdiction for other classes of action or proceedin#& /ecisions #iven by the $ourt of 4irst 5nstance under this para#raph may be sub;ect to a ri#ht of appeal to the $ourt of ?ustice on points of law only, under the conditions and within the limits laid down by the "tatute& 2& The $ourt of 4irst 5nstance shall have ;urisdiction to hear and determine actions or proceedin#s brou#ht a#ainst decisions of the ;udicial panels set up under 9rticle 225a& /ecisions #iven by the $ourt of 4irst 5nstance under this para#raph may e%ceptionally be sub;ect to review by the $ourt of ?ustice, under the conditions and within the limits laid down by the "tatute, where there is a serious ris0 of the unity or consistency of $ommunity law bein# affected& 6& The $ourt of 4irst 5nstance shall have ;urisdiction to hear and determine <uestions referred for a preliminary rulin# under 9rticle 26,, in specific areas laid down by the "tatute& @here the $ourt of 4irst 5nstance considers that the case re<uires a decision of principle li0ely to affect the unity or consistency of $ommunity law, it may refer the case to the $ourt of ?ustice for a rulin#& /ecisions #iven by the $ourt of 4irst 5nstance on <uestions referred for a preliminary rulin# may e%ceptionally be sub;ect to review by the $ourt of ?ustice, under the conditions and within the limits laid down by the "tatute, where there is a serious ris0 of the unity or consistency of $ommunity law bein# affected&

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Article 225a The $ouncil, actin# unanimously on a proposal from the $ommission and after consultin# the European !arliament and the $ourt of ?ustice or at the re<uest of the $ourt of ?ustice and after consultin# the European !arliament and the $ommission, may create ;udicial panels to hear and determine at first instance certain classes of action or proceedin# brou#ht in specific areas& The decision establishin# a ;udicial panel shall lay down the rules on the or#anisation of the panel and the e%tent of the ;urisdiction conferred upon it& /ecisions #iven by ;udicial panels may be sub;ect to a ri#ht of appeal on points of law only or, when provided for in the decision establishin# the panel, a ri#ht of appeal also on matters of fact, before the $ourt of 4irst 5nstance& The members of the ;udicial panels shall be chosen from persons whose independence is beyond doubt and who possess the ability re<uired for appointment to ;udicial office& They shall be appointed by the $ouncil, actin# unanimously& The ;udicial panels shall establish their .ules of !rocedure in a#reement with the $ourt of ?ustice& Those .ules shall re<uire the approval of the $ouncil, actin# by a <ualified ma;ority& Unless the decision establishin# the ;udicial panel provides otherwise, the provisions of this Treaty relatin# to the $ourt of ?ustice and the provisions of the "tatute of the $ourt of ?ustice shall apply to the ;udicial panels& Article 226 5f the $ommission considers that a 'ember "tate has failed to fulfil an obli#ation under this Treaty, it shall deliver a reasoned opinion on the matter after #ivin# the "tate concerned the opportunity to submit its observations& 5f the "tate concerned does not comply with the opinion within the period laid down by the $ommission, the latter may brin# the matter before the $ourt of ?ustice& Article 227 9 'ember "tate which considers that another 'ember "tate has failed to fulfil an obli#ation under this Treaty may brin# the matter before the $ourt of ?ustice& +efore a 'ember "tate brin#s an action a#ainst another 'ember "tate for an alle#ed infrin#ement of an obli#ation under this Treaty, it shall brin# the matter before the $ommission& The $ommission shall deliver a reasoned opinion after each of the "tates concerned has been #iven the opportunity to submit its own case and its observations on the other party=s case both orally and in writin#& 5f the $ommission has not delivered an opinion within three months of the date on which the matter was brou#ht before it, the absence of such opinion shall not prevent the matter from bein# brou#ht before the $ourt of ?ustice&

