Council agrees on own resources package

22 January 2014

The Permanent Representatives Committee reached a political agreement on the three legislative acts forming the own resources package related to the EU's multiannual financial framework 2014-2020, on the basis of a compromise proposal of the Hellenic Presidency.

Own resources constitute the EU revenue, which has to completely cover EU expenditure. The three legislative acts on own resources constitute one of the three parts of the MFF package, the other two being the MFF regulation (adopted by the Council on 2 December 2013) and the about 70 sector-specific acts the majority of which have been adopted by the end of last year.

The political agreement on own resources reached today translates the European Council conclusions of 8 February 2013 into legal terms.

As under the MFF covering the period 2007-2013, the own resources rules for the 2014-2020 period provide for the following types of own resources:

• traditional own resources (i.e. mainly customs duties and sugar levies);
• own resources based on the value added tax (VAT);
• own resources based on the Gross National Income (GNI); it is used to fund the part of the EU budget which is not covered by other own resources, with the aim of balancing EU revenue with expenditure.

The UK correction and the corrections on the UK correction are maintained.

A reduced VAT call rate of 0.15% (rather than 0.30%) will apply, for 2014-2020 only, to Germany, the Netherlands and Sweden. Denmark, the Netherlands and Sweden will benefit from reductions of their annual GNI-based payments for the period 2014-2020 of €130 million, €695 million and €185 million, respectively. The Austrian annual GNI contribution will be reduced by €30 million in 2014, €20 million in 2015 and €10 million in 2016. Member States will be allowed to retain only 20% (instead of 25%) of the traditional own resources to cover their collection costs.

Rules of adoption

In order to enter into force the three acts have to be adopted according to different rules, depending on the legislative act:

• the main legislative act on the revenue side, the own resources decision, must be adopted by the Council by unanimity after having consulted the European Parliament. In addition, the decision must be approved by the Member States in accordance with their respective constitutional requirements (in most cases: ratified by their national parliaments);
• the regulation laying down implementing rules on own resources must be adopted by the Council by qualified majority, after having received the European Parliament's consent;
• the regulation on how to make the traditional, VAT and GNI-based own resources available must be adopted by the Council by qualified majority after having consulted the European Parliament.

Next steps

The three legislative acts will now be revised by the legal-linguists. The Council will then ask the European Parliament to give its consent to the implementing regulation and expects the European Parliament's opinion on the own resources decision and the "making available" regulation. Once the European Parliament has given its consent and its opinions the Council will formally adopt the three legislative acts. This will be followed by the Member States' approval of the own resources decision.

As for previous MFF periods, the new own resources rules will enter into force retroactively on 1 January, 2014.

Press release

Remarks by Commissioner Šemeta on EU budget discharge procedure, 21.1.14

EP-Conference of Presidents endorses Mario Monti as chair of High Level Group on Own Resources, 30.1.14

© European Council