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Article 228 1& 5f the $ourt of ?ustice finds that a 'ember "tate has failed to fulfil an obli#ation under this Treaty, the "tate shall be re<uired to ta0e the necessary measures to comply with the ;ud#ment of the $ourt of ?ustice& 2& 5f the $ommission considers that the 'ember "tate concerned has not ta0en such measures it shall, after #ivin# that "tate the opportunity to submit its observations, issue a reasoned opinion specifyin# the points on which the 'ember "tate concerned has not complied with the ;ud#ment of the $ourt of ?ustice& 5f the 'ember "tate concerned fails to ta0e the necessary measures to comply with the $ourt=s ;ud#ment within the time limit laid down by the $ommission, the latter may brin# the case before the $ourt of ?ustice& 5n so doin# it shall specify the amount of the lump sum or penalty payment to be paid by the 'ember "tate concerned which it considers appropriate in the circumstances& 5f the $ourt of ?ustice finds that the 'ember "tate concerned has not complied with its ;ud#ment it may impose a lump sum or penalty payment on it& This procedure shall be without pre;udice to 9rticle 22(& Article 229 .e#ulations adopted ;ointly by the European !arliament and the $ouncil, and by the $ouncil, pursuant to the provisions of this Treaty, may #ive the $ourt of ?ustice unlimited ;urisdiction with re#ard to the penalties provided for in such re#ulations& Article 229a @ithout pre;udice to the other provisions of this Treaty, the $ouncil, actin# unanimously on a proposal from the $ommission and after consultin# the European !arliament, may adopt provisions to confer ;urisdiction, to the e%tent that it shall determine, on the $ourt of ?ustice in disputes relatin# to the application of acts adopted on the basis of this Treaty which create $ommunity industrial property ri#hts& The $ouncil shall recommend those provisions to the 'ember "tates for adoption in accordance with their respective constitutional re<uirements& Article 230 The $ourt of ?ustice shall review the le#ality of acts adopted ;ointly by the European !arliament and the $ouncil, of acts of the $ouncil, of the $ommission and of the E$+, other than recommendations and opinions, and of acts of the European !arliament intended to produce le#al effects visAHAvis third parties& 5t shall for this purpose have ;urisdiction in actions brou#ht by a 'ember "tate, the European !arliament, the $ouncil or the $ommission on #rounds of lac0 of competence, infrin#ement of an essential procedural re<uirement, infrin#ement of this Treaty or of any rule of law relatin# to its application, or misuse of powers& The $ourt of ?ustice shall have ;urisdiction under the same conditions in actions brou#ht by the $ourt of 9uditors and by the E$+ for the purpose of protectin# their prero#atives& 1,

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9ny natural or le#al person may, under the same conditions, institute proceedin#s a#ainst a decision addressed to that person or a#ainst a decision which, althou#h in the form of a re#ulation or a decision addressed to another person, is of direct and individual concern to the former& The proceedin#s provided for in this article shall be instituted within two months of the publication of the measure, or of its notification to the plaintiff, or, in the absence thereof, of the day on which it came to the 0nowled#e of the latter, as the case may be& Article 231 5f the action is well founded, the $ourt of ?ustice shall declare the act concerned to be void& 5n the case of a re#ulation, however, the $ourt of ?ustice shall, if it considers this necessary, state which of the effects of the re#ulation which it has declared void shall be considered as definitive& Article 232 "hould the European !arliament, the $ouncil or the $ommission, in infrin#ement of this Treaty, fail to act, the 'ember "tates and the other institutions of the $ommunity may brin# an action before the $ourt of ?ustice to have the infrin#ement established& The action shall be admissible only if the institution concerned has first been called upon to act& 5f, within two months of bein# so called upon, the institution concerned has not defined its position, the action may be brou#ht within a further period of two months& 9ny natural or le#al person may, under the conditions laid down in the precedin# para#raphs, complain to the $ourt of ?ustice that an institution of the $ommunity has failed to address to that person any act other than a recommendation or an opinion& The $ourt of ?ustice shall have ;urisdiction, under the same conditions, in actions or proceedin#s brou#ht by the E$+ in the areas fallin# within the latter=s field of competence and in actions or proceedin#s brou#ht a#ainst the latter& Article 233 The institution or institutions whose act has been declared void or whose failure to act has been declared contrary to this Treaty shall be re<uired to ta0e the necessary measures to comply with the ;ud#ment of the $ourt of ?ustice& This obli#ation shall not affect any obli#ation which may result from the application of the second para#raph of 9rticle 2))& This article shall also apply to the E$+& Article 234 The $ourt of ?ustice shall have ;urisdiction to #ive preliminary rulin#s concernin#* (a the interpretation of this TreatyF

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(b (c

the validity and interpretation of acts of the institutions of the $ommunity and of the E$+F the interpretation of the statutes of bodies established by an act of the $ouncil, where those statutes so provide&

@here such a <uestion is raised before any court or tribunal of a 'ember "tate, that court or tribunal may, if it considers that a decision on the <uestion is necessary to enable it to #ive ;ud#ment, re<uest the $ourt of ?ustice to #ive a rulin# thereon& @here any such <uestion is raised in a case pendin# before a court or tribunal of a 'ember "tate a#ainst whose decisions there is no ;udicial remedy under national law, that court or tribunal shall brin# the matter before the $ourt of ?ustice& Article 235 The $ourt of ?ustice shall have ;urisdiction in disputes relatin# to compensation for dama#e provided for in the second para#raph of 9rticle 2))& Article 236 The $ourt of ?ustice shall have ;urisdiction in any dispute between the $ommunity and its servants within the limits and under the conditions laid down in the "taff .e#ulations or the $onditions of employment& Article 237 The $ourt of ?ustice shall, within the limits hereinafter laid down, have ;urisdiction in disputes concernin#* (a the fulfilment by 'ember "tates of obli#ations under the "tatute of the European 5nvestment +an0& 5n this connection, the +oard of /irectors of the +an0 shall en;oy the powers conferred upon the $ommission by 9rticle 223F measures adopted by the +oard of 1overnors of the European 5nvestment +an0& 5n this connection, any 'ember "tate, the $ommission or the +oard of /irectors of the +an0 may institute proceedin#s under the conditions laid down in 9rticle 260F measures adopted by the +oard of /irectors of the European 5nvestment +an0& !roceedin#s a#ainst such measures may be instituted only by 'ember "tates or by the $ommission, under the conditions laid down in 9rticle 260, and solely on the #rounds of nonAcompliance with the procedure provided for in 9rticle 21(2 , (5 , (3 and (( of the "tatute of the +an0F the fulfilment by national central ban0s of obli#ations under this Treaty and the "tatute of the E"$+& 5n this connection the powers of the $ouncil of the E$+ in respect of national central ban0s shall be the same as those conferred upon the $ommission in respect of 'ember "tates by 9rticle 223& 5f the $ourt of ?ustice finds that a national central ban0 has failed to fulfil an obli#ation under this Treaty, that ban0 shall be re<uired to ta0e the necessary measures to comply with the ;ud#ment of the $ourt of

(b

(c

(d

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?ustice& Article 238 The $ourt of ?ustice shall have ;urisdiction to #ive ;ud#ment pursuant to any arbitration clause contained in a contract concluded by or on behalf of the $ommunity, whether that contract be #overned by public or private law& Article 239 The $ourt of ?ustice shall have ;urisdiction in any dispute between 'ember "tates which relates to the sub;ect matter of this Treaty if the dispute is submitted to it under a special a#reement between the parties& Article 240 "ave where ;urisdiction is conferred on the $ourt of ?ustice by this Treaty, disputes to which the $ommunity is a party shall not on that #round be e%cluded from the ;urisdiction of the courts or tribunals of the 'ember "tates& Article 241 Notwithstandin# the e%piry of the period laid down in the fifth para#raph of 9rticle 260, any party may, in proceedin#s in which a re#ulation adopted ;ointly by the European !arliament and the $ouncil, or a re#ulation of the $ouncil, of the $ommission, or of the E$+ is at issue, plead the #rounds specified in the second para#raph of 9rticle 260 in order to invo0e before the $ourt of ?ustice the inapplicability of that re#ulation& Article 242 9ctions brou#ht before the $ourt of ?ustice shall not have suspensory effect& The $ourt of ?ustice may, however, if it considers that circumstances so re<uire, order that application of the contested act be suspended& Article 243 The $ourt of ?ustice may in any cases before it prescribe any necessary interim measures& Article 244 The ;ud#ments of the $ourt of ?ustice shall be enforceable under the conditions laid down in 9rticle 253& Article 245 The "tatute of the $ourt of ?ustice shall be laid down in a separate !rotocol& The $ouncil, actin# unanimously at the re<uest of the $ourt of ?ustice and after consultin# the European !arliament and the $ommission, or at the re<uest of the $ommission and after consultin# the European !arliament and the $ourt of ?ustice, may amend the provisions of the "tatute, with the e%ception of Title 5&

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I.(. T!E COURT O& AUDITORS

Article 246 The $ourt of 9uditors shall carry out the audit& Article 247 1& The $ourt of 9uditors shall consist of one national from each 'ember "tate& 2& The 'embers of the $ourt of 9uditors shall be chosen from amon# persons who belon# or have belon#ed in their respective countries to e%ternal audit bodies or who are especially <ualified for this office& Their independence must be beyond doubt& 6& The 'embers of the $ourt of 9uditors shall be appointed for a term of si% years& The $ouncil, actin# by a <ualified ma;ority after consultin# the European !arliament, shall adopt the list of 'embers drawn up in accordance with the proposals made by each 'ember "tate& The term of office of the 'embers of the $ourt of 9uditors shall be renewable& They shall elect the !resident of the $ourt of 9uditors from amon# their number for a term of three years& The !resident may be reAelected& ,& The 'embers of the $ourt of 9uditors shall, in the #eneral interest of the $ommunity, be completely independent in the performance of their duties& 5n the performance of these duties, they shall neither see0 nor ta0e instructions from any #overnment or from any other body& They shall refrain from any action incompatible with their duties& 5& The 'embers of the $ourt of 9uditors may not, durin# their term of office, en#a#e in any other occupation, whether #ainful or not& @hen enterin# upon their duties they shall #ive a solemn underta0in# that, both durin# and after their term of office, they will respect the obli#ations arisin# therefrom and in particular their duty to behave with inte#rity and discretion as re#ards the acceptance, after they have ceased to hold office, of certain appointments or benefits& 3& 9part from normal replacement, or death, the duties of a 'ember of the $ourt of 9uditors shall end when he resi#ns, or is compulsorily retired by a rulin# of the $ourt of ?ustice pursuant to para#raph (& The vacancy thus caused shall be filled for the remainder of the 'ember=s term of office& "ave in the case of compulsory retirement, 'embers of the $ourt of 9uditors shall remain in office until they have been replaced& (& 9 'ember of the $ourt of 9uditors may be deprived of his office or of his ri#ht to a pension or other benefits in its stead only if the $ourt of ?ustice, at the re<uest of the $ourt of

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9uditors, finds that he no lon#er fulfils the re<uisite conditions or meets the obli#ations arisin# from his office& )& The $ouncil, actin# by a <ualified ma;ority, shall determine the conditions of employment of the !resident and the 'embers of the $ourt of 9uditors and in particular their salaries, allowances and pensions& 5t shall also, by the same ma;ority, determine any payment to be made instead of remuneration& 2& The provisions of the !rotocol on the privile#es and immunities of the European $ommunities applicable to the ?ud#es of the $ourt of ?ustice shall also apply to the 'embers of the $ourt of 9uditors& Article 248 1& The $ourt of 9uditors shall e%amine the accounts of all revenue and e%penditure of the $ommunity& 5t shall also e%amine the accounts of all revenue and e%penditure of all bodies set up by the $ommunity in so far as the relevant constituent instrument does not preclude such e%amination& The $ourt of 9uditors shall provide the European !arliament and the $ouncil with a statement of assurance as to the reliability of the accounts and the le#ality and re#ularity of the underlyin# transactions which shall be published in the >fficial ?ournal of the European Union& This statement may be supplemented by specific assessments for each ma;or area of $ommunity activity& 2& The $ourt of 9uditors shall e%amine whether all revenue has been received and all e%penditure incurred in a lawful and re#ular manner and whether the financial mana#ement has been sound& 5n doin# so, it shall report in particular on any cases of irre#ularity& The audit of revenue shall be carried out on the basis both of the amounts established as due and the amounts actually paid to the $ommunity& The audit of e%penditure shall be carried out on the basis both of commitments underta0en and payments made& These audits may be carried out before the closure of accounts for the financial year in <uestion& 6& The audit shall be based on records and, if necessary, performed on the spot in the other institutions of the $ommunity, on the premises of any body which mana#es revenue or e%penditure on behalf of the $ommunity and in the 'ember "tates, includin# on the premises of any natural or le#al person in receipt of payments from the bud#et& 5n the 'ember "tates the audit shall be carried out in liaison with national audit bodies or, if these do not have the necessary powers, with the competent national departments& The $ourt of 9uditors and the national audit bodies of the 'ember "tates shall cooperate in a spirit of trust while maintainin# their independence& These bodies or departments shall inform the $ourt of 9uditors whether they intend to ta0e part in the audit& The other institutions of the $ommunity, any bodies mana#in# revenue or e%penditure on behalf of the $ommunity, any natural or le#al person in receipt of payments from the bud#et,

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and the national audit bodies or, if these do not have the necessary powers, the competent national departments, shall forward to the $ourt of 9uditors, at its re<uest, any document or information necessary to carry out its tas0& 5n respect of the European 5nvestment +an0=s activity in mana#in# $ommunity e%penditure and revenue, the $ourt=s ri#hts of access to information held by the +an0 shall be #overned by an a#reement between the $ourt, the +an0 and the $ommission& 5n the absence of an a#reement, the $ourt shall nevertheless have access to information necessary for the audit of $ommunity e%penditure and revenue mana#ed by the +an0& ,& The $ourt of 9uditors shall draw up an annual report after the close of each financial year& 5t shall be forwarded to the other institutions of the $ommunity and shall be published, to#ether with the replies of these institutions to the observations of the $ourt of 9uditors, in the >fficial ?ournal of the European Union& The $ourt of 9uditors may also, at any time, submit observations, particularly in the form of special reports, on specific <uestions and deliver opinions at the re<uest of one of the other institutions of the $ommunity& 5t shall adopt its annual reports, special reports or opinions by a ma;ority of its 'embers& 8owever, it may establish internal chambers in order to adopt certain cate#ories of reports or opinions under the conditions laid down by its .ules of !rocedure& 5t shall assist the European !arliament and the $ouncil in e%ercisin# their powers of control over the implementation of the bud#et& The $ourt of 9uditors shall draw up its .ules of !rocedure& Those rules shall re<uire the approval of the $ouncil, actin# by a <ualified ma;ority&

II. PROCEDURES Article 250 1& @here, in pursuance of this Treaty, the $ouncil acts on a proposal from the $ommission, unanimity shall be re<uired for an act constitutin# an amendment to that proposal, sub;ect to 9rticle 251(, and (5 & 2& 9s lon# as the $ouncil has not acted, the $ommission may alter its proposal at any time durin# the procedures leadin# to the adoption of a $ommunity act& II. . T!E CODECISION PROCEDURE Article 251 1& @here reference is made in this Treaty to this 9rticle for the adoption of an act, the followin# procedure shall apply&

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2& The $ommission shall submit a proposal to the European !arliament and the $ouncil& The $ouncil, actin# by a <ualified ma;ority after obtainin# the opinion of the European !arliament* E if it approves all the amendments contained in the European !arliament=s opinion, may adopt the proposed act thus amended, E if the European !arliament does not propose any amendments, may adopt the proposed act, E shall otherwise adopt a common position and communicate it to the European !arliament& The $ouncil shall inform the European !arliament fully of the reasons which led it to adopt its common position& The $ommission shall inform the European !arliament fully of its position& 5f, within three months of such communication, the European !arliament* (a approves the common position or has not ta0en a decision, the act in <uestion shall be deemed to have been adopted in accordance with that common positionF (b re;ects, by an absolute ma;ority of its component members, the common position, the proposed act shall be deemed not to have been adoptedF (c proposes amendments to the common position by an absolute ma;ority of its component members, the amended te%t shall be forwarded to the $ouncil and to the $ommission, which shall deliver an opinion on those amendments& 6& 5f, within three months of the matter bein# referred to it, the $ouncil, actin# by a <ualified ma;ority, approves all the amendments of the European !arliament, the act in <uestion shall be deemed to have been adopted in the form of the common position thus amendedF however, the $ouncil shall act unanimously on the amendments on which the $ommission has delivered a ne#ative opinion& 5f the $ouncil does not approve all the amendments, the !resident of the $ouncil, in a#reement with the !resident of the European !arliament, shall within si% wee0s convene a meetin# of the $onciliation $ommittee& ,& The $onciliation $ommittee, which shall be composed of the 'embers of the $ouncil or their representatives and an e<ual number of representatives of the European !arliament, shall have the tas0 of reachin# a#reement on a ;oint te%t, by a <ualified ma;ority of the 'embers of the $ouncil or their representatives and by a ma;ority of the representatives of the European !arliament& The $ommission shall ta0e part in the $onciliation $ommittee=s proceedin#s and shall ta0e all the necessary initiatives with a view to reconcilin# the positions of the European !arliament and the $ouncil& 5n fulfillin# this tas0, the $onciliation $ommittee shall address the common position on the basis of the amendments proposed by the European !arliament& 5& 5f, within si% wee0s of its bein# convened, the $onciliation $ommittee approves a ;oint te%t, the European !arliament, actin# by an absolute ma;ority of the votes cast, and the $ouncil, actin# by a <ualified ma;ority, shall each have a period of si% wee0s from that approval in which to adopt the act in <uestion in accordance with the ;oint te%t& 5f either of the two institutions fails to approve the proposed act within that period, it shall be deemed not to have been adopted& 21

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3& @here the $onciliation $ommittee does not approve a ;oint te%t, the proposed act shall be deemed not to have been adopted& (& The periods of three months and si% wee0s referred to in this 9rticle shall be e%tended by a ma%imum of one month and two wee0s respectively at the initiative of the European !arliament or the $ouncil& II.#. T!E COOPERATION PROCEDURE Article 252 @here reference is made in this Treaty to this 9rticle for the adoption of an act, the followin# procedure shall apply& (a The $ouncil, actin# by a <ualified ma;ority on a proposal from the $ommission and after obtainin# the opinion of the European !arliament, shall adopt a common position& (b The $ouncil=s common position shall be communicated to the European !arliament& The $ouncil and the $ommission shall inform the European !arliament fully of the reasons which led the $ouncil to adopt its common position and also of the $ommission=s position& 5f, within three months of such communication, the European !arliament approves this common position or has not ta0en a decision within that period, the $ouncil shall definitively adopt the act in <uestion in accordance with the common position& (c The European !arliament may, within the period of three months referred to in point (b , by an absolute ma;ority of its component 'embers, propose amendments to the $ouncil=s common position& The European !arliament may also, by the same ma;ority, re;ect the $ouncil=s common position& The result of the proceedin#s shall be transmitted to the $ouncil and the $ommission& 5f the European !arliament has re;ected the $ouncil=s common position, unanimity shall be re<uired for the $ouncil to act on a second readin#& (d The $ommission shall, within a period of one month, reAe%amine the proposal on the basis of which the $ouncil adopted its common position, by ta0in# into account the amendments proposed by the European !arliament& The $ommission shall forward to the $ouncil, at the same time as its reAe%amined proposal, the amendments of the European !arliament which it has not accepted, and shall e%press its opinion on them& The $ouncil may adopt these amendments unanimously& (e The $ouncil, actin# by a <ualified ma;ority, shall adopt the proposal as reAe%amined by the $ommission& Unanimity shall be re<uired for the $ouncil to amend the proposal as reA e%amined by the $ommission& (f 5n the cases referred to in points (c , (d and (e , the $ouncil shall be re<uired to act within a period of three months& 5f no decision is ta0en within this period, the $ommission proposal shall be deemed not to have been adopted& 22

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(# The periods referred to in points (b and (f may be e%tended by a ma%imum of one month by common accord between the $ouncil and the European !arliament& II.$. T!E )UD*ETAR+ PROCEDURE Article 268 9ll items of revenue and e%penditure of the $ommunity, includin# those relatin# to the European "ocial 4und, shall be included in estimates to be drawn up for each financial year and shall be shown in the bud#et& 9dministrative e%penditure occasioned for the institutions by the provisions of the Treaty on European Union relatin# to common forei#n and security policy and to cooperation in the fields of ;ustice and home affairs shall be char#ed to the bud#et& The operational e%penditure occasioned by the implementation of the said provisions may, under the conditions referred to therein, be char#ed to the bud#et& The revenue and e%penditure shown in the bud#et shall be in balance& Article 269 @ithout pre;udice to other revenue, the bud#et shall be financed wholly from own resources& The $ouncil, actin# unanimously on a proposal from the $ommission and after consultin# the European !arliament, shall lay down provisions relatin# to the system of own resources of the $ommunity, which it shall recommend to the 'ember "tates for adoption in accordance with their respective constitutional re<uirements& Article 270 @ith a view to maintainin# bud#etary discipline, the $ommission shall not ma0e any proposal for a $ommunity act, or alter its proposals, or adopt any implementin# measure which is li0ely to have appreciable implications for the bud#et without providin# the assurance that that proposal or that measure is capable of bein# financed within the limit of the $ommunity=s own resources arisin# under provisions laid down by the $ouncil pursuant to 9rticle 232& Article 271 The e%penditure shown in the bud#et shall be authorised for one financial year, unless the re#ulations made pursuant to 9rticle 2(2 provide otherwise& 5n accordance with conditions to be laid down pursuant to 9rticle 2(2, any appropriations, other than those relatin# to staff e%penditure, that are une%pended at the end of the financial year may be carried forward to the ne%t financial year only&

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9ppropriations shall be classified under different chapters #roupin# items of e%penditure accordin# to their nature or purpose and subdivided, as far as may be necessary, in accordance with the re#ulations made pursuant to 9rticle 2(2& The e%penditure of the European !arliament, the $ouncil, the $ommission and the $ourt of ?ustice shall be set out in separate parts of the bud#et, without pre;udice to special arran#ements for certain common items of e%penditure& Article 272 1& The financial year shall run from 1 ?anuary to 61 /ecember& 2& Each institution of the $ommunity shall, before 1 ?uly, draw up estimates of its e%penditure& The $ommission shall consolidate these estimates in a preliminary draft bud#et& 5t shall attach thereto an opinion which may contain different estimates& The preliminary draft bud#et shall contain an estimate of revenue and an estimate of e%penditure& 6& The $ommission shall place the preliminary draft bud#et before the $ouncil not later than 1 "eptember of the year precedin# that in which the bud#et is to be implemented& The $ouncil shall consult the $ommission and, where appropriate, the other institutions concerned whenever it intends to depart from the preliminary draft bud#et& The $ouncil, actin# by a <ualified ma;ority, shall establish the draft bud#et and forward it to the European !arliament& ,& The draft bud#et shall be placed before the European !arliament not later than 5 >ctober of the year precedin# that in which the bud#et is to be implemented& The European !arliament shall have the ri#ht to amend the draft bud#et, actin# by a ma;ority of its 'embers, and to propose to the $ouncil, actin# by an absolute ma;ority of the votes cast, modifications to the draft bud#et relatin# to e%penditure necessarily resultin# from this Treaty or from acts adopted in accordance therewith& 5f, within ,5 days of the draft bud#et bein# placed before it, the European !arliament has #iven its approval, the bud#et shall stand as finally adopted& 5f within this period the European !arliament has not amended the draft bud#et nor proposed any modifications thereto, the bud#et shall be deemed to be finally adopted& 5f within this period the European !arliament has adopted amendments or proposed modifications, the draft bud#et to#ether with the amendments or proposed modifications shall be forwarded to the $ouncil& 5& 9fter discussin# the draft bud#et with the $ommission and, where appropriate, with the other institutions concerned, the $ouncil shall act under the followin# conditions*

2,

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(a the $ouncil may, actin# by a <ualified ma;ority, modify any of the amendments adopted by the European !arliamentF (b with re#ard to the proposed modifications* E where a modification proposed by the European !arliament does not have the effect of increasin# the total amount of the e%penditure of an institution, owin# in particular to the fact that the increase in e%penditure which it would involve would be e%pressly compensated by one or more proposed modifications correspondin#ly reducin# e%penditure, the $ouncil may, actin# by a <ualified ma;ority, re;ect the proposed modification& 5n the absence of a decision to re;ect it, the proposed modification shall stand as accepted, E where a modification proposed by the European !arliament has the effect of increasin# the total amount of the e%penditure of an institution, the $ouncil may, actin# by a <ualified ma;ority, accept this proposed modification& 5n the absence of a decision to accept it, the proposed modification shall stand as re;ected, E where, pursuant to one of the two precedin# subpara#raphs, the $ouncil has re;ected a proposed modification, it may, actin# by a <ualified ma;ority, either retain the amount shown in the draft bud#et or fi% another amount& The draft bud#et shall be modified on the basis of the proposed modifications accepted by the $ouncil& 5f, within 15 days of the draft bein# placed before it, the $ouncil has not modified any of the amendments adopted by the European !arliament and if the modifications proposed by the latter have been accepted, the bud#et shall be deemed to be finally adopted& The $ouncil shall inform the European !arliament that it has not modified any of the amendments and that the proposed modifications have been accepted& 5f within this period the $ouncil has modified one or more of the amendments adopted by the European !arliament or if the modifications proposed by the latter have been re;ected or modified, the modified draft bud#et shall a#ain be forwarded to the European !arliament& The $ouncil shall inform the European !arliament of the results of its deliberations& 3& @ithin 15 days of the draft bud#et bein# placed before it, the European !arliament, which shall have been notified of the action ta0en on its proposed modifications, may, actin# by a ma;ority of its 'embers and three fifths of the votes cast, amend or re;ect the modifications to its amendments made by the $ouncil and shall adopt the bud#et accordin#ly& 5f within this period the European !arliament has not acted, the bud#et shall be deemed to be finally adopted& (& @hen the procedure provided for in this 9rticle has been completed, the !resident of the European !arliament shall declare that the bud#et has been finally adopted& )& 8owever, the European !arliament, actin# by a ma;ority of its 'embers and two thirds of the votes cast, may, if there are important reasons, re;ect the draft bud#et and as0 for a new draft to be submitted to it&

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2& 9 ma%imum rate of increase in relation to the e%penditure of the same type to be incurred durin# the current year shall be fi%ed annually for the total e%penditure other than that necessarily resultin# from this Treaty or from acts adopted in accordance therewith& The $ommission shall, after consultin# the Economic !olicy $ommittee, declare what this ma%imum rate is as it results from* E the trend, in terms of volume, of the #ross national product within the $ommunity, E the avera#e variation in the bud#ets of the 'ember "tates, and E the trend of the cost of livin# durin# the precedin# financial year& The ma%imum rate shall be communicated, before 1 'ay, to all the institutions of the $ommunity& The latter shall be re<uired to conform to this durin# the bud#etary procedure, sub;ect to the provisions of the fourth and fifth subpara#raphs of this para#raph& 5f, in respect of e%penditure other than that necessarily resultin# from this Treaty or from acts adopted in accordance therewith, the actual rate of increase in the draft bud#et established by the $ouncil is over half the ma%imum rate, the European !arliament may, e%ercisin# its ri#ht of amendment, further increase the total amount of that e%penditure to a limit not e%ceedin# half the ma%imum rate& @here the European !arliament, the $ouncil or the $ommission consider that the activities of the $ommunities re<uire that the rate determined accordin# to the procedure laid down in this para#raph should be e%ceeded, another rate may be fi%ed by a#reement between the $ouncil, actin# by a <ualified ma;ority, and the European !arliament, actin# by a ma;ority of its 'embers and three fifths of the votes cast& 10& Each institution shall e%ercise the powers conferred upon it by this article, with due re#ard for the provisions of the Treaty and for acts adopted in accordance therewith, in particular those relatin# to the $ommunities= own resources and to the balance between revenue and e%penditure& Article 273 5f, at the be#innin# of a financial year, the bud#et has not yet been voted, a sum e<uivalent to not more than one twelfth of the bud#et appropriations for the precedin# financial year may be spent each month in respect of any chapter or other subdivision of the bud#et in accordance with the provisions of the .e#ulations made pursuant to 9rticle 2(2F this arran#ement shall not, however, have the effect of placin# at the disposal of the $ommission appropriations in e%cess of one twelfth of those provided for in the draft bud#et in course of preparation& The $ouncil may, actin# by a <ualified ma;ority, provided that the other conditions laid down in the first subpara#raph are observed, authorise e%penditure in e%cess of one twelfth& 5f the decision relates to e%penditure which does not necessarily result from this Treaty or from acts adopted in accordance therewith, the $ouncil shall forward it immediately to the 23

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European !arliamentF within 60 days the European !arliament, actin# by a ma;ority of its 'embers and three fifths of the votes cast, may adopt a different decision on the e%penditure in e%cess of the one twelfth referred to in the first subpara#raph& This part of the decision of the $ouncil shall be suspended until the European !arliament has ta0en its decision& 5f within the said period the European !arliament has not ta0en a decision which differs from the decision of the $ouncil, the latter shall be deemed to be finally adopted& The decisions referred to in the second and third subpara#raphs shall lay down the necessary measures relatin# to resources to ensure application of this 9rticle& Article 274 The $ommission shall implement the bud#et, in accordance with the provisions of the re#ulations made pursuant to 9rticle 2(2, on its own responsibility and within the limits of the appropriations, havin# re#ard to the principles of sound financial mana#ement& 'ember "tates shall cooperate with the $ommission to ensure that the appropriations are used in accordance with the principles of sound financial mana#ement& The re#ulations shall lay down detailed rules for each institution concernin# its part in effectin# its own e%penditure& @ithin the bud#et, the $ommission may, sub;ect to the limits and conditions laid down in the re#ulations made pursuant to 9rticle 2(2, transfer appropriations from one chapter to another or from one subdivision to another& Article 275 The $ommission shall submit annually to the $ouncil and to the European !arliament the accounts of the precedin# financial year relatin# to the implementation of the bud#et& The $ommission shall also forward to them a financial statement of the assets and liabilities of the $ommunity& Article 276 1& The European !arliament, actin# on a recommendation from the $ouncil which shall act by a <ualified ma;ority, shall #ive a dischar#e to the $ommission in respect of the implementation of the bud#et& To this end, the $ouncil and the European !arliament in turn shall e%amine the accounts and the financial statement referred to in 9rticle 2(5, the annual report by the $ourt of 9uditors to#ether with the replies of the institutions under audit to the observations of the $ourt of 9uditors, the statement of assurance referred to in 9rticle 2,)(1 , second subpara#raph and any relevant special reports by the $ourt of 9uditors& 2& +efore #ivin# a dischar#e to the $ommission, or for any other purpose in connection with the e%ercise of its powers over the implementation of the bud#et, the European !arliament may as0 to hear the $ommission #ive evidence with re#ard to the e%ecution of e%penditure or the operation of financial control systems& The $ommission shall submit any necessary information to the European !arliament at the latter=s re<uest&

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6& The $ommission shall ta0e all appropriate steps to act on the observations in the decisions #ivin# dischar#e and on other observations by the European !arliament relatin# to the e%ecution of e%penditure, as well as on comments accompanyin# the recommendations on dischar#e adopted by the $ouncil& 9t the re<uest of the European !arliament or the $ouncil, the $ommission shall report on the measures ta0en in the li#ht of these observations and comments and in particular on the instructions #iven to the departments which are responsible for the implementation of the bud#et& These reports shall also be forwarded to the $ourt of 9uditors& Article 277 The bud#et shall be drawn up in the unit of account determined in accordance with the provisions of the re#ulations made pursuant to 9rticle 2(2& Article 278 The $ommission may, provided it notifies the competent authorities of the 'ember "tates concerned, transfer into the currency of one of the 'ember "tates its holdin#s in the currency of another 'ember "tate, to the e%tent necessary to enable them to be used for purposes which come within the scope of this Treaty& The $ommission shall as far as possible avoid ma0in# such transfers if it possesses cash or li<uid assets in the currencies which it needs& The $ommission shall deal with each 'ember "tate throu#h the authority desi#nated by the "tate concerned& 5n carryin# out financial operations the $ommission shall employ the services of the ban0 of issue of the 'ember "tate concerned or of any other financial institution approved by that "tate& Article 279 (*) 1& The $ouncil, actin# unanimously on a proposal from the $ommission and after consultin# the European !arliament and obtainin# the opinion of the $ourt of 9uditors, shall* (a ma0e 4inancial .e#ulations specifyin# in particular the procedure to be adopted for establishin# and implementin# the bud#et and for presentin# and auditin# accountsF (b lay down rules concernin# the responsibility of financial controllers, authorisin# officers and accountin# officers, and concernin# appropriate arran#ements for inspection& 4rom 1 ?anuary 200(, the $ouncil shall act by a <ualified ma;ority on a proposal from the $ommission and after consultin# the European !arliament and obtainin# the opinion of the $ourt of 9uditors& 2& The $ouncil, actin# unanimously on a proposal from the $ommission and after consultin# the European !arliament and obtainin# the opinion of the $ourt of 9uditors, shall determine the methods and procedure whereby the bud#et revenue provided under the arran#ements relatin# to the $ommunity=s own resources shall be made available to the $ommission, and determine the measures to be applied, if need be, to meet cash re<uirements&

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Article 280 1& The $ommunity and the 'ember "tates shall counter fraud and any other ille#al activities affectin# the financial interests of the $ommunity throu#h measures to be ta0en in accordance with this article, which shall act as a deterrent and be such as to afford effective protection in the 'ember "tates& 2& 'ember "tates shall ta0e the same measures to counter fraud affectin# the financial interests of the $ommunity as they ta0e to counter fraud affectin# their own financial interests& 6& @ithout pre;udice to other provisions of this Treaty, the 'ember "tates shall coordinate their action aimed at protectin# the financial interests of the $ommunity a#ainst fraud& To this end they shall or#anise, to#ether with the $ommission, close and re#ular cooperation between the competent authorities& ,& The $ouncil, actin# in accordance with the procedure referred to in 9rticle 251, after consultin# the $ourt of 9uditors, shall adopt the necessary measures in the fields of the prevention of and fi#ht a#ainst fraud affectin# the financial interests of the $ommunity with a view to affordin# effective and e<uivalent protection in the 'ember "tates& These measures shall not concern the application of national criminal law or the national administration of ;ustice& 5& The $ommission, in cooperation with 'ember "tates, shall each year submit to the European !arliament and to the $ouncil a report on the measures ta0en for the implementation of this article&

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